h) Provision and contingent liability
A provision is recognized when the Company has a present
obligation as a result of past event, and it is probable that
an outflow of resources embodying economic benefits will
be required to settle the obligation that can be reliably
estimated. Provisions are not discounted to its present
value and are determined based on best estimate required
to settle the obligation at the balance sheet date. These
estimates are reviewed at each balance sheet date and
adjusted to reflect the current best estimates.
A contingent liability is a possible obligation that arises
from past events whose existence will be confirmed by the
occurrence or non-occurrence of one or more uncertain
future events beyond the control of the Company or a
present obligation that is not recognized because it is not
probable that an outflow of resources will be required to
settle the obligation. A contingent liability also arises in
extremely rare cases where there is a liability that cannot
be recognized because it cannot be measured reliably.
The Company does not recognize a contingent liability but
discloses its existence in the financial statements.
i) Financial instruments
A financial instrument is a contract that gives rise to a
financial asset of one entity and a financial liability or equity
instrument of another entity.
I. Financial assets
All financial assets are recognized initially at fair value.
Transaction costs that are directly attributable to the
acquisition of financial assets (other than financial
assets at fair value through profit or loss) are added
to the fair value measured on initial recognition of
financial asset. Purchase and sale of financial assets
are accounted for at trade date.
(i) Financial instruments at amortized cost
A financial instrument is measured at
the amortized cost if both the following
conditions are met:
a) the asset is held within a business model
whose objective is to hold assets for
collecting contractual cash flows, and
b) contractual terms of the asset give rise on
specified dates to cash flows that are solely
payments of principal and interest (SPPI) on
the principal amount outstanding.
After initial measurement, such financial assets
are subsequently measured at amortized cost
using the effective interest rate (EIR) method.
Amortized cost is calculated by taking into
account any discount or premium on acquisition
and fees or costs that are an integral part of the
EIR. The EIR amortization is included in other
income in the statement of profit and loss. The
losses arising from impairment are recognized in
the statement of profit and loss.
(ii) Financial instrument at Fair Value through Other
Comprehensive Income (OCI)
A financial instrument is classified and measured
at fair value through OCI if both of the following
criteria are met:
a) The objective of the business model is
achieved both by collecting contractual cash
flows and selling the financial assets, and
b) The asset's contractual cash flows represent
solely payments of principal and interest.
Financial instruments included within the OCI
category are measured initially as well as at each
reporting date at fair value. Fair value movements
are recognized in OCI. On derecognition of
the asset, cumulative gain or loss previously
recognized in OCI is reclassified from OCI to
statement of profit and loss.
(iii) Financial instrument at Fair Value through Profit
and Loss
Any financial instrument, which does not meet
the criteria for categorization at amortized cost
or at fair value through other comprehensive
income, is classified at fair value through profit
and loss. Financial instruments included in
the fair value through profit and loss category
are measured at fair value with all changes
recognized in the statement of profit and loss.
(iv) De-recognition of financial assets
A financial asset is primarily derecognized when
the rights to receive cash flows from the asset
have expired, or the Company has transferred its
rights to receive cash flows from the asset.
II. Financial liabilities
All financial liabilities are recognized initially at fair
value and, in the case of loans and borrowings and
payables, net of directly attributable transaction costs.
The subsequent measurement of financial liabilities
depends on their classification, as described below:
(i) Financial liabilities at fair value through profit or
loss
Financial liabilities at fair value through profit or loss
include financial liabilities designated upon initial
recognition as at fair value through profit or loss.
(ii) Financial liabilities at amortised cost
After initial recognition, interest-bearing loans
and borrowings are subsequently measured at
amortised cost using the Effective Interest Rate
[EIR] method. Gains and losses are recognised
in the statement of profit and loss when the
liabilities are derecognised as well as through the
EIR amortisation process.
Amortised cost is calculated by taking into
account any discount or premium on acquisition
and fees or costs that are an integral part of the
EIR. The EIR amortisation is included as finance
costs in the statement of profit and loss.
(iii) De-recognition of financial liabilities
A financial liability is derecognised when the
obligation under the liability is discharged or
cancelled or expires. When an existing financial
liability is replaced by another from the same
lender on substantially different terms, or the
terms of an existing liability are substantially
modified, such an exchange or modification
is treated as the derecognition of the original
liability and the recognition of a new liability. The
difference in the respective carrying amounts is
recognised in the statement of profit and loss.
Financial assets and financial liabilities are offset
and the net amount is reported in the balance
sheet if there is a currently enforceable legal right
to offset the recognized amounts and there is an
intention to settle on a net basis, to realize the
assets and settle the liabilities simultaneously.
j) Impairment
(i) Financial assets
The Company recognizes loss allowances using the
expected credit loss (ECL) model for the financial assets
which are not fair valued through profit or loss. Loss
allowance for trade receivables with no significant
financing component is measured at an amount equal
to lifetime ECL. For all other financial assets, expected
credit losses are measured at an amount equal to the
twelve month ECL, unless there has been a significant
increase in credit risk from initial recognition in which
case those are measured at lifetime ECL. The amount of
expected credit losses (or reversal) is recognized as an
impairment loss (or gain) in statement of profit and loss.
(ii) Non-financial assets
At the end of each reporting period, the Company
reviews the carrying amounts of its tangible and
intangible assets to determine whether there is
any indication that those assets have suffered an
impairment loss. If any such indication exists, the
recoverable amount of the asset is estimated in order
to determine the extent of the impairment loss (if any).
Where it is not possible to estimate the recoverable
amount of an individual asset, the Company estimates
the recoverable amount of the cash-generating unit
to which the asset belongs. Where a reasonable
and consistent basis of allocation can be identified,
corporate assets are also allocated to individual cash¬
generating units, or otherwise they are allocated to
the smallest Company of cash-generating units for
which a reasonable and consistent allocation basis
can be identified. Recoverable amount is the higher
of fair value less costs to sell and value in use. In
assessing value in use, the estimated future cash flows
are discounted to their present value using a pre-tax
discount rate that reflects current market assessments
of the time value of money and the risks specific to
the asset for which the estimates of future cash flows
have not been adjusted. If the recoverable amount of
an asset (or cash-generating unit) is estimated to be
less than its carrying amount, the carrying amount of
the asset (or cash-generating unit) is reduced to its
recoverable amount. An impairment loss is recognized
immediately in the statement of profit and loss.
An impairment loss is reversed in the statement
of profit and loss if there has been a change in the
estimates used to determine the recoverable amount.
The carrying amount of the asset is increased to
its revised recoverable, amount provided that this
amount does not exceed the carrying amount that
would have been determined (net of any accumulated
amortisation or depreciation) had no impairment loss
has been recognised for the asset in prior years.
k) Segment reporting
An operating segment is a component of the Company
that engages in business activities from which it may
earn revenues and incur expenses, including revenues
and expenses that relate to transactions with any of the
Company's other components, and for which discrete
financial information is available. Operating segments are
reported in a manner consistent with the internal reporting
provided to the chief operating decision maker ('CODM').
The Company's Board of Director's has been identified as
the CODM who is responsible for financial decision making
and assessing performance.
l) Earnings per share ('EPS')
Basic earnings per share are calculated by dividing the net
profit or loss for the period attributable to equity shareholders
by the weighted average number of equity shares outstanding
during the period including equity shares that will be issued
upon the conversion of a mandatorily convertible instrument.
Diluted EPS amounts are computed by dividing the net
profit attributable to the equity holders of the Company by
the weighted average number of equity shares considered
for deriving basic earnings per share and also the weighted
average number of equity shares that could have been
issued upon conversion of all dilutive potential equity
shares. The diluted potential equity shares are adjusted
for the proceeds receivable had the shares been actually
issued at fair value (i.e. the average market value of the
outstanding shares). Dilutive potential equity shares are
deemed converted as at the beginning of the year, unless
issued at a later date. Dilutive potential equity shares are
determined independently for each year presented.
m) Cash and cash equivalents
Cash and cash equivalents in the balance sheet comprise
cash at banks and on hand, short-term deposits with an
original maturity of three months or less, which are subject
to an insignificant risk of changes in value.
n) Use of estimates and judgments
The preparation of financial statements in conformity with
the recognition and measurement principles of Ind AS
requires management of the Company to make estimates
and judgements that affect the reported balances of assets
and liabilities, disclosures of contingent liabilities as at the
date of standalone financial statements and the reported
amounts of income and expenses for the periods presented.
Estimates and underlying assumptions are reviewed on
an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimates are revised
and future periods are affected.
The Company uses the following critical accounting
judgements, estimates and assumptions in preparation of
its financial statements:
i. Leases
The Company evaluates if an arrangement qualifies
to be a lease as per the requirements of Ind AS 116.
Identification of a lease requires significant judgement.
The Company uses significant judgement in assessing
the lease term (including anticipated renewals) and
the applicable discount rate.
The Company determines the lease term as the non¬
cancellable period of a lease, together with both
periods covered by an option to extend the lease if
the Company is reasonably certain to exercise that
option; and periods covered by an option to terminate
the lease if the Company is reasonably certain not
to exercise that option. In assessing whether the
Company is reasonably certain to exercise an option
to extend a lease, or not to exercise an option to
terminate a lease, it considers all relevant facts and
circumstances that create an economic incentive for
the Company to exercise the option to extend the
lease, or not to exercise the option to terminate the
lease. The Company revises the lease term if there is a
change in the non-cancellable period of a lease.
The discount rate is generally based on the incremental
borrowing rate specific to the lease being evaluated or
for a portfolio of leases with similar characteristics.
ii. Useful lives of property, plant and equipment
The Company reviews the useful life of property, plant
and equipment at the end of each reporting period.
This reassessment may result in change in depreciation
expense in future periods.
iii. Impairment of investments in subsidiaries
The Company reviews its carrying value of investments
carried at cost (net of impairment, if any) annually,
or more frequently when there is indication for
impairment. If the recoverable amount is less than its
carrying amount, the impairment loss is accounted for
in the statement of profit and loss.
iv. Fair value measurement of financial instruments
When the fair value of financial assets and financial
liabilities recorded in the balance sheet cannot be
measured based on quoted prices in active markets,
their fair value is measured using valuation techniques
including the Discounted Cash Flow model. The inputs
to these models are taken from observable markets
where possible, but where this is not feasible, a
degree of judgement is required in establishing fair
values. Judgements include considerations of inputs
such as liquidity risk, credit risk and volatility. Changes
in assumptions about these factors could affect the
reported fair value of financial instruments.
v. Impairment of financial assets (other than at fair value)
Measurement of impairment of financial assets
require use of estimates, which have been explained
in the note on financial assets, financial liabilities and
equity instruments, under impairment of financial
assets (other than at fair value).
vi. Deferred tax assets
A deferred tax asset is recognised to the extent that it
is probable that future taxable profit will be available
against which the deductible temporary differences
and tax losses can be utilised. Accordingly, the Company
exercises its judgement to reassess the carrying amount
of deferred tax assets at the end of each reporting period.
vii. Provisions and contingent liabilities
The Company estimates the provisions that have
present obligations as a result of past events and it is
probable that outflow of resources will be required to
settle the obligations. These provisions are reviewed at
the end of each reporting period and are adjusted to
reflect the current best estimates.
The Company uses significant judgements to assess
contingent liabilities. Contingent liabilities are disclosed
when there is a possible obligation arising from past
events, the existence of which will be confirmed only
by the occurrence or non-occurrence of one or more
uncertain future events not wholly within the control
of the Company or a present obligation that arises
from past events where it is either not probable that
an outflow of resources will be required to settle the
obligation or a reliable estimate of the amount cannot
be made. Contingent assets are neither recognised nor
disclosed in the standalone financial statements.
viii. Employee benefits
The accounting of employee benefit plans in the
nature of defined benefit requires the Company to use
assumptions. These assumptions have been explained
under employee benefits note.
o) Recent accounting pronouncement
Ministry of Corporate Affairs ("MCA") notifies new standards
or amendments to the existing standards under Companies
(Indian Accounting Standards) Rules as issued from time to
time. For the year ended 31 March 2025, MCA has notified
Ind AS - 117 Insurance Contracts and amendments to Ind
AS 116 - Leases, relating to sale and leaseback transactions,
applicable to the Company w.e.f.1 April 2024. The Company
has reviewed the new pronouncements and based on
its evaluation has determined that it does not have any
significant impact in its financial statements.
p) New and amended standards issued but not effective
On 7 May 2025, MCA notifies the amendments to Ind AS
21 - Effects of Changes in Foreign Exchange Rates. These
amendments aim to provide clearer guidance on assessing
currency exchangeability and estimating exchange rates when
currencies are not readily exchangeable. The amendments are
effective for annual periods beginning on or after 1 April 2025.
The Company is currently assessing the probable impact of
these amendments on its financial statements.
11 Equity share capital (Contd..)
B. Rights, preferences and restrictions attached to equity shares
The Company has only single class of Equity Shares having a par value of ^ 10. Accordingly, all equity shares rank equally with regard
to dividends and share in the Company's residual assets. Each holder of equity shares is entitled to one vote per share. On winding
up of the Company, the holders of equity shares will be entitled to receive the residual assets of the Company, remaining after
distribution of all preferential amounts in proportion to the number of equity shares held.
C. Aggregate number of bonus shares issued, shares issued for consideration other than cash and shares bought back
during the period of five years immediately preceding the reporting date.
There are no bonus shares issued and shares bought back during the period of five years immediately preceding reporting date.
During the year, the Company has raised a capital of Rs. 2,750 lakhs( Including Securities Premium of Rs 2,650 lakhs) by issuing
10,00,000 equity shares through private placement.
During the year, the Company has converted all outstanding 24,988 CCDs into equity shares in the pre-determined ratio of 28:1. and
accordingly equity shares issued were 6,99,664.
On 23rd August 2024 The company has acquired a 98.78% stake in NES Data Private Limited (previously known as Natural
Environment Solutions Private Limited) for 45,542 lakhs, through a share swap by issuing 1,29,38,448 shares, Natural Environment
Solutions Private Limited has been renamed NES Data Private Limited w.e.f 12 th September 2024
29 Fair value measurements
The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current
transaction between willing parties, other than in a forced or liquidation sale.
Fair value hierarchy
The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or
unobservable and consists of following:
Measurement of Fair Value
Level 1: Category includes financial assets and liabilities, that are measured in whole or in significant part by reference to published
quoted price (unadjusted) in an active market.
Level 2: Category includes financial assets and liabilities measured using a valuation technique based on assumptions that are supported
by prices from observable current market transactions.
Level 3: Category includes financial assets and liabilities measured using valuation techniques based on non market observable inputs.
This means that fair values are determined in whole or in part using a valuation model based on assumptions that are neither supported
by prices from observable current market transactions in the same instrument nor are they based on available market data.
The fair values of non-current loans/borrowings are based on discounted cash flows using a current rate. They are classified as level
3 fair values in the fair value hierarchy due to the use of unobservable inputs, including counterparty/own credit risk.
Fair value of cash and cash equivalent, bank balance other than cash and cash equivalents, trade receivables, trade payables,
and other current financial assets and liabilities approximate their carrying amounts largely due to the short-term maturities of
these instruments.
There are no transfers between levels 1 and 2 during the year.
30 Financial risk management
The Company's activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Company's primary focus is
to foresee the unpredictability of financial markets and seek to minimise potential adverse effects on its financial performance.
The Company's financial liabilities comprise of borrowings, trade payable and other liabilities to manage its operation and financial assets
include trade receivables, security deposits, loans and advances, etc, arises from its operation.
The Company's senior management oversees the management of these risks. The Company's senior management ensures that the
Company's financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured
and managed in accordance with the Company's policies and risk objectives. The Board of Directors reviews and agrees policies
for managing each of these risks, which are summarised below.
A. Credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its
contractual obligation.
The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities,
including deposits with banks and financial institutions and other financial instruments.
30 Financial risk management (Contd..)
Credit risk is managed on an entity level basis. The Company has adopted a policy of dealing only with creditworthy counterparties
and obtaining sufficient collateral, where appropriate, as a means of mitigating risk of financial loss from defaults. The Company
invests only in those instruments issued by high rated banks/ institutions and government agencies. The Company assesses the
credit quality of the customer, taking into account its financial position, past experience and other factors. The Company's loans
are considered to have low credit risk.
The Company periodically monitors the recoverability and credit risks of its other financials assets including security deposits and
other receivables. The Company evaluates 12 month expected credit losses for all the financial assets for which credit risk has not
increased. In case credit risk has increased significantly, the Company considers life time expected credit losses for the purpose of
impairment provisioning.
The Company has used a practical expedient by computing the expected credit loss allowance for trade receivables based on
a provision matrix. The provision matrix takes into account historical credit loss experience and adjusted for forward looking
information. The expected credit loss allowance is based on the ageing of the days for which the receivables are due and the
expected loss rates as given in the provision matrix.
B. Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities
that are settled by delivering cash or another financial asset. The Company's approach to managing liquidity is to ensure, as far as
possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the Company's reputation.
30 Financial risk management (Contd..)
C. Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market
prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk. The above risks may affect the
Company's income and expenses, or the value of its financial instruments. The Company's exposure to and management of these
risks are explained below.
Interest rate risk
Interest rate risk is the risk that the fair value or the future cash flows of a financial instrument will fluctuate because of changes in
market interest rate risks. The Company does not have any interest rate risk as it has no variable rate borrowings as at any of the
reporting date.
Currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign
exchange rates. There are no material currency risk affecting the financial position of the Company as there are no material
transactions in currency other than functional currency of the Company.
Price risk
The Company's exposure to price risk arises from investments held and classified in the balance sheet at fair value through profit
or loss. The Company does not have any price risk as at any of the reporting date.
31 Capital management
The Company's capital includes issued equity capital and all other equity reserves attributable to the equity holders of the Company.
The Company objectives when managing capital are to:
- Safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and for other
stakeholders, and
- Maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital
to shareholders or issue new shares.
The Company monitors capital using a gearing ratio, which is net debt divided by total equity. Net debt comprises of long term and short
term borrowings less cash and bank balances, equity includes equity share capital and reserves that are managed as capital. The gearing
at the end of the reporting period was as follows.
Employee benefit expense of the Company includes various short term employee expenses, defined benefits expenses, expenses toward
defined contribution on plans and other long-term employee benefits.
(a) Defined contribution plans
The Company makes provident fund contributions to defined benefit plan for qualifying employees. Under the Schemes, the
Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The contributions payable to
these plans by the Company are at rates specified in the rules of the schemes.
b) Defined Benefit Plans
The Company has unfunded defined benefit plan for payment of gratuity to all eligible employees calculated at specified number
of days of last drawn salary depending upon the tenure of service for each year of completed service subject to minimum service
of five years payable at the time of separation upon superannuation or on exit otherwise. These defined benefit gratuity plans are
governed by Payment of Gratuity Act, 1972.
Interest rates risk: While calculating the defined benefit obligation a discount rate based on government bonds yields of matching
tenure is used to arrive at the present value of future obligations. If the bond yield falls, the defined benefit obligation will tend to
increase and plan assets will decrease.
Salary risk: Higher than expected increases in salary will increase the defined benefit obligation
Demographic risks: Demographic assumptions are required to assess the timing and probability of a payment taking place. The
effects of this decrement on the DBO depend upon the combination salary increase, discount rate, and vesting criteria and therefore
not very straight forward.
(c) Compensated absences note
The Company provides for accumulation of compensated absences by certain categories of its employees. These employees can
carry forward a portion of the unutilized compensated absences and utilise them in future periods or receive cash in lieu thereof as
per the Company's policy. The Company records a liability for compensated absences in the period in which the employee renders
the services that increases this entitlement.
The above analysis has been performed using P.U.C method. If an employee's service in later years will lead to a materially
higher level of benefit than in earlier years, these benefits are attributed on a straight-line basis. The limitations are that in
assessing the change other parameters are kept constant. As some of the assumptions may be correlated, it is unlikely that
changes in assumptions will occur in isolation of one another. There is no change from the previous period in the methods and
assumptions used in the preparation of above analysis, except that the base rates have changed."
38 The Parliament has approved the Code on Social Security, 2020 which may impact the contribution by the Company towards
Provident Fund and Gratuity. The effective date from which the Code and its provisions would be applicable is yet to be notified and the
rules which would provide the details based on which financial impact can be determined are yet to be notified after which the financial
impact can be ascertained. The Company will complete its evaluation and will give appropriate impact in the financial statements
following the Code becoming effective and the related rules to determine the financial impact being notified.
39 Additional disclosure with respect to amendments to Schedule III
a. The Company has not been declared as Wilful defaulter by any lenders.
b. The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
c. The provision related to number of layers as prescribed under section 2(87) of the Companies Act read with Companies (Restriction
on number of Layers) Rules, 2017 is not applicable to Company.
d. The Company has not entered into any scheme of arrangement which has an accounting impact on the current or previous
financial year.
e. The Company have not any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed
as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant
provisions of the Income Tax Act, 1961).
f. The Company has not traded or invested in Crypto currency or Virtual Currency during the current financial year and any of the
previous financial years.
g. The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for
holding any Benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.
h. The Company did not enter into any transaction with Companies struck off from ROC records for the period ended 31 March 2025
and 31 March 2024.
i. Funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of
funds) by the company to or in any other person(s) or entity(ies) including foreign entities (intermediaries) with the understanding,
whether recorded in writing or otherwise, that the intermediary shall, whether directly or indirectly lend or invest in other persons
or entities identified in any manner whatsoever by or on behalf of the company (ultimate beneficiaries) or provide any guarantee,
security or the like on behalf of the Ultimate Beneficiaries
j. No funds have been received by the Company from or in any other person(s) or entity(is) including foreign entities (funding parties)
with the understanding, whether recorded in writing or otherwise, that the Company shall, whether directly or indirectly lend or
invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries)
or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
Note:
(a) In respect of aforementioned ratios there is no significant change (25% or more) in FY 2024-25 in comparison to FY 2023-24
As per our report of even date For and on behalf of the Board of Directors of
For Mehra Goel & Co TCC Concept Limited
Chartered Accountants
Firm Registration Number: 000517N
Roshan Daultani Umesh Kumar Sahay Abhishek Narbaria
Partner Chairman and Managing Director Director
Membership number: 137405 DIN: 01733060 DIN: 01873087
Place: Pune Rahul Jashvant Shah Divya Reejwani
Date: 24 May 2025 Chief Financial Officer Company Secretary
Membership number : F11670
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