nitin fire protection industries ltd.nitin fire protection industries ltd. regd. office: 501, delta,...

NITIN FIRE PROTECTION INDUSTRIES LTD.

Regd. Office : 501, Delta, Technology Street, Hiranandani Gardens, Powai, Mumbai 400 076, India. Tel.: +91 22 4045 7000 Fax : +91 22 2570 1110 Email : [email protected] Website : http://www.nitinfire.com

CIN No. : L29193MH1995PLC092323 Subsidiary Offices : UAE, UK & Singapore

Date: October 20, 2018 To,

BSE Limited, Corporate Services Department, P. J. Towers, Dalal Street, Mumbai – 400 001. BSE Scrip Code No. 532854

National Stock Exchange of India Limited, Corporate Communications Department, Exchange Plaza, 5

th Floor, Bandra Kurla Complex, Bandra (E),

Mumbai - 400 051. NSE Scrip Symbol: NITINFIRE

Dear Sir, Sub.: Regulation Number 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations, 2015”) Pursuant to Regulation 34 of the Listing Regulations, 2015, please find enclosed the Annual Report of the Company for the Financial Year 2017-18. Kindly acknowledge receipt. Thanking you, Yours faithfully, For Nitin Fire Protection Industries Limited

Sraban Kumar Karan Company Secretary & Compliance Officer Encl.: As above

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Statement on Impact of Audit Qualifications (for audit report with modified opinion) submitted alongwith Annual Audited Financial Results

' ,.

Standalone Rs. in lakhs except per EPS

Statement on Impact of Audit Qualifications for the Financial Year ended March 31, 2018 [Under Regulation 33 / 52 of the SEBI (LODR) (Amendment) Regulations, 2016)

SI. No.

1.

2. 3. 4. 5. 6. 7. 8.

Particulars Audited Figures (as reported Adjusted Figures (audited

Turnover/ Total income

Total Expenditure Net Profit/(Loss)

Earnings Per Share

Total Assets

Total Liabilities

Net Worth Any other financial item(s) (as felt appropriate by the management)

before adjusting for figures after adjusting for ualifications} qualifications}

6,687.10 NA

25,831.98 NA (19,157.69) NA

(6.57) NA

51,950.23 NA 51,950.23 NA

(16,160.58) NA NA NA

II. Audit Qualification (each audit qualification separately):

a. Details of Audit Qualification: 1) Note No. 5 to the Statement, no provision has been made by the Company in respect of its dispute with a bank for claim made by the bank for Rs . 501 .33 lakhs (excluding interest) on a derivative contract entered into by its erstwhile subsidiary, the liability for which has been taken over by the C,ompany. The Company has not determined the quantum of provision required in this regard as at March 31, 2018 on the above contract and has relied on a legal opinion in the matter wherein no liability is expected . Pending the final settlement of the matter, we are unable to comment on the extent of provis ion required, if any, in this regard.

b. Type of Audit Qualification :

® <8> APPROVED

2) Note No. 6 to the Statement, the Company has an exposure in Worthington Nitin Cylinders Private Limited aggregating Rs. 4,195.04 lakhs as at March 31, 2018. In the absence of the fair value of the investment as required under Ind AS 28 'Investment in Associates and Joint Ventures', we are unable to comment on the impairment, if any, on the carrying amount of the investment as at March 31, 2018. 3) Note No. 7 to the Statement, in relation to exposu re in trade receivables aggregating Rs . 27,673.23 lakhs which are outstanding for a long period of time, payments for which are not forthcoming and are subject to independent confirmation . In the absence of independent confirmations from some of the trade receivab les, any other alternate audit evidence and non recovery of any amount during the year and till •date, we are unable to comment on the recoverability of the same and consequential write off, if any. 4) Note No. 8 to the Statement, the Trade receivables aggregating Rs. · 3,459.95 lakhs (other than those covered under para (c) above), Trade payables aggregating Rs. 1,867.47 lakhs and loans to body corporates aggregating Rs. 331.08 lakhs are subject to independent confirmation/ reconciliation. In the absence of independent confirmation/ reconciliation, we are unable to comment on the consequential impact, if any. Disclaimer of Opinion

A . , CE Regd. Office : 501, Delta, Technology Street, Hiranandani Gardens, Powai, Mumbai - 400 076. INDIA. Tel.: +91 22 4045 7000 • Fax : +91 22 2570 1110 • Email : [email protected] • Website : http://www.nitinfire.com

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CIN NO.: L29193MH 1995PLC092323 Subsidiary Offices: UAE, UK & Singapore.

--------------------------------- -----

' Qualified Opinion/ Disclaimer of Opinion/ Adverse Opinion c. Frequency of qualification: Whether Audit opinion is disclaimer. However in respect of point (1) to (3) appeared first time/ repetitive/ since above Audit Report was Qualified in previous years. how long continuing d. For Audit Qualification(s) where the NA impact is quantified by the auditor, Management's Views: e. For Audit Qualification(s) where the impact is not quantified by the auditor: (i) Management's estimation on the NA impact of audit qualification:

(ii) If management is unable to Ql. Matter being subjudice. estimate the impact, reasons for the Q2. The Management is in the process of doing needful and hopes same: that impairment, if any will not be material and if any such thing is

noticed in future, we will provide the same. Q3. All efforts for recovery are being made. Amount which may not

, be ultimately realized canhot be estimated as of now. Q4. The Management is in the process of doing needful and expects that there will not be any material impact post confirmation and if any impact arises, we will provide for the same in next quarter.

(iii) Auditors' Comments on (i) or (ii) None further. Please refer to our audit report of even date. above: Ill. Signatori ~s:

i~I CEO Rahul Nitin Shah

CEO

CFO ~ Bharat Shah _/'

, ' .Y

H~ran Iyer Audit Committee Chairman DIN : 07539227 Statutory Auditors For Haribhakti & Co. LLP

Chartered Accountants

8 Firm Registration No. No.103523W/W100048

~~~ ~ ½ :; MUMBAI * (') (/')

\ # Partner ~ ~ Membership NO. 048539 'lr~o ACCO\$

Place':'Mumbai Date: June 14, 2018

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Statement on Impact of Audit Qualifications (for audit report with modified opinion) submitted alongwith Annual Audited Financial Results

, I.

Consolidated Rs. in lakhs except per EPS

Statement on Impact of Audit Qualifications for the Financial Year ended March 31, 2018 [Under Regulation 33 / 52 of the SEBI (LODR) (Amendment) Regulations, 2016]

SI. No. Particulars Audited Figure$ (as reported Adjusted Figures (audited before adjusting for figures after adjusting for

qualifications) qualifications) 1. Turnover/ Total income 89,327.02 NA 2. Total Expenditure 106,388.79 NA 3. Net Profit/(Loss) (16,173.02) NA 4. Earnings Per Share (5.72) NA 5. Total Assets 139,958.62 NA 6. Total Liabilities 139,958.62 NA 7. Net Worth 34,423.87 NA 8. Any other financial item(s) (as felt NA NA

appropriate by the management) II. Audit Qualification (each audit qualification separately):

a. Details of Audit Qualification : 1) Note No. 5 to the Statement, no provision has been made by the Holding Company in respect of its dispute with a bank for claim made by the bank for Rs. 501.33 lakhs (excluding interest) on a derivative contract entered into by its erstwhile subsidiary, the liability for wh ich has been taken over by the b-iolding Company. The Holding Company has not determined the quantum of provision required in this regard as at March 31, 2018 on the above contract and has relied on a legal opinion in the matter wherein no liability is expected. Pending the final settlement of the matter, we are unable to comment on the extent of provision required, if any, in this regard.

<8> APPROVED

2) Note No. 6 to the Statement, the Holding Company has an exposure in Worthington Nitin Cylinders Private Limited an associate company aggregating Rs. 1,164.26 lakhs as at March 31, 2018. In the absence of the fair value of the investment as required under Ind AS 28 ' Investment in Associates and Joint Ventures', we are unable to comment on the impairment, if any, on the carrying amount of the investment as at March 31, 2018. 3) Note No. 7 to the Statement, in relation to Holding Company's exposure in trade receivables aggregating Rs. 27,673.23 lakhs which are outstanding for a long period of time, payments for which are not fo rthcoming and are subject to independent confirmation. In the absence of independent confirmations from some of the t rade receivables, any ot" er alternate audit evidence and non recovery of any amount during the year and till date, we are unable to comment on the recoverability of the same and consequential write off, if any. 4) Note No. 8 to the Statement, in relation to Holding Company's balances of Trade receivables aggregating Rs. 3,459.95 lakhs (other than those covered under para (c) above), Trade payables aggregating Rs. 1,867.47 lakhs and loans to body corporates aggregating Rs. 331.08 lakhs are subject to independent confirmation/ reconciliation . In the absence of independent confirmation/ reconciliat ion, we are unable to comment on the consequential impact, if any.

CE Regd. Office : 501, Delta, Technology Street, Hiranandani Gardens, Powai, Mumbai - 400 076. INDIA. Tel.: +91 22 4045 7000 • Fax : +91 22 2570 111 0 •Email : [email protected] • Website : http://www.nitinfire.com

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CIN NO.: L29193MH 1995PLC092323 Subsidiary Offices : UAE, UK & Singapore.

b. Type of Audit Qualification : Disclaimer of Opinion Qualified Opinion/ Disclaimer of Opinion/ Adverse Opinion c. Frequency of qualification: Audit opinion is disclaimer. However in respect of point (1) to (3) above Whether appeared first time/ Audit Report was Qualified in previous years. repetitive/ since how long continuing d. For Audit Qualification(s) where NA the impact is quantified by the auditor, Management's Views : e. For Audit Qualification(s) where the impact is not quantified by the auditor: (i) Management's estimation on the NA impact of audit qualification:

(ii) If management is unable to Ql. Matter being subjudice. estimate the impact, reasons for the Q2. The Management is in the process of doing needful and hopes that same: impairment, if any will not be material and if any such thing is noticed in

future, we will provide the same. Q3. All efforts for recovery are being made. Amount which may not be ultimately realized cannot be estimated as of now. Q4. The Management is in the process of doing needful and expects that there will not be any material impact post confirmation and if any impact arises, we will provide for the same in next quarter.

(iii) Auditors' Comments on (i) or (ii) None further. Please refer to our audit report of even date. above:

UI. - Signatori~: ,

~ h CEO CEO

CFO ~

Bharat Shah ..,/\ '

✓ Hariha an Iyer

Audit Committee Chairman DIN : 07539227 Statutory Auditors For Haribhakti & Co. LLP

Chartered Accountants -

8 Firm Registration No. No.103523W /W100048

<(" <'.

~~~ ~ ¼ I~ !) ~ ~ Partner

, ~~ ~"<{' Men'1bership NO. 048539

'li'£DAcC0...::S

Plac&f Mumbai Date: June 14, 2018

ANNUAL REPORT 2017-18

1

Contents Page No.Notice and Explanatory Statement 2

Directors’ Report 11

(Management Discussion and Analysis) 16

Secretarial Audit Report 22

Report on Corporate Governance 26

Corporate Governance Compliance Certificate 39

Standalone Financial Statement

Auditors’ Report & Annexure 41

Balance Sheet 47

Statement of Profit and Loss 48

Cash Flow Statement 49

Notes to the Financial Statements 52

Consolidated Financial Statement

Auditors’ Report 90

Balance Sheet 94

Statement of Profit and Loss 95

Cash Flow Statement 96

Notes to the Financial Statements 99

Attendance Slip / Form No. MGT 11 141

Nomination From SH-13 143

2


NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the 23rd Annual General Meeting of the Members of Nitin Fire Protection Industries Limited (‘Company’) will be held on Saturday, September 29, 2018, at 2.30 p.m. at BTTC / KCCMS (K. C. College of Management Studies) BLDG., 1st floor, above lings Pavalion, Mahakavi Bhushan Marg, Behind Regal Cinema, Colaba, Mumbai 400039, to transact the following businesses:

Ordinary Business :

1. Adoption of Accounts:

a. To receive, consider and adopt the Standalone financial statements of the Company for the financial year ended March 31, 2018, together with the Reports of the Board of Directors and the Reports of the Auditors thereon;

b. To receive, consider and adopt the consolidated financial statements of the Company for the financial year ended March 31, 2018, together with the Reports of the Auditors thereon.

2. Retire by Rotation:

“RESOLVED THAT pursuant to the provisions of Section 152(6) and all other applicable provisions, if any, of the Companies Act, 2013 (“Act”) and the respective rules made there under, as amended from time to time, Mr. Nitin Shah (DIN – 00073232) who retires by rotation and being eligible offers himself for re-appointment, be and is hereby appointed as a Director of the Company, liable to retire by rotation.”

Special Business:

3. To consider and if thought fit to pass with or without modification(s) the following resolution as a SPECIAL RESOLUTION:

Appointment of Mr. Nitin M. Shah (DIN - 00073232) as a Managing Director

“RESOLVED THAT pursuant to the provisions of Section 196 and Section 197 read with Schedule V and other applicable provisions, if any, of the Companies Act, 2013 (“Act”), the consent of the members of the Company be and is hereby accorded for the appointment of Mr. Nitin M. Shah as the Managing Director and Key Managerial Personnel (KMP) of the Company for a period of 3 (three) years w.e.f. August 28, 2018, on remuneration and perquisites payable to him and other terms and conditions as set out below:

Salary and perquisites and Allowances together with Retirals:

1. Salary: Nil payment till the default in repayment to secured lenders is made good in case of inadequate profit as per Schedule V under the Companies Act, 2013. Remuneration up to ` 10,00,000/- (Rupees Ten Lakhs only) per month, payable on quarterly basis after Company makes adequate profit or receives prior approval of secured lenders which is earlier. However, total salary shall not exceed the limit prescribed u/s.197 and 198 of the Act as calculated from time to time.

2. House Rent allowances: ` 1,00,000/- (Rupees One Lakh only) per month, payable on quarterly basis, subject to the provisions of the Income tax Act, 1961.

3. Bonus: Minimum bonus is salary of one month and H. R. A. The same may be increased to maximum as allowed under the Act.

4. Commission: In addition to the salary, allowances and perquisites in the years in which the Company has sufficient profit, the appointee shall be paid commission on the annual net profits of the Company as may be decided by the Nomination and Remuneration Committee and/or Board of Directors at the end of each financial year computed in the manner laid down under Section 198 of the Act and subject to the ceiling laid down under Sections 196 and 197 of the Act on the total remuneration.

5. Provident Fund: At the rate, it is payable to other employees of the Company, subject to the maximum permissible under the Income Tax Act, 1961.

In addition to the perquisites specified as above, the Managing Director shall also be eligible for the following perquisites which shall not be included in the computation of the ceiling on remuneration:

a) The Company’s contribution to the Provident Fund, Superannuation Fund (or other benefit permissible in lieu thereof) or annuity fund as per the rules of the Company and the same will not be included in the computation of the ceiling on perquisites to the extent these either singly or put together are not taxable under the Income Tax Act, 1961.

b) Gratuity: At such rate it is payable to other employees of the company or in the alternative the Whole-time Director may join Group gratuity - cum life assurance scheme and avail the benefit of such scheme. Gratuity to be payable at the rate of half month’s salary for each completed years of service or such rate which have been prescribed at the time of retirement.

c) Leave: On full pay as per the rules of the company but not exceeding one month leave for every completed year of service and leave encashment as per the rules of the company.

d) Personal accident Insurance for India and abroad.

e) Key Man Insurance policy.

f) Entrance as well as yearly membership fees of any two clubs or an association at Mumbai for the benefit of the Company.

g) Free use of car with driver for official and private purposes.

h) Provision of telephone (Mobile and land line), Fax and Internet connection at residence of the Managing Director with provision of the computer at residence for the use of Company’s business or private purpose.

i) Actual electricity charges of residence.


3

j) Actual water bill or charges of residence.

k) Actual maintenance charges of residence.

Provided that all perquisites together with expenditure incurred on the Managing Director shall not exceed total amount of salary. The Managing Director shall be paid and /or reimbursed all reasonable out of pocket / entertainment expenses incurred by him in the course of discharging duties as Managing Director by cash / cheque or through credit card.

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorized to vary or increase the remuneration and perquisites including monetary value thereof as specified above to the extent the Nomination and Remuneration Committee and/ or the Board of Directors may consider appropriate and as may be permitted or authorized in accordance with any provisions under the Companies Act, 2013 for the time being in force provided, however, that the remuneration payable to Mr. Nitin M. Shah shall be within the limits set out in the said Act or any amendments thereto or any modifications or statutory re-enactment(s) thereof and/or any rules or regulations framed there under and the terms of the aforesaid appointment of Mr. Nitin M. Shah shall be suitably modified to give effect to such variations or increase as the case may be.

RESOLVED FURTHER THAT during the currency of the tenure of the Managing Director where in any financial year, the Company has no profits or its profits are inadequate, the Company do pay to the Managing Director Minimum remuneration by way of salary and perquisites with the prior approval of the secured lenders till the default, if any, in repayment of loan along with interest is made good, as specified above as per relevant applicable provisions of law including provisions as contained in Schedule V to the Companies Act, 2013.

RESOLVED FUTHER THAT the Board of Directors be and is hereby authorized to do and perform all such acts, deeds, matters and things as may be necessary desirable or appropriate to give effect to this Resolution”.

4. To consider and if thought fit to pass with or without modification(s) the following resolution as a SPECIAL RESOLUTION:

Reversal of the resolution passed by members on December 9, 2017 with respect to increase in authorized share capital. Alteration of the Capital Clause of the Memorandum of Association (MoA) by cancellation of increase in Authorized Share Capital of the Company:

“RESOLVED THAT the consent of the Members be and is hereby accorded to cancel and reverse the resolution passed earlier for increase in the Authorized Share Capital of the Company from ` 75,00,00,000/- (Rupees Seventy Five Crores only) divided into 37,50,00,000 (Thirty Seven Crores Fifty Lakhs Only) Equity shares of a face value of ` 2/- (Rupees Two Only) each to ` 175,00,00,000/- (Rupees One Hundred Seventy Five Crores only) divided into 87,50,00,000 (Eighty Seven Crores Fifty Lakhs Only) Equity shares of a face value of ` 2/- (Rupees Two Only) each by creation of additional of 50,00,00,000 (Fifty Crores Only) Equity Shares of a face value of ` 2/- each and revised authorized share capital be as it is before the alteration and the same be ` 75,00,00,000/- (Rupees Seventy Five Crores only) divided into 37,50,00,000 (Thirty Seven Crores Fifty Lakhs Only) Equity shares of a face value of ` 2/- (Rupees Two Only) each and the existing Clause V of the Memorandum of Association of the Company be and is hereby altered by substituting it with the following the new Clause V:

V. The Authorized Share Capital of the Company is ` 75,00,00,000/- (Rupees Seventy Five Crores only) divided into 37,50,00,000 (Thir-ty Seven Crores Fifty Lakhs Only) Equity shares of a face value of ` 2/- (Rupees Two Only) each, with the power to the Board of Directors to increase or reduce the capital and to divide the shares in the capital for the time being into several classes and to attach rights, privileges or conditions as may be determined by or in accordance with the regulations of the Company and to vary, modify and abrogate any such rights, privileges or conditions in such manner as may for the time being be provided by the regulations of the Company and to consolidate or sub-divide the shares and issue shares of higher or lower denominations.

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorized to do all such acts, deeds and things as may be necessary and incidental to give effect to this resolution.”

Mumbai, August 28, 2018 For and on behalf of the BoardRegistered Office: 501, Delta, Technology Street, Hiranandani Gardens, Nitin Fire Protection Industries LimitedPowai, Mumbai – 400 076. Tel. No.: 022 40457000Email:[email protected]; Website:www.nitinfire.com Sraban Kumar KaranCIN:L29193MH1995PLC092323 Company Secretary

Notes:

a. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF/HERSELF AND A PROXY NEED NOT BE A MEMBER OF THE COMPANY. PROXIES IN ORDER TO BE EFFECTIVE MUST BE RECEIVED AT THE COMPANY’S REGISTERED OFFICE NOT LESS THAN 48 HOURS BEFORE THE MEETING. PROXIES SUBMITTED ON BEHALF OF COMPANIES/ SOCIETIES PARTNERSHIP FIRMS ETC. MUST BE SUPPORTED BY APPROPRIATE RESOLUTION/ AUTHORITY AS APPLICABLE ISSUED ON BEHALF OF THE NOMINATING ORGANIZATION/ENTITY. MEMBERS ARE REQUESTED TO NOTE THAT A PERSON CAN ACT AS A PROXY ON BEHALF OF MEMBERS NOT EXCEEDING 50 AND HOLDING IN THE AGGREGATE NOT MORE THAN 10% OF THE TOTAL SHARE CAPITAL OF THE COMPANY CARRYING VOTING RIGHTS. IN CASE A PROXY IS PROPOSED TO BE APPOINTED BY A MEMBER HOLDING MORE THAN 10% OF THE TOTAL SHARE CAPI-TAL OF THE COMPANY CARRYING VOTING RIGHTS, THEN, SUCH PROXY SHALL NOT ACT AS A PROXY FOR ANY OTHER PERSON OR SHAREHOLDER.

b. Corporate members intending to send their authorized representatives to attend the Meeting are requested to send a certified copy of the Board Resolution to the Company, authorizing their representative to attend and vote on their behalf at the Meeting.

4


c. The relevant explanatory statements pursuant to Section 102 of the Companies Act, 2013 in respect of the business under Item Nos. 3 & 4 above are annexed hereto.

d. Members, proxies and authorized representatives are requested to bring to the Meeting, their attendance slip duly completed and signed along with their copy of Annual Report.

e. In case of joint holders attending the Meeting only such joint holder which is higher in the order of names will be entitled to vote.

f. Documents relating to any of the items mentioned in the Notice and the Explanatory Statement thereto are open for inspection at the Registered Office of the Company on all working days during business hours up to the date of the Meeting.

g. The Register of Members and Share Transfer books of the Company will remain close from Sunday, September 23, 2018 to Saturday, September 29, 2018 (both days inclusive).

h. The Register of Directors and Key Managerial Personnel and their shareholding, maintained under Section 170 of the Companies Act, 2013, will be available for inspection by the members at the AGM.

i. The Register of Contracts or Arrangements in which the directors are interested, maintained under Section 189 of the Companies Act, 2013, will be available for inspection by the members at the AGM.

j. Members are requested to intimate queries to the Company, if any, regarding the accounts/notices at least seven days before the Annual General Meeting to enable the management to keep the information ready at the meeting.

k. Members are requested to send all correspondence, including dividend related correspondence and transfer of shares to IEPF as mentioned below (refer serial number n below) to the Registrar & Share Transfer Agent, i.e. Bigshare Services Private Limited, 1st Floor, Bharat TIN Works Building, Opp. Vasant Oasis (next to Keys Hotel), Marol, Makwana Road, Andheri East, Mumbai - 400059, Tel. 022 – 62638200, Email id: [email protected] / [email protected] and/or to the Company Secretary of the Company at [email protected]. Members holding shares in electronic form are advised to notify any change in their address to the concerned depository participants.

l. Members whose shareholding is in electronic mode are requested to direct change of address notifications and updates of savings bank account details to their respective Depository Participant(s).

m. Transfer of Unclaimed Dividend: Pursuant to Section 125 of the Companies Act, 2013, on 31st March 2018, the Company is having un-claimed or unpaid dividends of ̀ 52,146/- for the year ended 31st March, 2011 and the same will be transferred to the Investors Education and Protection Fund on or after September 12, 2018.

Pursuant to Section 125 of the Companies Act, 2013 the amount of dividend remaining unpaid or unclaimed for a period of seven years from the date of its transfer to the Unpaid Dividend Account of the Company shall be transferred to the Investor Education and Protection Fund (the Fund) set up by the Government of India. Members who have not yet encashed their dividend warrant(s) for the financial year ended 31st March, 2011 onwards, are requested to make their claims to the Registrar & Share Transfer Agent and/or Company Secretary of the Company accordingly, without any delay. The details of unclaimed dividend are posted at the link http://nitinfire.com/blog/inves-tors/unpaid-unclaimed-dividend/.

Status of unclaimed and unpaid dividend (` in lakhs)

Year Ended Date of declaration of Dividend

Amount of Dividend

Unclaimed and unpaid dividend

as on 31st March, 2018

% of Unclaimed and Unpaid

Dividend

Due Date for transfer to IEPF

Account

March 31,2011 11.08.2011 630.16 0.5214 0.08 12.09.2018March 31,2012 11.08.2012 882.21 0.7698 0.09 13.09.2019March 31,2013 13.08.2013 441.11 0.2609 0.06 14.09.2020March 31,2014 No Dividend declaredMarch 31,2015 21.09.2015 585.54 1.0722 0.18 23.10.2022March 31,2016 No Dividend declaredMarch 31,2017 No Dividend declaredMarch 31,2018 No Dividend recommended

The Company had transferred unclaimed dividend of ` 89135/- for the year ended March 31, 2010 to Investor Education & Protection Fund on November 15, 2017.

n. Transfer of Shares to IEPF: The intimation has been given to all shareholders who has not claimed dividend for 7 years or more from the financial year March 31, 2011 to claim on or before September 12, 2018, to avoid the transfer of your shares to IEPF Authority.

Further, pursuant to the provisions of Section 124 of the Act read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended (‘IEPF Rules’), all the shares on which dividends remain unpaid/unclaimed for a period of 7 (seven) consecutive years or more shall be transferred to the demat account of the IEPF Authority as notified by the Ministry of Corporate Affairs. Accordingly, the Company has transferred 7063 Equity Shares of the face value of ` 2/- per share to the demat account of the IEPF Authority during the financial year 2017-18.


5

Also complete details of such shareholders have been uploaded on the company’s website and can be referred to under section “Investors” and sub-section “Unpaid & Unclaimed Shares to IEPF”, the link of which are as follows:

i) http://nitinfire.com/wp/wp-content/uploads/2016/07/NITIN-FIRE_IEPF-SHARE-TRANSFER-TO-IEPF-2008-09.pdf

ii) http://nitinfire.com/wp/wp-content/uploads/2016/07/NITIN-FIRE_IEPF-SHARE-TRANSFER-TO-IEPF-2009-10.pdf

iii) http://nitinfire.com/wp/wp-content/uploads/2016/07/IEPF-share-transfer-2010-11_DATA_19_05_2018.pdf

The Company has sent individual notice to all the shareholders whose shares are due to be transferred to the IEPF Authority and has also published newspaper advertisement in this regard. The details of such dividends/shares to be transferred to IEPF are uploaded on the website of the Company at www.nitinfire.com under the ‘Investors’ section.

Claim from IEPF Authority: Members/claimants whose shares and unclaimed dividend have been transferred to the IEPF Authority can claim the same by making an application to the IEPF Authority in Form IEPF- 5 along with requisite documents (available on www.iepf.gov.in) and sending duly signed physical copy of the same to the Company along with requisite documents prescribed in Form IEPF-5. Member/claimant can file only one consolidated claim in a financial year as per the IEPF Rules. Link to Form IEPF- 5 is available on the website of Ministry of Corporate Affairs (MCA) at http://www.iepf.gov.in/IEPFA/corporates.html. Since MCA revises the forms from time to time, it is advisable to download the form in the given link. No claims shall lie against the Company in respect of the dividend/shares so transferred.

o. To prevent fraudulent transactions, members are advised to exercise due diligence and notify the Company of any change in address or demise of any member as soon as possible. Members are also advised not to leave their demat account(s) dormant for long. Periodic statement of holdings should be obtained from the depository participant(s) and holdings should be verified.

p. The Securities and Exchange Board of India (SEBI) has mandated the submission of Permanent Account Number (PAN) by every participant in securities market. Members holding shares in electronic form are therefore, requested to submit the PAN and Bank Account details to their depository participants with whom they are maintaining their demat accounts. Members holding shares in physical form can submit their PAN and Bank Account details to the Registrar & Share Transfer Agent and/or Company Secretary of the Company.

q. As per the provisions of section 72 of the Companies Act, 2013, facility for making nomination in Form SH-13, is available for the Members in respect of the shares held by them. Nomination forms can be obtained from the Company’s Registrar and Transfer Agent by Members holding shares in physical form. Members holding shares in electronic form may obtain Nomination forms from their respective Depository Participant. The same is also enclosed at the end of this report.

r. Members may also note that the Notice of the 23rd AGM and the Annual Report 2017-18 will be available on the Company’s website, www.nitinfire.com/investor. The physical copies of the documents will also be available at the Company’s registered office for inspection during normal business hours on working days. Members, who require communication in physical form in addition to e-communication, may write to us at: [email protected].

s. The Annual Report 2017-18, the Notice of the 23rd AGM and instructions for e-voting, along with the Attendance slip and Proxy form, are being sent by electronic mode to all members whose email addresses are registered with the Company / Registrar and Transfer Agent / Depository Participant(s), unless a member has requested for a physical copy of the documents. For members who have not registered their email addresses, physical copies of the documents are being sent by the permitted mode.

t. The relevant details of Director(s) seeking appointment/re-appointment pursuant to Regulation 36 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are furnished as under:

Details of Director(s) as on the date of this Notice seeking appointment/ re-appointment at the forthcoming 23rd Annual General Meeting

{Pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015}

Name of Director Mr. Nitin M. ShahDIN 00073232Date of Birth 10.06.1957 Age 61Nationality IndianDate of first Appointment on the Board

April 1, 2006

Qualifications Diploma in Mechanical Engineering Experience including Expertise in specific functional areas

The founder and driving force behind the Company. After completing his Diploma in Mechanical Engineering, in 1975 he joined his family business namely, Zenith Fire Services, which was into manufacturing of fire extinguishers. Subsequently, he did his training in BRK Electronics, U.S.A., which is one of the largest manufacturers of smoke detectors. He set up Nitin Fire Protection Industries Limited in 1995 and has more than 4 decades of experience in fire fighting equipment business.

Terms and conditions of Appointment As per the resolution passed by the Board on August 28, 2018 and proposed to confirmation by the shareholders in their ensuing AGM. The same will be submitted to the Central Government for their approval.

6


Remuneration sought to be paid As per the resolution passed by the Board on August 28, 2018 and proposed to confirmation by the shareholders in their ensuing AGM. The same will be submitted to the Central Government for their approval.

Last remuneration drawn during the 2016-17

Nil

Number of Board meetings attended during the year

Held Attended

6 2 (including one by way of video conference)Relationship with other directors and Key Managerial Personnel

Mr. Nitin M. Shah is father of Mr. Rahul N. Shah and Mr. Kunal N. Shah. Mr. Rahul N. Shah is acting as CEO and KMP of the Company. Mr. Kunal N. Shah is acting as COO and KMP of the Company.

No. of shares held in the Company (including held by dependents)

Not applicable as proposed to be appointed as executive director

Directorship in other Public Limited Companies

Nil

Chairmanship / Membership of the Mandatory Committees of other Public Limited Companies

Nil

u. The Chairman shall, at the AGM, at the end of discussion on the resolutions on which voting is to be held, allow voting with the assistance of Scrutinizer, by ballot paper for all those members who are present at the AGM but have not cast their votes by availing the remote e-voting facility.

v. Mr. Mayank Arora (Membership No. ACS 33328) of M/s. Mayank Arora & Co., Company Secretaries, has been appointed as the Scrutinizer for providing facility to the members of the Company to scrutinize remote e-voting process as well as voting at the AGM in a fair and transparent manner. The Scrutinizer shall, after the conclusion of voting at the AGM, first count the votes cast at the meeting and, thereafter unblock the votes cast through remote e-voting, in the presence of at least two witnesses not in the employment of the Company and shall make, not later than forty eight hours from the conclusion of the AGM, a Consolidated Scrutinizer’s Report of the total votes cast in favour or against, if any, to the Chairman or a person authorised by him in writing, who shall countersign the same and declare the result of the voting forthwith. The results declared alongwith the Scrutinizer’s Report, shall be placed on the website of the Company www.nitinfire.com and on the website of NSDL www.evoting.nsdl.com immediately after the declaration of results by the Chairman or a person authorised by him in writing. The results shall also be immediately forwarded to the Stock Exchanges where the Company’s shares are listed viz. BSE Limited and the National Stock Exchange of India Limited. The results shall also be displayed on the notice board at the registered office of the Company. Subject to receipt of requisite number of votes, the Resolutions shall be deemed to be passed on the date of AGM i.e. Saturday, September 29, 2018.

w. Process and manner for members opting for e-voting are as under:

In compliance with the provisions of Section 108 of the Companies Act, 2013, read with Rule 20 of The Companies (Management and Administration) Rules, 2014 and amendment thereof, and regulation 44 of the SEBI Listing Regulations, 2015 the Company is providing the remote e-voting (e-voting) facility to the Members to exercise their right to vote for the 23rd Annual General Meeting (AGM) by electronic means, arranged to be provided by National Securities Depository Limited (NSDL) i.e. facility of casting the votes by the members using an electronic voting system from a place other than the venue of the AGM (remote e-voting) on all the resolutions set forth in this Notice. The important features to be noted with respect to e-voting are as follows:

Sr. No. Particulars Day, Date & Timing1 Cut-off date for eligibility of e-voting Saturday, September 22, 20182 Opening of E-voting period Monday, September 24, 2018 at 9.00 a.m.3 Closing of E-voting period Friday, September 28, 2018 at 5.00 p.m.

The e-voting module shall be disabled by NSDL for voting thereafter.4 Declaration of Results of voting Monday, October 1, 2018

A member may participate in the general meeting even after exercising his right to vote through remote e-voting, but, shall not be allowed to vote again in the meeting. A person who is not a member on the cut-off date should treat the AGM notice for information purposes only.

The instructions for members for voting electronically are as under:-

The way to vote electronically on NSDL e-Voting system consists of “Two Steps” which are mentioned below:

Step 1 : Log-in to NSDL e-Voting system at https://www.evoting.nsdl.com/

Step 2 : Cast your vote electronically on NSDL e-Voting system.


7

Details on Step 1 are mentioned below:

How to Log-in to NSDL e-Voting website?

1. Visit the e-Voting website of NSDL. Open web browser by typing the following URL: https://www.evoting.nsdl.com/ either on a Personal Computer or on a mobile.

2. Once the home page of e-Voting system is launched, click on the icon “Login” which is available under ‘Shareholders’ section.

3. A new screen will open. You will have to enter your User ID, your Password and a Verification Code as shown on the screen.

Alternatively, if you are registered for NSDL eservices i.e. IDEAS, you can log-in at https://eservices.nsdl.com/ with your existing IDEAS login. Once you log-in to NSDL eservices after using your log-in credentials, click on e-Voting and you can proceed to Step 2 i.e. Cast your vote electronically.

4. Your User ID details are given below

Manner of holding shares i.e. Demat (NSDL or CDSL) or Physical

Your User ID is:

a) For Members who hold shares in demat account with NSDL.

8 Character DP ID followed by 8 Digit Client ID

For example if your DP ID is IN300*** and Client ID is 12****** then your user ID is IN300***12******.

b) For Members who hold shares in demat account with CDSL.

16 Digit Beneficiary ID

For example if your Beneficiary ID is 12************** then your user ID is 12**************

c) For Members holding shares in Physical Form. EVEN Number followed by Folio Number registered with the companyFor example if folio number is 001*** and EVEN is 101456 then user ID is 101456001***

5. Your password details are given below:

a) If you are already registered for e-Voting, then you can use your existing password to login and cast your vote.

b) If you are using NSDL e-Voting system for the first time, you will need to retrieve the ‘initial password’ which was communicated to you. Once you retrieve your ‘initial password’, you need to enter the ‘initial password’ and the system will force you to change your password.

c) How to retrieve your ‘initial password’?

(i) If your email ID is registered in your demat account or with the company, your ‘initial password’ is communicated to you on your email ID. Trace the email sent to you from NSDL from your mailbox. Open the email and open the attachment i.e. a .pdf file. Open the .pdf file. The password to open the .pdf file is your 8 digit client ID for NSDL account, last 8 digits of client ID for CDSL account or folio number for shares held in physical form. The .pdf file contains your ‘User ID’ and your ‘initial password’.

(ii) If your email ID is not registered, your ‘initial password’ is communicated to you on your postal address.

6. If you are unable to retrieve or have not received the “ Initial password” or have forgotten your password:

a) Click on “Forgot User Details/Password?”(If you are holding shares in your demat account with NSDL or CDSL) option available on www.evoting.nsdl.com.

b) Physical User Reset Password?” (If you are holding shares in physical mode) option available on www.evoting.nsdl.com.

c) If you are still unable to get the password by aforesaid two options, you can send a request at [email protected] mentioning your demat account number/folio number, your PAN, your name and your registered address.

7. After entering your password, tick on Agree to “Terms and Conditions” by selecting on the check box.

8. Now, you will have to click on “Login” button.

9. After you click on the “Login” button, Home page of e-Voting will open.

8


Details on Step 2 are given below:

How to cast your vote electronically on NSDL e-Voting system?

1. After successful login at Step 1, you will be able to see the Home page of e-Voting. Click on e-Voting. Then, click on Active Voting Cycles.

2. After click on Active Voting Cycles, you will be able to see all the companies “EVEN” in which you are holding shares and whose voting cycle is in active status.

3. Select “EVEN” of company for which you wish to cast your vote.

4. Now you are ready for e-Voting as the Voting page opens.

5. Cast your vote by selecting appropriate options i.e. assent or dissent, verify/modify the number of shares for which you wish to cast your vote and click on “Submit” and also “Confirm” when prompted.

6. Upon confirmation, the message “Vote cast successfully” will be displayed.

7. You can also take the printout of the votes cast by you by clicking on the print option on the confirmation page.

8. Once you confirm your vote on the resolution, you will not be allowed to modify your vote.

General Guidelines for shareholders

1 Institutional shareholders (i.e. other than individuals, HUF, NRI etc.) are required to send scanned copy (PDF/JPG Format) of the relevant Board Resolution/ Authority letter etc. with attested specimen signature of the duly authorized signatory(ies) who are authorized to vote, to the Scrutinizer by e-mail to [email protected] with a copy marked to [email protected].

2. It is strongly recommended not to share your password with any other person and take utmost care to keep your password confidential. Login to the e-voting website will be disabled upon five unsuccessful attempts to key in the correct password. In such an event, you will need to go through the “Forgot User Details/Password?” or “Physical User Reset Password?” option available on www.evoting.nsdl.com to reset the password.

In case of any queries, you may refer the Frequently Asked Questions (FAQs) for Shareholders and e-voting user manual for Shareholders available at the download section of www.evoting.nsdl.com or call on toll free no.: 1800-222-990 or send a request


9

Annexure to the Notice

THE EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013.

3 . Appointment of Mr. Nitin M. Shah (DIN - 00073232) as a Managing Director

Mr. Nitin M. Shah is appointed as a Managing Director on August 28, 2018, for a term of three years. He is liable to retire by rotation. He is also appointed as Key Managerial Personnel by the Board by recommendation of the Nomination and Remuneration Committee as required under the provisions of the Section 203 and other provisions of the Companies Act, 2013.

Mr. Nitin M. Shah is the founder and driving force behind the Company. He is a Diploma in Mechanical Engineering. In 1975 he joined his family business namely, Zenith Fire Services, which was into manufacturing of fire extinguishers. Subsequently, he did his training in BRK Electronics, U.S.A., which is one of the largest manufacturers of smoke detectors. He set up Nitin Fire Protection Industries Limited in 1995 and more than 4 decades of experience in firefighting equipment business. With a hands-on managerial style, he is the guiding light for the Company.

Considering the qualification and expertise of Mr. Nitin M. Shah the Board approved the appointment to perform the dual role as Managing Director cum Key Managerial Personnel. Due to ups and downs in the business, the Company is facing a financial crunch and has defaulted in payment of principal and interest on loans taken from the Banks, financial institutions and other lender. Mr. Shah assured that the Company will take all the necessary steps to overcome the situation. Accordingly the Board decided to pay remuneration after the Company makes the default good or obtains prior approval of secured lenders whichever is earlier. The Board of Directors have decided the remuneration payable to Mr. Nitin M. Shah, subject to approval by the shareholders of the Company as provided in the special resolution recommended to be passed at item no. 3.

Most of the information required pursuant to Schedule V of the Companies Act, 2013 has generally been covered under resolution and note no. t to the Notes. The term of office is for a period of three years from August 28, 2018 to August 27, 2021. The remuneration is nil till the default of the lenders made good and as mentioned in the resolution. Perquisites, allowances and other terms and conditions is mentioned in the resolution. The entire remuneration will be subject to overall ceiling specified under section 196, 197 and schedule V and other sections if any of the Companies Act, 2013. He will not get any fees for attending the meetings of the Board or Committee thereof. The Company falls under the category of manufacturing and trading of the fire fighting equipments. The Commencement of the commercial production/business is not applicable being an existing Company. The plant for manufacture is already in production. Total income of the Company for the year ended March 31, 2018 is Rs.6,687.11 lakhs. The Company has incurred a loss of Rs.19,144.88 lakhs for the year ended March 31, 2018. Earnings per share is Rs.(6.57) and the rate of dividend is nil. Nitin Ventures FZE, Nitin Global Pte Ltd and Nitin Fire Protection Middle East FZE are the foreign subsidiaries of the Nitin Fire Protection Industries Ltd. Information about appointee have been given above. He is acting as Non-executive director w.e.f. November 10, 2015 without any remuneration. Prior to that he was acting as Managing director vide the resolution of the Board dated September 30, 2014 and the salary was Rs.3,50,000/- per month excluding other allowances and perquisites. Though he has not received such recognition or awards, but suitable for the post of Managing Director as being a promoter and founder of the Company. The proposed remuneration being nil till the default made good and adequate profit earned is not matching/lower with/than the comparative remuneration profile with respect to industry, size of the Company, profile of the position and person. He has no pecuniary relationship with the Company except the interest on loan. He has no relationship with any managerial personnel except with Mr. Rahul Shah, CEO and Mr. Kunal Shah, COO. The Company is incurring losses due to increase in finance cost, non-realization of receivables, exceptional items for claims written off and provision for doubtful debts etc. All the possible steps are in the process including the onetime settlement with the lenders for improvement of the position. Total revenue of the Company in FY 2017-18 was Rs.6,687.11 lakhs. The expected increase in productivity and profits in the measurable terms for FY 2017-18 are that Company earned in the FY 2015-16. The revenue and profit after tax for the financial year 2015-16 were Rs. 47130.03 lakhs & Rs.543.87 lakhs respectively.

Your Directors recommend the approval of proposed resolutions as set out in item No. 3 of the accompanying notice by the Members by way of a Special Resolution.

Mr. Nitin M. Shah is father of Mr. Rahul Shah and Mr. Kunal Shah. None of the other Directors or Key Managerial Personnel of the Company and their relatives is in any way concerned or interested in the proposed Resolution.

4. Reversal of the resolution passed by members on December 9, 2017 with respect to increase in authorized share capital. Alteration of the Capital Clause of the Memorandum of Association (MoA) by cancellation of increase in Authorized Share Capital of the Company:

The Company had a planning of issuing the additional shares to the public for satisfaction of the loan and for other purposes. As the same could not be fructified, the increase in authorized share capital is no more required by the Company. Further the financial position of the Company has been deteriorated to a great extent for which the time is not perfect to invite the public or private parties to subscribe the shares of the Company. Hence the Board of Directors of the Company thought fit to request to cancel the resolution passed by the members on December 9, 2017 by enhancing Authorized Share Capital from ` 75,00,00,000/- (Rupees Seventy Five Crores only) to ` 175,00,00,000/- (Rupees One Hundred Seventy Five Crores only) divided into 87,50,00,000 (Eighty Seven Crores Fifty Lakhs Only) Equity shares of a face value of ` 2/- (Rupees Two Only) each by the addition of 50,00,00,000 (Fifty Crores Only) Equity Shares of a face value of ` 2/- each aggregating to ` 100,00,00,000/- (Rupees One Hundred Crores only). On cancellation the Authorized Share Capital will be as it is before the approval of the members i.e; ` 75,00,00,000/- (Rupees Seventy Five Crores only) divided into 37,50,00,000 (Thirty Seven Crores Fifty Lakhs Only) Equity shares of a face value of ` 2/- (Rupees Two Only) each. Further the Company has not filed the e-form SH-7 and record has not been updated after the passing of the increase in authorized share capital.

10


The Board of Directors of the Company at its meeting held on August 28, 2018 recommended canceling the increase in Authorized Share Capital of the Company as mentioned above as per the status of the Company. Consequent to the cancel in increase in Authorized Capital of the company, it is necessary to alter the present Clause V of the Memorandum of Association by substituting the same with the amended new Clause V as given in the respective Special Resolution.

Accordingly, the Board of Directors recommends passing of the Special Resolution set out in Item No.4 of the notice. None of the Directors, key managerial personnel of the Company and their relatives is concerned or interested in this Resolution.

Mumbai, August 28, 2018 For and on behalf of the BoardRegistered Office: 501, Delta, Technology Street, Hiranandani Gardens, Nitin Fire Protection Industries LimitedPowai, Mumbai – 400 076. Tel. No.: 022 40457000Email:[email protected]; Website:www.nitinfire.com Sraban Kumar KaranCIN:L29193MH1995PLC092323 Company Secretary

1. Important Communication to Members – Green Initiative

Members holding shares in electronic mode are requested to update their e-mail address with their respective Depository Participant and Members holding shares in physical mode are requested to provide their e-mail address to the Registrar and Share Transfer Agent at E-mail id: [email protected] or [email protected] along with correspondence to Company at [email protected] so as to allow the Company to serve the documents in electronic mode.

2. Important Communication to Shareholders holding shares in Physical mode – Dematerialization

The Securities and Exchange Board of India (SEBI) has amended Regulation 40 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 vide Gazette notification SEBI/LAD-NRO/GN/2018/24 dated June 8, 2018 and has mandated that transfer of securities would be carried out in dematerialized form only. No transfer as per the said circular will be allowed in physical mode with effect from December 5, 2018. As per the amendment, listed Companies and their Registrars and Transfer Agents (RTAs) are advised to ensure that request have been lodged for transfer of securities/shares in dematerialized form only with effect from December 5, 2018. Letters were sent to shareholders holding shares in physical mode to convert into dematerialization. Accordingly the members who hold shares in physical mode are again requested to contact with any depository participant to open the demat account and convert the shares into dematerialized mode, if the same has not been done yet now as per the earlier intimation.

3. Important Communication to Shareholders holding shares in Physical mode – KYC update

Securities and Exchange Board of India (SEBI) vide its circular dated April 20, 2018 has informed to take the following details from shareholders holding securities in physical form under the captioned subject of the circular i.e; “Strengthening the Guidelines and Raising Industry standards for RTA, Issuer Companies and Banker to an Issue”:

1. Self-attested copy of Pan Card;

2. Bank details (a copy of the original cancelled cheque leaf /attested bank passbook showing name of account holder);

3. Address proof (self-attested copy of Aadhaar-card);

4. Specimen signature of the registered and/or joint shareholders.

After receiving the above information the update of KYC (Know Your Customer) of the physical shareholders will be done by the Company and the Registrar and Transfer Agent (RTA). We have sent two requests vide our letter on May 8, 2018 and June 20, 2018 asking PAN, Bank and other details in a duly filled up form and to provide the supporting documents to update their records. The reminder – 3 to update KYC was sent for the same at the time of requesting for dematerialization on July 31, 2018. Accordingly the members who hold shares in physical mode are again requested to update their KYC, if the same has not been done yet now as per the earlier intimation.


11

DIRECTORS’ REPORT

To,The Members,Nitin Fire Protection Industries Limited

Your Directors have pleasure in presenting their 23rd Annual Report on the business and operations of the Company and the accounts for the Financial Year ended March 31, 2018.

1. Financial summary or highlights/Performance of the Company (Standalone & Consolidated):

(` in lakhs)Particulars 2017-18 2016-17 2017-18 2016-17

Standalone Standalone Consolidated ConsolidatedRevenue from Operations 5523.48 26886.08 88774.73 132689.49Other Income 1163.62 304.54 552.29 425.06Total Income 6687.10 27190.62 89327.02 133114.55Expenses 23568.24 39577.33 104125.06 136873.84Share of profit / (loss) in associate - - 393.63 (2637.81)Profit/(Loss) Before Tax (19144.87) (12386.71) (16668.14) (6397.10)Total Tax Expense 52.47 (27.20) 52.47 (36.78)Profit/(Loss) After Tax (19197.34) (12359.51) (16720.61) (6360.32)Other comprehensive income/expense (net of tax) 39.65 (17.53) 547.59 (760.65)

2. Review of Operations:

The total income during the year ended March 31, 2018, on standalone basis stood at ` 6687.10 lakhs as compared to the previous year of ` 27190.62 lakhs. The net loss for the year ended March 31, 2018 is ` 19197.34 lakhs as compared to ` 12359.51 lakhs loss for the previous year. The loss for the year is mainly due to the lower turnover, increase in the finance costs, non-realization of receivables, adverse economic scenario, exceptional items for claims written off of ̀ 2263.73 lakhs and provision for doubtful debts of ̀ 571.45 lakhs.

The total income during the year ended March 31, 2018, on consolidated basis stood at ̀ 89327.02 lakhs as compared to the previous year of ` 133114.55 lakhs. The net loss for the year ended March 31, 2018 is ` 16720.61 lakhs, as compared to the loss of ` 6360.32 lakhs in the previous year.

3. Change in the nature of business:

There is no change in business of the Company during the financial year 2017-18.

4. Dividend:

Due to losses, the Directors regret their inability to recommend any dividend for the year ended March 31, 2018.

5. Reserves:

The Company incurred loss of `19,197.34 lakhs and hence no transfer to the General Reserve arisen in the current year.

6. Share Capital:

The Authorized Share Capital of the Company was increased from ` 75.00 crores to ` 175.00 crores by way of approval of the members of the Company on December 9, 2017 as per the recommendation of the Board of the Directors on November 3, 2017. The filing of SH-7 has not been completed by the Company and hence the record of the MCA has not been updated accordingly.

The Board has considered the cancellation of the increase in authorized capital due to bad financial position and less chance of further issue of shares to public. The Board is proposing members to reverse the resolution and keep the authorized share capital at ` 75.00 crores as before the passing of the resolution on December 9, 2017.

There were no changes in the Paid-up Share Capital during the financial year 2017-18.

7. Directors, Key Managerial Personnel, Independent Directors & Compliance Officer:

Mr. Nitin M. Shah (DIN: 00073232) retires by rotation at the forthcoming 23rd Annual General Meeting of the Company and being eligible offers himself for re-appointment. The Board recommends his re-appointment.

All Independent Directors of the Company have submitted their declarations that they meet the criteria of independence as provided in section 149(6) of the Companies Act, 2013 (“Act”) and Regulation 16(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI Listing Regulations, 2015”).

Mr. Atul Mehta & Mr. Hariharan Iyer were appointed as Independent Directors w.e.f. September 1, 2017 by the members of the Company at the annual general meeting on September 29, 2017.

Mr. Rahul Shah and Mr. Kunal Shah resigned with effect from December 12, 2017 due to being disqualified u/s. 164 of the Companies Act, 2013, for non-filing of accounts and annual return of Innova Finance Corporation Pvt Ltd.

12


Mr. Kamlesh Gandhi, Chief Financial Officer (CFO) resigned with effect from December 12, 2017.

Mr. Rahul Shah, Mr. Kunal Shah and Mr. Bharat Shah appointed as Chief Executive Officer, Chief Operating Officer and Chief Financial Officer (CFO) respectively by the recommendation of Audit Committee (AC) and Nomination & Remuneration Committee (NRC) and by the approval of the Board w.e.f. May 30, 2018.

Mr. Nitin Shah was appointed as Chairman w.e.f. May 30, 2018 in place of Mr. Atul Mehta. On August 28, 2018, the Board of Directors of the Company appointed Mr. Atul Mehta as Chairman of the Company in place of Mr. Nitin Shah. The Board of Directors appointed Mr. Nitin Shah as Managing Director and Key Managerial Personnel w.e.f August 28, 2018 subject to approval of shareholders and others as required under the provisions of the Companies Act, 2013 and amendment thereof.

8. Particulars of Remuneration to its Employees / Directors / Key Managerial Personnel

The information required under the provisions of Section 197 of the Act read with Rule 5(1) and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, in respect of employees of the Company and Directors is furnished below:

Sr. No.

Name Designation Remuneration - FY 2017-18(`)

Remuneration - FY 2016-17(`)

Increase / (decrease) in remuneration from previous

year (`)

Ratio/times per Median of employee

remuneration (times)

1 2 3 4 5 6 71 Rahul N. Shah (*) Whole-time

Director – KMP(*)

11,55,000 1993400 (838400) 2.31

2 Kunal N. Shah (#) Whole-time Director (#)

15,40,000 1979000 (439000) 3.10

3 Kamlesh Gandhi(**)

CFO – KMP 15,38,756 2139357 (600601) 3.09

4 Sraban Kumar Karan

CS - KMP 945637 935159 10478 1.90

* Mr. Rahul Shah resigned with effect from December 12, 2017. # Mr. Kunal Shah resigned with effect from December 12, 2017. ** Mr. Kamlesh Gandhi resigned with effect from December 12, 2017. Increase / decrease in remuneration for those employees who was for part of the year is not applicable. The above increase and decrease

are due to deficiency in the payment of the contract amount in the previous year and payment for the part of the year.

Qualifications and experience of the

employee

Date of commencement of employment

Age Last employment held by such

employee before joining the Company

Nature of employment,

whether contractual or

otherwise

Percentage of equity shares held by the employee in the Company

within the meaning of

clause (iii) of Rule 5(2)

Such employee is a relative of any director or manager of the Company and if so, name of

such director or manager

8 9 10 11 12 13 14Graduate in Commerce & Diploma in Business Management and 19 years

14.08.2014 40 Nitin FireProtection

Industries Ltd.

Contractual (18,831,333shares)

Mr. Nitin M. Shah& Mr. Kunal N.

Shah, are relatives

Bachelor in Electronic and Tele Communications and more than 4 years

14.08.2014 34 Nitin FireProtection

Industries Ltd.

Contractual (30,673,000shares)

Mr. Nitin M. Shah& Mr. Rahul N.

Shah are relatives

C. A. and 37 years 17.06.2013 58 Greshma Shares & Stocks Ltd.

Contractual NIL No

A.C.S. and 11 years 19.01.2016 41 Mehta & Mehta, Company Secretaries

Contractual NIL No


13

Other Disclosures pursuant to the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

Sr. No. Requirements Disclosure1 Ratio of the remuneration of each director to the median re-

muneration of the employees of the Company for the finan-cial year.

There was no increase in the salary of any employees. Further no remuneration was paid to any whole-time director for full year as they resigned w.e.f. December 12, 2017.For this purpose, sitting fees paid to the Directors have not been considered as remuneration.

2 Percentage increase in remuneration of Director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year.

The directors and CFO left the Company on December 12 2017. There was no increment in the salary of any employees during the current year.

During the year the directors were paid the salary up to July 31, 2017 as per the resolution approved by the members earlier.

3 Percentage increase in the median remuneration of employees in the financial year.

Nil

4 Number of permanent employees on the rolls of Company as on 31st March, 2018.

127

5 Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration.

There was no increase in the salary of any employees.

6 Affirmation that the remuneration is as per the remuneration policy of the Company.

The remuneration is as per the remuneration policy of the Company.

Remuneration Policy:

Pursuant to the provisions of Section 178(3) of the Act, the Board has on the recommendation of the Nomination & Remuneration Committee framed a remuneration policy on March 26, 2016 and revised on February 12, 2018 for selection and appointment of Directors, Senior Management and their remuneration–

• Remuneration to Key Managerial Personnel and Staff is industry driven in which it is operating taking into account the performance leverage and factors such as to attract and retain qualified professional and talent.

• For Directors, it is based on the shareholders’ resolutions, provisions of the Companies Act, 2013 and Rules framed therein and guidelines issued by the Central Government and other authorities from time to time.

Managerial Remuneration:

The remuneration paid to the whole-time directors is as mentioned above and has also been provided in MGT-9 available at the link www.nitinfire.com

The Company pays sitting fees to all the Independent Directors for attendance in the meetings of the Board of Directors and the Audit Committee constituted by the Board of Directors of the Company.

The summary of Remuneration Policy is provided in the Corporate Governance Report.

9. Meetings:

During the year ended 31st March, 2018, the Board of Directors had met 6 (six) times on 30.05.2017, 01.09.2017, 14.09.2017, 03.11.2017, 12.12.2017 and 12.02.2018.

4 (Four) Audit Committee meetings were held on 30.05.2017, 14.09.2017, 12.12.2017 and 12.02.2018 for the year ended on March 31, 2018. Nomination and Remuneration Committee meetings were held on 01.09.2017, 12.12.2017 and 12.02.2018 for 3 (three) times. There were 1 (one) Corporate Social Responsibility Committee meeting on 12.02.2018 and 1 (one) Independent Directors’ meetings on 12.02.2018. Stakeholders’ Relationship Committee meeting was held once on 12.02.2018 and Risk Management Committee meeting was held on 12.02.2018 for One (1) time during the year ended 31st March, 2018.

The details of Committee membership, meetings and attendance thereat has been given in the Corporate Governance Report. The intervening gap between two consecutive Board meetings & Audit Committee Meetings respectively were within the period prescribed under the Companies Act, 2013.

The recommendation by the Audit Committee as and when made to the Board had been accepted by it or deferred to the next meeting.

10. Board Evaluation:

In line with the provisions under the Companies Act, 2013, SEBI Regulations, the evaluation of the Board, Committee(s) and Individual Directors were made by the Board at their meeting held on February 12, 2018.

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The evaluation questionnaires were circulated to all the directors along with agenda. It was consisting of three parts as follows:

BOARD EVALUATION; DIRECTORS’ SELF EVALUATION; COMMITTEE EVALUATION. Independent Directors (IDs) reviewed the performance of the non-independent directors, the Chairman and the Board (as a whole). The Nomination & Remuneration Committee had discussed with the Directors of the Company on overall board effectiveness. The Board discussed overall performance of Board, individual directors (including IDs) and committees of Board. After a joint discussion, the Chairpersons of the meeting of the Independent Directors’, Nomination & Remuneration Committee and

Board expressed satisfaction on the evaluation of all the directors and overall performance of Board, individual directors (including IDs) and committees of Board. The evaluation was conducted satisfactorily for the current year. In the previous year there was delay in receiving the questionnaire from Mr. Nitin Shah. The same had been received subsequently and noted by the Committee and Board.

11. Details of Subsidiary/Joint Ventures/Associate Companies:

Pursuant to sub-section (3) of section 129 of the Act, the statement containing the salient features of the financial statement of a Company’s subsidiary(ies), associate Company(ies) and joint venture(s) is given in Form AOC-1 as Annexure - I [Performance and financial position of the subsidiaries and associate included in the consolidated financial statement].

Further, the Annual Accounts and related documents of the subsidiary Company(ies) shall be kept open for inspection at the Registered Office of the Company. The Company will also make available copy thereof upon specific request by any Member(s) of the Company interested in obtaining the same. Further, pursuant to Accounting Standard AS-21 issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company in this Annual Report include the financial information of its subsidiary(ies).

12. Auditors:

Pursuant to the provisions of section 139 of the Act and the rules framed thereafter, M/s. Haribhakti & Co. LLP (FRN – 103523W/ W-100048) was appointed as statutory auditors of the Company from the conclusion of the twenty first annual general meeting (AGM) of the Company held on September 30, 2016 till the conclusion of the twenty fifth AGM to be held in the year 2020, subject to ratification of their appointment at every AGM.

Since the provisions has been amended and ratification for appointment is no more required, the ratification made in the Annual General Meeting held on September 29, 2017 pursuant to the recommendation of the Board and the Audit Committee for appointment of auditors till the conclusion of the twenty fifth AGM to be held in the year 2020 will still remain in force. Hence the ratification was not repeated in the forthcoming Annual General Meeting to be held on September 29, 2018.

Audit Report: The Auditors’ disclaimer opinion and reply of the management are as under:

Basis of disclaimer opinion of Statutory Auditors’ on Standalone Financial Statement:

a) Disclaimer opinion in the Statutory Audit Report:

As more fully explained in Note No. 40 to the Standalone Ind AS Financial Statements, no provision has been made by the Company in respect of its dispute with a bank for claim made by the bank for ` 50,133,481 (excluding interest) on a derivative contract entered into by its erstwhile subsidiary, the liability for which has been taken over by the Company. The Company has not determined the quantum of provision required in this regard as at March 31, 2018 on the above contract and has relied on a legal opinion in the matter wherein no liability is expected. Pending the final settlement of the matter, we are unable to comment on the extent of provision required, if any, in this regard.

Management’s Reply on disclaimer opinion in the Statutory Audit Report:

Consequent to part sale of equity stake in an erstwhile subsidiary in December, 2010, the Company has taken over an outstanding claim of a derivative contract amounting to ` 50,133,481/- (excluding interest). Based on a legal opinion the Company has filed a petition in the Hon’ble High Court of Bombay challenging the legality of the contract. Pending decision, no provision is made in the books of account for this claim.

b) Disclaimer opinion in the Statutory Audit Report:

As more clarified in Note No. 46 to the Standalone Ind AS Financial Statements, the Company has an exposure in Worthington Nitin Cylinders Private Limited aggregating ` 419,504,163 as at March 31, 2018. In the absence of the fair value of the investment as required under Ind AS 28 ‘Investment in Associates and Joint Ventures’, we are unable to comment on the impairment, if any, on the carrying amount of the investment as at March 31, 2018.

Management’s Reply on disclaimer opinion in the Statutory Audit Report:

Worthington Nitin Cylinders Private Limited (WNCPL) is our Associate Company and based on the valuation of the fixed assets of WNCPL from an independent valuer, the Company is hopeful that impairment, if any, will not be material and if any such thing is noticed in future, we will provide for the same.

c) Disclaimer opinion in the Statutory Audit Report:

As more explained in the Note 47 to the Standalone Ind AS Financial Statements, in relation to exposure in trade receivables aggregating ` 2,767,323,001 which are outstanding for a long period of time, payments for which are not forthcoming and are subject to independent confirmation. In the absence of independent confirmations from some of the trade receivables, any other al-ternate audit evidence and non recovery of any amount during the year and till date, we are unable to comment on the recoverability of the same and consequential write off, if any.


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Management’s Reply on disclaimer opinion in the Statutory Audit Report:All efforts for recovery are being made. Amount which may not be ultimately realized cannot be estimated as of now.

d) Disclaimer opinion in the Statutory Audit Report: As more explained in the Note 48 to the Standalone Ind AS Financial Statements, the Trade receivables aggregating ` 345,994,837

(other than those covered under para (c) above), Trade payables aggregating ` 186,746,632 and loans to body corporates aggregating ` 33,108,413 are subject to independent confirmation/ reconciliation. In the absence of independent confirmation/ rec-onciliation, we are unable to comment on the consequential impact, if any.

Because of the significance of the matters described in the Basis for Disclaimer of Opinion paragraph, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion. Accordingly, we do not express an opinion on the Standalone Ind AS Financial Statements.

Material Uncertainty Related to Going Concern We draw attention to Note no. 49 to the Standalone Ind AS Financial Statements, which indicates that the Company incurred a net

loss of Rs. 19,157.71 lakhs during the year ended March 31, 2018 and, as of that date, the Company’s current liabilities exceeded its total assets by Rs. 13,645.07 lakhs. Further as stated therein, indicates that a material uncertainty exists that may cast significant doubt on the Company’s ability to continue as a going concern.

Management’s Reply on disclaimer opinion in the Statutory Audit Report: The Management is in the process of doing needful and expects that there will not be any material impact post confirmation and if

any impact arises, we will provide for the same in next quarter.

e) Auditors’ disclaimer opinion in Internal Financial control report: According to the information and explanation given to us, the Company has not established its internal financial control over financial

reporting on criteria based on or considering the essential components of internal control stated in the Guidance Note issued by ICAI.

Because of this reason, we are unable to obtain sufficient appropriate audit evidence to provide a basis for our opinion whether the Company had adequate internal financial controls over financial reporting and whether such internal financial controls were operating effectively as at March 31, 2018.

We have considered the disclaimer reported above in determining the nature, timing, and extent of audit tests applied in our audit of the Standalone & Consolidated Financial Statements of the Company, and the disclaimer does not affect our opinion on the Stand-alone Financial Statements of the Company.

Management’s reply on disclaimer opinion in Internal Financial control report:

The Company has appointed internal auditor to find out the deficiency in the internal financial control and taking the steps as required from time to time. The measures on the same is under the process in consultation with the internal auditors.

f) Basis of disclaimer opinion of Statutory Auditors’ on Consolidated Financial Statement:

The above disclaimer of Statutory Auditors’ on Standalone Financial Statement remains same with respect to their basis of disclaimer opinion on Consolidated Financial Statement. The auditor has given emphasis on the matter of net loss of Rs.19,157.69 lakhs of the holding Company and the excess of current liabilities in comparison to total assets of the holding Company and the continuity of going concern. The Management is confident of continuing as going concern.

g) Auditors’ opinion:

The Standalone Ind AS Financial Statements, which indicates that the Company incurred a net loss of ` 1,915,770,553 during the year ended March 31, 2018 and, as of that date, the Company’s current liabilities exceeded its total assets by ` 1,364,507,204. Fur-ther as stated therein, indicates that a material uncertainty exists that may cast significant doubt on the Company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.

Managements’ Reply:

The Management is looking after all options to recover the Company and hoping turnaround to continue as going concern. One of the main obstacles is burden of finance cost which can be sorted out after the one time settlement with lenders as in the process now.

13. Secretarial Audit Report:

Pursuant to the provisions of Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed Mr. Mayank Arora, Practicing Company Secretary, to undertake the Secretarial Audit for the financial year ended 31st March, 2018. The report of the Secretarial Auditors in Form No. MR-3 is enclosed as Annexure II. The qualifications of Secretarial Auditor and reply of the Management are as follows:

Qualifications of Secretarial Auditor Reply of the ManagementThe Company has delayed 1 day and 14 days in submitting the outcome of financial result approved at the meeting to the Stock Exchanges for the quarter ended 31-Mar-17 and 31-Mar-18 respectively.

The fines imposed by the stock exchanges for delay in submission have been paid by the Company as per SEBI (LODR) Regulations, 2015.

The Company has submitted the voting results of the Annual General Meeting held on September 29, 2017, to the Stock Exchange after expiry of the prescribed time limit.

The delay in submission caused due to September 30, 2017, the intermediate day, being Sunday or holiday falling within the specified time limit of 48 hours. The Company had replied to National Stock Exchange with regard to the same.

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Qualifications of Secretarial Auditor Reply of the ManagementThe fees of BSE, NSE, CDSL and NSDL have not been paid for the financial year 2018-19.

Due to financial constraints the management could not pay the same as on August 28, 2018.

The Company has not filed the Form SH-7 with the office of Registrar of Companies, Mumbai for increase in Authorized Share Capital to ` 1,75,00,00,000/-.

Due to financial constraints the management could not file SH-7 as on August 28, 2018.

Mr. Rahul Shah (DIN:00073226), Whole Time Director & Key Managerial Personnel and Mr. Kunal Shah (DIN: 00077216), Whole Time Director of the Company were disqualified by the Registrar Of Companies, Mumbai vide notice number ROC/CLR/164(2)(a)/2017/3 dated, September 7, 2017 with respect to non filing of annual returns and financial statement since 2010 of “Innova Finance Private Limited”. Hence both the Directors resigned from the said post and Board of Directors passed a resolution in their meeting held on 12th December, 2017.

Due to incurrence of the disqualification both the Directors resigned from the Board of Directors on 12th December, 2017.

Pursuant to regulation 27 of the SEBI LODR Regulations, 2015, the Statutory Auditors of the Company has issued a disclaimer Report.

The Board has noted disclaimer Report of the Statutory Auditors. The reply has been mentioned in the respective section of the report of the Board of Directors.

The Board of Directors at their meeting held on 30th May, 2017 has noted that pursuant to Section 135 of the Act, the Company is required to spend ` 24,95,341/- by the end of March 31, 2017 as Corporate Social Responsibility expenditure for the financial year 2016-2017 and the same has not been spent by the Company as of 31st March, 2017. due to insufficient revenue generation.

Due to insufficient revenue generation and financial constraints the management could not spend ` 24,95,341/- by the end of March 31, 2017 as Corporate Social Responsibility expenditure for the financial year 2016-2017. The same has been noted by the Board to spend in future.

14. Disclosure about Cost Audit:

Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, as amended from time to time, the Company is not required to carry out the cost audit for the financial year ended 31st March, 2018.

15. Internal Audit & Controls:

Pursuant to Section 138 of the Companies Act, 2013, read with the Clause 49 of the Listing Agreements with Stock Exchanges and the SEBI (LODR) Regulations, 2015, the Company had appointed M/s. Valueonshore Advisors as Internal Auditor of the Company for the financial year 2017-18. Further, the Board appointed again M/s. KNPS & Associates, Chartered Accountants as Internal Auditor of the Company for the financial year 2017-18 in place of M/s. Valueonshore Advisors. The report of the Internal Auditors had been placed from time to time at the meetings of the Board and Audit Committee.

16. Internal Financial Control System:

The Company has overall effective systems and procedure for internal control for ensuring orderly and efficient conduct of business, safeguarding its assets, prevention & detection of frauds & errors & completeness of accounting records and timely preparation of reliable financial information. These systems are periodically reviewed by the Audit Committee of the Board of Directors. The Audit Committee and the Board have ensured that the said system is adequate considering the nature of business and size of the transactions. Further the Audit Committee and Board has considered the disclaimer opinion of the statutory auditors and assured to overcome such disclaimer without any negative impact on the going concern status of the Company.

17. Issue of employee stock options:

The Company has not issued / granted any stock options to its employees including its Key Managerial Personnel and hence, the provisions of Rule 12 (9) of the Companies (Share Capital and Debentures) Rules, 2014 are not applicable.

18. Vigil Mechanism / Whistle Blower Policy:

Your Company has put in place Whistle Blower Mechanism. The detailed mechanism is given in Corporate Governance Report forming part of this report and the same has been posted on the Company’s website at the link http://nitinfire.com/blog/vigil-mechanism/vig-il-mechanism.

19. Risk management policy:

The Company has been addressing various risks impacting the smooth operation and the policy of the Company on risk management as provided in Management Discussion and Analysis section of the Annual Report.

20. Management Discussion and Analysis:

Macroeconomic development:

The Government had taken many steps for development of the country and to form a new India. Though several sectors had improved well, the fire and safety sector had suffered due to deficiency of the Government’s attention to strong policy measures and implementation of the rules and regulations. The next upcoming important issue for the world leaders is to protect the world from global warming and destruction of assets by fire. The Global Community has failed to take unanimous and collective decision to protect from the impact of global warming. America has stepped back to support global community in the year 2017 at Bonn, Germany. United States declared that they will no longer contribute to the Green Climate Fund for global warming assistance. The support and participation of the developed countries will make the solution easier for the global issue like global warming to save the planet earth. Globally and in India, particularly the Fire protection industry has been affected due to changes in the policy of the various governments and the main reason being the taxation on running the fire business. The two major domestic policy developments:


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Implementation of the Goods and Services Tax (GST) and demonetization of the ` 500 and ` 1,000 Indian bank notes has affected the macro economic development of the Country with a negative impact on the fire fighting Industry.

Our business and strong track record

Our Company has establishment in overseas countries. Due to that reason the business may be affected if the foreign countries make changes in the policies, taxation and business rules. Nitin Fire Protection Industries Limited (NFPIL) is nationally and internationally certified Fire Protection solutions provider with wide range of systems to protect and prevent from disaster of fire. The Company is providing end to end Fire Protection Solutions for various industries like Refineries, Control Rooms, Power Plants, Offshore Platforms, Server Rooms & Data Centres, Warehouses, Commercial Spaces, Hospitals and Hospitality sector.

We undertake large scale fire protection system installation and have successfully completed 35 years of operation in India and have completed various installations both direct & indirect across India.

We have following objectives:-

• Safe living of the society and increasing awareness and education of safety and security at all times.• To promote and use the advance technology and modern fire safety and protection systems.• To increase the footprints in overseas countries with the success of domestic country.

INDUSTRY STRUCTURE & DEVELOPMENT The Global Fire & Safety market is steadily increasing and company expects to gradually increase its market share. There is a

definite demand for Fire Protection products worldwide with newer products under development. The Innovation and Product Development are the critical aspects of success in the industry.

Financial Performance Financial performance of the company is given in the director’s report.

OUTLOOK, OPPORTUNITIES AND CHALLENGES India:

Though business prospects seem to be brighter in the near future, the main deterrent to the Company at present is financial burden that has not been met in the due course. The Board and promoters are trying hard to bring the lenders into the one time Settlement. Once the same is agreed and closed from both the ends, the up moving phase will be visible sooner. The company had to face the recessionary market conditions and it had a difficult time realizing the outstanding dues from the customers in the Middle East as well as South East Asian countries due to slack in the overall business scenario in these countries. Due to this, the company could not meet the commitments of the working capital lenders. Also the reduction in the limit by one of the working capital lenders and the untied portion of the assessed working capital limit further added to the liquidity problems. The change in rules of taxation in Dubai is also going to impact the operation of the Company.

Due to the above, the company is facing liquidity crunch to run its operations. The accounts of the company are monitored by the bank. The company is coordinating with the working capital lenders for Debt Restructuring program. Hence till that time the company is not taking any new major contracts/projects. The reduction in the price of oil and slowdown in the Middle East and South East Asian countries have also affected export business.

GST on most of the Fire protection Equipments and products is 18% which may have short term effects on the business. The overall Fire protection business outlook in India seems gradually improving. Except Industrial clients, small units like housing societies and commercial complexes are expecting to create scope for Fire Protection Industry. The Company has over 60 (domestic + international) approvals from various agencies & regulatory bodies required to operate in this business & execute fire protection, safety & security solution projects across various demographics. Hence, the Company believes that once the proposed debt restructuring programme and liquidity crisis is over the company will be able to regain its past glory.

Global subsidiaries

There will be large spending, asset creation and business development in UAE due to the Expo 2020 and other events. With UAE contributing major portion of the total revenue, your Company is in a position to capture the higher growth potential of the growing markets. Worldwide demand for this segment is expected to grow due to more awareness and concerns for the safety.

The diversified portfolio of products and its regular up gradation has helped your Company to add value in markets of UAE, South Asia and Europe. Our strength is our determination and team work.

Human Resources

Employees are the key to achieve the Company’s objectives and strategies. Your Company considers human resource to be an important and valuable asset for the organization. Therefore, it constantly strives to attract and retain best “Talents” for the present and future business requirements and growth. The Company thankfully acknowledges their commitment, dedication and passion and sacrifices. And the Company expects their continuous guidance and support in future. The Company inspires and motivates employees and promotes teamwork, trust and confidence for the organizational growth and to attain the organizational goals. The Company is going to provide a meaningful environment which gives boost in their confidence and help to realize their potential and motivation to develop personally and professionally. The Board is reshaping the size of the employees as per the projects and business in hand.

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Risk Management and Internal Control System

The Internal control system is vested with the promoters of the Company. Professionals and Independent directors advise and give guidance as per the necessity and in the interest of the Company considering the provisions of the acts, rules and regulation applicable from time to time. The Company has a system of controls in order to ensure that all assets are safeguarded against loss from unauthorized use or disposal and also felt from time to time to be strengthened as per the advice of the professional. Regular Internal Audit is carried out to ensure that the responsibilities are executed effectively and that proper and adequate systems are in place and is reviewed by audit committee constituted by the Board of Directors. Though the audit Committee and Risk Management Committee analyzes the same, the promoters are advised to come forward to take all the necessary steps to implement the internal control system.

Your Company continues to comply with laws, regulations and policies as per the regulatory guidelines that are applicable.

The Company monitors principal risks and uncertainties that can impact our ability to achieve strategic objectives. Internal controls are regularly tested for design and operating effectiveness. The Internal Control System is supplemented by defined risk management programme identifying and mitigating risks which are reviewed by the Board of Directors of the Company.

Cautionary Statement

In this Management’s Discussion and Analysis and directors’ report detailing the Company’s objectives, projections, estimates, expectations or predictions and describing the Company’s strength, strategies and estimates are “forward-looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied.

21. Extract of Annual Return

As required pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of annual return in Form MGT 9 as a part of this Annual Report is available in the website of the Company. The link/website to view the MGT 9 is www.nitinfire.com.

22. Material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report

The IND AS has become applicable to the Company w.e.f. financial year 2017-18.

The adverse material changes or commitments occurred are as follows:

During the year the short term borrowing has been increased by repayment of SBLC of ` 1595133449/- against the guarantee commitment to the global subsidiaries in favour of Nitin Ventures, FZE and Nitin Global Pte Limited. There was also increase in finance cost of ` 190162783/- in comparison to previous year. The Company has written off the claim of ` 2263.73 lakhs on account of loss of intangible assets as per the extended litigation and order of the Delhi High Court in relation to the Joint venture partnership with Oil Block. The Company has provided the doubtful debts of ` 5.71 crores and ECL provision on trade receivables.

There were no such adverse material changes or commitments occurring after the financial year 31st March, 2018 except as above and the claim of the financial creditors and banks.

23. Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company’s operations in future

There are no significant or material orders passed by the Regulators, courts or tribunals which impact the going concern status of the Company. However some judgments has been passed by the courts which may affect the future operations. However members’ attention is drawn to the following developments:

As per the order of the Bombay High Court, mentioned hereunder, it can be stated that the operation will not be affected in future according to the order passed by the regulators. Standard Chartered Bank Bank had filed the petition against Nitin Fire Protection Industries Limited (NFPIL) before the Hon’ble High Court of Bombay to recover the dues against associate Company Worthington Nitin Cylinders Private Limited (WNCPL). WNCPL was the principal borrower. NFPIL was corporate guarantor. The petition (COMPANY PETITION NO.159 OF 2016) of Standard Chartered Bank against the Company seeking winding up is barred by limitation and stands dismissed. The Company was the guarantor under the Master Agreement entered into between Worthington Nitin Cylinders Limited (principal borrower) and Standard Chartered Bank, petitioner. The Hon’ble High Court has passed the order in favour of Nitin Fire Protection Industries Limited by dismissing / rejecting Standard Chartered Bank’s Company Petition, on the basis that the same was filed after the expiry of the limitation period.

The Company had entered into a joint venture with Oil Block (RJ-ONN-2004/1) which was un-incorporated. As per the order of the High Court of Delhi, on September 5, 2017, the company has become the defaulting party and shall be deemed to have surrendered the participating interest in the Joint venture. The petition filed by the Company under the Joint venture agreement against Gail (India) Ltd for recovery of the loss happened to the Company before the High Court of Delhi, New Delhi was dismissed and disposed off. The Management had taken the note of the same as claims written off for ` 2263.73 lakhs and provided under the books of accounts in the standalone financial results of the Company for the quarter and nine months ended December 31, 2017.

24. Deposits

The Company has not accepted any deposits during the financial year under review.

25. Particulars of loans, guarantees or investments under section 186(4) of the Companies Act, 2013

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the note 4, 5 and 13 to Financial Statements.


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26. Particulars of contracts or arrangements with related parties

Details of transaction with related party have been given in the note number 41 to the financial statements. There were no transactions required to be reported in form AOC-2.

27. Corporate Governance Certificate

A report on Corporate Governance approved by the Board of Directors of the Company and a certificate from Mr. Mayank Arora, Practicing Company Secretary, Mumbai, for the year ended 31st March, 2018 are enclosed to the report. The Company has fully complied with the Corporate Governance practices specified under the Companies Act, 2013 and the Listing Agreement with the BSE Limited and the National Stock Exchange of India Limited and SEBI Listing Regulations, 2015.

28. Disclosure as per The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

Under the said Act, the Company has set up a “Committee for Harassment of Women at Work Place” to look into complaints relating to sexual harassment at work place of any women employees in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. During the year under review, the Company has not received any complaints of harassment.

29. Conservation of energy, technology absorption and foreign exchange earnings and outgo

Information required under section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 with regard to conservation of energy and technology absorption and foreign exchange earnings and outgo are provided in Annexure III attached to this report.

30. Corporate Social Responsibility (CSR)

Since the Company had incurred huge loss, the Company was not requiring any spending on Corporate Social Responsibility during 2017-18 as per the provisions of the Companies Act, 2013 and amendment thereto. The Company has been carrying out Corporate Social Responsibility (CSR) activities. The unspent amount of ` 2,495,341/- is yet to be incurred after the improvement in the performance of the Company. These activities are carried out in terms of Section 135 read with Schedule VII of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014. Annual Report on CSR activities is annexed herewith as Annexure IV.

31. Directors’ Responsibility Statement

To the best of knowledge and belief, your Directors make the following statement in terms of Section 134(3)(c) of the Companies Act, 2013:

(i) that in the preparation of the Annual Accounts for the year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

(ii) the directors had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the profit of the Company for the year ended on that date;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) the annual accounts have been prepared on a going concern basis;

(v) that the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

(vi) that the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

32. Transfer of Amounts to Investor Education and Protection Fund

Pursuant to Section 125 of the Companies Act, 2013, on 31st March, 2018, the Company is having unclaimed or unpaid dividends of ` 52,146/- for the year ended 31st March, 2011 and the balance as on the date of completion of 7 years from the date of transfer to Unpaid Dividend Account will be transferred to the Investors Education and Protection Fund (the Fund) set up by the Government of India on or after September 12, 2018.

Status of unclaimed and unpaid dividend (` in lakhs)

Year Ended Date of declaration of Dividend

Amount of Dividend

Unclaimed and unpaid dividend

as on 31st March, 2018

% of Unclaimed and Unpaid

Dividend

Due Date for transfer to IEPF

Account

March 31,2011 11.08.2011 630.16 0.5214 0.08 12.09.2018March 31,2012 11.08.2012 882.21 0.7698 0.09 13.09.2019March 31,2013 13.08.2013 441.11 0.2609 0.06 14.09.2020March 31,2014 No Dividend declaredMarch 31,2015 21.09.2015 585.54 1.0722 0.18 23.10.2022March 31,2016 No Dividend declaredMarch 31,2017 No Dividend declaredMarch 31,2018 No Dividend recommended

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Members who have not yet encashed their dividend warrant(s) for the financial year ended 31st March, 2011 onwards, are requested to make their claims to the Company accordingly, without any delay.

The Standard Chartered Bank (Bank) had sent the letter of interest and balance certificate in the Escrow Account having number 12N22205345677. The Balance amount was Rs.39025.00 as on May 4, 2018. The Listing was made on June 5, 2007. As per the provi-sions, the balance in the escrow account should be transferred to IEPF after the expiry of 7 years from the allotment. So accordingly the same had become due to be transferred to IEPF w.e.f. June 2014. The Bank had been requested vide the letter dated July 6, 2018 to explain the reason of delay in confirmation of the balance. It was now proposed to transfer to IEPF.

Details about transfer of unclaimed shares have been given in the Corporate Governance Report and Notice of AGM.

33. Secretarial Standards Compliance

During the year under review, the Company has complied with all the applicable Secretarial Standards issued by The Institute of Compa-ny Secretaries of India and approved by the Central Government pursuant to Section 118 of the Companies Act, 2013.

34. Listing with the Stock Exchange

Annual Listing Fees for the year 2018-19 to the BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) is yet to be paid where the Company’s Shares are listed.

35. Acknowledgements

Your Directors wish to place on record their appreciation, for the contribution made by the employees at all levels but for whose hard work and support, your Company’s achievements would not have been possible. Your Directors also wish to thank its customers, dealers, agents, suppliers, investors and bankers for their continued support and faith.

For and on behalf of the BoardNitin Fire Protection Industries Limited

(Atul H. Mehta) (Chairman) (DIN – 00112451)Mumbai, August 28, 2018Registered Office: 501, Delta, Technology Street, Hiranandani Gardens, Powai, Mumbai – 400 076. Tel. No.: 022 40457000Email:[email protected]; Website:www.nitinfire.com CIN:L29193MH1995PLC092323

ANNEXURE INDEX

Annexure Content

I Details of Subsidiaries/Associate Companies/Joint Ventures in Form AOC-1

II Form MR-3 - Secretarial Audit Report

III Conservation of energy, technology absorption and foreign exchange earnings and outgo

IV Annual Report on Corporate Social Responsibility


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Annexure - I

Form AOC - 1

(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014)

Statement containing salient features of the financial statement of subsidiaries/Associate Companies/Joint Ventures

Part “A”: Subsidiaries(Information in respect of each subsidiary to be presented with amounts in ` in lakhs)Sr. No. Particulars Details

1 Name of the subsidiary(ies) Eurotech Cylinders Private Limited

Nitin Ventures FZE, UAE*

Nitin Global Pte Limited, Singapore

Nitin Fire Protection Middle East FZE

2 Reporting period for the subsidiary concerned, if different from the holding Company’s reporting period

N.A. N.A. N.A. N.A

3 Reporting currency and Exchange rate as on the last date of the relevant Financial year in the case of foreign subsidiaries

N.A. USD (1USD= 64.8386

USD (1USD= 64.8386

USD (1USD= 64.8386

4 Share capital 1.00 1,102.09 47.61 - 5 Reserve & surplus 736.41 53,305.43 (445.62) - 6 Total assets 2730.54 102438.23 4863.44 6.707 Total liabilities 2730.54 102438.23 4863.44 6.708 Investments - - - - 9 Turnover 12.85 83270.94 - -

10 Profit/(loss) before taxation (1420.59) 4401.53 (878.83) - 11 Provision for taxation - - - - 12 Profit(loss) after taxation (1420.59) 4401.53 (878.83) - 13 Proposed dividend - - - - 14 % of shareholding 100 100 100 10015 Date of acquisition/incorporation 01.04.2005 25.07.2007 23.07.2009 02.02.2016

(* includes New Age Co., LLC and Firectec Systems, UK)Notes:1. Names of subsidiaries which are yet to commence operations – Nitin Fire Protection Middle East FZE.

Part “B”: Associates and Joint Ventures

Statement pursuant to Section 129 (3) of the Companies Act, 2013 related to Associate Companies and Joint Ventures ` in lakhs

Name of associates/Joint Ventures Worthington Nitin Cylinders Private Limited (Associate)

Oil Block (RJ-ONN-2004/1)**

(Un- incorporated joint venture)Latest audited Balance Sheet Date 31-March-2018 31-March-2018Shares of Associate/Joint Ventures held by the Company on the year endNo. of Shares 2,336,496 N. A.Amount of Investment in Associates/Joint Venture 4195.04 N. A.

Extend of Holding% 40% 0%Description of how there is significant influence Due to percentage of holding No significant influence**

Reason why the associate/joint venture is not consolidated N. A. N. A.

Net worth attributable to shareholding as per latest audited Balance Sheet 1164.26 N.A.

Profit/Loss for the year: 2017-18Considered in Consolidation Yes N.A.Not Considered in Consolidation N.A. Not a partner w.e.f. September 5, 2017

**Nitin Fire Protection Industries Limited was JV partner with Oil Block till September 5, 2017. As per the order of the Court the company is no more a partner to joint venture. The Company has written off the claim of ` 2263.73 lakhs on account of loss of intangible assets as per the extended litigation and order of the Delhi High Court.

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Annexure - II

Form No. MR-3

SECRETARIAL AUDIT REPORTFOR THE FINANCIAL YEAR ENDED 31ST MARCH, 2018

[Pursuant to section 204(1) of the Companies Act, 2013 and rule No.9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]

To,The Members,Nitin Fire Protection Industries Limited501, Delta, Technology Street, Hiranandani Gardens, Powai, Mumbai - 400076.

I have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate governance practice by M/s. Nitin Fire Protection Industries Limited (hereinafter called “the Company”). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts / statutory compliances and expressing my opinion thereon.

Based on my verification of the Company’s Books, Papers, Minutes Books, Forms and Returns filed and other records maintained by the Company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, I hereby report that in my opinion, the Company has, during the financial year ended 31st March, 2018, complied with the statutory provisions listed hereunder and also that the Company has proper Board processes and compliance mechanism in place to the extent, in the manner and subject to the reporting made hereinafter.

1. I have examined the books, papers, minute books, forms and returns filed and other records maintained by M/s. Nitin Fire Protection Industries Limited (“the Company”) for the financial year ended on 31st March, 2018, according to the provisions of:

(i) The Companies Act, 2013 (the Act) and the rules made there under for specified sections notified and came into effect from 12th September, 2013 and sections and Rules notified and came into effect from 1st April, 2014:

(ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made there under;

(iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed there under;

(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made there under to the extent of Foreign Direct Investment and Overseas Direct Investment (not applicable to the Company during the Audit Period);

(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’):

a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;

b. The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992;

c. The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009;

d. The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Regu-lations, 2009, and The Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 notified on 28th October, 2014 (not applicable to the Company during the Audit period);

e. The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 (not applicable to the Company during the Audit period);

f. The Securities and Exchange Board of India (Registrar to an Issue and Share Transfer Agents) Regulations, 1993;

g. The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009 (not applicable to the Company during the Audit period);

h. The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

(vi) Other Laws applicable to the Company as per the representations made by the Company:

In case of Direct and Indirect Tax Laws like Income Tax Act, Service Tax Act, Excise & Custom Acts I have relied on the Reports given by the Statutory Auditors of the Company.

I have also examined compliance with the applicable clause of the following:

a. Secretarial Standards issued by The Institute of Company Secretaries of India and

b. The Listing Agreements entered into by the Company with Bombay Stock Exchange Limited and National Stock Exchange of India Limited.


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During the financial year under review, the Company has complied with the provisions of the Companies Act, 2013, Companies Act, 1956, Rules, Regulations, Guidelines, Standards, etc. mentioned above subject to the following qualifications:

1. As required under Schedule III Part A of the SEBI (LODR) Regulations, 2015, every listed Company shall disclose outcome of the meeting within 30 minutes of the closure of the meeting held for approval of audited financial results to the Stock Exchanges. However, the Company has delayed in submitting the outcome of the meeting to the Stock Exchanges, as detailed below:

Result for Quarter Due date of Board Meeting

Date of Submission on NSE

Date of Submission on BSE

Remark (Delay in no. of day)

31-Mar-17 30-May-17 31-May-17 31-May-17 131-Mar-18 30-May-18 14-June-18 14-June-18 14

The fines imposed by the stock exchanges for delay in submission have been paid by the Company.

2. According to Regulation 44(3) of the SEBI (LODR) Regulations, 2015, every listed Company shall submit within 48 hours of conclusion if its General Meeting details regarding the voting results to the Stock Exchange. However, the Company has submitted the voting results to the Stock Exchange after expiry of the prescribed time limit.

Regulation Date of AGM Due Date for Submission

Submitted on BSE Submitted on NSE Remark

30 29/09/2017 30/09/2017 (Within 24 hrs.)

01/10/2017 At 2:15 P.M.

01/10/2017 At 2:15 P.M.

*As per Reply to NSE noted below

44(3) 29/09/2017 01/10/2017 (Within 48 hrs.)

02/10/2017 At 3:44 P.M.

02/10/2017 At 3:44 P.M.

*As per Reply to NSE noted below

*The Company had received letter from NSE asking to provide explanation for the delay in submission of the details of voting results of the Annual General Meeting held on September 29, 2017. As per reply of the Company, the delay in submission caused due to September 30, 2017, the intermediate day, being Sunday or holiday. NSE had accepted the reply of the Company. However, the Company has not received any objection from BSE for the above said delay in submission.

3. The fees of BSE, NSE, CDSL and NSDL have not been paid for the financial year 2018-19.

4. The Company has increased Authorized Share Capital of the Company to ` 1,75,00,00,000/- by Postal Ballot Resolution on 09th December, 2017, the Company was required to File Form SH-7 with the office of Registrar of Companies, Mumbai. However, the Company has not filed the same.

5. Mr. Rahul Shah (DIN:00073226), Whole Time Director & Key Managerial Personnel and Mr. Kunal Shah (DIN: 00077216), Whole Time Director of the Company were disqualified by the Registrar Of Companies, Mumbai vide notice number ROC/CLR/164(2)(a)/2017/3 dated, September 7, 2017 with respect to non filing of annual returns and financial statement since 2010 of “Innova Finance Private Limited”. Hence both the Directors resigned from the said post and Board of Directors passed a resolution in their meeting held on 12th December, 2017.

6. Pursuant to regulation 27 of the SEBI LODR Regulations, 2015, the Statutory Auditors of the Company has issued a disclaimer Report.

7. The Company is not required to spend any amount on Corporate Social Responsibility for the financial year 2017-18. The provisions under section 135 of the Companies Act, 2013 are not applicable to the Company for the financial year 2017-18. However, the Board of Directors of the Company at their meeting held on 30th May, 2017 has noted that pursuant to Section 135 of the Act, the Company is required to spend ` 24,95,341/- by the end of March 31, 2017 as Corporate Social Responsibility expenditure for the financial year 2016-2017 and the same had not been spent by the Company as of 31st March, 2017 due to insufficient revenue generation.

• I further report that:

The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Executive Directors and Independent Directors.

The changes in the composition of the Board of Directors that took place during the year under review were carried out in compliance with the provisions of the Act.

Adequate notice is given to all directors to schedule the Board Meetings. Agenda and detailed notes on agenda were sent at least seven days in advance, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.

Majority decision is carried through while the dissenting members’ views are captured and recorded as part of the minutes.

I further report that there are adequate systems and processes in the Company commensurate with the size and operations of the Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines. I further report that during the audit period, there were no instances of:

i. Issue of shares to Public / Right Issue/ Issue of debentures / sweat equity.

ii. Buy-Back of securities.

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iii. Major decisions taken by the Members in pursuance to Section 180 of the Companies Act, 2013.

iv. Merger / amalgamation / reconstruction etc.

v. Foreign technical collaborations.

This report is to be read with my letter of even date which is annexed as Enclosure I and form an integral part of this report.

Mayank Arora & Co.Date: 28.08.2018 Mayank Arora Place: Mumbai Proprietor

C. P. No. 13609

Enclosure - ITo,The Members,Nitin Fire Protection Industries Limited501, Delta, Technology Street, Hiranandani Gardens, Powai, Mumbai-400076.

My report of even date is to read along with this letter.

1. Maintenance of secretarial record is the responsibility of the management of the Company. My responsibility is to express an opinion on these secretarial records based on my audit.

2. I have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness of the contents of the Secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records. We believe that the processes and practices, we followed provided a reasonable basis for my opinion.

3. I have not verified the correctness and appropriateness of financial records and Book of Accounts of the Company.

4. Where ever required, we have obtained the Management representation about the compliance of laws, rules and regulations and happening of events etc.

5. The compliance of the provisions of Corporate and other applicable laws, rules, regulation, standards is the responsibility of management. My examination was limited to the verification of procedures on the test basis.

6. The Secretarial audit report is neither an assurance as to the future viability of the Company nor of the efficiency or effectiveness with which the management has conducted the affairs of the Company.

7. I have reported, in my audit report, only those non-compliances, especially in respect of filing of applicable forms/documents, which, in my opinion, are material and having major bearing on financials of the Company.


C. P. No. 13609

Enclosure - IIList of major applicable laws to the Company as identified by the management and compliance made there under, that is to say:

1. Explosives Act, 1884.

2. Factories Act, 1948 (as amended in 1987)

3. Gas Cylinder Rules, 2004 (amended)

4. Air (Prevention and Control of Pollution) Act, 1981.

Manufacture, Storage and Import of Hazardous Chemicals Rules, 1989.

5. Labour Welfare Act of respective States.

6. The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

7. The Reserve Bank of India Act, 1934 & the Foreign Exchange Management Act, 1999, to the extent applicable.


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8. The Income-Tax Act, 1961.

9. The Central Excise Act, 1944.

10. The Customs Act, 1962.

11. The Finance Act applicable for Service Tax.

Plants are located at:

1. A-117 TTC Industrial Area, 2. Shed -6 Phase- I, Pawana Village, Duvada VSEZ, Navi Mumbai – 400701, Vishakhapatnam - 530049, Maharashtra, India. Andhra Pradesh, India.

Annexure - III

Conservation of energy, technology absorption and foreign exchange earnings and outgo

Information required under section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 with regard to conservation of energy and technology absorption and foreign exchange earnings and outgo are as under:

a) Conservation of energy

(i) The steps taken or impact on conservation of energy. The Company has been taking from time to time measures as deemed necessary and advisable for conservation of power.

(ii) The steps taken by the Company for utilizing alternate sourc-es of energy.

The Company uses latest technology to reduce energy consumption and costs.

(iii) The capital investment on energy conservation equipments. Not invested.

Sr.No. Particulars For the year 2017-18 For the year 2016-17

[A] Power and fuel consumption1 Electricity

a) Purchased units 8655 7491Amount (`) 69460 50940Rate/Unit (`) 8.02 6.80

b) Own Generation Nil Nil2 Coal Nil Nil3 Fuel Furnace Oil + Light Diesel Nil Nil4 Other/Internal Generations Nil Nil

[B] Consumption per unit N.A. N.A.Electricity per Unit N.A. N.A.

(b) Technology absorption

(i) The efforts made towards technology absorption It is the policy of the Companyto use the latest technology forthe safety and security of the

life and property and hence theCompany is constantly activein harnessing and tapping thelatest and best technology in

the industry.

(ii) The benefits derived like product improvement, cost reduction, product development orimport substitution

(iii) In case of imported technology (imported during the last three years reckoned from thebeginning of the financial year)(a) the details of technology imported(b) the year of import(c) whether the technology been fully absorbed(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof

(iv) The expenditure incurred on Research and Development Not incurred.

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(c) Foreign exchange earnings and outgo

Particulars For the year 2017-18(`) For the year 2016-17(`)Earnings – Export sales at FOB (on accrual basis) 15,361,900 531,759,408Outgo – Import of materials and components etc. at landed cost 23,708,192 197,127,128Expenditure in Foreign Currency – traveling financial expenses & professional / license fees (on accrual basis)

394,174 9,791,322

Annexure – IV

Corporate Social Responsibility(Annual report on CSR Activities)

(CSR Policy approved by the Board on August 14, 2014 and revised on May 30, 2018)

1. Brief outline of the Company’s CSR Policy:

The CSR policy of the Company is aimed at demonstrating care for the community through its focus on development of poor people i.e; marginalized cross section of the society, health & wellness, teaching to handicapped children, environmental sustainability and welfare works, support of women, children and the aged in the areas of health, education, etc. The projects undertaken will be within the broad framework of Schedule VII of the Companies Act, 2013.

The CSR policy of the Company is available for inspection at www.nitinfire.com.

2. The composition of the CSR committee:

The CSR Committee of the Company was consisting of three Directors, viz. Mrs. Padmaja Nair, Chairperson, Mr. Nitin M. Shah and Mr. Kailat H. Vaidyanathan as members.

3. Average net profit/(loss) of the Company for last three financial years for CSR expenditure:(` 222,886,497/-)

4. Prescribed CSR Expenditure (two per cent. of the amount as in item 3 above): Nil

5. Details of CSR spent during the financial year:

(a) Total amount to be spent for the financial year Nil

(b) Amount unspent, if any (previous financial year): ` 2,495,341/-

(c) Manner in which the amount spent during the financial year is detailed below: Nil

6. In case the Company has failed to spend the two per cent of the average net profit of the last three financial years or any part thereof, the Company shall provide the reasons for not spending the amount in its Board report:

The CSR expenditure was not required to be made for the financial year 2017-18 due to loss or negative turnover. The provisions under section 135 relating to expenditure on Corporate Social Responsibility are not applicable to the Company for the financial year 2017-18.

7. A responsibility statement of the CSR committee that the implementation and monitoring of CSR policy, is in compliance with CSR objectives and policy of the Company:

No CSR expenditure was spent during the year due to negative net profit as mentioned at point no. 6. Hence the monitoring of the project/expenditure under the CSR policy did not arise.

Nitin M. Shah(Member)

DIN: 00073232

Padmaja Nair(Chairperson - CSR Committee)

DIN: 06841868

Mumbai, August 28, 2018

Corporate Governance Report for the year ended on 31st March 2018The Directors present the Company’s Report on Corporate Governance for the year ended March 31, 2018, in terms of Regulation 34(3) read with schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“ SEBI Listing Regulations”).

1. Company’s Philosophy on Corporate Governance

Effective and good corporate governance practice ensures not only sustainability but also accountability to the stakeholders associated with the Company. The Company being listed with Bombay Stock Exchange Limited (BSE) and the National Stock Exchange of India Limited (NSE) follows provisions specified under various acts, rules, regulations and amendments thereof as applicable for better corporate governance practice. The securities are being regularly traded at BSE & NSE.

The Company believes that, though total business risk elimination is not possible, it can be minimized by consistently developing and following the best practices of Corporate Governance. To this end, the Company focuses on developing and implementing higher standards of accountability to enable optimum returns to all stakeholders. The Company has adopted the requirements of Corporate Gov-ernance stipulated under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as “SEBI Listing Regulations”).


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2. Board of Directors

(a) Composition

Category No. of directorsWhole-time Directors 0*Non Executive and Non Independent Chairperson & Directors (NENID) 2Non-executive Independent Directors including a Woman Director 3

Total 5

*As on March 31, 2018 there were no Whole-time directors in the Company. The Whole-time directors Mr. Rahul Shah and Mr. Kunal Shah had resigned on December 12, 2017.

As required under Section 149 of the Companies Act, 2013 (“Act”) & Regulation 17 of the SEBI Listing Regulations, the Company had 3 (i.e. 60%) Non-executive Independent Directors including Mrs. Padmaja Nair, Woman cum Independent Director, 2 (i.e. 40%) Non-executive Directors on the Board on March 31, 2018. Mr. Atul Mehta, Independent Director was acting as Chairperson of the Board as on March 31, 2018. Mr. Nitin Shah is acting as Chairman w.e.f. May 30, 2018. The maximum tenure of Independent Directors is in compliance with the Act.

The Nomination & Remuneration Policy containing terms and conditions of appointment of the Independent Directors are disclosed on the website of the Company at the link http://nitinfire.com/wp/wp-content/uploads/2016/03/Nomination-Remuneration-poli-cy-to-be-appvd-by-Board-Approved.pdf

The number of meetings of the Board and its Committees held and attended director wise has been given considering the number of meetings held and attended during the tenure of respective director for the Financial Year 2017-18.

(b) & (c) Attendance and Other Directorships

The names and categories of the Directors on the Board, their attendance at Meetings held during the year and the number of Directorships and Committee Chairpersonships / Memberships held by them in other public companies as on March 31, 2018 are given hereunder:

Name of Directors Category No. of Board Meetings during the

year 2017-18*

Whether attended last AGM held on Septem-ber 29, 2017

No. of other Directorship(s) held

in Indian public Companies****

No. of other Board Committee(s) of which Member/Chairperson position held in Indian public Companies****

Held Attended Member Chairper-son

Member Chairperson

Mr. Nitin M. Shah**DIN - 00073232

Non Executive & Non Independent Chairperson

6 2 Yes 0 0 0 0

Mr. Kunal N. Shah DIN - 00077216

Whole-time Director

5 5 Yes 0 0 0 0

Mr. Rahul N. Shah DIN - 00073226

Whole-time Director

5 5 Yes 0 0 0 0

Mr. Kailat H. Vaidyanathan DIN - 00077323

Non Executive & Non Independent Director

6 6 Yes 0 0 0 0

Mr. Krishna Kant Jha# DIN - 02816500

Non-Executive Independent Director

1 1 NA NA NA NA NA

Mrs. Padmaja Nair DIN - 06841868

Woman cum Non-Executive Independent Director

6 6 No 0 0 0 0

Mr. Atul Mehta (DIN – 00112451)


5 5 Yes 0 0 0 0

Mr. Hariharan Iyer (DIN – 07539227)


5 5 Yes 0 0 0 0

Mr. Satish Kumar Dheri*** DIN - 00077533


NA NA NA NA NA NA NA

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(*)The number of Board Meetings held and attended has been given as per the directorship on the dates of Board meetings during the year. A director who resigned has been taken as not applicable (NA) to calculate the number of Board meetings held and attended.

(**) Mr. Nitin Shah attended 2 Board meetings out of which one was by way of video conference.

(***) Mr. Dheri has resigned w.e.f. May 26, 2017.

(#) Mr. Jha has resigned w.e.f. September 1, 2017.

(****)These numbers exclude the directorship / committee membership held in the Company and in private limited companies, foreign companies, companies registered under section 8 of the Act. Further it includes only the chairpersonship / membership of the Audit Committee and Stakeholders’ Relationship Committee. All the directors except those who resigned before March 31, 2018, have informed the Company about the Committee positions they occupy in other companies as per Regulation 26 of the SEBI Listing Regulations which were placed before the Board. Chairpersonship has also been considered in the number of membership positions held.

None of the Directors on the Board hold directorships in more than ten public companies. Further, none of them is a member of more than ten committees or Chairperson of more than five committees across all the public companies in which he is a Director. Necessary disclosures regarding Committee positions in other public companies as on March 31, 2018 have been made by the Di-rectors.

Pursuant to the Regulation 24(1) of the SEBI Listing Regulations, the Board had appointed Mr. K. K. Jha, an Independent Director of the Company as a member of the Board of Eurotech Cylinders Private Limited, the wholly owned unlisted Subsidiary Company.

Mr. Rahul Shah, Mr. Kunal Shah and Mr. Bharat Shah appointed as Chief Executive Officer, Chief Operating Officer and Chief Fi-nancial Officer (CFO) respectively by the recommendation of Audit Committee (AC) and Nomination & Remuneration Committee (NRC) and by the approval of the Board w.e.f. May 30, 2018.

Mr. Nitin Shah was appointed as Chairman w.e.f. May 30, 2018 in place of Mr. Atul Mehta. On August 28, 2018, the Board of Directors of the Company appointed Mr. Atul Mehta as Chairman of the Company in place of Mr. Nitin Shah. The Board of Direc-tors appointed Mr. Nitin Shah as Managing Director and Key Managerial Personnel w.e.f August 28, 2018 subject to approval of shareholders and others as required under the provisions of the Companies Act, 2013 and amendment thereof.

(d) Board Meetings

The notice and detailed agenda along with the relevant notes and other material information are sent in advance separately to each Director and in exceptional cases sent at a shorter notice & also tabled at the Meeting with the approval of the Board. This ensures timely and informed decisions by the Board. The Board reviews the performance of the Company vis-à-vis the budgets/targets.

During the financial year 2017-18, Six (6) Board Meetings were held and the interval between two consecutive meetings was well within the maximum period mentioned under Section 173 of the Companies Act, 2013 and the SEBI Listing Regulation. The dates of the said meetings were:

May 30, 2017; September 1, 2017; September 14, 2017; November 3, 2017, December 12, 2017 and February 12, 2018.

The necessary quorum was present for all the meetings.

During the year 2017-18, information as mentioned in Schedule II Part A of the SEBI Listing Regulations, has been placed before the Board for its consideration as per the transaction basis as and when happened.

(e) Disclosure of Inter se relationship between Directors

None of the Directors were related to each other except Mr. Nitin M. Shah, Mr. Rahul N. Shah & Mr. Kunal N. Shah.

(f) Number of Shares held by Non Executive Directors as on 31st March, 2018

Name Category Number of equity sharesMr. Kailat Hariharan Vaidyanathan Non-Independent, Non-Executive 19,902Mr. Nitin Mansukhlal Shah Non-Independent, Non-Executive 40,040,171

The Company has not issued any convertible instruments.

(g) Web link details of familiarization program to Independent Director

The details of the familiarization program of the Independent Directors are available on the website of the Company. The link for the same is http://nitinfire.com/wp/wp-content/uploads/2016/03/Familiarization-Program-2017-18-Final.pdf.

The Board periodically reviews the compliance reports of all laws applicable to the Company. The certificates of the same are placed before the Board at their meeting by the respective officials/directors of the Company. The Corporate Governance Certificate issued by M/s. Mayank Arora, Practicing Company Secretaries was also placed before the Board.


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COMMITTEES OF THE BOARD3. Audit Committee (mandatory committee)

(a) Brief description of Terms of Reference

The constitution of the Audit Committee is in compliance with the provisions of Regulation 18 of the SEBI Listing Regulations read with Section 177 of the Companies Act 2013.

The terms of reference of the audit committee are broadly as under:

Financial Reporting and Related Processes

• Oversight of the Company’s financial reporting process and financial information submitted to BSE, NSE & regulatory authorities.

• Reviewing with the Management the quarterly unaudited financial statements and the Auditors’ Limited Review Report thereon/ audited annual financial statements and Auditors’ Report thereon before submission to the Board for approval. This would, inter alia, include reviewing changes in the accounting policies and reasons for the same, major accounting estimates based on exercise of judgement by the Management, significant adjustments made in the financial statements and / or recommendation, if any, made by the Statutory Auditors in this regard.

• Review the Management Discussion & Analysis of financial and operational performance.

• Discuss with the Statutory Auditors its judgement about the quality and appropriateness of the Company’s accounting principles with reference to the Generally Accepted Accounting Principles (GAAP) in India.

• Review the investments and others made by the Company.

(b) Composition, Name of Members and Chairperson, Meetings and Attendance during the year

The Committee is constituted and governed in line with the regulatory requirements mandated by the Companies Act, 2013 and SEBI Listing Regulations. The composition of the Audit Committee as at 31st March, 2018, the details of Meetings of the Audit Committee held during the financial year 2017-18 and attendance of the members of the Committee are as under:

Name of Directors Designation Category Committee MeetingsHeld during the year Attended

Mr. Hariharan Iyer Chairman Non-Executive Independent Director

(NEID)

3 3

Mr. Atul Mehta Member NEID 3 3Mrs. Padmaja Nair Member NEID 4 4Mr. S. K. Dheri Member NEID 0 0Mr. K. H. Vaidyanathan Member NED 1 1Mr. Krishna Kant Jha Member NEID 1 1

During the year, 4 (four) Audit Committee Meetings were held on May 30, 2017; September 14, 2017; December 12, 2017 and February 12, 2018. The necessary quorum was present for all Meetings.

Mr. Dheri & Mr. Krishna Kant Jha resigned from the directorship of the Company w.e.f. May 26, 2017 and September 1, 2017, respectively. On May 30, 2017, the Board had reconstituted the Audit Committee by including Mr. Krishna Kant Jha as member of the Audit Committee. Independent Directors does not hold any shares of the Company.

All the Members of the Audit Committee have the requisite qualification for appointment on the Committee and possess sound knowledge of finance, accounting practices and internal controls. Minutes of the meetings of the Audit Committee are circulated to members and the Board is kept apprised.

The meetings were scheduled well in advance and not more than one hundred and twenty days elapsed between any two meetings. In addition to the members of the Audit Committee, these meetings were attended by the Chief Financial Officer, internal auditor and the statutory auditors of the Company. Mr. Hariharan Iyer, Chairman of Audit Committee was present at the annual general meeting of the Company held on September 29, 2017, to answer shareholders’ queries. The Board at their meeting held on September 1, 2017, had reconstituted the Audit Committee, which consisted of three members including Chairman i.e; Mr. Hariharan Iyer – Chairman; Mr. Atul Mehta- Member; Mrs. Padmaja Nair – Member.

The Company Secretary acts as secretary to the Audit Committee.

4. Nomination & Remuneration Committee (mandatory committee)

(a) Brief description of Terms of Reference

In compliance with Section 178 of the Companies Act, 2013, the Board has constituted the “Nomination and Remuneration Committee” (NRC).

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The terms of reference of the Committee, inter alia, include the following:

• Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy relating to the remuneration of the directors, key managerial personnel, senior management and other employees;

• Formulation of criteria for evaluation of Independent Directors and the Board;

• Devising a policy on Board diversity;

• Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down and recommend to the Board their appointment and removal.

(b) & (c) Composition, Name of Members and Chairperson, Meetings and Attendance during the year

The composition of the Nomination & Remuneration Committee as at March 31, 2018 and the details of meeting are as under:


Mrs. Padmaja Nair Chairman Non-Executive Independent Director

(NEID)

3 3

Mr. Hariharan Iyer Member NEID 2 2Mr. K. H. Vaidyanathan Member NED 3 3Mr. K K Jha Member NEID 0 0

Three NRC meetings were held on September 1, 2017, December 12, 2017 and February 12, 2018. The Board at their meeting held on September 1, 2017 had reconstituted the Nomination & Remuneration Committee consisting of three members including chairperson i.e; Mrs. Padmaja Nair– Chairperson; Mr. K. H. Vaidyanathan - Member; Mr. Hariharan Iyer – Member.

(d) Remuneration Policy

The Company has adopted the “Remuneration Policy” for the appointment and remuneration of the directors, KMP and other employees of the Company and the same has been placed on the website of the Company at the link http://nitinfire.com/wp/wp-con-tent/uploads/2016/03/Nomination-Remuneration-policy-to-be-appvd-by-Board-Approved.pdf.

The salient features of the remuneration policy and the evaluation criteria are as follows:

(a) The level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors of the quality required to run the Company successfully;

(b) Relationship of remuneration to performance is clear and meets appropriate performance benchmarks;

(c) Remuneration to directors, key managerial personnel and senior management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals;

(d) Discussion by the Chairperson with all the Directors as per the evaluation questionnaires. One-on-one discussion with directors with feedback on 1 (Strongly Disagree) to 5 (Strongly agree) point scale was made for evaluation of director.

Mr. K. H. Vaidyanathan, Non-Executive Director of the Company does not receive any salary, benefits, pension etc.

The Company pays sitting to all the Independent Directors for attendance in the board meetings and audit committee meetings. Details of remuneration paid to the Directors are given in Form MGT – 9, available in the website of the Company i.e; www.nitinfire.com.

During the year, remuneration paid to the whole-time directors are as under:

1. Mr. Rahul N. Shah (Executive Director) – ` 11,55,000/-

2. Mr. Kunal N. Shah (Executive Director) – ` 15,40,000/-

5. Stakeholders’ Relationship Committee (mandatory committee)

(a) Composition, Name of Members, Chairperson & Attendance during the year

In compliance with the provisions of Section 178 of the Companies Act, 2013, the Listing Regulations, the Board has constituted “Stakeholders’ Relationship Committee”(SRC).

The terms of reference of the Committee are in accordance with the provisions of Section 178(5) of the Companies Act, 2013 and the SEBI Listing Regulations. The Committee shall consider and resolve the grievances of the security holders including complaints related to transfer of shares, non-receipt of annual report and non-receipt of declared dividends and other matters as incidental to the grievance.


31

One (1) SRC meeting was held on 12.02.2018. The composition of the Stakeholders’ Relationship Committee (SRC) as on March 31, 2018 and details of the meetings are as under:


Mr. Atul Mehta Chairman Non-Executive Independent Director

1 1

Mrs. Padmaja Nair Member Non-Executive Independent Director

1 1

Mr. K. H. Vaidyanathan Member Non-Executive Director

1 1

The Board at their meeting held on September 1, 2017 reconstituted the Stakeholders’ Relationship Committee consisting of three members including chairperson i.e; Mr. Atul Mehta – Chairperson; Mr. K. H. Vaidyanathan - Member; Mrs. Padmaja Nair – Member.

(b) Name & Designation of Compliance Officer:

Mr. Sraban Kumar Karan, Company Secretary is designated as Compliance Officer of the Company.

(c) to (e)

Complaints received, cleared and pending by the Company during the year ended on 31st March, 2018

Sr. No.

Nature of Queries/Complaints

Pending as on April 1, 2017

Received during the year

Redressed during the year

Pending as on March 31, 2018

1 Non-receipt ofDividend

0 1 1 0

2 Non receipt of AnnualReport

0 2 2 0

3 SEBI SCORES 0 0 0 04 NSE 0 2 2 0

Any Member / Investor, whose grievance has not been resolved satisfactorily, may kindly write to the Company Secretary with a copy of the earlier correspondence.

6. Corporate Social Responsibility (CSR) Committee

The terms of reference of the Corporate Social Responsibility Committee broadly comprises:

• To review the existing CSR Policy and to make it more comprehensive so as to indicate the activities to be undertaken by the Company as specified in Schedule VII of the Companies Act, 2013;

• To recommend the amount of expenditure to be incurred on the specified CSR activities and to provide guidance on various CSR activities to be undertaken by the Company and to monitor its progress.

The composition of the CSR Committee as on 31st March, 2018 is as under:

1. Mrs. Padmaja Nair …… Chairman & Non-Executive Independent Director

2. Mr. K. H. Vaidyanathan …… Member & Non-Executive Director

3. Mr. Nitin M. Shah …… Member & Non-executive Director

One (1) CSR Committee meeting was held on 12.02.2018 under the chairpersonship of Mrs. Padmaja Nair. The said meeting was attended by Mrs. Padmaja Nair & Mr. K. H. Vaidyanathan.

7. Risk Management Committee (RMC)

As per the provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the constitution of Risk Management Committee is mandatory for the Company falling under top 100 listed entities. Though it is not mandatory, the Company has still formed a Risk Management Committee, the composition of which as on March 31, 2018, is as under:

1. Mr. Hariharan Iyer …… Chairman & Non-Executive Independent Director2. Mr. Atul Mehta …… Non-Executive Independent Director3. Mr. Rahul N. Shah …… Executive Director

Risk Management Committee shall take the following actions:

1. Lay down procedures to inform Board members about the risk assessment and minimization procedures; and

2. Monitoring and reviewing of the risk management plan.

One (1) RMC meeting was held on 12.02.2018 under the chairmanship of Mr. Hariharan Iyer. The said meeting was attended by Mr. Hariharan Iyer & Mr. Atul Mehta. Mr. Rahul N. Shah resigned on December 12, 2017. The Committee was reconstituted by inducting Mr. Nitin Shah in place of Mr. Rahul Shah.

32


8. Independent Directors’ Meeting

The Company had 3 (three) Independent Directors i.e; Mr. Hariharan Iyer, Mr. Atul Mehta and Mrs. Padmaja Nair as on 31st March, 2018. One Independent Director Mr. S. K. Dheri resigned May 26, 2017 and another Independent Director Mr. Jha resigned on September 1, 2017 during financial year 2017-18.

The Independent Directors, inter-alia, decided to evaluate the performance of non-independent directors, Chairperson of the Company and the Board as a whole.

Independent directors evaluated leadership quality and commitment of the Chairperson towards the functioning of the Company and shareholders’ value. They also assessed the quality, quantity and timeliness of flow of information between the company management and the Board that is necessary for the members of the Board to perform their duties effectively and reasonably. All the Directors evaluated by the Independent Directors (IDs) at their meeting held on February 12, 2018, secured 5 points. Independent Directors jointly expressed satisfaction on the evaluation that continuity of non-independent directors in the Board is in the interest of the Company.

In compliance with the provisions of Section 149 read with Schedule IV of the Companies Act, 2013, one (1) Meeting of the Independent Directors was held on February 12, 2018 inter alia, to discuss about the following:

• Review the performance of non-independent directors and the Board as a whole;• Review the performance of the Chairperson of the Company, taking into account the views of other directors.

All the Independent Directors were present at the Meeting.

General Body Meetings

Particulars of last three Annual General Meetings

Meeting Year Venue Date Time Particulars of Special Resolutions passedAGM 2017 “Rangaswar”, 4th

Floor, Yashwantrao Chavan Pratishthan

Mumbai, Gen. Jagannathrao Bhosle Marg, Nariman Point,

Mumbai - 400 021

29-Sep-17 2.15p.m.

1. To consider and appoint Mr. Rahul N. Shah (DIN - 00073226) as the Whole-time Director and fix his remuneration;

2. To consider and appoint Mr. Kunal N. Shah (DIN - 00077216) as the Whole-time Director and fix his remuneration;

3. Appointment of Mr. Atul Mehta (DIN - 00112451), as an Independent Director;

4. To keep registers, indexes and records as required to be maintained under sections 88 and 94 of the Companies Act, 2013 in a place other than the registered office of the Company;

5. To issue and allot secured / unsecured, redeemable, cumulative / non-cumulative, non-convertible debentures / Bonds upto ` 500 Crore or equivalent in one or more tranches / series, through private placement.

AGM 2016 “Rangaswar”, 4thFloor, YashwantraoChavan Pratishthan

Mumbai, Gen.Jagannathrao BhosleMarg, Nariman Point,

Mumbai - 400 021

30-Sep-16 2.15 p.m.

1. Entering into Related Party Transactions with Eurotech Cylinders Private Limited;

2. Entering into Related Party Transactions with New Age LLC, UAE, Step-down Subsidiary;

3. Entering into Related Party Transactions with Mr. Nitin M. Shah;

4. Entering into Related Party Transactions with Mr. Saroj Nitin Shah;

5. Entering into Related Party Transactions with Nitin Global Pte. Ltd., Foreign Subsidiary;

6. Entering into Related Party Transactions with Nitin Ventures FZE, U. A. E.;

7. Entering into Related Party Transactions with Worthington Nitin Cylinders Private Limited;

8. Entering into Related Party Transactions with Firetec Systems Ltd, Step-down Foreign Subsidiary;

9. Entering into Related Party Transactions with Nitin Fire Protection Middle East FZE;

10. Issuance of Equity Shares.In the calendar year 2016, Special Resolutions were passed by postal ballot for following items:1. Sell / dispose / transfer of shares of the Company’s subsidiary;2. Sell / dispose / transfer of 40% shares of the Company Associate viz. Worthington Nitin Cylinders Private Limited;Mr. Kishor V. Ved, Practicing Company Secretary was appointed as a Scrutinizer in respect of aforesaid resolution to ensure that E-Voting and Postal Ballot process was conducted in fair and transparent manner. The above resolutions were passed with requisite majority.


33

Meeting Year Venue Date Time Particulars of Special Resolutions passedAGM 2015 Bajaj Bhawan,

Jamnalal Bajaj Marg,226, Nariman Point,Mumbai -400 021.

21-Sep-15 1. Increase in authorized share capital of the Company;2. Consideration of the issue of further shares by the Company;3. Authority to borrow funds;4. Creation of charge on the assets of the Company.

Of the above, Special Resolutions mentioned at Sr. No. 3 & 4 were passed by postal ballot.Mr. Kishor V. Ved, Practicing Company Secretary was appointed as a Scrutinizer in respect of aforesaid resolution to ensure that E-Voting and Postal Ballot process was conductedin fair and transparent manner. The above resolutions were passed with requisite majority.

Postal Ballot

During FY 2017-18, pursuant to Section 110 of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, the Company passed the special resolution for the matters as mentioned below with details of the voting through postal ballot. The Company had appointed Kishore Ved, Practicing Company Secretary, as the Scrutinizer for conducting the postal ballot voting process (including e-voting).

The Company had sent the Postal Ballot Notice dated November 3, 2017 together with the Explanatory Statement, the postal ballot form and self-addressed envelope to the Members in the permitted mode. The voting under the postal ballot/e-voting was kept open from November 10, 2017 to December 9, 2017 (either physically or through electronic mode). All postal ballot forms received up to the close of working hours on December 9, 2017, the last date and time fixed by the Company for receipt of the forms, had been considered for scrutiny. 97 members had voted by both the methods of voting by physical postal ballot forms and e-voting. Out of 97 members voting of 5 members were rejected.

All the resolutions were deemed to be passed by way of a special resolution on December 9, 2017.

On December 11, 2017, the results for the postal ballot were announced as under:

Item No. 1: Alteration of the Capital Clause of the Memorandum of Association (MoA) for increase in Authorized Share Capital of the Company:

In Favour AgainstNo. of valid votes % No. of valid votes %180,649,902 99.97% 55,701 0.03%

Item No. 2: Sell / dispose / divest / transfer of shares of the Company’s Subsidiary, Nitin Ventures FZE, U.A.E.: 2,573,668 99.98% 557 0.02%

Item No. 3: Sell / dispose / divest / transfer of shares in the Company’s Associate, Worthington Nitin Cylinders Private Limited: 2,573,668 99.98% 557 0.02%

Item No. 4: Issue of Securities to Qualified Institutional Buyers: 180,703,452 100.00% 2,151 0.00%

Item No. 5: Issuance of Equity Shares including Convertible Bonds / Debentures / Warrants /Depository Receipts on Preferential basis:180,649,602 99.97% 56,001 0.03%

None of the businesses proposed to be transacted in the ensuing AGM requires the passing of a Special Resolution by way of postal ballot.

AFFIRMATIONS AND DISCLOSURES:

Disclosure of Accounting Treatment

In the preparation of the financial statements, the Company has followed the Accounting Standards referred to in Section 133 of the Companies Act, 2013. The significant accounting policies which are consistently applied are set out in the Notes to the Financial Statements.

Risk Management

Business risk evaluation and management is an ongoing process within the Company. The assessment is periodically examined by the Board.

9. Means of Communication-

a. Quarterly/Half-yearly & Yearly Financial results

The annual, half-yearly and quarterly results of the Company were submitted to the stock exchanges immediately after the con-clusion of the board meetings as required under Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and are also put on the Company’s website at the link: http://nitinfire.com/finnacial_results.

b. Newspaper where in results are published

The results of the Company were published in Free Press Journal in English & Navshakti in Marathi language.

c. Website

All the information required to be displayed are available under the category “Investors” of the Company’s website: i.e; www. nitinfire.com.

34


d. Release of official news

The Company intimates official news to the stock exchanges and places in its website.

e. Presentation to Institutional Investor or to analysts

There is no such official news and the Company has not made any presentation to Institutional Investor or to analysts.

10. General Shareholders Information:

a. Annual General Meeting 23rd Annual General MeetingSeptember 29, 2018, at 2.30 p.m. at BTTC / KCCMS BLDG., 1st floor, above lings Pavalion, Mahakavi Bhushan Marg, Behind Regal Cinema, Colaba, Mumbai 400039.Book closure:Sunday, September 23, 2018 to Saturday, September 29, 2018 (both days inclusive).

b. Financial calendar (tentative) & Year

30th June, 2018: On or before August 14, 2018;30th September, 2018: On or before November 14, 2018;31st December, 2018: On or before February 14, 2019;31st March, 2019: On or before May 30, 2019.The Company follows the April to March Financial Year.

c. Dividend payment date No Dividend has been recommended for the financial year ended March 31, 2018.d. Stock Exchanges where the

Company’s shares are listed 1. Bombay Stock Exchange Limited (BSE)2. National Stock Exchange of India Limited (NSE) Annual listing fees for the year 2018-19 have not been paid to BSE & NSE.

e. Scrip code Stock code at BSE: 532854Stock code at NSE (SYMBOL): NITINFIRE

f. ISIN Number: INE489H01020Registered Office (address for correspondence)

801 & 802, C-wing, Neelkanth Business Park, Kirol Road, Vidhyavihar (W), Mumbai - 400086.Maharashtra, India.Phone: +91-22-40457000, Fax No. +91 22 25701110Email id : [email protected] : www.nitinfire.com(w.e.f. May 30, 2018)501, Delta, Technology Street,Hiranandani Gardens, Powai, Mumbai - 400076.Maharashtra, India.0-Phone : +91-22-40457000,Fax No. +91 22 25701110Email: [email protected]

Transfer of unclaimed / unpaid Dividend and shares to Investor Education and Protection Fund (“IEPF”):

As per Sections 124 and 125 of the Companies Act, 2013, read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, (notified on September 5, 2016) and the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Amendment Rules, 2016 (notified on February 28, 2017) (“IEPF Rules”), all dividends which remain unclaimed and unpaid for a period of seven years from the date they became due for payment were required to be transferred to the Investor Education and Protection Fund established by the Central Government.

In terms of the IEPF Rules, the Company has transferred unpaid / unclaimed dividend for the financial year 2009-10 to the IEPF and uploaded the information in respect of unclaimed dividends as on the date of the last AGM i.e. September 29, 2017, on the website of IEPF viz. www.iepf.gov.in and under the “Unpaid & Unclaimed Dividend” sub-section of the “Investor” section on the website of the Company (www.nitinfire.com).

As per the provisions of Section 124 of the Companies Act, 2013, shares in respect of which dividend has not been paid or claimed for seven consecutive years or more are also required to be transferred to the Investor Education and Protection Fund (IEPF) Authority. Information about unclaimed dividends and unclaimed shares to be transferred to IEPF is provided in the notes to the Notice of AGM.

g. Market price data: - Market Price Data: high, low during each month in the last financial year Monthly Share Price Data of the Company’s shares on BSE and NSE for the year ended 31st March, 2018

BSE NSEMonth Highest Rate (`) Lowest Rate (`) Highest Rate (`) Lowest Rate (`)

April, 2017 26.50 23.10 26.45 23.25May, 2017 24.20 13.70 24.20 13.65June, 2017 14.19 8.45 14.15 8.60July, 2017 9.56 5.93 9.30 5.95


35

BSE NSEMonth Highest Rate (`) Lowest Rate (`) Highest Rate (`) Lowest Rate (`)

August, 2017 6.49 3.60 6.50 3.60September, 2017 10.05 3.65 9.25 3.70October, 2017 11.07 6.61 10.15 6.65November, 2017 8.10 5.80 8.10 5.75December, 2017 7.33 5.82 7.25 5.70January, 2018 9.94 6.15 9.80 6.20February, 2018 7.01 5.37 6.90 5.45March, 2018 5.65 3.50 5.70 3.50

h. Performance in comparison to BSE Sensex (Closing share price of Nitin Fire Protection Industries Limited at BSE V/s. Sensex close for the financial year 2017-18)

12000

17000

22000

27000

32000

37000

42000

3

8

13

18

23

28

April, 17 May, 17 June, 17 July, 17 Aug, 17 Sep, 17 Oct, 17 Nov, 17 Dec, 17 Jan, 18 Feb, 18 Mar, 18

Sen

sex

Month

Sto

ck P

rice

Comparison of Sensex & Stock Price Sensex

Stock Price

i. In case securities are suspended from trading, directors’ report shall explain reason

Not applicable.

j. Name, Address & contact details of the Registrar & Transfer Agent

Mr. Joy VargheseBigshare Services Private LimitedE-mail id: [email protected] / [email protected]

1st Floor, Bharat TIN Works Building, Opp. Vasant Oasis, Makwana Road,Marol, Andheri East, Mumbai - 400059, Maharashtra.Tel.: 022 62638200; Fax: 022 62638299

k. Share transfer system

A shareholder’s request is normally attended and a reply is sent within 10-15 days time. The certificates after the transfer of shares are returned within a period of 15 days except in the cases which face problems due to technical reasons. Shares are being transferred and demat option letter in this respect are dispatched within 15 days from the date of receipt as long as the documents are clear in all respects. The Company has not received any request for transfer of shares in physical form.

The Board of Directors has delegated the power of share transfer to the Registrar and Share Transfer Agents (RTA) viz. Bigshare Services Private Limited, Mumbai, who attends to the same once in a fortnight.

36


l. Distribution of Share Holding as on 31st March, 2018

1) Distribution schedule as on 31st March 2018: -

Equity shares held No. of Shareholders % of shareholders No. of Equity Shares % of Equity shareholding

1 - 500 20389 52.2781 4359694 1.4917501 - 1000 7435 19.0636 6277087 2.14771001 - 2000 4600 11.7946 7306156 2.49982001 - 3000 1944 4.9845 5040665 1.72473001 - 4000 941 2.4128 3441664 1.17764001 - 5000 917 2.3512 4380627 1.49885001 - 10000 1503 3.8537 11264622 3.854210001 and above 1272 3.2615 250199107 85.6056

Total 39001 292269622 100.00002) Distribution of shareholding according to categories of shareholders as on 31st March, 2018

Sr. No. Category % of Equity shareholding No. of Equity Shares1 Clearing Member 0.3874 11321162 Corporate Bodies and Corporate Bodies NBFC 6.5213 190598543 Employee(s) 0.0055 161574 Financial Institutions 2.4783 72433335 Foreign Institutional Investors 2.0859 60963336 Foreign Portfolio Investors 2.0679 60439217 Government/ Government Companies 0.0024 70638 Non Nationalized Banks 0.0319 933429 Non-resident Indians 1.6382 4788066

10 Other Directors 0.0068 1990211 Promoters 11.0827 3239141412 Promoters/Directors 22.8575 6680553713 Public 25.3381 7405561814 Relatives of Directors 25.4960 74516966

Total 100.0000 292269622

m. Details of Dematerialization and its liquidity

Control Report as on 31/03/2018

Sr. No. Name of Depository As on 31.03.2018 As on 31.03.20171 NSDL 85.67 89.492 CDSL 14.33 10.513 Percentage of Shares held in

Physical form0.00 0.00

Total 100.00 100.00n. The Company has not issued any GDRs/ ADRs, Warrants or any other convertible instruments.

o. Commodity Price risk/Foreign exchange risk and hedging activities

The Company purchases the Fire protection materials equipments, systems for the business from both domestic and foreign supplier. So far as the said materials procured from the domestic market, there is no foreign exchange fluctuation risk and for the materials procured from the foreign suppliers, the Company is having a natural hedge as the Company’s exports are more than Company’s import. The Company also has a framework, to proactively mitigate the impact through measures like cost based price increases, cost reductions measures, renegotiate the procurement contracts etc. The Company also strives to develop on an ongoing basis alternate supply sources for key products subject to economic justification.

p. Plant Locations: (1) A-117, TTC Industrial Area, Pawana Village, Navi Mumbai – 400701, Maharashtra, India; (2) Shed -6, Phase- I, Duvada VSEZ, Vishakhapatnam – 530049, Andhra Pradesh, India.

q. Address for Correspondence

Mr. Joy VargheseBigshare Services Private Limited1st Floor, Bharat TIN Works Building, Opp. Vasant Oasis,Makwana Road, Marol, Andheri East, Mumbai - 400059,Maharashtra. Tel.: 022 62638200; Fax: 022 62638299Email: [email protected] [email protected]

Mr. Sraban Kumar Karan, Company Secretary501, Delta, Technology Street,Hiranandani Gardens, Powai, Mumbai - 400076.Maharashtra, IndiaPhone : +91-22-40457000, Fax No. +91 22 25701110Email: [email protected]


37

11. Other Disclosures

(a) Related Party Transactions

All the transactions with related parties are periodically placed before the Audit Committee and pre-approval is also obtained wher-ever required. The Register of Contracts detailing transactions in which Directors are interested is placed before the Board at every meeting for its approval. Transactions with related parties, as per requirements of Accounting Standard 18, are disclosed in Notes to the Accounts in the Annual Report and they are not in conflict with the interest of the Company at large.

Materially Significant related party transactions:

Related party transactions are noted in the Directors’ Report. The Company has formed related party transaction policy pursuant to the provisions of the Companies Act, 2013. The same has been posted on the Company’s website at the link: http://nitinfire.com/wp/wp-content/uploads/2015/11/Related-party-Transactions-Policy-Approved.pdf.

(b) Compliances by the Company

There was no instance of levy of any penalties under the SEBI Regulations during the last three years except the fine paid for late filing with respect to quarterly and yearly compliances as under:

Sr. No. Regulation no. Compliance Quarter Stock Exchange Fine paid (in `)1 Reg. 33 Financial Results 31-Mar-2018 BSE 88,500 including service tax2 Reg. 33 Financial Results 31-Mar-2017 BSE 5,750 including service tax3 Reg. 33 Financial Results 31-Mar-2016 NSE 5,0004 Reg. 33 Financial Results 31-Mar-2016 BSE 5,750 including service tax5 Reg. 27 (2) Corporate Governance 31-Dec-2015 NSE 4000

(c) Vigil Mechanism / Whistle Blower Policy

The Company has a Vigil Mechanism which provides the adequate safeguards against victimization of persons who use such mechanism and make provision for direct access to the chairperson of the Audit Committee in appropriate or exceptional cases. The policy has been posted on the Company’s website at the link: http://nitinfire.com/blog/vigil-mechanism/vigil-mechanism/.

(d) Compliance with Mandatory and Non-Mandatory Items

The Company has complied with the mandatory requirements regarding the Board of Directors, Audit Committee and other Board committees and other disclosures as required under the provisions of the Part C of Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The status of compliance in respect of non-mandatory requirements of Part E of Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is as follows:

a) Maintenance of the Non-Executive Chairperson’s Office: Mrs. Padmaja Nair, the Non-executive Independent Director of the Company, was acting as Chairperson till August 31, 2017. The Board appointed Mr. Atul Mehta as Chairman of the Company from September 1, 2017. Mr. Nitin Shah become Chairman w.e.f. May 30, 2018.

b) Shareholder’s Rights

The quarterly and half yearly financial results along with significant events are published in the news papers and are also posted on the Company’s website.

c) Audit Qualification

The details of the qualifications by the Auditors in their report on the Accounts of the Company and reply of the Management has been provided in the directors’ report with specific section.

d) Separate posts of Chairperson and CEO: The Company has appointed Mr. Rahul Shah as CEO w.e.f. May 30, 2018. The Whole-time directors resigned on December 12, 2017. At present, the Chairperson of the Company is a Non-executive Director.

e) Internal Auditor attends the meetings of the audit committee regularly and directly inter-acts with the audit committee along with reports.

(e) Web link of policy for determining material subsidiaries

The Company has material subsidiary as defined under Listing Regulation. However, the Company has formulated the Material Subsidiary Policy and uploaded on the website of the Company at the link http://nitinfire.com/wp/wp-content/uploads/2016/03/Policy-for-determining-material-subsidiary.pdf.

(f) Web link of policy on dealing of with related party transactions

The web link for policy dealing with related party transactions is http://nitinfire.com/wp/wp-content/uploads/2015/11/Related-par-ty-Transactions-Policy-Approved.pdf.

12. Non Compliance of any requirement of corporate governance report of sub-paras (2) to (10) above

The Company has complied with all mandatory items of the the SEBI Listing Regulations except the delay in submission of the results and outcome of the general meeting from time to time as mentioned above as per the Listing Regulations.

38


13. Adoption of discretionary requirements as specified in part E of Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

The Company complied with all the discretionary requirements as specified in part E of Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

14. As per point 13 of Part C of Schedule V to the SEBI Listing Regulations, the Company has made disclosures of the compliance with corporate governance requirements specified in regulation 17 to 27 and clauses (b) to (i) of sub-regulation (2) of regulation 46 on the website of the Company – www.nitinfire.com/investor.

15. CEO / CFO Certifications

The CEO and the Chief Financial Officer of the Company have given annual Certification on Financial Statements and the cash flow statement and internal controls for financial reporting to the Board in terms of Regulation 17(8) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Whole-time Director and/or CEO and the Chief Financial Officer also gives the quarterly certification on financial results while placing the financial results before the board in terms of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. These certificates have been placed before the board meetings from time to time.

16. Declaration by the Whole-time Director to the Compliance of Code of Conduct in pursuance to Part D of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The CEO has declared that all the Board Members and Senior Management Personnel of the Company have affirmed to the Board of Directors, their compliance with the Code of Conduct of the Company pursuant to Part D of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

For and on behalf of the BoardNitin Fire Protection Industries Limited

(Atul H. Mehta)Mumbai, August 28, 2018 (Chairman)

(DIN – 00112451)


39

CERTIFICATE OF CORPORATE GOVERNANCE

To,The Members,Nitin Fire Protection Industries Limited501, Delta, Technology Street, Hiranandani Gardens, Powai, Mumbai – 400 076.

We have examined all relevant records of Nitin Fire Protection Industries Limited, (the “Company”) for the purpose of certifying the compliance of conditions of Corporate Governance for the year ended 31st March, 2018 as stipulated in Regulations 17 to 27 and clauses (b) to (i) of sub-regulation (2) of Regulation 46 and Part C of Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“the SEBI (LODR) Regulations, 2015), subject to following observations:

Regulation

Date of AGM/

Result of Quarter

Due Date for Submission Submitted On BSE Submitted On NSE Remark

30 29/09/2017 30/09/2017 (Within 24 hrs.)

01/10/2017 At 2:15 P.M.

01/10/2017 At 2:15 P.M.

Delay has been addressed to NSE

44(3) 29/09/2017 01/10/2017 (Within 48 hrs.)

02/10/2017 At 3:44 P.M.

02/10/2017 At 3:44 P.M.

Delay has been addressed to NSE

33 31/03/2017 30/05/2017 31/05/2017 31/05/2017 The fines for delay have been paid to stock exchanges.

33 31/03/2018 30/05/2018 14/06/2018 14/06/2018 The fines for delay have been paid to BSE

The compliance of conditions of Corporate Governance is the responsibility of the management of the Company. Our examination was limited to the procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of my information and according to the explanations given to me, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the SEBI (LODR) Regulations, 2015, subject to observations as mentioned above.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.


C. P. No. 13609

40


WHOLE-TIME DIRECTOR/ CFO CERTIFICATION

We hereby certify that,

We have reviewed the financial statements and the cash flow statement of Nitin Fire Protection Industries Limited for the year ended March 31, 2018 and to the best of our knowledge and belief:

(a) (i) these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;

(ii) these statements together present a true and fair view of the Company’s affairs and are in compliance with existing Accounting Standards, applicable laws and regulations.

(b) There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year which are fraudulent, illegal or violative of the Company’s Code of Conduct.

(c) We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of the internal control systems of the Company pertaining to financial reporting and have disclosed to the Auditors and the Audit Committee, deficiencies in the design or operation of such internal controls, if any, of which we are aware and the steps we have taken or propose to take for rectifying these deficiencies.

(d) We have indicated to the Auditors and the Audit Committee:

(i) significant changes in internal control over financial reporting during the year;

(ii) significant changes in accounting policies made during the year and the same have been disclosed in the notes to the financial statements; and

(iii) instances of significant fraud of which we have become aware and the involvement therein, if any, of the management or an employee having a significant role in the Company’s internal control system over financial reporting.

For Nitin Fire Protection Industries Limited

S/d- S/d-Rahul Shah Bharat ShahCEO CFO

Mumbai, June 14, 2018


41

INDEPENDENT AUDITOR’S REPORT

To the Members of Nitin Fire Protection Systems LimitedReport on the Standalone Ind AS Financial Statements We were engaged to audit the accompanying Standalone Ind AS Financial Statements of Nitin Fire Protection Systems Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended and a summary of significant accounting policies and other explanatory information, (hereinafter referred to as “Ind AS Financial Statements”)

Management’s Responsibility for the Standalone Ind AS Financial StatementsThe Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these Standalone Ind AS Financial Statements that give a true and fair view of the (state of affairs) financial position, profit or loss (financial performance including other comprehensive income) cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act, read with relevant rules issued thereunder. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls and ensuring their operating effectiveness and the accuracy and com-pleteness of the accounting records, relevant to the preparation and presentation of the Standalone Ind AS Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the Standalone Ind AS Financial Statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Auditor’s ResponsibilityOur responsibility is to express an opinion on these Standalone Ind AS Financial Statements based on conducting our audit in accordance with the Standards on Auditing under Section 143(10) of the Act.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

Because of the matters described in the Basis for Disclaimer of Opinion paragraph, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion.

Basis for Disclaimer of Opinion(a) As more fully explained in Note no. 40 to the Standalone Ind AS Financial Statements, no provision has been made by the Company in

respect of its dispute with a bank for claim made by the bank for Rs. 501.33 lakhs (excluding interest) on a derivative contract entered into by its erstwhile subsidiary, the liability for which has been taken over by the Company. The Company has not determined the quantum of provision required in this regard as at March 31, 2018 on the above contract and has relied on a legal opinion in the matter wherein no liability is expected. Pending the final settlement of the matter, we are unable to comment on the extent of provision required, if any, in this regard.

(b) As more clarified in Note no. 46 to the to the Standalone Ind AS Financial Statements, the Company has an exposure in Worthington Nitin Cylinders Private Limited aggregating Rs. 4,195.04 lakhs as at March 31, 2018. In the absence of the fair value of the investment as required under Ind AS 28 ‘Investment in Associates and Joint Ventures’, we are unable to comment on the impairment, if any, on the carrying amount of the investment as at March 31, 2018.

(c) As more explained in the Note no. 47 to the Standalone Ind AS Financial Statements, in relation to exposure in trade receivables aggregating Rs. 27,673.23 lakhs which are outstanding for a long period of time, payments for which are not forthcoming and are subject to independent confirmation. In the absence of independent confirmations from some of the trade receivables, any other alternate audit evidence and non recovery of any amount during the year and till date, we are unable to comment on the recoverability of the same and consequential write off, if any.

(d) As more explained in the Note no. 48 to the Standalone Ind AS Financial Statements, the Trade receivables aggregating Rs. 3,459.95 lakhs (other than those covered under para (c) above), Trade payables aggregating Rs. 1,867.47 lakhs and loans to body corporates aggregating Rs. 331.08 lakhs are subject to independent confirmations/ reconciliations. In the absence of independent confirmations/ reconciliations, we are unable to comment on the consequential impact, if any.

The audit report on the Standalone financial statements for the year ended March 31, 2017 was qualified in respect of matters stated under (a) to (c) above

Disclaimer of OpinionBecause of the significance of the matters described in the Basis for Disclaimer of Opinion paragraph, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion. Accordingly, we do not express an opinion on the Standalone Ind AS Financial Statements.

Material Uncertainty Related to Going ConcernWe draw attention to Note no. 49 to the Standalone Ind AS Financial Statements, which indicates that the Company incurred a net loss of Rs. 19,157.71 lakhs during the year ended March 31, 2018 and, as of that date, the Company’s current liabilities exceeded its total assets by Rs. 13,645.07 lakhs. Further as stated therein, indicates that a material uncertainty exists that may cast significant doubt on the Company’s ability to continue as a going concern.

42


Our opinion is not modified in respect of this matter.

Other MatterThe comparative financial information of the Company for the year ended March 31, 2017 and the transition date opening Balance Sheet as at April 01, 2016 included in these Standalone Ind AS Financial Statements, are based on the previously issued statutory Financial Statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 audited by us for the year ended March 31, 2017 vide our report dated May 30, 2017 expressed a modified opinion on those Standalone Financial Statements, as adjusted for the differences in the accounting principles adopted by the Company on transition to the Ind AS, which have been audited by us.

Report on Other Legal and Regulatory Requirements(1) As required by the Companies (Auditors’ Report) Order, 2016 (“the Order”) issued by the Central Government of India in terms of

sub-section (11) of Section 143 of the Act, we give in “Annexure 1”, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

(2) As required by Section 143(3) of the Act, we report that:

a. As described in the Basis for Disclaimer of Opinion paragraph, we sought but were unable to obtain all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b. Due to the possible effects of the matters described in the Basis for Disclaimer of Opinion paragraph and para (vi) of Annexure 1 to the Independent Auditor’s Report, we are unable to state whether proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c. Due to the possible effects of the matters described in the Basis for Disclaimer of Opinion paragraph, we are unable to state whether the Balance Sheet, Statement of Profit and Loss Cash Flow Statement and Statement of Changes in equity dealt with by this Report are in agreement with the books of account;

d. Due to the possible effects of the matters described in the Basis for Disclaimer of Opinion paragraph, we are unable to state whether the aforesaid Standalone Ind AS Financial Statements comply with the Indian Accounting Standards referred to in Section 133 of the Act read with relevant rules issued thereunder;

e. The matters described in under the Material Uncertainty Related to Going Concern para and the Basis for Disclaimer of Opinion paragraph above, in our opinion, may have an adverse effect on the functioning of the Company;

f. On the basis of written representations received from the directors as on March 31, 2018, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164 (2) of the Act;

g. The qualification relating to the maintenance of accounts and other matters connected therewith are as stated in the Basis for Disclaimer of Opinion paragraph above;

h. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, we give our separate Report in “Annexure 2”. Our report expresses a qualified opinion on the adequacy and operating effectiveness of the Company’s internal financial controls over financial reporting;

i. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

(i) The Company has disclosed the impact of pending litigations on its financial position in its Standalone Ind AS Financial Statements – Refer Note no. 42 on Contingent Liabilities to the Standalone Ind AS Financial Statements;

(ii) Except for the possible effects of the matters described in sub - paragraph (a) of the basis of Disclaimer of Opinion above, the Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, on long-term contracts including derivative contracts – Refer Note nos. 40, 45 and 52 to the Standalone Ind AS Financial Statements;

(iii) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

For Haribhakti & Co. LLPChartered AccountantsICAI Firm Registration No.103523W/W100048

Snehal ShahPartnerMembership No.048539

Place : MumbaiDate : June 14, 2018


43

ANNEXURE 1 TO THE INDEPENDENT AUDITOR’S REPORT

[Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory Requirements’ in the Independent Auditor’s Report of even date to the members of Nitin Fire Protection Industries Limited (“the Company”) on the Standalone Ind AS Financial Statements for the year ended March 31, 2018]

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) During the year, fixed assets have not been physically verified by the management. However, there is a regular programme of veri-fication which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets.

(c) The title deeds of immovable properties recorded as fixed assets in the books of account of the Company are held in the name of the Company except for the details given below:

Land/ Building Total number of cases Leasehold/ Freehold Gross Block as on March 31, 2018

Rs. in lakhs

Net Block as on March 31, 2018

Rs. in lakhsLeasehold Land 1 Leasehold 12.79 12.45

(ii) The inventory has been physically verified by the Management during the year. In our opinion, the frequency of verification is reasonable. As informed, material discrepancies noticed in physical verification carried out during the year have been properly dealt with in the books of accounts.

(iii) The Company has granted loans, secured or unsecured, to companies, firms, Limited Liability Partnerships and other parties covered in the register maintained under Section 189 of the Act.

(a) According to the information and explanations given to us and based on the audit procedures conducted by us, we are of the opinion that, the terms and conditions of the aforesaid loans granted by the Company which are repayable on demand are not prejudicial to the interest of the Company.

(b) The schedule of repayment of principal and payment of interest in respect of such loans has not been stipulated thus we are unable to comment whether the repayments or receipts are regular and report amounts overdue for more than ninety days, if any, as required under paragraph 3(iii)(c) of the Order.

(c) In respect of the aforesaid loans, there is no overdue amount of loans granted to companies listed in the register maintained under Section 189 of the Act.

(iv) Based on information and explanation given to us in respect of loans, investments, guarantees and securities, the Company has complied with the provisions of Section 185 and 186 of the Act.

(v) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the provisions of Sections 73 to 76 of the Act and the rules framed there under.

(vi) We have broadly reviewed the books of account maintained by the Company in respect of products where the maintenance of cost records has been specified by the Central Government under sub-section (1) of Section 148 of the Act and the rules framed there under and we are of the opinion that prima facie, the prescribed accounts and records have not been made and maintained.

(vii) (a) The Company is generally regular in depositing with appropriate authorities, undisputed statutory dues including provident fund, employees’ state insurance, income tax, sales tax, service tax, value added tax, goods and service tax, customs duty, excise duty, cess and any other material statutory dues applicable to it, however, there have been slight delay in few cases.

According to the information and explanations given to us, undisputed dues in respect of income tax and any other material statu-tory dues applicable to it, which were outstanding, at the year end, for a period of more than six months from the date they became payable are as follows:

Name of the statute Nature of dues Amount`

Period to which the amount relates

Due Date Date of Payment

Income Tax Act, 1961 Dividend Distribu-tion Tax

Rs. 117.05 (includes interest

of Rs. 42.08)

AY 2013-14 August 23, 2013 Unpaid

Income Tax Act, 1961 Income Tax Rs. 83.07 AY 2015-16 November 30, 2015 UnpaidIncome Tax Act, 1961 Income Tax Rs. 185.25 AY 2016-17 November 30, 2016 Unpaid

44


(b) According to the information and explanation given to us, the dues outstanding with respect to, income tax, sales tax, service tax, value added tax, customs duty, excise duty on account of any dispute, are as follows:

Name of the statute Nature of dues Amount RsRs. in lakhs

Period to which the amount relates

Forum where dispute is pending

Income Tax Act, 1961 Income Tax 8.85 A.Y. 2009-10 Commissioner of Income Tax (Appeal)Income Tax 4.77 A.Y. 2009-10

Income Tax 4.05 A.Y. 2010-11Income Tax 103.46 A.Y. 2012-13Income Tax 484.15 A.Y. 2013-14Income Tax 425.81 A.Y. 2014-15

The Central Sales Tax Act 1956

Sales Tax 5.41 F.Y. 2010-11 Commissioner of Sales TaxSales Tax 0.14 F.Y. 2011-12

Sales Tax 22.16 F.Y. 2012-13

(viii) According to the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowings to financial institutions and banks, except for the details given below:

Sr No

Particulars Amount of Default as at March 31, 2018

Rs. in lakhs

Period of Default

1 Aditya BirlaPrincipal 17.08 January 2018 – March 2018Interest 11.29

2 IFCI LimitedPrincipal 44.23 March 2018

3 Punjab National BankPrincipal 4.47 January 2018 – March 2018Interest 15.41

4 Bank of BarodaPrincipal 5,049.79 June 2017- March 2018Interest 124.60

5 Dena BankPrincipal 2,930.53 July 2017 -March 2018

6 IDBI BankPrincipal 17,492.24 January 2018- March 2018Interest 2,236.15

7 Axis BankPrincipal 18,564.22 August 2017- March 2018Interest 190.25

(ix) The Company has neither raised money by way of public issue offer nor has obtained any term loans. Therefore, paragraph 3(ix) of the Order is not applicable to the Company.

(x) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud by the Company or any fraud on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such instance by the Management.

(xi) According to the information and explanations given to us, managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Therefore, paragraph 3(xii) of the Order is not applicable to the Company.

(xiii) According to the information and explanation given to us, all transactions entered into by the Company with the related parties are in compliance with Sections 177 and 188 of Act, where applicable and the details have been disclosed in the Financial Statements etc., as required by the applicable accounting standards.


45

(xiv) The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Therefore, paragraph 3(xiv) of the Order is not applicable to the Company.

(xv) According to the information and explanations given to us, the Company has not entered into any non-cash transactions with directors or persons connected with him during the year.

(xvi) According to the information and explanation given to us, the Company is not required to be registered under Section 45-IA of the Re-serve Bank of India Act, 1934





[Referred to in paragraph 2(h) under ‘Report on Other Legal and Regulatory Requirements’ in the Independent Auditor’s Report of even date to the members of Nitin Fire Protection Industries Limited on the Standalone Ind AS Financial Statements for the year ended March 31, 2018]

Report on the Internal Financial Controls over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)

We have audited the internal financial controls over financial reporting of Nitin Fire Protection Industries Limited (“the Company”) as of March 31, 2018 in conjunction with our audit of the Standalone Ind AS Financial Statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial ControlsThe Company’s Management is responsible for establishing and maintaining internal financial controls based on the internal control over fi-nancial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) issued by the Institute of Chartered Accountants of India (“ICAI”). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operat-ing effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors’ Responsibility Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We con-ducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing specified under section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, includ-ing the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified audit opinion on the Com-pany’s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial ReportingA Company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Standalone Ind AS financial statements for external purposes in accordance with generally ac-cepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of Standalone Ind AS Finan-cial Statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being

46


made only in accordance with authorisations of Management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the Standalone Ind AS Financial Statements.

Inherent Limitations of Internal Financial Controls Over Financial ReportingBecause of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any eval-uation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Qualified opinionAccording to the information and explanations given to us and based on our audit, the following material weaknesses have been identified in the operating effectiveness of the Company’s internal financial control over financial reporting as at March 31, 2018:

a) Provision for diminution in the value of an investment (fully described in note no. 46 to the Standalone Ind AS Financial State-ments);

b) Provision for a claim on a derivative contract (fully described in note no. 40 to the Standalone Ind AS Financial Statements);

c) Exposure in trade receivables are outstanding for long period of time, payments for which are not forthcoming (fully described in note no. 47 to the Standalone Ind AS Financial Statements);

d) Non receipt of independent confirmations/ reconciliations from trade receivables; trade payables and loans to body corporates (fully described in note no. 48 to the Standalone Ind AS Financial Statements);

e) Determination of terms of sales and purchase of items of inventory and underlying documentation relating to internal movement of items of inventory; and

f) Policy documentation pertaining to human resources and payroll related matters, which could potentially impact the related account balances when determined and / or recognised.

A ‘material weakness’ is a deficiency, or a combination of deficiencies, in internal financial control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

In our opinion, the Company has, in all material respects, maintained adequate internal financial controls over financial reporting as of March 31, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the ICAI, and except for the possible effects of the material weaknesses described above on the achievement of the objectives of the control criteria, the Company’s internal financial controls over financial reporting were operating effectively as of March 31, 2018.

We have considered the material weaknesses identified and reported above in determining the nature, timing, and extent of audit tests applied in our audit of the Standalone Ind AS Financial Statements of the Company and except for the material weaknesses relating to point (e) to (f) of qualified opinion above which does not affect our opinion on the Standalone Ind AS Financial Statements of the Company, the other material weaknesses have affected our opinion on the Standalone Ind AS Financial Statements and we have issued a disclaimer of opinion on the standalone Ind AS financial statements





47

BALANCE SHEET AS AT MARCH 31, 2018 (` in lakhs)

Particulars Note No.As at

March 31, 2018 `

As at March 31, 2017

`


` ASSETSNon Current AssetsProperty, plant and equipment 3 2,285.93 3,300.94 3,700.91 Capital work in progress 3 - 199.24 162.18 Intangible assets 3 - 0.70 5.15 Investment in subsidiaries and in an associate 4 5,344.75 5,357.75 5,735.14 Financial assets - - - (i) Investments 5 - 25.41 26.11 (ii) Other financial assets 6 254.28 2,672.38 2,347.54 Income tax assets (net) 7 - - 25.96 Other non current assets 8 2.82 31.13 31.13 Total non current assets 7,887.78 11,587.55 12,034.12

Current AssetsInventories 9 6,534.23 8,918.28 13,474.32 Financial assets(i) Trade receivables 10 18,456.58 25,292.86 26,576.96 (ii) Cash and cash equivalents 11 128.94 85.21 587.77 (iii) Bank balances other then (ii) above 12 142.72 132.19 509.24 (iv) Loans 13 18,449.45 1,921.45 1,123.45 (v) Other financial assets 14 3.67 10.65 25.83 Other current assets 15 346.86 982.37 2,347.87 Total current assets 44,062.45 37,343.01 44,645.44

TOTAL ASSETS 51,950.23 48,930.56 56,679.56

Equity and LiabilitiesEquityEquity share capital 16 5,845.39 5,845.39 5,845.39 Other equity 17 (22,005.98) (2,848.27) 9,528.77 Total equity (16,160.59 ) 2,997.12 15,374.16

Non Current LiabilitiesFinancial liabilities(i) Long term borrowings 18 2,459.58 3,899.58 5,732.33 Long term provisions 19 55.93 60.62 36.49 Deferred tax liabilities (net) 20 - - 27.20 Total non current liabilities 2,515.51 3,960.20 5,796.02

Current LiabilitiesFinancial liabilities(i) Short term borrowings 21 51,546.22 19,117.71 26,918.21 (ii) Trade payables 22 - - -

- Total outstanding dues to Micro and Small Enterprises 41.28 22.49 13.25 - Total outstanding dues to others 9,525.61 20,570.00 6,745.34

(iii) Other financial liabilities 23 3,986.23 2,026.23 1,414.72 Provisions 24 102.37 132.06 125.08 Other current liabilties 25 318.57 104.68 292.78 Income tax liabilities (net) 26 75.03 0.07 - Total current liabilities 65,595.31 41,973.24 35,509.38 Total Liabilities 68,110.82 45,933.44 41,305.40

TOTAL EQUITY AND LIABILITIES 51,950.23 48,930.56 56,679.56

Significant accounting policies 2

The accompanying notes are an integral part of these financial statements (1-56) For Haribhakti & Co. LLP For and on behalf of the Board of DirectorsChartered Accountants Niin Fire Protection Industries Limited ICAI Firm Registration No.: 103523W/W-100048

Sd/- Sd/- Sd/- Sd/- Snehal Shah Nitin M. Shah Kailat Vaidhyanathan Rahul N. ShahPartner Chairman and Non Executive Director Chief Executive OfficerMembership No.: 048539 Non Executive Director DIN No. 00077323 DIN No. 00073232 Sd/- Sd/- Bharat K. Shah Sraban Kumar Karan Chief Financial Officer Company Secrtetary Mumbai Mumbai June 14, 2018 June 14, 2018

48


STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED MARCH 31, 2018 (` in lakhs)

Particulars Note No.For the year ended

March 31, 2018 `

For the year ended March 31, 2017

` IncomeIncome from operations 27 5,523.48 26,886.08 Other income 28 1,163.63 304.54

Total income 6,687.11 27,190.62 ExpenditureCost of materials and components consumed 29 4,534.40 4,094.76 Purchase of stock-in-trade 30 1,430.99 20,449.69 Changes in inventory of stock-in-trade 31 - 1,085.16 Excise duty on sales 3.62 11.82 Employee benefits expense 32 783.81 824.99 Finance costs 33 6,168.58 4,266.95 Depreciation and amortisation expense 34 442.13 469.76 Other expenses 35 12,468.46 8,374.20

Total expenses 25,831.99 39,577.33 Loss before tax (19,144.88) (12,386.71)Income Tax expense Current Tax - Adjustment of tax relating to earlier periods (net) 44 52.47 - Deferred tax 20 - (27.20)Total tax expenses 52.47 (27.20)Loss after tax (19,197.35) (12,359.51 )

Other comprehensive income :Items that will not be reclassified to profit or loss - Remeasurements gains / (loss) on defined benefit plans 39.64 (17.53) - Income tax relating to the above items - - Other comprehensive income for the year, net of tax 39.64 (17.53)

Total comprehensive Income for the year, net of tax (19,157.71) (12,377.04)

Earnings per equity shareBasic and Diluted [Nominal value of the shares ₹ 2 (March 31, 2017 : ₹ 2)] 36 (6.57) (4.23)


The accompanying notes are an integral part of these financial statements (1-56)

As per our attached report of even date

For Haribhakti & Co. LLP For and on behalf of the Board of DirectorsChartered Accountants Niin Fire Protection Industries Limited ICAI Firm Registration No.: 103523W/W-100048



49

CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2018 (` in lakhs)

ParticularsFor the year ended

March 31, 2018 `


` A Cash flow from operating activities

Net (loss) before taxation (19,144.88) (12,386.71)Adjustments for: - - Depreciation and amortisation 442.13 469.77 Unrealised foreign exchange difference-net (gain)/loss 15.55 306.28 Interest income (gross) (974.33) (242.52)Finance cost 6,168.58 4,266.95 Bad debts/balances written off and liquidated damages 36.02 1,426.23 Provision For Doubtful debts 7,126.20 4,679.88 Loss on fair valuation of bond 4.91 0.70 Loss on fair valuation of investment 19.00 383.40 Loss on Claims Receivable 2,544.49 - Loss on loans given to bodies corporate 454.33 - Loans written off - 150.00 Impairment loss on property, plant and equipment 723.15 - Liability no longer required written back (47.87) (44.57)Provision for doubtful debts, deposits and claims receivable 564.95 - Guarantee Commission Income Received (6.00) (6.00)Loss on sale of Tangible assets 2.06 - Operating profit before working capital changes (2,071.69) (996.60)Adjustments for:Decrease in value of inventories 2,384.05 4,556.04 Decrease in other current assets 101.69 1,365.49 Decrease in other non-current financial assets (416.43) (19.76)Decrease in other non-current assets (2.82) - Increase in other current financial liabilities 121.78 (1.51)Increase/ (Decrease) in other current liabilities 213.88 (188.10)(Increase) in value of trade receivables (399.81) (5,216.14)Increase/(decrease) in value of trade payables (10,919.42) 13,966.32 Increase in provisions 5.26 13.58 (Decrease) in working capital (8,911.81) 14,475.92 Cash generated from/(used in) operations (10,983.51) 13,479.32 Taxes paid (net of refunds, if any) 22.48 26.03 Net cash generated from/(used in) operating activities (10,961.03) 13,505.35

B Cash flow from investing activitiesPurchase of fixed assets* (24.57) (102.40)(*includes movement in capital work in progress) Investment in subsidiaries and in an associate - - (Purchase)/sale of investments 20.50 - Interest received 981.31 257.70 Increase/decrease in bank balances other than cash and cash equivalents 279.52 71.97 Proceeds on sale of fixed assets 72.18 - Net cash generated from investing activities 1,328.93 227.27

C Cash flow from financing activitiesProceeds from long term borrowings - 34.93 Repayment of long term borrowings (1,801.25) (1,110.43)(Repayment) of short term borrowings 32,428.51 (7,800.50)Loans given to/ (refunded from) Subsidiary Companies (16,822.14) (443.49)Loans given to/ (refunded from) Others (160.19) (504.52)Finance charges (3,969.09) (4,410.19)Dividends distributed (including corporate dividend tax) (0.00) (1.00)Net cash generated from financing activities 9,675.83 (14,235.19)

50


CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2018 (` in lakhs)


March 31, 2018 `


`

Net (decrease) in cash and cash equivalents 43.73 (502.57)Cash and cash equivalents (opening) 85.21 587.77 Cash and cash equivalents (closing) 128.94 85.21 Net increase/(decrease) as disclosed above 44.32 (501.98)

Notes:1 Brackets indicate a cash outflow or deduction.

2 Components of cash and bank balances (closing):

ParticularsAs at

March 31, 2018 `


` Cash on hand 0.07 0.48

Bank balances:With banks on:- Current accounts 128.87 83.55Deposits with maturity of more than 3 months but less than 12 months *** - 1.18

128.94 85.21

3 The cash flow statement has been prepared under the indirect method as set out in the Ind AS 7 “Statement of Cash Flows”.

4 The net profit / loss arising due to conversion of current assets / current liabilities, receivable / payable in foreign currency is furnished under the head “Unrealized forex exchange (gain) / loss”

5Particulars Opening Balance

`Cash Movement

`

Foreign exchange changes

`

Total `

March 31, 2018Non current borrowings, Refer note 18 5,766.54 (1,801.25) - 3,965.28Current borrowings, Refer note 21 19,117.71 32,428.51 - 51,546.22


In terms of our report attached For Haribhakti & Co. LLP For and on behalf of the Board of DirectorsChartered Accountants Niin Fire Protection Industries Limited ICAI Firm Registration No.: 103523W/W-100048



51

STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED MARCH 31, 2018 (` in lakhs)

Particulars As at March 31, 2018

Number of shares `

As at March 31, 2017 Number of shares

`

As at April 01, 2016 Number of shares

`

A Equity shares of ₹ 2 each issued, subscribed and fully paidBalance at the beginning 292,269,622 5,845.39 292,269,622 5,845.39 292,269,622 5,845.39 Changes in equity share capital during the yearBalance at the end 2,922.70 5,845.39 2,922.70 5,845.39 2,922.70 5,845.39

B Other EquityAttributable to ownersReserves and Surplus

Securities premium reserve

Revaluation reserve

General reserve

Retained Earnings

Total

Balance at April 01, 2016 1,338.94 2,131.62 6,058.21 9,528.77 Restated balance at the beginning of the reporting period

- - - -

Balance at April 01, 2016 1,338.94 2,131.62 6,058.21 9,528.77 Profit for the year - - (12,359.51) (12,359.51)Other comprehensive income (net of tax)

- - (17.53) (17.53)

movement during the year - - - - Total comprehensive income for the year

- - (12,377.04) (12,377.04)

Balance at March 31, 2017 1,338.94 2,131.62 (6,318.83) (2,848.27)Profit for the year - - (19,197.35) (19,197.35)Other comprehensive income (net of tax)

- - 39.64 39.64

Total comprehensive income for the year

- - (19,157.71) (19,157.71)

Transactions with owners of company

- - - -

Balance at March 31, 2018 1,338.94 2,131.62 (25,476.54) (22,005.98)




52


Notes to the Financial Statements

1. Corporate Information: Nitin Fire Protection Industries Limited (NFPIL or the ‘Company’) was incorporated in Mumbai, India on September 4, 1995 as a public

limited company under the ‘Companies Act, 1956’. The Company’s business activity is that of manufacturing fire fighting equipment (gas based and water based fire extinguishers) under the brand name ‘NITIE’ (also certified by the Bureau of Indian Standard (BIS)), providing turnkey solutions including procurement, designing, system integration, commissioning and installation of fire fighting sys-tems including annual maintenance contracts for fire protection systems. The Company undertakes above activities from Maharashtra and Andhra Pradesh and has marketing offices in Maharashtra, Tamil Nadu, Andhra Pradesh, Gujarat and Uttar Pradesh. As part of its business activities, the Company has formed/acquired domestic/foreign subsidiaries (including a step down foreign subsidiary), has a stake in an associate and invested in a non-integrated un-incorporated joint venture for crude oil. NFPIL is an ISO 9001:2000 certified Company.

The Company made an initial public offer (‘IPO’) in India in May 2007 and its shares are listed on the BSE Limited and the National Stock Exchange of India Limited.

2 Significant accounting policies:

(a) Basis of accounting and preparation of Financial Statements: Compliance with Indian Accounting Standards (Ind AS):

(a) These Standalone Ind AS Financial Statements (“Financial Statements”) of the Company, have been prepared in accordance with the recognition and measurement principles laid down in Indian Accounting Standards (“Ind AS”) as notified under Section 133 of the Companies Act, 2013 (“the Act”) read with Rule 4 of the Companies (Indian Accounting Standards) Rules, 2015 as amended and other relevant provisions of the Act and accounting principles generally accepted in India. These financial state-ments were authorized for issue by the Company’s Board of Directors on June 14, 2018.

(b) These Financial Statements are the first Financial Statements prepared in accordance with Indian Accounting Standards (Ind AS). For all periods up to and including the year ended March 31, 2017, the Company reported its Financial statements in ac-cordance with the accounting standards notified under the Section 133 of the Act, read together with relevant rules framed there under (“Indian GAAP”). The Financial Statements for the year ended March 31, 2017 and the opening Balance Sheet as at April 1, 2016 have been restated in accordance with Ind AS for comparative information. Reconciliations and explanations of the effect of the transition from IGAAP to Ind AS on the Company’s Balance Sheet, Statement of Profit and Loss and Statement of Cash Flows are provided in note 54.

Functional and Presentation Currency:

These financial statements are presented in Indian rupees, which is the functional currency of the Company. All financial infor-mation presented in Indian rupees has been rounded to the nearest thousand, except otherwise indicated.

Basis of measurement:

These Financial statements are prepared under the historical cost convention unless otherwise indicated.

Use of Estimates and Judgments:

The preparation of the financial statements in conformity with Ind AS requires the Management to make estimates and assump-tions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known/ materialise. Estimates and underlying assumptions are reviewed on an ongoing basis.

Information about critical judgments in applying accounting policies, as well as estimates and assumptions that have the most significant effect to the carrying amounts of assets and liabilities within the next financial year, are included in the accounting policies.

- Measurement of defined benefit obligations (Refer note 32.1)

- Measurement and likelihood of occurrence of provisions and contingencies (Refer note 42)

- Estimation of tax expenses and liability (Refer note 20 & 44)

- Useful lives of property, plant, equipment and intangibles (Refer note 3)

- Impairment of financial assets such as trade receivables (Refer note 52)

- Revenue recognition

(b) Revenue Recognition:

Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are inclusive of excise duty and net of returns, trade allowances, rebates, value added taxes, Goods and Service Tax.

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.


53

(i) Sale of goods: Revenue from sale of goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on delivery of the goods. Revenue is measured net of returns, trade discounts and volume rebates. The timing of the transfer of risks and rewards varies depending on the individual terms of the sales contract.

(ii) Rendering of services : In contracts involving rendering of services, revenue is recognised in profit or loss in the proportion of the stage of completion of the transaction at the reporting date and are measured net of sales tax, works contract tax, service tax and Goods and Service Tax.

(iii) Contract revenue

Contract revenue is recognised only to the extent of cost incurred till such time the outcome of the job cannot be ascertained reliably. When the outcome of the contract is ascertained reliably contract revenue is recognised at cost of work performed on the contract plus proportionate margin, using the percentage of completion method. Percentage of completion is the proportion of work performed to date to the total estimated contract costs. The estimates of cost and progress of contracts are measured at each reporting date by the Management. The effect of such changes to estimates is recognized in the period in which such changes are determined. The estimated cost of each contract is determined based on the estimate of the cost to be incurred till the final completion of the contract and includes cost of materials, services, and other related overheads. Any projected losses on contracts under execution are recognised in full when identified.

(iv) Interest income

Interest income from debt instruments is recognised using the EIR method or proportionate basis. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the gross carrying amount of a financial asset. While calculating the effective interest rate, the Company estimated the expected cash flows by considering all the contractual terms of the financial instrument (for example prepayment, extension, call and similar options( but doses not consider the expected credit losses.

(c) Property, Plant and Equipment, Depreciation and Impairment: (i) Property, Plant and Equipment:

Property, plant and equipment are measured at cost / deemed cost, less accumulated depreciation and impairment losses, if any. Cost of Property, plant and equipment comprises its purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates, any directly attributable cost of bringing the asset to its working condition for its intended use and estimated attributable costs of dismantling and removing the asset and restoring the site on which it is located.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be mea-sured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to the Statement of Profit and Loss during the reporting period in which they are incurred.

Gains or losses arising from derecognition of plant, property and equipment are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is derecognized.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Any gain or loss on disposal of an item of property, plant and equipment is recognised in Statement of Profit and Loss.

Depreciation on additions / disposals is provided on a pro-rata basis i.e. from / up to the date on which asset is ready for use / disposed of

The Company has elected to use the exemption available under Ind AS 101 to continue the carrying value for all of its Property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and used that as its deemed cost as at the date of transition (April 01, 2016).

(ii) Depreciation:

Depreciation on Property, Plant and Equipment has been provided on written down value basis and manner prescribed in Schedule II to the Act. Leasehold Land on a straight line basis over the period of lease.i.e.99 years.

(iii) Intangible Assets:

Intangible Assets are stated at acquisition cost, net of accumulated amortization and accumulated impairment losses, if any. Intangible assets are amortised on a Straight Line Basis over their estimated useful lives.

The Company has elected to continue with the carrying value of all its intangible assets as recognised in the standalone financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as the deemed cost as at the transition date pursuant to the exemption under Ind AS 101.

(iv) Capital work in progress:

Expenditure during the construction/ pre-operative period is included under Capital Work-in-Progress and same is allocated to the respective Property, Plant and Equipment on the completion of project.

54


(d) Impairment of Assets: i) Financial assets: In accordance with Ind-AS 109, the Company applies Expected Credit Loss (“ECL”) model for measurement and recognition of

impairment loss on the financial assets measured at amortised cost and debt instruments measured at FVOCI. Loss allowances on trade receivables are measured following the ‘simplified approach’ at an amount equal to the lifetime ECL at each reporting date. In respect of other financial assets, the loss allowance is measured at 12 month ECL only if there is no significant deterioration in the credit risk since initial recognition of the asset or asset is determined to have a low credit risk at the reporting date. The amount of ECLs (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognized is recognized as an impairment gain or loss in Statement of Profit and Loss.

ii) Non-financial assets:

The carrying values of assets / cash generating units at each Balance Sheet date are reviewed for impairment if any indication of impairment exists.

An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash generating units). The impairment loss is rec-ognised as an expense in the Statement of Profit and Loss.

(e) Investment in subsidiaries and associates:

Investments that are readily realisable and intended to be held for not more than a year from the date on which such investments are made, are classified as current investments. All other investments are classified as long term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long term investments are carried at cost. However, provision for diminution in value is made to recognise a decline, other than temporary, in the value of the long term investments.

The Company has elected to continue with the carrying value of all its equity investments in its subsidiaries and associates as recognized in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as the deemed cost as at the transition date pursuant to the exemption under Ind AS 101.

(f) Inventories: (i) Raw Materials and components are valued at lower of cost arrived on First In First Out method (FIFO) and Net Realisable Value.

Cost of raw materials comprises cost of purchases.(ii) Finished Goods are valued at lower of cost and net realisable value. Cost includes direct material, direct labour, excise duty and

attributable overheads.(iii) Traded goods are valued at lower of cost and net realisable value. Cost includes cost of purchase and other costs incurred in

bringing the inventories to their present location and condition. Cost is determined on a FIFO basis. Costs of purchased inventory are determined after deducting rebates and discounts. Net realizable value is the estimated selling

price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale. Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and

estimated costs necessary to make the sale.

(g) Employee Benefits: (i) Short-term obligations

Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in respect of employees services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the Balance Sheet.

(ii) Other long-term employee benefit obligations The liabilities for earned leave and sick leave are not expected to be settled wholly within 12 months after the end of the period

in which the employees render the related service. They are therefore measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. The benefits are discounted using the market yields at the end of the reporting period that have terms approximating to the terms of the related obligation. Remeasurements as a result of experience adjustments and changes in actuarial assumptions are recognised in the Statement of Profit and Loss.

The obligations are presented as current liabilities in the Balance Sheet if the Company does not have an unconditional right to defer settlement for at least twelve months after the reporting period, regardless of when the actual settlement is expected to occur.

(iii) Post-employment obligations

The Company operates the following post-employment schemes:

(a) defined benefit plans such as gratuity; and

(b) defined contribution plans such as provident fund and Employee State Insurance Fund (ESIC).

- Defined Benefit Plans - Gratuity obligations

The liability or asset recognised in the Balance Sheet in respect of defined benefit gratuity plans is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined benefit obligation is calculated annually by actuaries using the projected unit credit method.


55

The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee Benefit expense in the Statement of Profit and Loss.

Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in the year in which they occur, directly in other comprehensive income they are included in retained earnings in the Statement of changes in equity and in the Balance Sheet.

Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are recognised immediately in the Statement of Profit and Loss as past service cost.

- Defined contribution plan

The Company pays provident fund and ESIC contributions to publicly administered provident funds / ESIC as per local regulations. The Company has no further payment obligations once The contributions have been paid. The contributions are accounted for as Defined contribution Plans and The contributions are recognised as employee Benefit expense when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is available.

(h) Leases (where the Company is a lessee): At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease. At the inception or

on reassessment of an arrangement that contains a lease, the Company separates payments and other consideration required by the arrangement into those for the lease and those for the other elements on the basis of their relative fair values.

Leases of property, plant and equipment where the Company, as lessee, in which a significant portion of the risks and rewards of ownership are not transferred to the Company as lessee are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the Statement of Profit and Loss as per the terms of the lease or on a straight-line basis over the period of the lease unless the payments are structured to increase in line with expected general inflation to compensate for the lessor’s expected inflationary cost increases.

(i) Borrowings: Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at

amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in the Statement of Profit and Loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs.

Borrowings are removed from the Balance Sheet when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in the Statement of Profit and Loss.

Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period.

(j) Borrowing Costs: Borrowing costs consist of interest and transactions costs incurred in connection with the borrowing of funds. Borrowing costs may

include exchange differences to the extent regarded as an adjustment to the borrowing costs.

Borrowing costs that are attributable to the acquisition or construction of qualifying assets (i.e. an asset that necessarily takes a substantial period of time to get ready for its intended use) are capitalized as a part of the cost of such assets. All other borrowing costs are charged to the Statement of Profit and Loss.

(k) Foreign Currency Transactions / Translations: Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions.

Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognised in Statement of Profit and Loss as either profit or loss. A monetary item for which settlement is neither planned nor likely to occur in the foreseeable future is considered as a part of the entity’s net investment in that foreign operation.

Foreign exchange gains and losses are presented in the Statement of Profit and Loss on a net basis within other income and expenses accordingly.

Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss in the Statement of Profit and Loss. For example, translation differences on nonmonetary assets and liabilities such as equity instruments held at fair value through profit or loss are included in net profit in the Statement of Profit and Loss as part of the fair value gain or loss and translation differences on non-monetary assets such as equity investments classified as Fair Value through Other Comprehensive Income (“FVOCI”) are recognised in other comprehensive income (“OCI”).

56


(l) Taxes on Income:

Income tax expense comprises current tax and deferred tax. It is recognised in Statement of Profit and Loss except to the extent that it relates items recognised directly in equity or in OCI.

The income tax expense or credit for the period is tax payable on the current year’s taxable income based on the applicable income tax rate adjusted by change in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the reporting date. Current tax comprises of expected tax payable or receivable on taxable income/loss for the year or any adjustment or receivable in respect of previous year. Management periodically evaluates position taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amount expected to be paid to the tax authorities.

Deferred income tax is provided in full, using the Balance Sheet method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting date and are expected to apply to the Company when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused tax credits (Mini-mum alternate tax credit entitlement) only if it is probable that future taxable amounts will be available to utilise those temporary differences, unused losses and unused tax credits. Deferred tax assets – unrecognised or recognised, are reviewed at each reporting date and are recognised / reduced to the extent that it is probable or no longer probable respectively that the related tax benefit will be realized.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

(m) Earnings Per Share

(i) Basic earnings per share

Basic earnings per share is calculated by dividing:

- the profit attributable to owners of the Company;

- by the weighted average number of equity shares outstanding during the financial year, adjusted for bonus elements in equity shares issued during the year.

(ii) Diluted earnings per share

Diluted earnings per share is calculated by dividing:

- the net profit or loss after tax for the year attributable to owners of the Company , and

- the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares

(n) Provisions: Provisions are recognized when there is a present obligation (legal or constructive) as a result of a past event, it is probable that an

outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. 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 are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

(o) Contingent Liabilities: 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. The company does not recognize a contingent liability but discloses its existence in the financial statements.

(p) Cash and cash equivalents: Cash and cash equivalents in the Balance Sheet include cash on hand, cheques on hand, deposits held at call with financial

institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

For the purpose of presentation in the Statement of Cash Flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value and overdrawn bank balances.


57

Cash Flows

Cash flows are reported using the indirect method, where by net profit before tax is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities are segregated.

(q) Dividend: Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the

entity, on or before the end of the reporting period but not distributed at the end of the reporting period.

(r) Financial instruments:

(a) Financial Liabilities

Initial recognition and measurement: Financial liabilities are initially recognised when the Company becomes a party to the contractual provisions of the instrument.

Financial liability is initially measured at fair value plus, for an item not at fair value through profit and loss, transaction costs that are directly attributable to its acquisition or issue.

Subsequent measurement:

Financial liabilities are subsequently carried at fair value through profit and loss. For trade payables and other liabilities maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of these instru-ments.

Derecognition

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 de-recognition 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.

(b) Financial Assets

Initial recognition and measurement

Trade Receivables are initially recognised when they are originated. All other financial assets are initially recognised when the Company becomes a party to the contractual provisions of the instrument. All financial assets other than those measured subsequently at fair value through profit and loss, are recognised initially at fair value plus transaction costs that are attribut-able to the acquisition of the financial asset.

Classification and subsequent measurement

Subsequent measurement is determined with reference to the classification of the respective financial assets. Based on the business model for managing the financial assets and the contractual cash flow characteristics of the financial asset, the Com-pany classifies financial assets as subsequently measured at amortised cost, fair value through OCI or fair value through profit and loss.

(i) Financial assets amortised at cost

A financial asset is subsequently measured at amortised cost if it is held with in a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely consisting payments of principal and interest on the principal amount outstanding.

(ii) Financial assets at fair value through other comprehensive income:

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments principal and interest on the principal amount outstanding.

(iii) Financial assets at fair value through profit or loss:

A financial asset which is not classified in any of the above categories are subsequently fair valued through profit or loss.

Equity investments:

All equity investments within the scope of Ind-AS 109 are measured at fair value. Such equity instruments which are held for trad-ing are classified as FVTPL. For all other such equity instruments, the Company decides to classify the same either as FVOCI or FVTPL. The Company makes such election on an instrument-by-instrument basis. The classification is made on initial recognition and is irrevocable.

For equity instruments classified as FVOCI, all fair value changes on the instrument, excluding dividends, are recognized in OCI. Dividends on such equity instruments are recognised in the Statement of Profit or Loss.

Equity instruments included within the FVTPL category are measured at fair value with all changes recognized in the Statement of Profit and Loss. Dividends on such equity instruments are recognised in the Statement of Profit or Loss.

58


Derecognition:

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised 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 or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either:

- the Company has transferred substantially all the risks and rewards of the asset, or

- the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

On de-recognition, any gains or losses on all debt instruments (other than debt instruments measured at FVOCI) and equity in-struments (measured at FVTPL) are recognised in the Statement of Profit and Loss. Gains and losses in respect of debt instru-ments measured at FVOCI and that are accumulated in OCI are reclassified to profit or loss on de-recognition. Gains or losses on equity instruments measured at FVOCI that are recognised and accumulated in OCI are not reclassified to profit or loss on de-recognition.

(s) Current–non-current classification: All assets and liabilities are classified into current and non-current. Assets An asset is classified as current when it satisfies any of the following criteria:

a) it is expected to be realised in, or is intended for sale or consumption in, the company’s normal operating cycle;b) it is held primarily for the purpose of trade;c) it is expected to be realised on demand or within 12 months after the reporting date; ord) it is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12 months after

the reporting date. Current assets include the current portion of non-current financial assets.

All other assets are classified as non-current.

Liabilities

A liability is classified as current when it satisfies any of the following criteria:

a) it is expected to be settled in the company’s normal operating cycle;b) it is held primarily for the purpose of trade;c) it is due to be settled in demand or within 12 months after the reporting date; ord) there is no unconditional right to defer settlement of the liability for at least 12 months after the reporting date. Terms of a liability

that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification. Current liabilities include current portion of non-current financial liabilities. All other liabilities are classified as non-current. Deferred tax assets and liabilities are classified as non-current assets and

liabilities. (t) Operating cycle: Based on the nature of products / activities of the Company and the normal time between acquisition of assets and their realisation

in cash or cash equivalents, the Company has determined its operating cycle as 12 months for the purpose of classification of its assets and liabilities as current and non-current.

(u) Recent Accounting Pronouncements: On 28th March, 2018, the Ministry of Corporate Affairs (MCA) issued the Companies (Indian Accounting Standards) (Amend-

ments) Rules, 2018, notifying amendments to Ind AS 21, ‘The Effects of Changes in Foreign Exchange Rates’ and the new standard Ind AS 115, ‘Revenue from Contract with Customers’. These amendments are applicable to the Company from 1st April, 2018..

Amendment to Ind AS 21:

On 28th March, 2018, MCA has notified the Companies (Indian Accounting Standards) Amendment Rules, 2018

containing ‘Appendix B to Ind AS 21: Foreign currency transactions and advance consideration’ which clarifies the date of the transaction for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income, when an entity has received or paid advance consideration in a foreign currency. This amendment will come into force from 1st April, 2018.

Standard issued but not yet effective (Ind AS 115):

On 28th March, 2018, the MCA notified the Ind AS 115, Revenue from Contracts with Customers. The core principle of the new standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Further the new standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts with customers.

The effective date for adoption of Ind AS 115 is financial periods beginning on or after 1st April, 2018.The Company is in process of evaluating the impact due to above changes in accounting principles.


59

3 Ta

ngib

le a

nd in

tang

ible

ass

ets

(` in

lakh

s)

Des

crip

tion

Gro

ss c

arry

ing

amou

ntA

ccum

ulat

ed d

epre

ciat

ion

/ am

ortis

atio

nN

et b

lock

Car

ryin

g am

ount

as

at A

pril

01,

2017

Add

ition

s du

ring

the

year

Dis

posa

l du

ring

the

year

As a

t Mar

ch

31, 2

018

Up

to A

pril

01, 2

017

Cha

rge

for

the

year

Dis

posa

l du

ring

the

year

Impa

irm

ent

loss

(R

efer

not

e 2

belo

w)

Up

to

Mar

ch 3

1,

2018

At M

arch

31

, 201

7A

t Mar

ch

31, 2

018

A

Prop

erty

, pla

nt a

nd

equi

pmen

t

Land

- Fr

eeho

ld 4

02.2

3 -

- 4

02.2

3 -

- -

- -

402

.23

402

.23

Land

- Le

aseh

old

25.

18

- -

25.

18

0.3

6 0

.36

- -

0.7

2 2

4.82

2

4.45

Bui

ldin

gs 1

,632

.63

199

.24

55.

43

1,7

76.4

5 8

9.48

9

5.68

-

- 1

85.1

6 1

,543

.15

1,5

91.2

9

Plan

t and

equ

ipm

ents

1,1

71.5

4 -

- 1

,171

.54

169

.36

207

.98

- 6

51.8

3 1

,029

.17

1,0

02.1

8 1

42.3

7

Furn

iture

and

fixt

ures

31.

37

- -

31.

37

10.

09

6.8

9 -

14.

40

31.

37

21.

28

-

Offi

ce e

quip

men

ts 2

5.45

0

.62

- 2

6.07

7

.58

8.1

0 -

10.

39

26.

07

17.

87

-

Vehi

cles

150

.94

22.

38

30.

89

142

.42

57.

36

42.

80

12.

09

- 8

8.07

9

3.58

5

4.35

Com

pute

r sys

tem

s 3

.79

1.5

7 -

5.3

6 1

.83

2.0

8 -

1.4

5 5

.36

1.9

6 -

Cyl

inde

rs 3

23.1

3 -

- 3

23.1

3 1

29.2

5 7

7.55

-

45.

08

251

.88

193

.88

71.

24

Tot

al A

3

,766

.25

223

.81

86.

32

3,9

03.7

4 4

65.3

1 4

41.4

4 1

2.09

7

23.1

5 1

,617

.81

3,3

00.9

4 2

,285

.93

B

Cap

ital

wor

k-in

-pro

gres

s 1

99.2

4 -

199

.24

- -

- -

- -

199

.24

-

Tot

al B

1

99.2

4 -

199

.24

- -

- -

- -

199

.24

-

C

Inta

ngib

le a

sset

s

Com

pute

r sof

twar

e*

5.1

5 -

- 5

.15

4.4

5 0

.69

- -

5.1

5 0

.69

-

Tot

al C

5

.15

- -

5.1

5 4

.45

0.6

9 -

- 5

.15

0.6

9 -

Tot

al (A

+B+C

) 3

,970

.64

223

.81

285

.56

3,9

08.8

9 4

69.7

7 4

42.1

3 1

2.09

7

23.1

5 1

,622

.96

3,5

00.8

8 2

,285

.93

60


3 Ta

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nd in

tang

ible

ass

ets

(`

in la

khs)

Des

crip

tion

Gro

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ion

/ am

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Dee

med

cos

t at

Apr

il 01

, 20

16 (R

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N

ote

1 be

low

)

Add

ition

s du

ring

the

year

Dis

posa

l du

ring

the

year

As a

t Mar

ch

31, 2

017

Up

to A

pril

01, 2

016

Cha

rge

for

the

year

Dis

posa

l du

ring

the

year

Impa

irm

ent

loss

Up

to

Mar

ch 3

1,

2017

At A

pril

1,

2016

At M

arch

31

, 201

7

A

Prop

erty

, pla

nt a

nd

equi

pmen

t

Land

- Fr

eeho

ld 4

02.2

3 -

- 4

02.2

3 -

- -

- -

402

.23

402

.23

Land

- Le

aseh

old

25.

18

- -

25.

18

- 0

.36

- -

0.3

6 2

5.18

2

4.82

Bui

ldin

gs 1

,632

.63

- -

1,6

32.6

3 -

89.

48

- -

89.

48

1,6

32.6

3 1

,543

.15

Plan

t and

equ

ipm

ents

1,1

70.1

9 1

.35

- 1

,171

.54

- 1

69.3

6 -

- 1

69.3

6 1

,170

.19

1,0

02.1

8

Furn

iture

and

fixt

ures

30.

15

1.2

2 -

31.

37

- 1

0.09

-

- 1

0.09

3

0.15

2

1.28

Offi

ce e

quip

men

ts 3

.85

21.

60

- 2

5.45

-

7.5

8 -

- 7

.58

3.8

5 1

7.87

Vehi

cles

110

.83

40.

11

- 1

50.9

4 -

57.

36

- -

57.

36

110

.83

93.

58

Com

pute

r sys

tem

s 2

.73

1.0

5 -

3.7

9 -

1.8

3 -

- 1

.83

2.7

3 1

.96

Cyl

inde

rs 3

23.1

3 -

- 3

23.1

3 -

129

.25

- -

129

.25

323

.13

193

.88

Tot

al A

3

,700

.91

65.

34

- 3

,766

.25

- 4

65.3

1 -

- 4

65.3

1 3

,700

.91

3,3

00.9

4

B

Cap

ital

wor

k-in

-pro

gres

s 1

62.1

8 3

7.06

-

199

.24

- -

- -

162

.18

199

.24

Tot

al B

1

62.1

8 3

7.06

-

199

.24

- -

- -

- 1

62.1

8 1

99.2

4

C

Inta

ngib

le a

sset

s

Com

pute

r sof

twar

e*

5.1

5 -

- 5

.15

- 4

.45

- -

4.4

5 5

.15

0.7

0

Tot

al C

5

.15

- -

5.1

5 -

4.4

5 -

- 4

.45

5.1

5 0

.70

Tot

al (A

+B+C

) 3

,868

.24

102

.40

- 3

,970

.64

- 4

69.7

6 -

469

.76

3,8

68.2

4 3

,500

.88

(* o

ther

than

inte

rnal

ly g

ener

ated

)


61

Note : (` in lakhs)3.1. The Company has elected to use the exemption available under Ind AS 101 to continue the carrying value for all of its Property, plant and

equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and used that as its deemed cost as at the date of transition (April 01, 2016) as per the following details:

Particulars Gross Block (at cost)

Accumulated Depreciation

(as per Previous GAAP)

Gross Block as per Ind AS

Land - Freehold 402.23 - 402.23 Land - Leasehold 32.40 7.22 25.18 Buildings 1,928.34 295.71 1,632.63 Plant and equipments 1,646.62 476.43 1,170.19 Furniture and fixtures 140.10 109.95 30.15 Office equipments 49.98 46.13 3.85 Vehicles 301.26 190.43 110.83 Computer systems 13.30 10.57 2.73 Cylinders 490.36 167.23 323.13 Tangible Assets 5,004.60 1,303.69 3,700.91 Computer software 253.04 247.89 5.15 Intangible Assets 253.04 247.89 5.15

3.2 The Company during the year has appointed independent valuer to evaluate the impairment, if any, required to be made on carrying value of Property, Plant and Equipment in view of lower utilisation of its capacities. Based on the report of the Independent valuer impairment provision of ₹ 723.15 towards Property, Plant and Equipment has been made.

3.3 Property, Plant and Equipment provided as security

Particulars As at March 31, 2018 As at March 31, 2017 As at April 1, 2016₹ ₹ ₹

Land - Freehold (Refer note 3 below) 402.23 402.23 402.23 Buildings (Refer note 3 below) 1,528.13 1,413.30 1,492.20 Vehicles (Refer note 3 below) 24.70 35.92 - Total 1,955.06 1,851.44 1,894.42

Note -

Note - First pari passu charge on immovable and movable assets of the Company both present and future including its location at (i)factory at A-117,TTC Industrial area, Pawana Village, Navi Mumbai-400 705 (ii) office premises at 501/502 Delta Technology Street, Hiranandani Gardens, Powai, Mumbai - 400 076 and (iii)immovable properties of Eurotech Cylinders Private Limited, situated at EL-29, TTC Industrial Area, Mahape, Navi Mumbai 400 701 to IDBI Bank Limited.

62


Notes to the financial statement for the year ended March 31, 2018 (` in lakhs)

4 Investment in subsidiaries and in an associate:

No. Particulars Nos.

As at As at As at March 31,

2018 Nos. March 31, 2017 Nos. April 1, 2016

₹ ₹ ₹ I Investment in Equity instruments of

subsidiaries (Unquoted) (Fully paid up) (Trade)

(i) Domestic (wholly owned

subsidiary):Investment in Eurotech Cylinders Private Limited of face value ₹ 10 each (100% holding)

10000 - 10000 13.00 10000 7.00 - - - - - -

(ii) Foreign (wholly owned subsidiaries):(a) Investment in Nitin

Ventures FZE, UAE of face value 1,000,000 Dhs each (100% holding)

10 1,102.09 10 1,102.09 10 1,102.09

(b) Investment in Nitin

Global Pte Limited, Singapore, Ordinary shares, with no par value in USD(100% holding)

100000 47.61 100000 47.61 100000 47.61

Ordinary shares, with no par value in USD

(iii) Investment in Equity

instruments of Associates (Unquoted) (Fully paid up) (Trade)Investment in Worthington Nitin Cylinders Private Limited of face value ₹ 10 each (40% holding)

2336496 4,195.04 2336496 4,195.05 2336496 4578.44

Total - 5,344.75 - 5357.75 - 5735.14 Note:

Aggregate amount of quoted investments - - - Aggregate amount of unquoted invest-ments

5,344.75 5,357.75 5,735.15

Aggregate amount of impairment in the value of investments

- - -

5. Investments:

No. Particulars Nos.

As at As at As at March 31,

2018 Nos. March 31, 2017 Nos. April 1, 2016

₹ ₹ ₹ I Investment in Bonds (quoted)

at amortised cost 9.35% IFCI Limited - Non

convertible debentures of ₹ 1,000 each

- - 2,500 25.41 2,500 26.11

Total - - 2,500 25.41 2,500 26.11


63

Note: (` in lakhs)

Aggregate amount of quoted investments - 25.41 - 26.11 Aggregate amount of unquoted investments

- - - -

Aggregate amount of impairment in the value of investments

- - - -

6 Other financial assets:

ParticularsAs at As at As at

March 31, 2018 March 31, 2017 April 1, 2016 ₹ ₹ ₹

Unsecured, considered good (unless otherwise stated)Sundry deposits Considered good 239.25 103.57 80.23 Considered doubtful 81.81 19.50 20.24

321.06 123.06 100.47 (Less):Provision against deposits (81.81) (19.50) (20.24)

239.25 103.57 80.23 Fixed deposits with original maturity of more than twelve months*

15.03 305.08 -

Claim receivable (Refer note 54) - 2,263.73 2,267.31 Total 254.28 2,672.38 2,347.54

(* pledged with banks for credit facilities availed)

7 Income tax assets (net):



Advance Income Tax (Net of Provision for Taxation of (Mar 31,2018 ₹ Nil, Mar 31,2017 ₹ Nil, Apr 01,2016 ₹ 58.04)

- - 25.96

Total - - 25.96

8 Other non current assets:



Unsecured, considered good (unless otherwise stated) Capital advances 31.13 31.13 31.13 (Less) : Provision against capital advances (31.13) - -

- 31.13 31.13 Prepaid expenses 2.82 - -

Total 2.82 31.13 31.13

9 Inventories:



Materials and components 6,429.39 8,813.44 12,284.32 (including materials and components in transit of ₹ Nil (as at March 31, 2017 ₹ Nil as at April 1, 2016 ₹ 258.27)

Stock-in-trade 104.84 104.84 1,190.00 Total 6,534.23 8,918.28 13,474.32

First pari passu charge by way of hypothecation or indenture of mortgage and /or pledge of borrowers current assets, namely, stock of raw materials, semi finished and finished goods, stores and spares not relating to Property, Plant and Equipment (consumable stores and spares), bills receivable and book debts and all movable current assets , both present and future.

64


10 Trade receivables: (` in lakhs)



Unsecured, considered good (unless otherwise stated)

Dues from subsidiaries, considered good (Refer note 41) 122.59 9.65 88.37 Dues from other trade receivables considered good 18,333.99 25,283.21 26,488.59 Dues from other trade receivables considered doubtful 13,139.35 6,013.15 1,333.27

31,595.93 31,306.01 27,910.23 Less: Allowance for doubtful debts (13,139.35) (6,013.15) (1,333.27)

Total 18,456.58 25,292.86 26,576.96

Note:

1. Trade receivable are receivable in normal operating cycle and are shown net of an allowance for doubtful debts

2. First pari passu charge by way of hypothecation or indenture of mortgage and /or pledge of borrowers current assets, namely, stock of raw materials, semi finished and finished goods, stores and spares not relating to Property, Plant and Equipment (consumable stores and spares), bills receivable and book debts and all movable current assets , both present and future.

11 Cash and cash equivalents:



Balances with banks - in current accounts 128.87 83.55 584.65 - Deposits with original maturity of less than 3 months* - 1.18 2.64 Cash on hand 0.07 0.48 0.48

Total 128.94 85.21 587.77

(* maturity period less than three months and pledged with banks for credit facilities availed)

12 Bank balances other than cash and cash equivalents:



Unpaid dividend accounts** 3.52 3.52 4.52 Deposits with maturity of more than 3 months but less than 12 months ***

139.20 128.67 504.72

Total 142.72 132.19 509.24

(**earmarked for payment of unpaid dividend only)

(*** pledged with banks for credit faciliites availed)

13 Loans:




Loan to subsidiaries (Refer note 41) 17,694.72 872.58 429.09 Loans to bodies corporate and others - - - Considered good 747.82 1,036.19 622.35 Considered doubtful 454.33 - -

1,202.15 1,036.19 622.35 (Less): Provision against douftful loans (454.33) - -

747.82 1,036.19 622.35 Loans and advances to employees/others 6.91 12.68 72.01

Total 18,449.45 1,921.45 1,123.45


65

14 Other financial assets: (` in lakhs)



Unsecured, considered goodAccrued interest on loans, fixed deposits and bonds 3.67 10.65 25.83

Total 3.67 10.65 25.83

15 Other current assets:



Unsecured, considered good (unless otherwise stated)Advances to suppliers - From related parties considered good (Refer note 41) 267.27 308.19 300.06 - Others considered good 11.03 605.02 1,926.92 - Others considered doubtful 471.50 - -

749.80 913.21 2,226.98 (Less): Provision against supplier advances (471.50) - -

278.30 913.21 2,226.98 Unbilled revenue (Refer note 45) - 24.40 - Prepaid expenses 6.07 10.78 28.97 Balance with Government authorities 62.49 33.98 91.92

Total 346.86 982.37 2,347.87

16 Equity share capital:

16.1 Authorised/issued, subscribed and fully paid up:

ParticularsAs at

March 31, 2018 As at


April 1, 2016 Number ₹ Number ₹ Number ₹

Authorised share capital :Equity shares of ₹ 2 (as at March 31, 2017 ₹ 2 as at April 1, 2016 ₹ 2) each fully paid up

375,000,000

7,500.00 375,000,000 7,500.00 375,000,000 7,500.00

375,000,000 7,500.00 375,000,000 7,500.00 375,000,000 7,500.00

Issued, Subscribed and Paid Up :

Equity shares of ₹ 2 (as at March 31, 2017 ₹ 2 as at April 1, 2016 ₹ 2) each fully paid up

292,269,622

5,845.39 292,269,622 5,845.39 292,269,622 5,845.39

Total 292,269,622 5,845.39 292,269,622 5,845.39 292,269,622 5,845.39

16.2 The Authorized Share Capital of the Company was increased from ₹ 7500.00 to ₹ 17,500.00by way of approval of the members of the Company on December 9, 2017 as per the recommendation of the Board of the Directors on November 3, 2017. The filing of SH-7 has not been completed by the Company and hence the record of the MCA has not been updated accordingly. The Board has considered the cancellation of the increase in authorized capital due to bad financial position and less chance of further issue of shares to public. The Board is proposing members to reverse the resolution and keep the authorized share capital at ₹ 750,000,000 as before the passing of the resolution on December 9, 2017.

16.3 Reconciliation of number of shares outstanding at the beginning and at the end of the reporting period:

ParticularsAs at




Outstanding at the beginning of the year

292,269,622 5,845.39 292,269,622 5,845.39 292,269,622 5,845.39

Outstanding at the end of the year 292,269,622 5,845.39 292,269,622 5,845.39 292,269,622 5,845.39

66


16.4 Terms/rights attached to equity shares (` in lakhs)

The Company has only one class of equity shares having par value of ₹ 2 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after the distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

16.5 Shareholders holding more than 5% of the paid up equity share capital of the Company:

Particulars



As at April 1, 2016

No. of shares held

% of hold-ing

No. of shares held

% of hold-ing

No. of shares held

% of hold-ing

Name of the shareholders Nitin M.Shah 40,040,171 13.70% 54,326,835 18.59% 60,226,835 20.61%Nitin M. Shah (HUF) 8,761,197 3.00% 15,462,000 5.29% 15,462,000 5.29%Saroj N. Shah 61,963,633 21.20% 61,963,633 21.20% 61,963,633 21.20%Rahul N. Shah 18,831,333 6.44% 18,831,333 6.44% 18,831,333 6.44%Kunal N. Shah 30,673,000 10.49% 30,673,000 10.49% 30,673,000 10.49%

17 Other equity:

Particulars Note As at March 31, 2018


As at April 1, 2016

General reserve 17 (i) 2,131.62 2,131.62 2,131.62 Securities premium reserve 17 (ii) 1,338.94 1,338.94 1,338.94 Retained earnings 17 (iii) (25,476.54) (6,318.83) 6,058.21

Total (22,005.98) (2,848.27) 9,528.77

Sr. no Particulars As at March 31, 2018

As at April 1, 2017

17 (i) General reserve Balance at the beginning of the year 2,131.62 2,131.62 Movement during the year - - Balance at the end of the year 2,131.62 2,131.62

17 (ii) Securities premium reserveBalance at the beginning of the year 1,338.94 1,338.94 Movement during the year - - Balance at the end of the year 1,338.94 1,338.94

17 (iii) Retained earningsOpening Balance at the beginning of the year (6,318.83) 6,058.21 Add : Loss for the year (19,197.35) (12,359.51) Items that will not be reclassified to profit or loss : - - - Remesurment of defined benefit obligation 39.64 (17.53)- Income tax relating to above item - - Balance as at the year end (25,476.54) (6,318.83)

Note Nature of reserves

a) General reserve

The General reserve is used from time to time to transfer profits from retained earnings for appropriation purposes. As the General reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the General reserve will not be reclassified subsequently to the Statement of Profit and Loss.

b) Securities premium reserve

Securities premium account comprises of premium on issue of shares. The reserve is utilised in accordance with the specific provision of the Companies Act, 2013.


67

c) Retained earnings

Retained earnings represents surplus/accumulated earnings of the Company and are available for distribution to shareholders

18 Long term borrowings: (` in lakhs)



Term LoansSecured - - - From financial institutions/non banking financial companies 3,936.63 5,731.61 6,842.03 (Refer Notes 18.1- 18.4) - - -

- - - From a bankVehicle loan (Refer Note 18.5) 28.66 34.93 -

3,965.29 5,766.54 6,842.03 Less: Current maturities of long-term debt 1,505.71 1,866.96 1,109.70

Total 2,459.58 3,899.58 5,732.33

18.1 IFCI Limited

18.1.1 The term loan outstanding as at March 31, 2018 of ₹ Nil (as at March 31, 2017 ₹ 778.13 as at March 31, 2016 ₹ 1815.62) is secured by exclusive first charge on the commercial property owned by the promoters, situated at Ghatkopar - Mumbai and industrial land at village Khalapur, district - Raigarh, exclusive pledge of 9,529,587 (as at March 31, 2017 9,529,587; April 1, 2016 9,573,527) equity shares of the Company, owned by the promoters, so as to give security cover of 1.5 times of the loan amount and personal guarantee of Nitin M Shah and Rahul N Shah.

18.1.2 The aforesaid loan was repayable in 8 quarterly installments of ₹ 259.38 each at the end of 15th,18th, 21st, 24th, 27th, 30th, 33rd and 36th month, starting from November 03, 2014 and rate of interest ranges from 14% per annum to 14.50% per annum.

18.1.3 Loan has been fully repaid in current year, Company is in process of releasing the charge.

18.2 Aditya Birla Finance Limited

18.2.1 The term loan outstanding as at March 31, 2018 of ₹ 377.38 (as at March 31, 2017 ₹ 425.83; April 1, 2016 ₹ 483.65) is secured by exclusive charge on office no. 801, 8th floor, Wing C, Neelkanth Business Park, Kirol Road, Vidyavihar West, Mumbai 400086.

18.2.2 The aforesaid loan is repayable in 84 monthly installments of ₹ 9.46each starting from April 05, 2015 and carries rate of interest of 12.35% per annum.

18.2.3 The Company has defaulted in the repayment of Aditya Birla Term loan. The amount of total overdue outstanding as at March 31, 2018 is ₹ 17.08 on account of principal since January 2018 and ₹ 11.29 on account of interest since January 2018.

18.3 IFCI Limited

18.3.1 The term loan outstanding as at March 31, 2018 of ₹ 3044.23 (as at March 31, 2017 ₹ 4000.00; April 1, 2016 ₹ 4000.00) is secured by exclusive charge on the immovable property owned by Nitin M. Shah (HUF) situated at 7001, 70th floor, World One Tower, Lower Parel, Mumbai 400 013, exclusive charge on an immovable property owned by the promoters such that the combined distress value of both the properties shall provide a cover of one time of the loan outstanding , pledge of 19,200,803 (as at March 31, 2017 19,200,803; April 1, 2016 14,590,803) equity shares of the Company owned by the promoters, so as to give security cover of 1.25 times of the loan amount and personal guarantee of Nitin M Shah and Rahul N Shah.

18.3.2 The aforesaid loan is for a period of five years including moratorium period of two years. Repayment will be in 36 equal monthly installments beginning from 25th month and continuing till 60th month and rate of interest ranges from 14% to 14.50% per annum.

18.3.3 The Company has defaulted in the repayment of IFCI Term loan. The amount of total overdue outstanding as at March 31, 2018 is ₹ 44.23 on account of principal since March 2018.

18.4 PNB Housing Finance Limited

18.4.1 The term loan outstanding as at March 31, 2018 of ₹ 515.02 (as at March 31, 2017 ₹ 527.65 April 1, 2016 ₹ 542.76) taken from a financial institution is co-borrowed along with Nitin M. Shah and Rahul N. Shah, promoters of the Company which is secured by mortgage of property owned by the Company and situated at C-802, Neelkanth Business Park, Kirol Road, Vidyavihar -W, Mumbai 400 077.

18.4.2 Loan is repayable in 180 equal monthly installments of ₹ 6.63 each commencing from July 10, 2015 and carries an interest rate of 12.00% per annum.

68


18.4.3 The Company has defaulted in the repayment of PNB Housing finance term loan. The amount of total overdue outstanding as at March 31, 2018 is ₹ 4.47 on account of principal since January 2018 and ₹ 15.41on account of interest since January 2018 .

18.5 ICICI Bank Limited

18.5.1 Vehicle loan taken from a bank and outstanding as at March 31, 2018 of ₹ 28.66 (as at March 31, 2017 ₹ 34.93; April 1, 2016 ₹ Nil) is secured by the hypothecation of the underlying asset.

18.5.2 The aforesaid loan is re-payable in 30 monthly installments of ₹ 0.78 each and carries rate of interest of 9.51% per annum.

19 Long-term provisions: (` in lakhs)



Provision for employee benefits (Refer note 32.1)- Gratuity (funded) 55.10 60.62 36.49 - Leave encashment (un funded) 0.83 - -

Total 55.93 60.62 36.49

20 Deferred tax (liabilities) (net) (i) Movement in deferred tax liabilities for the year ended March 31, 2018

ParticularsNet balance Recognised

through Profit and Loss

Recognised through OCI

Net balanceAs at As at

March 31, 2017 March 31, 2018Property, plant and equipment - - - - provision for doubtful debts and Advances and disallowances under Section 43B of the Income tax Act, 1961

- - - -

- - - -

(ii) Movement in deferred tax liabilities for the year ended March 31, 2017





March 31, 2017 March 31, 2018Property, plant and equipment 93.34 (93.34) - - provision for doubtful debts and Advances and disallowances under Section 43B of the Income tax Act, 1961

(66.14) 66.14 - -

27.20 (27.20) - -

Note: The Company is not recognising deferred tax assets due to prudence and in the absence of probability of future taxable profit.

21 Short-term borrowings:



Secured (Refer Notes 21.1 to 21.3)Repayable on demand from banks: - Cash credit 46,587.78 14,983.39 10,306.51 - Temporary overdraft/ working capital demand loan - - 1,267.82 Foreign currency loans* - 1,714.01 15,343.88 (* buyers line of credit/packing credit facilities availed by the Company) Unsecured payable on demand - From Directors (Refer Note 41) 4,775.03 2,284.64 - - From Subsidiary (Refer Note 41) 78.78 135.67 - - From Others 104.63 - -

Total 51,546.22 19,117.71 26,918.21

21.1 The above secured borrowings are availed through a consortium agreement with bankers namely IDBI Bank Limited (Lead bank), Bank of Baroda, Dena Bank and Axis Bank Limited.


69

21.1.1 Security

First pari passu charge by way of hypothecation or indenture of mortgage and /or pledge of borrowers current assets, namely, stock of raw materials, semi finished and finished goods, stores and spares not relating to plant and machinery (consumable stores and spares), bills receivable and book debts and all movable current assets , both present and future.

First pari passu charge on immovable and movable assets of the Company both present and future including its location at (i)factory at A-117,TTC Industrial area, Pawana Village, Navi Mumbai-400 705 (ii) office premises at 501/502 Delta Technology Street, Hiranandani Gardens, Powai, Mumbai - 400 076 and (iii)immovable properties of Eurotech Cylinders Private Limited, situated at EL-29, TTC Industrial Area, Mahape, Navi Mumbai 400 701 (only for IDBI Bank Limited).

Personal guarantees of Nitin M. Shah and Rahul N. Shah

21.1.2 Credit facilities availed

Working capital loan and other non-fund based facilities.

21.1.3. Rate of interest ranges from 11.65% to 14.5% per annum.

21.1.4 The Company has defaulted in the repayment of Bank of baroda borrowing, the amount of overdue outstanding as at March 31, 2018 is ₹ 5049.79 on account of principal since June 30, 2017and ₹ 124.60 on account of interest since June 30, 2017.

21.1.5 In respect of Bank of baroda borrowing, from June 30, 2017, the account has become NPA. However provision for inter-est on the said loan (based on prime landing rate) of ₹ 517.30 has been made. Further no provision is made for Penalty/ overdue interest in the absence of specific claim.

21.1.6 The Company has defaulted in the repayment of Dena bank borrowing, the amount of overdue outstanding as at March 31, 2018 is ₹ 2930.53 on account of principal since July 31, 2017 and ₹ nil on account of interest since July 31, 2017.

21.1.7 In respect of Dena bank borrowing, from July 31, 2017, the account has become NPA. However provision for interest on the said loan (based on prime landing rate) of ₹ 186.40 has been made. Further no provision is made for Penalty/ overdue interest in the absence of specific claim.

21.2 IDBI Bank Limited:

21.2.1 Primary security: First pari passu charge on immovable properties of Eurotech Cylinders Private Limited at EL-29, TTC, Navi Mumbai 400 705.

Collateral security: Second pari passu charge on (i) entire current assets and movable assets of the Company both present and future (ii) 501/502 Delta, Technology Street, Hiranandani Gardens, Powai, Mumbai 400076 and its factory at A-117, TTC Industrial Area, Pawana Village, Navi Mumbai 400 705. Pledge of promoters shares held in the Company to the extent of 100% of the exposure.

Personal guarantees of the Nitin M. Shah and Rahul N. Shah

21.2.2 Credit facilities availed: Standby letter of credit

21.2.3 The Company has defaulted in the repayment of IDBI bank borrowing, including the devolvement of stand by letter of credit for subsidiary company of ₹ 4193.83. The amount of total overdue outstanding as at March 31, 2018 is ₹ 17,492.24 on account of principal since January 10, 2018 and ₹ 2,236.15 on account of interest January 10, 2018.

21.2.4 From January 10, 2018, the account has become NPA. However provision for interest on the said loan (based on prime landing rate) of ₹ 579.04 has been made. Further no provision is made for Penalty/ overdue interest in the absence of specific claim.

21.3 Axis Bank Limited:

21.3.1 Primary security: Negative lien on receivables of Nitin Ventures FZE and New Age Company LLC .

21.3.2 Collateral security: Pledge of the Company’s shares having aggregate market value of at least 75% of the facility amount.

Pari passu second charge on fixed assets of the Company’s (i) factory at A-117,TTC Industrial area, Pawana Village, Navi Mumbai-400 705 (ii) office premises at 501/502 Delta Technology Street, Hiranandani Gardens, Powai, Mumbai - 400 076 and (iii) on the entire current assets of the Company both present and future.

PDC’s for the facility amount of Nitin Ventures FZE and New Age Company LLC to the Dubai branch of the bank.

Personal guarantees of Nitin M. Shah and Rahul N. Shah.

21.3.3 Credit facilities availed Stand by letter of credit.

70


21.3.4 The Company has defaulted in the repayment of Axis bank borrowing, including the devolvement of stand by letter of credit for subsidiary company of ₹ 11,757.50. The total amount of overdue outstanding as at March 31, 2018 is ₹ 18.564.22 on account of principal since August 11, 2017 and ₹ 190.25 on account of interest since August 11, 2017.

21.3.5 From August 11, 2017, the account has become NPA. However provision for interest on the said loan (based on prime landing rate) of ₹ 876.55 has been made. Further no provision is made for Penalty/ overdue interest in the absence of specific claim.

22 Trade payables: (` in lakhs)



Total outstanding dues of micro and small enterprises(Refer note 22.1) 41.28 22.49 13.25 Total outstanding of creditors other than micro and small enterprises 9,525.61 20,570.00 6,745.34

Total 9,566.89 20,592.49 6,758.59

22.1 To the extent, the Company has received intimation from the “suppliers” regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006, the details are provided as under



1 the principal amount remaining unpaid to any supplier at the end of the accounting year

33.29 17.60 8.76

2 Interest due thereon remaining unpaid to any supplier as at the end of the accounting year

2.01 0.40 0.07

3 the amount of interest paid along with the amount of the pay-ment made to the supplier beyond the appointed day.

- - -

4 the amount of interest due and payable for the year of delay in making payment (which have been paid but beyond the appointed day during the year) but without adding the inter-est specified under the Micro, Small and Medium Enterprises Development Act, 2006.

2.08 0.99 1.09

5 the amount of interest accrued and remaining unpaid; and 7.98 4.89 4.49 6 the amount of further interest remaining due and payable

even in the succeeding years, until such date when the inter-est dues above are actually paid.

3.90 3.50 3.41

23 Other financial liabilities:



Book overdrawn balances - 0.03 3.84 Current maturities of long-term debt (Refer note 18) 1,505.71 1,866.96 1,109.70 Interest accrued on borrowings 2,236.54 37.06 180.30 Unpaid dividends* 3.52 3.52 4.52 Outstanding liability for expenses 181.40 42.88 59.38 Employee Benefits Payable 59.06 75.78 56.98

Total 3,986.23 2,026.23 1,414.72

(* There are no unpaid dividend which is required to be transferred to Investors Education Protection Fund)

24 Provisions:



Provision for employee benefits (Refer note 32.1) - Gratuity (funded) 22.23 35.21 28.23 - Leave encashment (un funded) 5.17 21.88 21.88 Corporate dividend tax on proposed dividend 74.97 74.97 74.97

Total 102.37 132.06 125.08


71

25 Other current liabilities: (` in lakhs)



Invoices raised in respect of incomplete contracts 1,005.33 - 851.64 Less: Adjustment against aggregated amount of cost incurred and rec-ognised profit (less recognised losses) (Refer note 45)

783.66 - 778.14

221.67 - 73.50Income received in advance 9.93 8.64 8.47 Statutory Dues Payable 11.34 70.91 41.32 Advances from customers 75.63 25.13 169.49

Total 318.57 104.68 292.78

26 Income tax liabilities (net):



IIncome Tax (Net of advance tax of (Mar 31,2018 ₹ 811.00) 75.03 0.07 -

Total 75.03 0.07 -

27 Revenue from operations:

Particulars For the year ended For the year ended

March 31, 2018 March 31, 2017 ₹ ₹

Sale of products (net of sales return) 5,267.07 26,213.42 Sale of services (AMC) 167.06 337.29 Operating revenue-consultancy fees 89.35 335.37

Total 5,523.48 26,886.08

27.1 Detail of Sale of Products / Services


March 31, 2018 March 31, 2017 ₹ ₹

Primary project related activities 2,888.71 5,250.57 Cylinders, fire protection, detection equipments etc. 2,378.36 20,962.85

Total 5,267.07 26,213.42

Goods and Service Tax (GST) has been effective from July 1, 2017. Consequently, excise duty, value added tax (VAT), Service tax etc. have been replaced with GST. Until June 30, 2017, ‘Sale of product’ included the amount of excise duty recovered on sales. With effect from July 1, 2017, ‘Sales of products’ excludes the amount of GST recovered. Accordingly, revenue from ‘Sale of Products’ and ‘Revenue from operations’ for the year ended March 31, 2018 are not comparable with those of the previous year.

28 Other income:


March 31, 2018 March 31, 2017 ₹ ₹

Interest Income received on Financial Assets - Carried at amortised cost- deposits with banks 21.54 28.47 - loans and deposits 912.83 207.56 - overdue trade receivables and others 39.96 6.49 Foreign Exchange Gain (net) 94.60 - Liability no longer required written back 47.87 44.57 Corporate guarantee comission 6.00 6.00 Debts written off in earlier years, now recovered 40.83 11.45

Total 1,163.63 304.54

72


29 Cost of materials and components consumed: (` in lakhs)


March 31, 2018 March 31, 2017 ₹ ₹

Inventory at the beginning of the year 8,813.45 12,284.32 Add: Purchases 2,150.34 623.88

10,963.79 12,908.20 Less: Inventory at the end of the year 6,429.39 8,813.44

Total 4,534.40 4,094.76

30 Purchases of stock-in-trade:


March 31, 2018 March 31, 2017 ₹ ₹

Fire alarm, detection equipments etc. 1,244.96 18,296.53 Cylinders etc. 186.03 2,153.16

Total 1,430.99 20,449.69

31 Changes in inventory of stock-in-trade:


March 31, 2018 March 31, 2017 ₹ ₹

Inventory at the end of the year: Stock in trade 104.84 104.84 Inventory at the beginning of the year: Stock in trade 104.84 1,190.00

Total - 1,085.16

32 Employee benefits expense:


March 31, 2018 March 31, 2017 ₹ ₹

Salaries, wages and bonus 665.25 712.60 Contributions to provident and other funds (Refer note 32.1 ) 28.31 25.31 Contributions to gratuity fund (Refer note 32.1) 21.61 15.61 Employees welfare expenses 68.64 71.47

Total 783.81 824.99

32.1 Employee benefit obligations i) Defined Contribution Plans

Provident Fund: Contribution towards provident fund for employees is made to the regulatory authorities, where the Company has no further obligations. Such benefits are classified as Defined Contribution Schemes as the Company does not carry any further obligations, apart from the contributions made on a monthly basis.

Contribution to Defined Contribution Plans, recognized as expense for the year as under:

ParticularsYear ended

March 31, 2018 March 31, 2017 ₹ ₹

Employer's Contribution to Provident Fund 23.49 21.97 Employer's Contribution to Employees State Insurance Corporation 4.74 3.26Company's contribution to Maharashtra Labour Welfare Fund 0.08 0.08

Total 28.31 25.31

ii) Defined Benefits Plans

Gratuity: The Company provides for gratuity, a defined benefit plan (the “Gratuity Plan”) covering eligible employees in accordance with the Payment of Gratuity Act, 1972. The Gratuity Plan provides a lump sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee’s salary and the tenure of employ-ment. The Company’s liability is actuarially determined (using the Projected Unit Credit method) at the end of each year. The fair value of the plan assets of the trust administered by the Company, is deducted from the gross obligation.

The following table sets forth the status of the gratuity plan of the Company, and the amounts recognized in the Balance sheet and Statement of profit and loss.


73

Funding :

The Company makes annual contributions to the Group Gratuity cum Life Assurance Schemes administered by the LIC, a funded defined benefit plan for qualifying employees

Reconciliation of the net defined benefit obligation: (` in lakhs)


March 31, 2018 March 31, 2017 ₹ ₹

Opening defined benefit obligation 123.82 92.90 Benefits paid from the fund (10.86) (4.57) Benefit paid directly by the employer (0.47) - Current service cost 14.62 10.40 Interest cost 9.03 7.47 Past service cost - - Actuarial losses / (gain) recognized in other comprehensive income changes in demographic assumptions - - changes in financial assumptions (4.79) 8.51 experience adjustments (35.02) 9.11 Liabilities assumed / (settled) - - Closing defined benefit obligation 96.33 123.82

Reconciliation of the fair value of plan assets:


March 31, 2018 March 31, 2017 ₹ ₹

Opening fair value of plan assets 27.99 28.17Interest Income 2.03 2.26 Employer contributions - 2.03 Benefits paid (10.86) (4.57)Actuarial gains on Plan Assets (0.16) 0.10 Closing fair value of plan assets 19.00 27.99

Balance sheet reconciliation



Opening defined benefit obligation 123.82 92.90 86.15 Opening fair value of plan assets (27.99) (28.18) (30.29)Expenses recognised in profit and loss 21.61 15.61 8.86 Expenses recognised in Other Comprehensive Income (39.64) 17.53 - Employer contributions - (2.03) - Benefits paid (0.47) - - Net (Asset) / Liability recognised in the Balance sheet 77.33 95.83 64.72

Expenses recognised in Statement of Profit and Loss:


March 31, 2018 March 31, 2017 ₹ ₹

Current service cost 14.62 10.40 Interest cost 6.99 5.21 Past Service Cost - -

21.61 15.61

Remeasurements recognised in other comprehensive income


March 31, 2018 March 31, 2017 ₹ ₹

Actuarial (gain) loss on defined benefit obligation (39.80) 17.63 Return on plan assets excluding interest income 0.16 (0.10)

(39.64) 17.53

74


Analysis of plan assets (` in lakhs)


March 31, 2018 March 31, 2017 April 1, 2016

Insurer managed funds (%) 100% 100% 100%Others (%) 0% 0% 0%

100% 100% 100%

Maturity profile of defined benefit obligation

ParticularsAs at

March 31, 2018 March 31, 2017 ₹ ₹

1 Year 12.09 25.49 2 to 5 years 9.77 11.36 6 to 10 years 35.69 32.37 More than 10 years 190.34 236.39

Actuarial assumption

Principal actuarial assumption used to determine net periodic benefit cost and benefit obligation at the reporting dates;

ParticularsAs at

March 31, 2018 March 31, 2017

Discount Rate (p.a.) 7.78% 7.29%Salary escalation rate (p.a.) 7.00% 7.00%Expected rate of return on assets 7.78% 7.29%Attrition rate 2.00% 2.00%Mortality rate during employment Indian Assured Lives

Mortality(2006-08)Indian Assured Lives

Mortality(2006-08)Mortality rate after employment NA NA

Notes :

Salary escalation rate: The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

Discount rate: The discount rate is based on the prevailing market yields of Indian government securities for the estimated term of the obligations.

Assumptions regarding future mortality experience are set in accordance with the statistics published by the Life Insurance Corpo-ration of India.

The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the pe-riod over which the obligation is to be settled. There has been significant change in expected rate of return on assets due to change in the market scenario.

Sensitivity analysis Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant,

would have affected the defined benefit obligations by the amounts shown below;


March 31, 2018 March 31, 2017 ₹ ₹

Projected Benefit Obligation on Current Assumptions - - Discount Rate: 0.5% increase (4.53) (5.78)Discount Rate: 0.5% decrease 4.89 6.29 Future salary growth: 0.5% increase 4.90 6.28 Future salary growth: 0.5% decrease (4.58) (5.83)Change in Rate of Employee Turnover : 0.5% Increase 0.20 (0.07)Change in Rate of Employee Turnover : 0.5% Decrease (0.22) 0.07


75

iii) Compensated absences (` in lakhs)

The Company accrues for the compensated absences, a long term employee benefit plan based on the entire available leave balance standing to the credit of the employees at year end. The value of such leave balance eligible for carry forward, is determined by actuarial valuation as at the Balance sheet date and is charged to Statement of profit and loss in the period determined. The provision as at balance sheet dates are as follows:



Compensated absences liability 6.01 21.88 21.88


Particulars As at As at As at March 31, 2018 March 31, 2017 April 1, 2016

Discount rate 7.78% 7.29% 8.04%Long–term rate of compensation increase 7.00% 7.00% 7.00%Surplus recognised in Statement of Profit and Loss towards compensated absences are ₹ 15.88 (March 31, 2017 ₹ Nil)

33 Finance costs:


March 31, 2018 March 31, 2017 ₹ ₹

Interest expense on: Borrowings - From Banks and others 5,320.49 3,481.79 - From Directors (Refer Note 41) 499.69 133.36 - From Subsidiaries (Refer Note 41) 13.67 - Others (Interest on delayed payment of Income tax and dividend distribution tax) 62.92 59.06 Other borrowing costs - Processing fees 40.04 47.77 - Bank Charges 231.77 544.97

Total 6,168.58 4,266.95

34 Depreciation and amortisation expense:


March 31, 2018 March 31, 2017 ₹ ₹

Depreciation on property, plant and equipment 441.44 465.31 Amortisation of intangible assets 0.69 4.45

Total 442.13 469.76

35 Other expenses:


March 31, 2018 March 31, 2017 ₹ ₹

Sub-contract charges and site expenses 193.16 139.75 Conveyance and travelling 171.99 216.94 Miscellaneous expenses 126.65 96.04 Rent and lease rent (Refer note 39) 0.43 24.14 Repairs - other assets 34.49 40.92 Repairs-building 4.67 29.90 Insurance premium 5.76 11.51 Payment to Auditors (exclusive of service tax & GST) (refer note 37) 21.35 30.20 Legal and professional fees 133.72 131.67 Donations and charity 6.21 23.11 Vehicle expenses 23.89 24.92 Sitting fees to Non Executive Directors 0.60 5.20 Sales promotion and advertisement 68.21 118.17 Bad debts written off/liquidated damages 36.02 1,426.23 Provision for doubtful deposits, advances and claims 1,019.28 -

76



March 31, 2018 March 31, 2017 ₹ ₹

Loss on sale of Tangible assets 2.06 - Loss on claims receivable (Refer note 54) 2,544.49 - Distribution expenses (net) 63.82 115.31 Survey cost incurred for mineral rights - 3.59 Foreign Exchange Loss / Gain (Net) - 710.18 Rates and taxes 138.40 12.44 Provision For Doubtful debts 7,126.20 4,679.88 Loans written off - 150.00 Loss on fair valuation of bond 4.91 0.70 Loss on fair valuation of investment 19.00 383.40 Impairment loss on property, plant and equipment [Refer note 3 (2)] 723.15 -

Total 12,468.46 8,374.20

36 Earnings Per Share (EPS):


March 31, 2018 March 31, 2017 ₹ ₹

Loss for the year (19,197.35) (12,359.51)Amount available for equity share holders (19,197.35) (12,359.51)Weighted average number of equity shares (nos.) 2922,69,622 2922,69,622 Basic EPS (6.57) (4.23)Diluted EPS (6.57) (4.23)

37 Payments to auditors (exclusive of service tax & GST):


March 31, 2018 March 31, 2017 ₹ ₹

Statutory audit fees 13.00 20.30 Limited review fees 6.00 6.00 Certification fees 2.00 2.00 Re-imbursement of expenses 0.35 1.90

Total 21.35 30.20

38 Corporate Social Responsibility Expense :


March 31, 2018 March 31, 2017 ₹ ₹

Gross amount required to be spent by the group during the yearCorporate Social Responsibility Expense - 24.95Amount spent during the year (paid in cash)i) Construction/acquisition of any asset - - ii) On purposes other than (i) above - - Amount spent during the year (yet to paid in cash)i) Construction/acquisition of any asset - - ii) On purposes other than (i) above - -

39 Operating lease: (a) In respect of a property acquired on lease (located at Vishakhapatnam) , the future minimum lease rentals under non-cancellable

operating lease are as follows:

Particulars

Future minimum lease payments As at As at As at


Not later than one year - 7.72 8.88 Later than one year and not later than five years - 32.83 35.72 Later than five years - - 4.83

Total - 40.55 49.43

(` in lakhs)


77

Note:

(a) In the previous years , the impact of escalation in lease payments which may arise is not considered due to its uncertainty.

(b) Lease payments recognised in the Statement of Profit and Loss: ₹ 0.43 (P. Y. ₹ 24.14).

(c) Lease rentals are charged on the basis of agreed terms.

40 Consequent to dilution of equity stake in Worthington Nitin Cylinders Private Limited (WNCPL) in December 2010, the Company has taken over the outstanding claim of a derivative contract amounting to ` 50,133,481 (excluding interest). As advised by the legal counsel, it has opined that the said contract is not valid as per the Reserve Bank of India regulations and hence, no liability is expected to devolve on the Company and hence the Management of the Company is of the view that no provision is required. The Company has filed a petition in the Hon’ble High Court of Bombay challenging the legality of the contract. The petition is pending for disposal.

41 Related party disclosures: (a) Parties where control/significant influence exists and/or other related parties with whom transactions (material) have taken place

include:

(i)

No Name of the related party Relationship1 Eurotech Cylinders Private Limited } 2 Nitin Fire Protection Appliances Private Limited (name

striked off from MCA on May 18, 2016)Domestic subsidiaries

3 Nitin Fire Protection Systems Private Limited (name striked off from MCA on June 13, 2016)

4 Nitin Ventures FZE, UAE } Foreign subsidiaries 5 Nitin Global Pte Limited, Singapore 6 Nitin Fire Protection Middle East Fze, UAE 7 New Age Company LLC, UAE (100% subsidiary of Nitin

Ventures FZE, UAE) } Step down foreign subsidiaries of Nitin Ventures FZE8 Firetec Systems Limited, UK (100% subsidiary of Nitin Ven-

tures FZE, UAE)9 Worthington Nitin Cylinders Private Limited (WNCPL) Associate

10 Nitin M. Shah (Non Executive Director up to May 30, 2018 and from May 30, 2018 Chairman and Non Executive Direc-tor) } Key Management Personnel (KMP) Repre-

sented on the Board11 Rahul N. Shah (Whole time Director up to December 12, 2017 and CEO from May 30, 2018)

12 Kunal N. Shah (Whole time Director up to December 12, 2017 and COO from May 30, 2018)

13 Saroj N. Shah (spouse of Nitin M. Shah) } Relatives of KMP's14 Nitin M. Shah (HUF) 15 Rahul N. Shah (HUF) 16 Reshma N. Shah (daughter of Nitin M. Shah)17 New Age Industries LLC, UAE (100% subsidiary of Nitin

Ventures FZE, UAE) } Companies in which a KMP has significant influence18 New Age Electromechanical Contracting Company LLC,

UAE19 Nitie Fire Protection Oil and Gas Field Services LLC, UAE

78


(ii) Transactions with related parties (including re-imbursement of expenses): (` in lakhs)

Sr. No. Particulars

For the year ended For the year ended March 31, 2018 March 31, 2017

₹ ₹ I Capital transactions

Assets1 Advances to suppliers / Loans given etc.

Domestic subsidiary Eurotech Cylinders Private Limited - 56.79

Foreign subsidiariesNitin Ventures FZE (net of exchange difference) 11,864 .04 1.71 Nitin Fire Protection Middle-East FZE 0.02* 0.15* (* exchange difference)Nitin Global Pte Limited (net of exchange difference) 4,199 .38 4,309.86

AssociateWorthington Nitin Cylinders Private Limited 8.71 42.99

2 Advances given for supply of goods, now received backAssociateWorthington Nitin Cylinders Private Limited 46.91 30.28

Foreign subsidiaryNitin Global Pte Limited (net of exchange difference) - 3,871.19

Liabilities1 Unsecured loans

KMP's/NEDKMPNitin M. Shah 1,587.47 1,775.51 Rahul N. Shah 423.05 1,167.48 Domestic subsidiary Eurotech Cylinders Private Limited 50.00 347.06

(b) Transactions with related parties (including re-imbursement of expenses):

(` in lakhs)

Sr. No. Particulars


₹ ₹ 2 Unsecured loans / security deposit repaid

KMP's/NEDNitin M. Shah 2.82 760.60 Rahul N. Shah 17.00 3.50 Domestic subsidiary Eurotech Cylinders Private Limited 120.58 154.59

II Revenue transactions Income

1 Sale of products (net of taxes)Domestic subsidiary Eurotech Cylinders Private Limited 13.06 18.71

AssociateWorthington Nitin Cylinders Private Limited 101.63 -

Step down foreign subsidiaries of Nitin Ventures FZENew Age Company LLC, UAE - 9.96


79

(` in lakhs)

Sr. No. Particulars


₹ ₹ 2 Reimbursement of bank charges / Expenses/interest

Subsidiary/step down subsidiary/KMPNitin Global Pte Limited 463.77 - Nitin Ventures FZE 294.11 14.49 Nitin Fire Protection Middle East FZE 0.81 - Nitin M. Shah (HUF) - 0.67 Nitin M. Shah - 1.01 Rahul N. Shah (HUF) - 0.73

3 Corporate guarantee commissionDomestic subsidiary Eurotech Cylinders Private Limited 6.00 6.00

Expenditure1 Purchase of materials and components (net of taxes)

Domestic subsidiary Eurotech Cylinders Private Limited - 21.45

Foreign subsidiary New Age Co. LLC 19.47 -

2 Rent (net of taxes)KMP/Relative of a KMPNitin M. Shah - 8.00 Saroj N. Shah - 8.00

3 Remuneration**KMP'sRahul N. Shah 15.40 19.93 Kunal N. Shah 15.40 19.79

4 Interest/Reimbursement of expensesKMPNitin M. Shah 291.80 95.55 Rahul N. Shah 207.89 37.81

Wholly owned domestic subsidiaryEurotech Cylinders Private LimitedInterest 13.67 -

5 Loss on fair valuation of investmentsEurotech Cylinders Private Limited 19.00 - Worthington Nitin Cylinders Private Limited - 383.40

(ii) Transactions with related parties (including re-imbursement of expenses):

Sr. No. Particulars


₹ ₹ III Additional Standby letter of credit facility provided (Including trans-

lation effect)Foreign subsidiariesNitin Global Pte Limited - 733.92

(** excluding incremental liability for gratuity as employee wise breakup of such liability based on estimation is not ascertainable)

80


( b) Amounts outstanding for related parties: (` in lakhs)

Sr. No. Particulars

As at As at As at March 31, 2018 March 31, 2017 April 1, 2016

₹ ₹ ₹ I Assets1 Non current investments/other non-current assets(i) Equity Sharesa Non current investments

Domestic subsidiary Eurotech Cylinders Private Limited - 13.00 7.00

Foreign subsidiaries Nitin Ventures FZE 1,102.09 1,102.09 1,102.09 Nitin Global Pte Limited 47.61 47.61 47.61

Non current investmentAssociateWorthington Nitin Cylinders Private Limited 4,195.04 4,195.04 4,578.44

2 Trade receivables (net of trade payables, if any)AssociateWorthington Nitin Cylinders Private Limited 101.63 -

Domestic subsidiary Eurotech Cylinders Private Limited 13.32 - 88.37

Step down foreign subsidiaries of Nitin Ventures FZENew Age Company LLC, UAE 7.64 9.65 -

3 Loans to subsidiaryForeign subsidiariesNitin Ventures FZE 12,468.42 310.26 295.78 Nitin Global Pte Limited 5,218.77 555.62 126.46 Nitin Fire Protection Middle-East FZE 7.53 6.70 6.86

Advances (includes outstanding towards reimbursement of expenses and advance for supply of goods)Foreign subsidiariesNitin Ventures FZE 266.13 270.70 275.28 Associate Worthington Nitin Cylinders Private Limited 1.15 37.49 24.78

II Equity and Liabilities1 Short term borrowings

KMP'SNitin M. Shah 2,963.07 1,086.63 - Rahul N Shah 1,811.96 1,198.01 - Domestic subsidiary Eurotech Cylinders Private Limited 78.78 135.68 -

2 Other Current Liabilitiesa Dues (Excluding outstanding salary payable, if any)

Nitin M. Shah 3.60 3.60 1.89 Saroj N Shah 3.60 3.60 - Outstanding Salary Payable

b Rahul N Shah 1.08 1.08 - Kunal N Shah 1.85 1.85 -

III Guarantees given 1 Corporate financial guarantees given

Domestic subsidiary Eurotech Cylinders Private Limited 841.98 808.31 688.53

IV Standby letter of credit facility provided 1 Foreign subsidiaries

Nitin Ventures FZE ** - 11,878.43 12,099.12 Nitin Global PTE ** - 4,182.09 3,548.81

(** Post devolvement of Standby letter of credit the balances are now reflected as recoverable from foreign subsidiaries and correspondingly payable to bank of demand).


81

Notes:

Related party relationships are as identified by the Company on the basis of information available and relied upon by the auditors.

42 Contingent liabilities not provided for in respect of :* (` in lakhs)

Sr. No. Particulars


₹ ₹ ₹ i Performance/bid-bond guarantees 190.99 389.94 342.71

ii Corporate financial guarantees provided on behalf of a domestic subsidiary - Limit 800.00 800.00 800.00 - Outstanding 841.98 808.31 688.53

iii Standby letters of credit provided on behalf of foreign subsidiaries (including a step down subsidiary) and an associate - Limit (includes exchange rate translation difference, if any) - 16,060.52 16,430.66 - Outstanding - 15,257.50 15,647.93

iv Claim against the Company not acknowledged as debt: - Income Tax 1,115.09 1,115.09 689.28 [(A.Y. 2009-10 - 2014-15) (amount paid under protest ₹84.00(March 31, 2017: ₹ 84.00, April 01, 2016 ₹ 84.00)]-Sales tax 60.13 60.13 37.96 ‘[(A.Y. 2011-12 and A.Y. 2012-13) (amount paid under protest ₹ 32.41 (March 31, 2017: ₹ 32.41, April 01, 2016 ₹ 32.41)]

- Other matters 376.25 644.83 644.83 Note:

Contingent liabilities in respect of above matters arising in the ordinary course of business, it is anticipated that no material liabilities will arise.

43 Commitments: Estimated amount of contracts remaining to be executed on capital account (net of advances, unsecured and considered good) :

₹ 72.03 (as at March 31, 2017 ₹ 301.60 as at April 1, 2016 ₹ 351.59).

44 Income taxes

a. Income tax expense is as follows:


March 31, 2018 ₹

March 31, 2017 ₹

Statement of Profit and LossCurrent tax:Tax for the year - - Adjustments for current tax of prior periods 52.47 - Total current tax expense 52.47 - Deferred tax: - - Deferred tax expenses - (27.20)Total deferred tax expense - (27.20)Income tax expense 52.47 (27.20)Other comprehensive income - - Deferred tax related to OCI items: - - Net loss / (gain) on Remeasurements of defined benefit plans - -

In view of losses incurred during the years ended March 31, 2018 and March 31, 2017, no provision for income tax is made for the aforesaid years ended.

82


b. Reconciliation of effective tax rate

A reconciliation of income tax expense as included in the statement of profit and loss to the amount computed by applying the weighted average enacted income tax rate to income before income taxes is summarized below: (` in lakhs)


March 31, 2018 ₹

March 31, 2017 ₹

Loss before tax (19,144.88) (12,386.71)Tax at the Indian tax rate 0.00% - 0.00% - Tax effect of: Prior years tax adjustments (0.27%) 52.47 - - Others - - (0.22%) (27.20)

(0.27%) 52.47 0.22% (27.20)

45 Disclosures pursuant to Ind AS 11 ‘Construction Contracts’:

Sr. No. Particulars


₹ ₹ ₹ (a) Contract revenue recognised for the financial year* 2,888.72 5,250.57 22,052.71 (b) Aggregate of contract costs incurred and recognised profit

(less recognised losses) up to the reporting date for contracts in progress

783.67 1,018.20 778.14

(c) Advances received for contracts in progress - 10.53 11.82 (d) Retention money for contracts in progress 195.06 - - (e) Gross amount due from customers for contract work (asset) 441.64 944.97 961.66 (f) Gross amount due to customers for contract work (liability) - 41.02 108.18

( * in respect of completed and contracts in progress)

46 With regard to the Company’s investment in Equity Shares of WNCPL carried at a cost of ₹ 4195.04 as at March 31, 2018 (as at March 31, 2017 ₹ 4195.04; April 1, 2016 ₹ 4578.44), the Management is in discussion with the majority shareholders of WNCPL and expects to recover the carrying amount. Hence the Management believes that no impairment provision is required.

47 Trade receivables for the year ended March 31, 2018 includes ₹ 276.73 (as at March 31, 2017 ₹ 16698.10; April 1, 2016 ₹ nil) against exports/domestic sales made in earlier years, payments for which are not forthcoming. The Company’s Management is making all efforts to recover the same and is confident of recovery. Hence, no specific provision is considered necessary.

48 The balances of Trade receivables amounting to ₹ 3459.95 (other than those covered under note (47) above), Trade payables amounting to ₹ 1867.47 and Loans to body corporates amounting to ₹ 331.08 are subject to reconciliation. The Management is in the process of reconciling the same and do not expect any consequential impact in the financial statements in this regard.

49 The Company has incurred net loss of ₹ 19157.71 during the year ended March 31, 2018 and, as of that date, the Company’s current liabilities exceeded its total assets by ₹ 13645.07. This indicates that a material uncertainty exists that may cast significant doubt on the Company’s ability to continue as a going concern. Based on future business plans, the Management is confident that the Company will be able to generate profit in future periods and meet its financial obligations as they arise and hence, the financial statements have been prepared on going concern basis.

50 Segment information:

In line with the provisions of IND AS 108 ‘Operating segments’ and basis the review of operations being done by the Senior Manage-ment, the operations of the Company fall under fire protection/detection equipments and allied activities, which is considered to be the only reportable segment by the Management.

51 Financial Instruments - Accounting Classifications and 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 of liquidation sale.

The following methods and assumptions were used to estimate the fair values:

Fair value of cash and cash equivalent, bank balances other than cash and cash equivalent, trade receivables, trade payables, other current financial liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or

indirectly. Level 3: techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.


83

(` in lakhs)

As at April 01, 2016Carrying value Fair value

Amortised Cost₹

FVTPL₹

FVTOCI₹

Total₹

Level 1₹

Level 2₹

Level 3₹

Non current financial assetsInvestments - 26.11 - 26.11 26.11 - - Other financial assets 2,347.54 - - 2,347.54 - - -

Total 2,347.54 26.11 - 2,373.65 26.11 - - Current financial assetsTrade receivables 26,576.96 - - 26,576.96 - - - Cash and cash equivalents 587.77 - - 587.77 - - - Bank balances other than cash and cash equivalents

509.24 - - 509.24 - - -

Loans 1,123.45 - - 1,123.45 - - - Other current financial assets 25.83 - - 25.83 - - -

Total 28,823.25 - - 28,823.25 - - - Non current financial liabilitiesBorrowings 5,732.33 - - 5,732.33 - - -

Total 5,732.33 - - 5,732.33 - - - Current financial liabilitiesBorrowings 26,918.21 - - 26,918.21 - - - Trade payables 6,758.59 - - 6,758.59 - - - Other current financial liabilities 1,414.72 - - 1,414.72 - - -

Total 35,091.52 - - 35,091.52 - - -

As at March 31, 2017Carrying value Fair value

Amortised Cost₹

FVTPL₹

FVTOCI₹

Total₹

Level 1₹

Level 2₹

Level 3₹



132.19 - - 132.19 - - -




Total 41,736.42 - - 41,736.42 - - -


Amortised Cost₹

FVTPL₹

FVTOCI₹

Total₹

Level 1₹

Level 2₹

Level 3₹

Non current financial assetsInvestments - - - - - - - Other financial assets 254.28 - - 254.28 - - -

Total 254.28 - - 254.28 - - - Current financial assetsTrade receivables 18,456.58 - - 18,456.58 - - - Cash and cash equivalents 128.94 - - 128.94 - - - Bank balances other than cash and cash equivalents

142.72 - - 142.72 - - -

Loans 18,449.45 - - 18,449.45 - - -

84



Amortised Cost₹

FVTPL₹

FVTOCI₹

Total₹

Level 1₹

Level 2₹

Level 3₹

Other current financial assets 3.67 - - 3.67 - - - Total 37,181.36 - - 37,181.36 - - -

Non current financial liabilitiesBorrowings 2,459.58 - - 2,459.58 - - -

Total 2,459.58 - - 2,459.58 - - -

CurrentBorrowings 51,546.22 - - 51,546.22 - - - Trade payables 9,566.88 - - 9,566.88 - - - Other current financial liabilities 3,986.23 - - 3,986.23 - - -

Total 65,099.33 - - 65,099.33 - - -

During the reporting period ending March 31, 2018 and March 31, 2017, there was no transfer between level 2 and level 3 fair value measurements.

52 Financial risk management

The Company has exposure to the following risks arising from financial instruments:

- Credit risk;- Liquidity risk; and\- Market risk”

The Company’s board of directors has overall responsibility for the establishment and oversight of the Company’s risk management framework who is also responsible for developing and monitoring the Company’s risk management policies.

The Company’s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed periodically to reflect changes in market conditions and the Company’s activities. The Company, through its training, standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.

The board of directors oversees how management monitors compliance with the company’s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company.

A) Credit risk

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. To manage this, the Com-pany periodically assesses the financial reliability of customers, taking into account the financial condition, current economic trends, and analysis of historical bad debts and ageing of accounts receivable. Individual risk limits are set accordingly.

The Company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk that company compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial rec-ognition. It considers reasonable and supportive forwarding-looking information such as:

i) Actual or expected significant adverse changes in business,ii) Actual or expected significant changes in the operating results of the counterparty,ii) Financial or economic conditions that are expected to cause a significant change to the counterparty’s ability to meet its obligations,iv) Significant increases in credit risk on other financial instruments of the same counterparty,

Financial assets are written off when there is no reasonable expectation of recovery, such as a debtor/borrower failing to engage in a repayment plan with the Company. Where receivables/loans have been written off, the Company continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these are recognised in Statement of Profit and Loss.

Trade and other receivables

The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. Credit terms are in line with industry trends.

Summary of the Company’s exposure to credit risk by age of the outstanding from various customers is as follows (` in lakhs)



As at April 1, 2016

Less than 180 days 1,244.83 7,316.52 12,086.16 From 181 - 365 days 244.18 5,183.06 10,450.04


85



As at April 1, 2016

More than 365 days 30,106.92 18,806.42 5,374.02 Total 31,595.93 31,306.00 27,910.22 Less : Provision for Doubtful Debts (13,139.35) (6,013.15) (1,333.27)Total 18,456.58 25,292.85 26,576.96

Expected credit loss assessment for customers as at April 1, 2016, 31 March 31, 2017 and March 31, 2018

Exposures to customers outstanding at the end of each reporting period are reviewed by the Company to determine credit losses. Given that the macro economic indicators affecting customers of the Company have not undergone any substantial change, the Company ex-pects the historical trend of minimal credit losses to continue.

The movement in the allowance for impairment in respect of trade and other receivables during the year was as follows

₹Balance as at April 01, 2016 1,333.27 Impairment loss recognised 4,679.88 Amounts written off / written back - Balance as at March 31, 2017 6,013.15 Impairment loss recognised 7,126.20 Amounts written off / written back - Balance as at March 31, 2018 13,139.35

Cash and bank balance The Company held cash and bank balance with credit worthy banks and financial institutions of ₹ 286.69 ₹ 522.47 and ₹ 1097.01 as at

March 31, 2018, March 31, 2017 and April 1, 2016, respectively. The credit worthiness of such banks and financial institutions is eval-uated by the management on an ongoing basis and is considered to be good.

Investment in bonds

The Company held investments in bonds of ₹ Nil, ₹ 25.41 and ₹ 26.11 as at March 31, 2017 and April 01, 2016 respectively. The Com-pany limits its investment in bonds / non-convertible debentures in instruments having a credit rating which indicates high credit quality. The Company monitors the changes in credit risk.

B) Market risk Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of a financial

instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign currency exchange rates, equity prices and other market changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments including investments and deposits, foreign currency receivables and payables.

The Company market risk is managed by the board of directors which evaluates and exercises independent control over the entire process of market risk management. It also recommends risk management objectives and policies and also management of cash resources, implementing hedging strategies for foreign currency exposures and ensuring compliance with market risk limits and policies.

a) Foreign 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. The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to its operating activities. The Company manages its foreign currency risk by hedging transactions that are expected to occur within a maximum 12 month periods for hedges of forecasted sales and purchases in foreign currency.

The Company’s exposure to foreign currency risk at the end of the reporting period expressed in ₹, are as follows: (` in lakhs)

Foreign currency exposure US$ EUR GBP TotalApril 1, 2016Financial assetsTrade receivables 22,789.61 - 20.23 22,809.84 Loans 429.09 - - 429.09 Net exposure to foreign currency risk (assets) 23,218.70 - 20.23 23,238.93 Financial Liabilities - - - - Borrowings 15,343.89 - - 15,343.88 Trade payables 2,536.51 1.55 290.80 2,828.86 Other financial liabilities 93.96 - - 93.96 Net exposure to foreign currency risk (liabilities) 17,974.36 1.55 290.80 18,266.70

86


Foreign currency exposure US$ EUR GBP TotalRupee Conversion Rate 66.33 75.10 95.09 - March 31, 2017 Financial assetsTrade receivables 21,786.64 - 17.21 21,803.85 Loans 872.58 - - 872.58 Net exposure to foreign currency risk (assets) 22,659.22 - 17.21 22,676.43 Financial LiabilitiesBorrowings 1,714.01 - - 1,714.00 Trade payables 2,449.92 0.67 364.59 2,815.18 Net exposure to foreign currency risk (liabilities) 4,163.93 0.67 364.59 4,529.18 Rupee Conversion Rate 64.84 69.25 80.88 March 31, 2018Financial assetsTrade receivables 23,566.57 - 19.64 23,586.20 Loans 17,694.72 - - 17,694.72 Net exposure to foreign currency risk (assets) 41,261.29 - 19.64 41,280.92 Financial LiabilitiesTrade payables 2,462.95 - 426.41 2,889.36 Net exposure to foreign currency risk (liabilities) 2,462.95 - 426.41 2,889.36 Rupee Conversion Rate 65.04 80.62 92.28

Foreign currency sensitivity

The table below demonstrates sensitivity impact on profit after tax and total equity due to change in foreign exchange rates of cur-rencies where it has significant exposure:

Foreign currency (USD)As at March 31, 2018 As at March 31, 2017

2% Increase 2% Decrease 2% Increase 2% Decrease₹ ₹ ₹ ₹

US$ 775.97 (775.97) 369.91 (369.91)EUR - - (0.01) 0.01 GBP (8.14) 8.14 (6.95) 6.95 Increase / (decrease) in profit and loss 767.83 (767.83) 362.95 (362.95)

b) Interest rate risk

Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair value interest rate risk is the risk of changes in fair values of fixed interest bearing investments because of fluctuations in the interest rates. Cash flow interest rate risk is the risk that the future cash flows of floating interest bearing investments will fluctuate because of fluctuations in the interest rates. In order to optimize the Company’s position with regards to interest expenses and to manage the interest rate risk, treasury performs a comprehensive corporate interest rate risk management by balancing the proportion of fixed rate and floating rate financial instruments in its total portfolio. Accordingly, the Company endeavors to gradually reduce the exposure to variable interest rate borrowings.

The Company’s main interest rate risk arises from short-term borrowings and long term borrowings with fixed rates, which expose the Company to cash flow interest rate risk. The Company’s borrowings at fixed rate were mainly denominated in INR and US$. The Company’s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of change in market interest rates.

c) Exposure to interest rate risk

The Company’s interest rate risk arises from borrowings. The interest rate profile of the Company’s interest-bearing borrowings is as follows: (` in lakhs)

ParticularsAs at

March 31, 2018 ₹


₹

As at April 1, 2016

₹Floating rate borrowings 46,587.78 16,697.40 26,918.21 Fixed rate borrowings 8,923.73 8,186.86 6,842.03

Total 55,511.51 24,884.25 33,760.25


87

d) Sensitivity

Profit or loss is sensitive to higher/lower interest expense from borrrowings as a result of changes in interest rates. A reasonably possible change of 50 basis points in interest rates at the reporting date would have increase/(decreased) and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency exchange rates, remain constant.

Particulars March 31, 2018₹

March 31, 2017₹

Interest rates - Increase by 50 basis points (50 basis points) (143.10) (54.59)Interest rates - decrease by 50 basis points (50 basis points) 143.10 54.59

C) Liquidity Risk

Liquidity risk is the risk that the Company will encounter in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The approach of the Company to manage liquidity is to ensure , as far as possible, that these will have sufficient liquidity to meet their respective liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risk damage to their reputation. The Company assessed the concentration of risk with respect to refinancing its debt and concluded it to be low.

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments.

As on March 31, 2018 within 1 year More than 1 year TotalBorrowings (including interest accrued but not due and interest accrued and due)

60,367.95 2,459.58 62,827.53

Trade payables 9,566.88 - 9,566.88 Other financial liabilities 243.98 - 243.98 Bank guarantee (including financial guarantee and letter of credit)* - 1,032.98 1,032.98

Total 70,178.81 3,492.56 73,671.37

As on March 31, 2017 within 1 year More than 1 year TotalBorrowings 26,325.39 3,899.57 30,224.97 Trade and other payables 20,592.48 - 20,592.48 Other financial liabilities 122.21 - 122.20 Bank guarantee (including financial guarantee and letter of credit)* - 16,455.75 16,455.75

Total 47,040.08 20,355.32 67,395.40

As on April 1, 2016 within 1 year More than 1 year TotalBorrowings 30,703.89 5,732.33 36,436.22 Trade and other payables 6,758.59 - 6,758.59 Other financial liabilities 124.72 - 124.72 Bank guarantee (including financial guarantee and letter of credit)* - 16,679.17 16,679.17

Total 37,587.20 22,411.50 59,998.70

Financial guarantees issued by the Company on behalf of subsidiary ₹ 841.98 (March 31, 2017 ₹ 808.31) are with respect to borrowing raised by the respective entity. These amounts will be payable on default by the concerned entity. As of the reporting date, none of the subsidiaries have defaulted and hence, the company does not have any present obligation to third parties in relation to such guarantee.

53 Capital management:

The Company manages its capital to ensure that the Company while maximising the return to stakeholders through optimisation of debt and equity balance. The capital structure of the Company consists of net debt (borrowings as detailed in Note 18 and Note 21 offset by cash and bank balances) and total equity of the Company.

The gearing ratio at the end of the reporting period was as follows:

ParticularsAs at

March 31, 2018₹

March 31, 2017₹

April 01, 2016₹

Debt 55,511.51 24,884.25 33,760.25 Less: Cash and bank balances 271.66 217.39 1,097.01 Net debt 55,239.85 24,666.86 32,663.24 Total equity (16,160.58) 2,997.12 15,374.16 Capital and net debt 39,079.27 27,663.98 48,037.40 Gearing ratio (%) 1.41 0.89 0.68

88


54 Pursuant to High Court order dated September 05, 2017, The Company has written off its share of costs incurred in an oil block exploration of ₹ 2263.73 being no longer recoverable and has also made provision of ₹ 280.76 towards amount payable to Gas Authority of India Limited (GAIL) on un paid cash calls

55 Transition to Ind AS reporting As stated in Note 2 A., the financial statements for the year ended March 31, 2018 are prepared in compliance with Ind AS.

The adoption of Ind AS was carried out in accordance with Ind AS 101, using April 01, 2016 as the transition date. Ind AS 101 requires that all Ind AS standards that are effective for the first Ind AS Financial Statements for the year ending March 31, 2018, be applied consistently and retrospectively for all fiscal years presented.

All applicable Ind AS have been applied consistently and retrospectively wherever required. The resulting difference between the carrying amounts of the assets and liabilities in the financial statements under both Ind AS and Previous GAAP as of the Transition Date have been recognized directly in equity at the Transition Date.

On transition the Company did not revise estimates previously made under IGAAP except where required by Ind AS

Reconciliations: The following reconciliations help to understand the effect of significant differences arising from the transition from Previous GAAP to Ind AS in accordance with Ind AS 101:

A Reconciliation of equity:

Particulars Note no.As at

March 31, 2017 `

As at April 1, 2016

`

Total net worth as per Indian GAAP 6,973.72 16,671.48 Interest on loans given a 5.65 - Guarantee commission b 12.00 6.00 ECL on Trade Receivables d (3,994.66) (1,249.00)Loss on fair valuation of bond e 0.41 1.11 Revaluation of Property, Plant and Equipments f - (55.43)Total net worth as per Ind AS 2,997.12 15,374.16

B Reconciliation between Profit as previously reported and total comprehensive income as per Ind AS for the year ended March 31, 2017 (` in lakhs)

ParticularsNote no.

For the year 2016-17

(`)

Loss under previous GAAP (9,642.33)Current practices and Ind AS gap differences - Interest on loans given a 5.65 Corporate guarantee commission b 6.00 Remeasurement of defined benefit plan c 17.53 ECL on Trade Receivables d (2,745.66)(Loss) on fair valuation of bond e (0.70)Net (loss) after tax as per Ind AS (12,359.51)Other comprehensive income - Remeasurement of defined benefit plan c (17.53)Income tax relating to the above itemsTotal Comprehensive Income for the year (net of tax) (12,377.04)

C Reconciliation of changes in cash and cash equivalent as per Ind AS for the year ended March 31, 2017

There were no differences between the Statement of Cash Flows presented under Ind AS and under IGAAP

Particulars Note For the year

ended March 31, 2017 ₹

Effects of transition to Ind AS

₹

Amount as per Ind AS

₹ Cash flow from Operating activities a, b, d and e 12,691.58 813.76 13,505.35 Cash flow from Investing activities a 223.24 4.03 227.27 Cash flow from Financing activities b (13,415.93) (819.25) (14,235.19)

(501.11) (1.46) (502.57)


89

Notes to the reconciliation:

a Interest on loans given Company has booked interest income on loans given to body corporate in accordance under Ind ASb Corporate guarantee commission Company has booked commission income on corporate guarantee given to its wholly owned domestic subsidiary in accordance

with Ind AS c Actuarial gain/loss on employee benefit plan As per Ind AS 19, actuarial gains and losses relating to defined employee benefit plans are recognized in other comprehensive

income as compared to being recognized in the Statement of profit and loss under IGAAP. d Trade Receivables

As per Ind AS 109,the Company is required to apply expected credit loss model for recognising the allowance for doubtful debts. As a result, the Company has estimated lifetime expected credit losses and recorded the same as at the transition date.

e Investments

Under previous GAAP, investments in bonds were recorded at cost. Under Ind AS, investments are required to be valued at fair value. The Company has classified these instruments as fair value through profit and loss and adjusted the amounts as on transition date.

f Revaluation reserve

In accordance with Ind AS 101, the Company has adopted the exemption to consider its revaluation reserve differences deemed to be zero as at April 01, 2016.

56 In compliance with Ind AS 27 “Separate Financial Statements” the required information is as under :

Particulars Principal place of business/country of

incorporation

Percentage of ownership Interest as on

31-Mar-18 31-Mar-17 01-Apr-16Subsidiaries % % %Nitin Venture FZE UAE 100 100 100 Nitin Global Pte. Limited Singapore 100 100 100 Nitin Fire Protection Middle East FZE UAE 100 100 100 New Age Co. LLC UAE 49 49 49 Firetech Systems Limited United Kingdom 100 100 100 Eurotech Cylinder Private Limited India 100 100 100 AssociatesWorthington Nitin Cylinders Private Limited

India 40 40 40

Previous years figures are regrouped/restated wherever considered necessary.

For and on behalf of the Board of Directors Niin Fire Protection Industries Limited

Sd/- Sd/- Sd/- Nitin M. Shah Kailat Vaidhyanathan Rahul N. Shah Chairman and Non Executive Director Chief Executive Officer Non Executive Director DIN No. 00077323 DIN No. 00073232 Sd/- Sd/- Bharat K. Shah Sraban Kumar Karan Chief Financial Officer Company Secrtetary Mumbai Mumbai June 14, 2018 June 14, 2018

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INDEPENDENT AUDITOR’S REPORT

To the Members of Nitin Fire Protection Systems LimitedReport on the Consolidated Ind AS Financial Statements

We were engaged to audit the accompanying Consolidated Ind AS Financial Statements of Nitin Fire Protection Systems Limited (hereinafter referred to as “the Holding Company”) and its subsidiaries (the Holding Company and its subsidiaries together referred to as “the Group”) and its associate, comprising of the Consolidated Balance Sheet as at March 31, 2018, the Consolidated Statement of Profit and Loss (including Other Comprehensive Income), the Consolidated Statement of Changes in Equity and the Consolidated Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information (hereinafter referred to as “the Consolidated Ind AS Financial Statements”).

Management’s Responsibility for the Consolidated Ind AS Financial Statements

The Holding Company’s Board of Directors is responsible for the preparation of these Consolidated Ind AS Financial Statements in terms of the requirements of the Companies Act, 2013 (hereinafter referred to as “the Act”) that give a true and fair view of the consolidated financial position, consolidated financial performance including other comprehensive income, consolidated changes in equity and consolidated cash flows of the Group including its associate, in accordance with the accounting principles generally accepted in India, including the Indian Ac-counting Standards (Ind AS) specified under Section 133 of the Act, read with relevant rules thereunder. The respective Board of Directors of the companies included in the Group and its associate are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Group and for preventing and detecting frauds and other irregularities; the selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the Consolidated Ind AS Financial Statements by the Directors of the Holding Company, as aforesaid.

In preparing the Consolidated Ind AS Financial Statements, the respective Board of Directors of the Companies included in the Group and of its associate are responsible for assessing the ability of the Group and of its associate to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless Management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Auditors’ Responsibility

Our responsibility is to express an opinion on these Consolidated Ind AS Financial Statements based on our audit in accordance with the Our responsibility is to express an opinion on these Consolidated Ind AS Financial Statements based on our audit in accordance with the Stan-dards on Auditing under Section 143(10) of the Act.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

Because of the matters described in the Basis for Disclaimer of Opinion paragraph, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion.

Basis for Disclaimer of Opinion

a) As more fully explained in Note no. 42 to the Consolidated Ind AS Financial Statements, no provision has been made by the Holding Company in respect of its dispute with a bank for claim made by the bank for Rs. 501.33 lakhs (excluding interest) on a derivative con-tract entered into by its erstwhile subsidiary, the liability for which has been taken over by the Holding Company. The Holding Company has not determined the quantum of provision required in this regard as at March 31, 2018 on the above contract and has relied on a legal opinion in the matter wherein no liability is expected. Pending the final settlement of the matter, we are unable to comment on the extent of provision required, if any, in this regard.

b) As more clarified in Note no. 47 to the Consolidated Ind AS Financial Statements, the Holding Company has an exposure in Worthington Nitin Cylinders Private Limited an associate Company aggregating Rs. 1,164.26 lakhs as at March 31, 2018. In the absence of the fair value of the investment as required under Ind AS 28 ‘Investment in Associates and Joint Ventures’, we are unable to comment on the impairment, if any, on the carrying amount of the investment as at March 31, 2018.

c) As more explained in the Note no. 48 to the Consolidated Ind AS Financial Statements, in relation to Holding Company’s exposure in trade receivables aggregating Rs. 27,673.23 lakhs which are outstanding for a long period of time, payments for which are not forthcom-ing and are subject to independent confirmation. In the absence of independent confirmations from some of the trade receivables, any other alternate audit evidence and non recovery of any amount during the year and till date, we are unable to comment on the recover-ability of the same and consequential write off, if any.

d) As more explained in the Note no. 49 to the Consolidated Ind AS Financial Statements, in relation to Holding Company’s balanc-es of Trade receivables aggregating Rs. 3,459.95 lakhs (other than those covered under para (c) above), Trade payables aggregating Rs. 1,867.47 lakhs and loans to body corporates aggregating Rs. 331.08 lakhs are subject to independent confirmations/ reconciliations. In the absence of independent confirmations/ reconciliations, we are unable to comment on the consequential impact, if any.

The audit report on the Consolidated Financial Statements for the year ended March 31, 2017 was qualified in respect of matters stated under (a) to (c) above.


91

Disclaimer of Opinion

Because of the significance of the matters described in Basis for Disclaimer of Opinion paragraph, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion. Accordingly, we do not express an opinion on the Consolidated Ind AS Financial Statements.

Material Uncertainty Related to Going ConcernWe draw attention to Note no. 59 to the Consolidated Ind AS financial statement, which indicates that the Holding Company has incurred net loss of Rs. 19,157.71 lakhs during the year ended March 31, 2018 and, as of that date, the Holding Company’s current liabilities exceeded its total assets by Rs. 13,645.07 lakhs. Further as stated therein, this indicates that a material uncertainty exists that may cast significant doubt on the Holding Company’s ability to continue as a going concern.

Our opinion is not modified in respect of this matter.

Other Matters(a) We did not audit the Ind AS Financial Statements of six subsidiaries (including two step down subsidiaries), whose Ind AS Financial

Statements reflects total assets of Rs. 110,038.91 lakhs and net assets of Rs. 54,764.93 lakhs as at March 31, 2018, total revenues of Rs. 83,283.79 lakhs and net cash inflow amounting to Rs. 520.74 lakhs for the year ended on that date, as considered in the Consolidated Ind AS Financial Statements. The Consolidated Ind AS Financial Statements also include Group’s share of net profit (including other compre-hensive income) of Rs. 393.63 lakhs for the year ended March 31, 2018, as considered in the Consolidated Ind AS Financial Statements, in respect of one associate, whose Ind AS Financial Statements have not been audited by us. These Ind AS Financial Statements have been audited by other auditors whose reports have been furnished to us by the Management and our opinion on the Consolidated Ind AS Financial Statements, in so far as it relates to the amounts and disclosures included in respect of these subsidiaries and associate, and our report in terms of sub-section (3) of Section 143 of the Act, in so far as it relates to the aforesaid subsidiaries and associate, is based solely on the reports of the other auditors.

Certain of these subsidiaries are located outside India whose Ind AS Financial Statements have been prepared in accordance with ac-counting principles generally accepted in their respective countries and which have been audited by other auditors under generally ac-cepted auditing standards applicable in their respective countries. The Comapny’s Management has converted the Financial Statements of such subsidiaries located outside India from accounting principles generally accepted in their respective countries to accounting prin-ciples generally accepted in India. We have audited these conversion adjustments made by the Company’s Management. Our opinion in so far as it relates to the balances and affairs of such subsidiaries located outside India is based on the report of other auditors and the conversion adjustments prepared by the Management of the Company and audited by us.

(b) The comparative financial information of the Group and its Associate for the year ended March 31, 2017 and the transition date opening Balance Sheet as at April 01, 2016 included in these Consolidated Ind AS Financial Statements, are based on the previously issued statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 audited by us for the year ended March 31, 2017 vide our report dated May 30, 2017 expressed modified opinion on those Consolidated Financial Statements, as adjusted for the differences in the accounting principles adopted by the Holding Company on transition to the Ind AS, which have been audited by us.

Our opinion on the Consolidated Ind AS Financial Statements and our report on the Other Legal and Regulatory Requirements below, is not modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors.

Report on Other Legal and Regulatory RequirementsAs required by Section 143(3) of the Act, we report, to the extent applicable, that:

a. As described in the Basis for Disclaimer of Opinion paragraph, we sought but were unable to obtain all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit of the aforesaid Consolidated Ind AS Financial Statements;

b. Due to the possible effects of the matters described in the Basis for Disclaimer of Opinion paragraph and para (vi) of Annexure 1 to the Independent Auditor’s Report on the Standalone Ind AS Financial Statements of the Holding Company, we are unable to state whether proper books of account as required by law relating to preparation of the aforesaid Consolidated Ind AS Financial Statements have been kept by the Group including its associate so far as it appears from our examination of those books and the reports of the other auditors;

c. Due to the possible effects of the matters described in the Basis for Disclaimer of Opinion paragraph, we are unable to state whether the Consolidated Balance Sheet, the Consolidated Statement of Profit and Loss, the Consolidated Cash Flow Statement dealt and Consolidat-ed Statement of Changes in Equity with by this Report are in agreement with the relevant books of account maintained for the purpose of preparation of the Consolidated Ind AS Financial Statements;

d. Due to the possible effects of the matters described in the Basis for Disclaimer of Opinion paragraph, we are unable to state whether the aforesaid Consolidated Ind AS Financial Statements comply with the Indian Accounting Standards referred to in Section 133 of the Act read with relevant rules framed thereunder;

e. The matters described under the Material Uncertainty related to Going Concern and the Basis for Disclaimer of Opinion paragraph above, in our opinion, may have an adverse effect on the functioning of the group including its associate;

f. On the basis of written representations received from the directors of the Holding Company as on March 31, 2018, and taken on record of the Holding Company and the reports of the other statutory auditors of its subsidiary company and associate company incorporated in India, none of the directors of the Group and its associate company incorporated in India is disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164 (2) of the Act;

g. The qualification relating to the maintenance of accounts and other matters connected therewith are as stated in the Basis for Disclaimer of Opinion paragraph;

92


h. With respect to the adequacy of the internal financial controls over financial reporting of the Group and the operating effectiveness of such controls, we give our separate Report in the “Annexure 1”. Our report expresses a qualified opinion on the operating effectiveness of the Holding Company’s internal control over financial reporting.

i. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Audi-tors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

(i) The Consolidated Ind AS Financial Statements disclose the impact of pending litigations on the consolidated financial position of the Group and its associate – Refer Note no. 43 on Contingent Liabilities to the Consolidated Ind AS Financial Statements;

(ii) Except for the possible effects of the matters described in sub - paragraph (a) of the basis of Disclaimer of Opinion above, provision has been made in the Consolidated Ind AS Financial Statements, as required under the applicable law or Indian Accounting Stan-dards, for material foreseeable losses, on long-term contracts including derivative contracts – Refer Note nos. 42, 45 and 56 to the Consolidated Ind AS Financial Statements; and

(iii) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Holding Company, its subsidiary Company and associate Company, incorporated in India.





[Referred to under ‘Report on Other Legal and Regulatory Requirements’ in the Independent Auditor’s Report of even date to the members of Nitin Fire Protection Industries Limited on the Consolidated Ind AS Financial Statements for the year ended March 31, 2018]

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)

In conjunction with our audit of the Consolidated Ind AS Financial Statements of the Holding Company as of and for the year ended March 31, 2018, we have audited the internal financial controls over financial reporting of the Holding Company and its subsidiary Company, which are companies incorporated in India, as of that date.

Management’s Responsibility for Internal Financial ControlsThe respective Board of Directors of the of the Holding Company and its subsidiary Company, which are companies incorporated in India, are responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Holding Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (‘ICAI’). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the respective company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditor’s ResponsibilityOur responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing specified under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, includ-ing the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained and the audit evidence obtained by the other auditors in terms of their reports referred to in the Other Matters paragraph below, is sufficient and appropriate to provide a basis for our qualified opinion on the Company’s internal financial controls system over financial reporting.


93

Meaning of Internal Financial Controls Over Financial ReportingA Company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting princi-ples. A Company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorisations of Management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial ReportingBecause of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any eval-uation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Qualified OpinionAccording to the information and explanations given to us and based on our audit, the following material weaknesses have been identified in the operating effectiveness of the Holding Company’s internal financial control over financial reporting as at March 31, 2018:

a) Provision for diminution in the value of an investment (fully described in note no. 47 to the Consolidated Ind AS Financial Statements);

b) Provision for a claim on a derivative contract (fully described in note no. 42 to the Consolidated Ind AS Financial Statements);

c) Exposure in trade receivables are outstanding for long period of time, payments for which are not forthcoming (fully described in note no. 48 to the Consolidated Ind AS Financial Statements);

d) Non receipt of independent confirmations/ reconciliations from trade receivables; trade payables and loans to body corporates (fully described in note no. 49 to the Consolidated Ind AS Financial Statements);

e) Determination of terms of sales and purchase of items of inventory and underlying documentation relating to internal movement of items of inventory; and

f) Policy documentation pertaining to human resources and payroll related matters, which could potentially impact the related account balances when determined and / or recognised.

A ‘material weakness’ is a deficiency, or a combination of deficiencies, in internal financial control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

In our opinion, the Holding Company and its subsidiary company, which are companies incorporated in India, have, in all material respects, maintained adequate internal financial controls over financial reporting as of March 31, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the ICAI, and except for the possible effects of the material weaknesses described above on the achievement of the objectives of the control criteria, the Company’s internal financial controls over financial reporting were operating effectively as of March 31, 2018.

We have considered the material weaknesses identified and reported above in determining the nature, timing, and extent of audit tests applied in our audit of the Consolidated Ind AS Financial Statements of the Company and its subsidiary and except for the material weaknesses relating to point (e) to (f) of qualified opinion which do not affect our opinion on the Consolidated Ind AS Financial Statements of the Company, the other material weakness have affected our opinion on the Consolidated Ind AS Financial Statements of the Company and we have issued a disclaimer of opinion on the Consolidated Ind AS Financial Statements.

Other MattersOur aforesaid reports under Section 143(3)(i) of the Act on the adequacy and operating effectiveness of the internal financial controls over financial reporting in so far as it relates to 1 subsidiary company incorporated in India, is based on the corresponding report of the auditor of such company incorporated in India




94


CONSOLIDATED BALANCE SHEET AS AT MARCH 31, 2018 (` in lakhs)

Particulars Note No.As at

March 31, 2018 `


`


` ASSETSNon Current AssetsProperty, plant & equipment 3 8,143.61 10,907.54 10,367.53 Capital work In progress 3 15,981.55 199.24 162.18 Intangible assets 3 12,836.99 9,417.41 8,257.68 Goodwill on consolidation 51 10,069.20 10,069.20 10,301.26 Investment in associate 4 1,164.26 770.63 3,408.44 Financial assets(i) Investments 5 - 25.41 400.82 (ii) Other financial assets 6 4,061.96 4,864.80 2,794.21 Income tax assets 7 - 68.66 91.36 Other non current assets 8 9.53 420.05 9,809.70 Total non current assets 52,267.10 36,742.94 45,593.18

Current AssetsInventories 9 22,611.60 25,955.00 22,411.77 Financial assets(i) Investments 10 - - 158.00 (ii) Trade receivables 11 53,021.08 42,203.84 51,824.60 (iii) Cash and cash equivalents 12 934.34 204.78 996.50 (iv) Bank balances other than (iii) above 13 210.53 365.09 580.87 (v) Loans 14 1,000.41 5,674.40 1,975.35 (v) Other current financial assets 15 170.13 273.61 258.86 Other current assets 16 9,743.43 18,754.62 3,251.52 Total current assets 87,691.52 93,431.34 81,457.47

TOTAL ASSETS 1,39,958.62 1,30,174.28 1,27,050.65 Equity and LiabilitiesEquityEquity share capital 17 5,845.39 5,845.39 5,845.39 Other equity 18 28,578.48 44,751.50 51,872.48 Total equity 34,423.87 50,596.89 57,717.87 LiabilitiesNon Current LiabilitiesFinancial liabilities(i) Long term borrowings 19 2,472.26 3,912.15 5,980.75 Provisions 20 830.73 388.30 310.84 Deferred tax liabilities (net) 21 - - 39.36 Total non current liabilities 3,302.99 4,300.45 6,330.95

Current LiabilitiesFinancial liabilities(i) Short term borrowings 22 79,006.02 39,296.69 47,956.84 (ii) Trade payables 23

Dues of micro, small and medium enterprises 41.27 22.49 13.25 - Total outstanding dues to others 11,501.48 32,977.51 10,497.45

(iii) Other financial liabilities 24 5,701.96 2,375.15 3,591.27 Provisions 25 102.37 344.29 125.08 Other current liabilties 26 5,853.88 260.81 817.94 Income tax liabilities (net) 27 24.78 - - Total current liabilities 1,02,231.76 75,276.93 63,001.83 Total Liabilities 1,05,534.75 79,577.39 69,332.78

TOTAL EQUITY AND LIABILITIES 1,39,958.62 1,30,174.28 1,27,050.65


The accompanying notes are an integral part of these financial statements (1-60)As per our attached report of even date For Haribhakti & Co. LLP For and on behalf of the Board of DirectorsChartered Accountants Niin Fire Protection Industries Limited ICAI Firm Registration No.: 103523W/W-100048



95

CONSOLIDATED STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED MARCH 31, 2018 (` in lakhs)

Particulars Note No.For the year ended

March 31, 2018 `


` IncomeIncome from Operations 28 88,774.73 1,32,689.49 Other Income 29 552.29 425.06

Total income 89,327.02 1,33,114.55 ExpenditureCost of materials consumed 30 47,493.79 39,156.21 Purchase of stock-in-trade 31 1,414.09 56,238.17 Changes in inventory of stock-in-trade 32 5,262.59 (3,537.55)Excise duty on sales 3.62 11.82 Employee benefits expense 33 5,395.08 5,226.59 Finance costs 34 7,346.81 6,029.61 Depreciation and amortisation expenses 35 3,804.84 2,470.68 Other expenses 36 35,667.97 31,278.30

Total expenses 1,06,388.79 1,36,873.84 Loss before tax (17,061.77) (3,759.29)Income Tax expense Current Tax - - Adjustment of tax relating to earlier periods (net) 46 52.47 2.58 Deferred tax 21 - (39.36)Total tax expenses 52.47 (36.78)Loss after tax (17,114.24) (3,722.51)Share of net profit/(loss) of Associate 393.63 (2,637.81)Loss for the year (16,720.61) (6,360.32)

Other comprehensive income :(i) Items that will be reclassified to profit or loss Exchange differences on translation of foreign operations 507.94 (743.12) Income tax relating to the above items - -

(ii) Items that will not be reclassified to profit or loss Remeasurements of defined benefit obligations gains / (loss) 39.64 (17.53) Income tax relating to the above items - -

547.58 (760.65)Other comprehensive income for the year, net of tax

Total comprehensive Income for the year, net of tax (16,173.03) (7,120.97)

Loss attributable to:Owners of equity (16,720.61) (6,360.32)Non controlling interest - -

(16,720.61) (6,360.32)Total comprehensive income attributable to:Owners of equity (16,173.03) (7,120.97)Non controlling interest - -

(16,173.03) (7,120.97)Earnings per equity share 37Basic and Diluted [Nominal value of the shares ₹ 2 (March 31, 2017 : ₹ 2)] (5.72) (2.18)

Significant accounting policies 2The accompanying notes are an integral part of these financial statements (1-60)As per our attached report of even date For Haribhakti & Co. LLP For and on behalf of the Board of DirectorsChartered Accountants Niin Fire Protection Industries Limited ICAI Firm Registration No.: 103523W/W-100048


96


CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2018 (` in lakhs)


March 31, 2018 `


`

A Cash flow from operating activitiesNet (loss) before taxation (17,061.77) (3,759.29)Adjustments for:Depreciation and amortisation 3,804.84 2,470.68 Unrealised foreign exchange difference-net (gain)/loss 15.55 - Interest income (gross) (282.47) (349.51)Finance cost 7,346.81 6,029.61 Provision for doubtful debts 7,703.46 5,482.98 Loss on fair valuation of bonds 4.91 0.70 Loss on claims receivable 2,544.49 - Loss on loans given to bodies corporate 762.92 - Loans written off - 150.00 Impairment loss on property, plant and equipment 723.15 - Liability no longer required written back (94.59) (52.21)Provision for doubtful deposits, advances and claims 1,019.28 - Loss on sale of tangible assets 2.06 210.14 Bad debts/balances written off and liquidated damages 113.59 1,593.88 Dividend income - (4.00)Exchange difference 75.08 942.32 Loss on sale of investments - 14.27 Operating profit before working capital changes 6,677.31 12,729.57 Adjustments for:(Increase)/decrease in value of Inventories 3,343.40 (3,543.23)Decrease in other current financial assets 87.80 (10.26)(Increase) in other non-current financial assets (2,760.93) (2,070.59)Decrease in other non-current assets 410.52 9,389.66 (Increase)/decrease in other current assets 9,011.20 (15,503.11)Increase/(decrease) in other current financial liabilities 1,510.71 (1,452.90)Increase/ (Decrease) in other current liabilities 5,593.07 (557.13)(Increase)/decrease in value of trade receivables (18,708.16) 2,543.90 Increase/(decrease) in value of trade payables (21,304.35) 22,541.51 Increase/(decrease) in short term provisions (241.93) 219.21 Increase in long term provisions 442.42 77.46 (Decrease) in working capital (22,616.24) 11,634.54 Cash generated from/(used in) operations (15,938.93) 24,364.11 Taxes paid (net of refunds, if any) 40.98 22.70 Net cash generated from/(used in) operating activities (15,897.96) 24,386.81

B Cash flow from investing activitiesPurchase of fixed assets* (20,512.25) (5,887.90)(*includes movement in capital work in progress)Sale of non current investments 20.50 360.44 Sale of current investments - 158.00 Interest received 298.15 345.02 Maturity/(placement) of fixed deposits with banks 154.56 215.78 Proceeds on sale of fixed assets 16.75 (2.32)Dividend income - 4.00 Net cash (used in) investing activities (20,022.30) (4,806.98)

C Cash flow from financing activitiesProceeds from long term borrowings - 47.50 (Repayment) of long term borrowings (1,801.14) (1,768.39)Proceeds/(repayment) from/of short term borrowings (net) 39,709.33 (8,660.15)


97

CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2018 (` in lakhs)


March 31, 2018 `


`

Loans given to/ (refunded from) Others 3,911.07 (3,849.05)Finance charges (5,169.44) (6,140.55)Dividends distributed (including corporate dividend tax) (0.00) (0.90)Net cash generated from/(used in) financing activities 36,649.81 (20,371.54)Net increase/(decrease) in cash and cash equivalents 729.56 (791.71)Cash and cash equivalents, (opening) 204.79 996.50 Cash and cash equivalents,(closing) 934.34 204.79 Net increase/(decrease) as disclosed above 729.56 (791.71)

Notes:1 Brackets indicate a cash outflow or deduction.

2 Components of cash and cash equivalents (closing):

ParticularsAs at

March 31, 2018 `


` Cash on hand 291.16 17.15

Bank balances:With banks on:- Current accounts 643.18 186.45 - Fixed deposit having maturity value less than 3 months - 1.18

934.34 204.79

3 The consolidated cash flow statement has been prepared under the indirect method as set out in the Ind AS 7 “Statement of Cash Flows”.

4 The net profit / loss arising due to conversion of current assets / current liabilities, receivable / payable in foreign currency is furnished under the head “Unrealized forex exchange (gain) / loss”

5Particulars Opening Balance

`Cash Movement

`

Foreign exchange changes

`

Total `

March 31, 2018Non current borrowings, Refer note 19 5,779.11 (1,801.14) - 3,977.97 Current borrowings, Refer note 22 39,296.69 39,709.33 - 79,006.02


In terms of our report attached For Haribhakti & Co. LLP For and on behalf of the Board of DirectorsChartered Accountants Niin Fire Protection Industries Limited ICAI Firm Registration No.: 103523W/W-100048


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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED MARCH 31, 2018 (` in lakhs)Equity Share Capital

Particulars As at March 31, 2018 As at March 31, 2017 As at April 01, 2016

Number of shares `

Number of shares `

Number of shares `

A Equity shares of ₹ 2 each issued, subscribed and fully paidBalance at the beginning 2922,69,622 5,845.39 2922,69,622 5,845.39 2922,69,622 5,845 Changes in equity share capital during the year

- - - - - -

Balance at the end 2922,69,622 5,845 .39 2922,69,622 5,845.39 2922,69,622 5,845

B Other Equity Attributable to ownersReserves and Surplus

Securities premium reserve

`

General reserve

`

Statutory reserve

`

Foreign currency

translation reserve

`

Retained Earnings

`

Total `

Balance at April 01, 2016 1,338.94 2,320.37 391.05 5,424.71 42,397.40 51,872.48 Restated balance at the beginning of the reporting period

- - - - - -

Balance at April 01, 2016 1,338.94 2,320.37 391.05 5,424.71 42,397 .40 51,872 .48Profit for the year - - - - (6,360.02) (6,360.32)Other comprehensive income (net of tax)

- - - (743.12) (17.53) (760.65)

movement during the year - - - - - - Total comprehensive income for the year

- - - (743.12) (6,377.85) (7,120.97)

Balance at March 31, 2017 1,338.94 2,320.37 391.05 4,681.59 36,019.55 44,751.50Profit for the year - - - - (16,720.61) (16,720.61)Other comprehensive income (net of tax)

- - - 507.94 39.65 547.58

Total comprehensive income for the year

- - - 507.94 (16,680.96) (16,173.03)

Transactions with owners of company

- - - - - -

Balance at March 31, 2018

1,338.94 2,320.37 391.05 5,189.52 19,338.59 28,578.48





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Notes to the consolidated financial statement for the year ended March 31, 2018

(All amounts in Indian Rupees in lakhs unless otherwise stated)

1. Corporate Information: Nitin Fire Protection Industries Limited (NFPIL or the ‘Company’) was incorporated in Mumbai, India on September 4, 1995 as a public

limited company under the ‘Companies Act, 1956’. The Company’s business activity is that of manufacturing fire fighting equipment (gas based and water based fire extinguishers) under the brand name ‘NITIE’ (also certified by the Bureau of Indian Standard (BIS)), pro-viding turnkey solutions including procurement, designing, system integration, commissioning and installation of fire fighting systems including annual maintenance contracts for fire protection systems. The Company undertakes above activities from Maharashtra and Andhra Pradesh and has marketing offices in Maharashtra, Tamil Nadu, Andhra Pradesh, Gujarat and Uttar Pradesh. As part of its busi-ness activities, the Company has formed/acquired domestic/foreign subsidiaries (including a step down foreign subsidiary), has a stake in an associate and invested in a non-integrated un-incorporated joint venture for crude oil. NFPIL is an ISO 9001:2000 certified Company. The Company made an initial public offer (‘IPO’) in India in May 2007 and its shares are listed on the BSE Limited and the National Stock Exchange of India Limited.

2 Significant accounting policies:

(a) Basis of accounting and preparation of Consolidated Financial Statements: Compliance with Indian Accounting Standards (Ind AS):

(a) These Consolidated Ind AS Financial Statements (“Consolidated Financial Statements”) of the Company and its subsidiaries (“the Group”), have been prepared in accordance with the recognition and measurement principles laid down in Indian Account-ing Standards (“Ind AS”) read with Rule 4 of the Companies (Indian Accounting Standards) Rules, 2015 as amended and other relevant provisions of the Act and accounting principles generally accepted in India. These consolidated financial statements were authorized for issue by the Company’s Board of Directors on June 14, 2018.

(b) These Consolidated Financial Statements are the first Consolidated Financial Statements prepared in accordance with Indian Accounting Standards (Ind AS). For all periods upto and including the year ended March 31, 2017, the Group reported its Con-solidated Financial statements in accordance with the accounting standards notified under the section 133 of the Companies Act 2013, read together with relevant rules framed there under (“Indian GAAP”). The Consolidated Financial Statements for the year ended March 31, 2017 and the opening Balance Sheet as at April 1, 2016 have been restated in accordance with Ind AS for comparative information. Reconciliations and explanations of the effect of the transition from IGAAP to Ind AS on the Group’s Balance Sheet, Statement of Profit and Loss and Statement of Cash Flows are provided in note 3.

Functional and Presentation Currency:

These consolidated financial statements are presented in Indian rupees, which is the functional currency of the parent Company. All financial information presented in Indian rupees has been rounded to the nearest thousand, except otherwise indicated.

Basis of measurement:

These Consolidated Financial statements are prepared under the historical cost convention unless otherwise indicated.

Use of Estimates and Judgements

The preparation of the consolidated financial statements in conformity with Ind AS requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. Management believes that the estimates used in preparation of the consolidated financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known/ materialise. Estimates and underlying assumptions are reviewed on an ongoing basis.

Information about critical judgments in applying accounting policies, as well as estimates and assumptions that have the most significant effect to the carrying amounts of assets and liabilities within the next financial year, are included in the accounting policies.

The areas involving critical estimates or judgments are:

- Measurement of defined benefit obligations (Refer note 33.1) - Measurement and likelihood of occurrence of provisions and contingencies (Refer note 43) - Estimation of tax expenses and liability (Refer note 46 & 27) - Useful lives of property, plant, equipment and intangibles (Refer note 4) - Revenue recognition

(b) Basis of consolidation:

i) Subsidiaries

Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns form its involvement with the entity and has the ability to affect those returns through its power over the entity. The finan-cial statements of subsidiaries are included in the consolidated financial statements from the date on which control commences until the date on which control ceases.

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ii) Non-controlling interests (NCI)

The non-controlling interests comprise the portion of equity of subsidiaries that are not owned, directly or indirectly, by the Group.

Non-controlling interest in the results and equity of subsidiaries are shown separately in the consolidated statement of profit and loss, consolidated statement of changes in equity and balance sheet respectively.

The Group recognises any non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest’s proportionate share of the acquired entity’s net identifiable assets.

Changes in the Group’s equity interest in a subsidiary that do not result in a loss of control are accounted for as equity transac-tions.

iii) Loss of control

When a Group loses control over a subsidiary, it derecognises the assets and the liabilities of the subsidiaries, and any NCI and other components of equity. Any interest retained in the former subsidiary is measured at fair value at the date that control is lost. Any resulting gain or loss is recognised in statement of profit and loss.

iv) Equity accounted investees

The Group’s interests in equity accounted investees comprise interests in associates.

An associate is an entity in which the Group has significant influence, but not control or joint control, over the financial and operating policies.

Interests in associates are accounted for using the equity method. They are initially recognised at cost which includes transaction cost. Subsequent to initial recognition, the consolidated financial statements include the Group’s share or profit or loss and OCI of equity –accounted investees until the date on which significant \influence or joint control ceases.

v) Transactions eliminated on consolidation

Intra-group balance and transactions, and any unrealized income and expenses arising from intra-group transactions, are elim-inated. Unrealised gains arising from transactions with equity accounted investees are eliminated against the investment to the extent of Group’s interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

(c) Revenue Recognition:

Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are inclusive of excise duty and net of returns, trade allowances, rebates, value added taxes, Goods and Service Tax.

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured.

i) Sale of goods: Revenue from sale of goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on delivery of the goods. Revenue is measured net of returns, trade discounts and volume rebates. The timing of the transfer of risks and rewards varies depending on the individual terms of the sales contract.

ii) Rendering of services : In contracts involving rendering of services, revenue is recognised in profit or loss in the proportion of the stage of completion of the transaction at the reporting date and are measured net of sales tax, works contract tax, service tax and Goods and Service Tax.

iii) Dividend income : Dividends are recognised in Statement of Profit and loss only when the right to receive payment is estab-lished, it is probable that the economic benefits associated with the dividend will flow to the Group, and the amount of the divi-dend can be measured reliably.

iv) Insurance and other claims, where quantum of accruals cannot be ascertained with reasonable certainty, are accounted on accep-tance basis.

(d) Property, Plant and Equipment, Depreciation and Impairment:

i) Recognition and measurement: Property, plant and equipment are measured at cost / deemed cost, less accumulated depreciation and impairment losses, if any.

Cost of Property, plant and equipment comprises its purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates, any directly attributable cost of bringing the asset to its working condition for its intended use and estimated attributable costs of dismantling and removing the asset and restoring the site on which it is located.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other re-pairs and maintenance are charged to the Statement of Profit and Loss during the reporting period in which they are incurred.

Gains or losses arising from derecognition of plant, property and equipment are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the Statement of Profit and Loss when the asset is derecognized.


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An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Any gain or loss on disposal of an item of property, plant and equipment is recognised in Statement of Profit and Loss.

Depreciation on additions / disposals is provided on a pro-rata basis i.e. from / up to the date on which asset is ready for use / disposed of

The Group has elected to use the exemption available under Ind AS 101 to continue the carrying value for all of its Property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and used that as its deemed cost as at the date of transition (April 01, 2016).

ii) Depreciation:

Depreciation on Property, Plant and Equipment has been provided on written down value basis and manner prescribed in Schedule II to the Companies Act 2013. Leasehold Land on a straight line basis over the period of lease.i.e.99 year.

iii) Intangible Assets

Intangible Assets are stated at acquisition cost, net of accumulated amortization and accumulated impairment losses, if any. Intangible assets are amortised on a Straight Line Basis over their estimated useful lives. Costs related to patents are written off over the remaining useful life from the day of grant. Computer Softwares are amortized over a period of 3 years from the date of acquisition.

Expenditure on research and development eligible for capitalisation are carried as Intangible assets under development where such assets are not yet ready for their intended use.

The Group has elected to use the exemption available under Ind AS 101 to continue the carrying value for all of its intangible assets as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and used that as its deemed cost as at the date of transition (April 01, 2016).

iv) Capital work in Progress

Expenditure during the construction/ pre-operative period is included under Capital Work-in-Progress and same is allocated to the respective Property, Plant and Equipment on the completion of project.

(e) Investment Property Investment property is property (land or a building or part of a building or both) held either to earn rental income or for capital

appreciation or for both, but neither for sale in the ordinary course of business nor used in production or supply of goods or services or for administrative purposes. Investment properties are stated at cost net of accumulated depreciation and accumulated impairment losses, if any.

The Group has elected to use the exemption available under Ind AS 101 to continue the carrying value for all of its investment property as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and used that as its deemed cost as at the date of transition (April 01, 2016)

Based on technical evaluation and consequent advice, the management believes a period of 54 years as representating the best estimate of the period over which investment property are expected to be used. Accordingly, the Group depreciates investment properties over a period of 54 years on a written down value basis.

Any gain or loss on disposal of investment property calculated as the difference between the net proceeds from disposal and the carrying amount of the Investment Property is recognised in Statement of Profit and Loss.

Fair values is determined by an independent valuer who holds a recognised and relevant professional qualification and has recent experience in the location and category of the investment property valued.

(f) Research and Development Cost: Revenue expenditure pertaining to research is charged to the Statement of Profit and Loss. Development costs of products are

also charged to the Statement of Profit and Loss unless a products’ technical feasibility has been established, in which case such expenditure is capitalized.

Product development costs that are directly attributable to the design and testing of identifiable and unique products controlled by the Group are recongised as intangible assets if, and only if, technical and commercial feasibility of the project is demonstrated, future economic benefit are probable, the Group has intention and ability to complete and use or sell the assets and cost can be measured reliably.

The amount capitalized comprise expenditure that can be directly attributed or allocated on a reasonable and consistent basis to creating, producing and making the asset ready for its intended use. Capitalised product development costs are recorded as intangible assets and amortised from the useful life as estimated by the management. Property, Plant and Equipments utilized for research and development are capitalized and depreciated in accordance with the policies stated for Property, Plant and Equipments.

(g) Impairment of Assets: i) Financial assets

In accordance with Ind-AS 109, the Group applies Expected Credit Loss (“ECL”) model for measurement and recognition of impairment loss on the financial assets measured at amortised cost and debt instruments measured at FVOCI. Loss allowances on trade receivables are measured following the ‘simplified approach’ at an amount equal to the lifetime ECL at each reporting date. In respect of other financial assets, the loss allowance is measured at 12 month ECL only if there is no significant

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deterioration in the credit risk since initial recognition of the asset or asset is determined to have a low credit risk at the reporting date. The amount of ECLs (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognized is recognized as an impairment gain or loss in Statement of Profit and Loss.

ii) Non-financial assets

The carrying values of assets / cash generating units at each balance sheet date are reviewed for impairment if any indication of impairment exists.

An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash generating units). The impairment loss is recognised as an expense in the Statement of Profit and Loss.

(h) Investment in associates: Investments that are readily realisable and intended to be held for not more than a year from the date on which such investments

are made, are classified as current investments. All other investments are classified as long term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long term investments are carried at cost. However, provision for diminution in value is made to recognise a decline, other than temporary, in the value of the long term in-vestments.

The Gorup has elected to continue with the carrying value of all its equity investments in its associates as recognized in the consoli-dated financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as the deemed cost as at the transition date pursuant to the exemption under Ind AS 101.

(i) Inventories: i) Raw Materials, packing materials, Stores and Spares are valued at lower of cost arrived on First In First Out method (FIFO) and

Net Realisable Value. Cost of raw materials comprises cost of purchases.

ii) Work-in-progress and Finished Goods are valued at lower of cost and Net Realisable Value. Cost of work-in-progress and fin-ished goods comprises direct materials, direct labor and an appropriate proportion of variable and fixed overhead expenditure, the latter being allocated on the basis of normal operating capacity.

iii) Traded goods are valued at lower of cost and net realizable value. Cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on a FIFO basis.

Costs of purchased inventory are determined after deducting rebates and discounts. Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

(j) Employee Benefits:i) Short-term obligations

Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in respect of employees services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the Balance Sheet.

ii) Other long-term employee benefit obligations

The liabilities for earned leave and sick leave are not expected to be settled wholly within 12 months after the end of the period in which the employees render the related service. They are therefore measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting peri-od using the projected unit credit method. The benefits are discounted using the market yields at the end of the report-ing period that have terms approximating to the terms of the related obligation. Remeasurements as a result of ex-perience adjustments and changes in actuarial assumptions are recognised in the Statement of Profit and Loss. The obligations are presented as current liabilities in the Balance Sheet if the Group does not have an unconditional right to defer settlement for at least twelve months after the reporting period, regardless of when the actual settlement is expected to occur.

iii) Post-employment obligations

The Group operates the following post-employment schemes:

(a) defined benefit plans such as gratuity; and

(b) defined contribution plans such as provident fund and Employee State Insurance Fund (ESIC).

- Defined Benefit Plans - Gratuity obligations

The liability or asset recognised in the Balance Sheet in respect of defined benefit gratuity plans is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets.

The defined benefit obligation is calculated annually by actuaries using the projected unit credit method.

The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation.


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The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee Benefit expense in the Statement of Profit and Loss.

Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in the year in which they occur, directly in other comprehensive income they are included in retained earnings in the Statement of changes in equity and in the Balance Sheet.

Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are recognised immediately in the Statement of Profit and Loss as past service cost.

- Defined contribution plan

The Group pays provident fund and ESIC contributions to publicly administered provident funds / ESIC as per local regulations. The Group has no further payment obligations once The contributions have been paid. The contributions are accounted for as Defined contribution Plans and The contributions are recognised as employee Benefit expense when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is available.

(k) Leases (where the company is lessee): At the inception of an arrangement, the Group determines whether the arrangement is or contains a lease. At the inception or

on reassessment of an arrangement that contains a lease, the Group separates payments and other consideration required by the arrangement into those for the lease and those for the other elements on the basis of their relative fair values.

Leases of property, plant and equipment where the Group, as lessee, in which a significant portion of the risks and rewards of ownership are not transferred to the Group as lessee are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the Statement of Profit and Loss as per the terms of the lease or on a straight-line basis over the period of the lease unless the payments are structured to increase in line with expected general inflation to compensate for the lessor’s expected inflationary cost increases.

(l) Borrowings: Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at

amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in the Statement of Profit and Loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs.

Borrowings are removed from the Balance Sheet when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in the Statement of Profit and Loss.

Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period.

(m) Borrowing Costs: Borrowing costs consist of interest and transactions costs incurred in connection with the borrowing of funds. Borrowing costs may

include exchange differences to the extent regarded as an adjustment to the borrowing costs.

Borrowing costs that are attributable to the acquisition or construction of qualifying assets (i.e. an asset that necessarily takes a substantial period of time to get ready for its intended use) are capitalized as a part of the cost of such assets. All other borrowing costs are charged to the Statement of Profit and Loss.

(n) Foreign Currency Transactions / Translations(i) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognised in Statement of Profit and Loss as either profit or loss. A monetary item for which settlement is neither planned nor likely to occur in the foreseeable future is considered as a part of the entity’s net investment in that foreign operation.

Foreign exchange gains and losses are presented in the Statement of Profit and Loss on a net basis within other income and expenses accordingly.

Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss in the Statement of Profit and Loss. For example, translation differences on non monetary assets and liabilities such as equity instruments held at fair value through profit or loss are included in net profit in the Statement of Profit and Loss as part of the fair value gain or loss and translation differences on non-monetary assets such as equity investments classified as Fair Value through Other Comprehensive Income (“FVOCI”) are recognised in other comprehensive income (“OCI”).

(ii) Foreign Operations

In case of foreign operations whose functional currency is different from the parent company’s functional currency, the assets and liabilities of such foreign operations, including goodwill and fair value adjustments arising upon acquisition, are translated to

104


the reporting currency at exchange rates at the reporting date. The income and expenses of such foreign operations are translated to the reporting currency at the monthly average exchange rates prevailing during the year. Resulting foreign currency differenc-es are recognized in other comprehensive income/ (loss) and presented within equity as part of FCTR. When a foreign operation is disposed of, in part or in full, the relevant amount in the FCTR is reclassified to the Statement of Profit and Loss as a part of gain or loss on disposal.

(o) Income Tax: Income tax expense comprises current tax and deferred tax. It is recognised in Statement of Profit and Loss except to the extent that

it relates items recognised directly in equity or in OCI.

The income tax expense or credit for the period is tax payable on the current year’s taxable income based on the applicable income tax rate adjusted by change in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the reporting date. Current tax comprises of expected tax payable or receivable on taxable income/loss for the year or any adjustment or receivable in respect of previous year. Management periodically evaluates position taken in tax returns with respect to situations in which appli-cable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amount expected to be paid to the tax authorities.

Deferred income tax is provided in full, using the Balance Sheet method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting date and are expected to apply to the Group when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused tax credits (Minimum alternate tax credit entitlement) only if it is probable that future taxable amounts will be available to utilise those temporary differ-ences, unused losses and unused tax credits. Deferred tax assets – unrecognised or recognised, are reviewed at each reporting date and are recognised / reduced to the extent that it is probable or no longer probable respectively that the related tax benefit will be realized.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

(p) Earnings Per Share: (i) Basic earnings per share Basic earnings per share is calculated by dividing:

- the profit attributable to owners of the Group;- by the weighted average number of equity shares outstanding during the financial year, adjusted for bonus elements in equity

shares issued during the year.(ii) Diluted earnings per share Diluted earnings per share is calculated by dividing:

- the net profit or loss after tax for the year attributable to owners of the Group , and- the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential

equity shares. (q) Provisions:

Provisions are recognized when there is a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. 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 are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

(r) Contingent Liabilities 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 Group 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 Group does not recognize a contingent liability but discloses its existence in the financial statements.

(s) Cash and cash equivalents Cash and cash equivalents in the Balance Sheet include cash on hand, cheques on hand, deposits held at call with financial insti-

tutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

For the purpose of presentation in the Statement of Cash Flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value and overdrawn bank balances.


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Cash Flows Cash flows are reported using the indirect method, where by net profit before tax is adjusted for the effects of transactions of a

non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities are segregated.

(t) Dividend Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the

entity, on or before the end of the reporting period but not distributed at the end of the reporting period. (u) Derivatives and hedging activities The Group holds derivative financial instruments such as forward contracts to mitigate risk of changes in exchange and interest

rates. The counterparty for these contracts is generally banks.(i) Cash flow hedges that qualify for hedge accounting:

The Group designates their derivatives as hedges of foreign exchange risk associated with the cash flows of highly probable forecast transactions and variable interest rate risk associated with borrowings (cash flow hedges).

The Group documents at the inception of the hedging transaction the economic relationship between hedging instruments and hedged items including whether the hedging instrument is expected to offset changes in cash flows of hedged items.

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in the OCI in cash flow hedging reserve within equity, limited to the cumulative change in fair value of the hedged item on a present value basis from the inception of the hedge. The gain or loss relating to the ineffective portion is recognised immediately in the Statement of Profit and Loss.

Amounts accumulated in equity are reclassified to the Statement of Profit and Loss in the year when the hedged item affects profit or loss.

When a hedging instrument expires, or is sold or terminated, or when a hedge no longer meets the criteria for hedge accounting, any cumulative deferred gain or loss and deferred costs of hedging in equity at that time remains in equity until the forecast transaction occurs. When the forecast transaction is no longer expected to occur, the cumulative gain or loss and deferred costs of hedging that were reported in equity are immediately reclassified to the Statement of Profit and Loss.

The full fair value of a hedging derivative is classified as a non-current asset or liability when the remaining maturity of the hedged item is more than 12 months; it is classified as a current asset or liability when the remaining maturity of the hedged item is less than 12 months.

(ii) Derivatives that are not designated as hedges

The Group enters into certain derivative contracts to hedge risks which are not designated as hedges. Such contracts are accounted for at fair value through profit and loss and are included in other income / expenses. Assets/liabilities are presented as current assets/current liabilities if they are either held for trading or are expected to be realized within 12 months after the Balance Sheet date.

(v) Financial instruments a. Financial Liabilities


Financial liabilities are initially recognised when the Group becomes a party to the contractual provisions of the instrument. Financial liability is initially measured at fair value plus, for an item not at fair value through profit and loss, transaction costs that are directly attributable to its acquisition or issue.

Subsequent measurement

Financial liabilities are subsequently carried at fair value through profit and loss. For trade payables and other liabilities maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.

Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an ex-isting 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 de-recognition 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.

b. Financial assets


Trade Receivables are initially recognised when they are originated. All other financial assets are initially recognised when the Group becomes a party to the contractual provisions of the instrument. All financial assets other than those measured subse-quently at fair value through profit and loss, are recognised initially at fair value plus transaction costs that are attributable to the acquisition of the financial asset.

106


Classification and subsequent measurement

Subsequent measurement is determined with reference to the classification of the respective financial assets. Based on the business model for managing the financial assets and the contractual cash flow characteristics of the financial asset, the Group classifies financial assets as subsequently measured at amortised cost, fair value through OCI or fair value through profit and loss.

i) Financial assets amortised at cost

A financial asset is subsequently measured at amortised cost if it is held with in a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely consisting payments of principal and interest on the principal amount outstanding.

ii) Financial assets at fair value through other comprehensive income

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments principal and interest on the principal amount outstanding.

iii) Financial assets at fair value through profit or loss

A financial asset which is not classified in any of the above categories are subsequently fair valued through profit or loss.

Equity investments All equity investments within the scope of Ind-AS 109 are measured at fair value. Such equity instruments which are held for trading

are classified as FVTPL. For all other such equity instruments, the Group decides to classify the same either as FVOCI or FVTPL. The Group makes such election on an instrument-by-instrument basis. The classification is made on initial recognition and is irrevocable. For equity instruments classified as FVOCI, all fair value changes on the instrument, excluding dividends, are recognized in OCI. Dividends on such equity instruments are recognised in the Statement of Profit or Loss. Equity instruments included within the FVTPL category are measured at fair value with all changes recognized in the Statement of Profit and Loss. Dividends on such equity instruments are recognised in the Statement of Profit and Loss.

Derecognition A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised

when the rights to receive cash flows from the asset have expired, or the Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either:- the Group has transferred substantially all the risks and rewards of the asset, or

- the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

On de-recognition, any gains or losses on all debt instruments (other than debt instruments measured at FVOCI) and equity instruments (measured at FVTPL) are recognised in the Statement of Profit and Loss. Gains and losses in respect of debt instruments measured at FVOCI and that are accumulated in OCI are reclassified to profit or loss on de-recognition. Gains or losses on equity instruments measured at FVOCI that are recognised and accumulated in OCI are not reclassified to profit or loss on de-recognition.

(w) Current–non-current classification All assets and liabilities are classified into current and non-current. Assets An asset is classified as current when it satisfies any of the following criteria:

a) it is expected to be realised in, or is intended for sale or consumption in, the Group’s normal operating cycle;

b) it is held primarily for the purpose of trade;

c) it is expected to be realised on demand or within 12 months after the reporting date; or

d) it is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting date.

Current assets include the current portion of non-current financial assets. All other assets are classified as non-current. Liabilities A liability is classified as current when it satisfies any of the following criteria:

a) it is expected to be settled in the Group’s normal operating cycle;

b) it is held primarily for the purpose of trade;

c) it is due to be settled in demand or within 12 months after the reporting date; or

d) there is no unconditional right to defer settlement of the liability for at least 12 months after the reporting date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.


107

Current liabilities include current portion of non-current financial liabilities.

All other liabilities are classified as non-current. Deferred tax assets and liabilities are classified as non-current assets and liabilities.

(x) Operating cycle Based on the nature of products / activities of the Group and the normal time between acquisition of assets and

their realisation in cash or cash equivalents, the Group has determined its operating cycle as 12 months for the purpose of classification of its assets and liabilities as current and non-current.

(y) Recent Accounting Pronouncements On 28th March, 2018, the Ministry of Corporate Affairs (MCA) issued the Companies (Indian Accounting Standards)

(Amendments) Rules, 2018, notifying amendments to Ind AS 21, ‘The Effects of Changes in Foreign Exchange Rates’ and the new standard Ind AS 115, ‘Revenue from Contract with Customers’. These amendments are applicable to the Group from 1st April, 2018.

Amendment to Ind AS 21: On 28th March, 2018, MCA has notified the Companies (Indian Accounting Standards) Amendment Rules, 2018

containing ‘Appendix B to Ind AS 21: Foreign currency transactions and advance consideration’ which clarifies the date of the transaction for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income, when an entity has received or paid advance consideration in a foreign currency. This amendment will come into force from 1st April, 2018. Standard issued but not yet effective (Ind AS 115):

On 28th March, 2018, the MCA notified the Ind AS 115, Revenue from Contracts with Customers. The core principle of the new standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Further the new standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts with customers.

The effective date for adoption of Ind AS 115 is financial periods beginning on or after 1st April, 2018. The Group is in process of evaluating the impact due to above changes in accounting principles.

108


3 Ta

ngib

le a

nd in

tang

ible

ass

ets

(` in

lakh

s)

Desc

riptio

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Gros

s car

ryin

g am

ount

Accu

mul

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dep

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tion

/ am

ortis

ation

Net b

lock

Carr

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amou

nt as

at

Apr

il 01

, 20

17

Addi

tions

du

ring t

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year

Disp

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durin

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ye

ar

For

eign

exch

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di

ffere

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As at

Mar

ch

31, 2

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Up to

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for

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Disp

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of

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ffere

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Up to

M

arch

31,

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At M

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31,

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, 201

8

A

Prop

erty,

plan

t an

d eq

uipm

ent

Land

- Fr

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- -

- 40

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- -

- -

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402.2

3 La

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-

- -

25.18

0.

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0.36

-

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- 0.

72

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24

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5,59

8.34

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4 55

.43

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5,

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2 34

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376.3

7 -

- -

6.19

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5,03

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218.8

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- 65

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1 4,

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2 2,

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4

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and

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2.84

-

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73

2.19

206.2

7 19

9.29

- -

14.40

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0 51

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9

Offic

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24.58

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7 22

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6 11

2.78

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3 12

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2.14

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9 14

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- 32

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5 77

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45.08

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9 19

3.88

71.24

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otal

A 11

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5 25

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39

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2.83

1,02

7.71

2,22

8.23

12.09

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10,90

7.54

8,14

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B

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Tot

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199.2

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6.53

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8.42

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1.48

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3,79

3.24

270.5

8 37

8.25

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2 3,

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8 3,

138.8

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Comp

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7.01

4,47

4.24

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0 73

3.88

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1,06

6.31

2,67

3.41

6,41

6.69

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4 -

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4 15

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1 9,

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8 28

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3 20

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9 36

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5


109

3 Ta

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cost

at A

pril 0

1, 20

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year

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5.37

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7 5,

257.2

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7 -

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2.70

4,21

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6.81

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3 -

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323.1

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129.2

5 -

- -

- 12

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3 19

3.88

Tota

l A

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B

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8 37

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- -

199.2

4 -

- -

- -

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8 19

9.24

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l B

162.1

8 37

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- -

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4 -

- -

- -

- -

162.1

8 19

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ights

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2.65

- -

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3.53

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7.00)

456.5

3 4,

302.6

5 3,

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2

Prod

uct L

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Fees

1,80

5.14

1,51

7.66

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6.64)

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- 28

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4 3,

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Comp

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4 -

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1 -

348.9

6 -

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2.60

2,14

9.89

2,67

4.41

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8 2,

428.2

0 -

(217

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10,46

8.12

- 1,

115.7

8 -

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(66.0

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1 8,

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8 9,

418.4

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18,78

7.39

5,92

4.96

1,65

3.38

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22,60

1.61

- 2,

470.6

8 1,

496.3

5 1,

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7 -

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2,07

7.41

18,78

7.39

20,52

4.19

(* o

ther

than

inte

rnal

ly g

ener

ated

)

110


Notes to the consolidated financial statement for the year ended March 31, 2018

Note : (` in lakhs)1 The Company has elected to use the exemption available under Ind AS 101 to continue the carrying value for all of its Property, plant and

equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and used that as its deemed cost as at the date of transition (April 01, 2016) as per the following details:

Particulars Gross Block (at cost)

Accumulated Depreciation

(as per Previous GAAP)

Gross Block as per Ind AS

Land - Freehold 402.23 - 402.23 Land - Leasehold 32.40 7.22 25.18 Buildings 5,960.75 1,515.38 4,445.37 Plant and equipments 7,640.68 3,137.98 4,502.70 Furniture and fixtures 851.64 522.43 329.21 Office equipments 184.14 154.87 29.27 Vehicles 993.78 686.98 306.81 Computer systems 18.67 15.03 3.63 Cylinders 490.36 167.23 323.13 Tangible Assets 16,574.65 6,207.12 10,367.53 Agency Rights 4,780.72 478.07 4,302.65 Product listing fees 1,931.59 126.46 1,805.13 Computer software 3,059.19 909.29 2,149.90Intangible Assets 9,771.50 1,513.82 8,257.68

2 In accordance with Ind AS 16 - “Property, Plant and Equipment” the Holding Company does not except any future economic benefit from Plant and equipments, Furniture and fixtures, Office equipments, Computer systems and Cylinders. Hence, the Company has partially impaired the said assets by ₹ 72,315,088.

3 Property, Plant and Equipment provided as security

Particulars As at

March 31, 2018₹


₹

As at April 1, 2016

₹Land - Freehold 402.23 402.23 402.23 Buildings 1,528.13 1,413.30 1,492.20 Vehicles 52.30 74.67 51.13 Total 1,982.66 1,890.20 1,945.56

Note - First pari passu charge on immovable and movable assets of the Company both present and future including its location at (i) factory at A-117,TTC Industrial area, Pawana Village, Navi Mumbai-400 705 (ii) office premises at 501/502 Delta Technology Street, Hiranandani Gardens, Powai, Mumbai - 400 076 and (iii)immovable properties of Eurotech Cylinders Private Limited, situated at EL-29, TTC Industrial Area, Mahape, Navi Mumbai 400 701 (only for IDBI Bank Limited).

4 Investment in associate:

Particulars Nos.As at

March 31, 2018 Nos. As at

March 31, 2017 Nos. As at

April 1, 2016 ₹ ₹ ₹

Investment in Equity instruments of Associates (Unquoted) (Fully paid up) (Trade)Investment in Worthington Nitin Cylinders Private Limited of face value ₹ 10 each (40% holding)

23,36,496 1,164.26 23,36,496 770.63 23,36,496 3,408.44

- 1,164.26 - 770.63 - 3,408.44


111

Note: (` in lakhs

Aggregate amount of quoted investments - - - Aggregate amount of unquoted investments 1,164.26 770.63 3,408.44 Aggregate amount of impairment in the value of investments

- - -

5. Investments:

Particulars Nos.As at



April 1, 2016Nos. Nos. ₹ ₹ ₹

Investment in bonds-Quoted, non trade

9.35% IFCI Limited - Non convertible debentures of ₹ 1,000 each

- - 2,500 25.41 2,500 26.11

Investment in units of mutual fund- quoted/ non trade, fair value through profit and lossBGF-European Eqty Inc A6H Usd Dis

- - - - 8 62.45

Lion Cap Bos Emk Bd Usd Dis - - - - 1 312.26 Total - 25.41 400.82

Note:

Aggregate amount of quoted investments - 25.41 400.82 Aggregate amount of unquoted investments - - - Aggregate amount of impairment in the value of investments

- - -

6 Other financial assets:



Unsecured, considered good (unless otherwise stated)Sundry deposits - Considered good 350.21 108.97 85.63 - Considered doubtful 81.81 19.50 20.24

432.02 128.47 105.87 (Less):Provision for doubtful deposits (81.81) (19.50) (20.24) 350.21 108.97 85.63 Fixed deposits with original maturity of more than twelve months* 15.03 305.08 - Retention receivables 3,696.72 2,187.02 441.26 Claim receivable (Refer Note 50) - 2,263.73 2,267.32

Total 4,061.96 4,864.80 2,794.21

(* pledged with banks for credit facilities availed)

7 Income tax assets (net):



Advance payments against taxes (Net of Provision for Taxation of (Mar 31,2018 ₹ Nil, Mar 31,2017 ₹ 98,54,744, Apr 01,2016 ₹ 12,64,188)

- 68.66 91.36

Total - 68.66 91.36

112


8 Other non current assets: (` in lakhs)



Unsecured, considered good (unless otherwise stated)Capital advances - Considered good - 413.35 9,802.85 - Considered doubtful 31.13 - - (Less) : Provision against capital advances (31.13) - -

- 413.35 9,802.85 Prepaid expenses 9.52 6.70 6.86

Total 9.52 420.05 9,809.70

9 Inventories:



(including materials and components in transit of ₹ Nil (as at March 31, 2017 ₹ Nil as at April 1, 2016 ₹ 25,826,862)

22,418.84 20,498.58 20,500.67

Less: Provision for slow and non moving inventory* 337.97 336.90 344.67 22,080.87 20,161.68 20,156.01

Stock-in-trade (traded goods) 530.73 5,793.32 2,255.76 Total 22,611.60 25,955.00 22,411.77

Note: 1. In respect of a foreign subsidiary, a provision for slow moving inventory is made for ₹ 337.97 (as at March 31, 2017

₹ 336.90 as at April 1, 2016 ₹ 344.67).

2. First pari passu charge by way of hypothecation or indenture of mortgage and /or pledge of borrowers current assets, namely, stock of raw materials, semi finished and finished goods, stores and spares not relating to property, plant and machinery (consumable stores and spares), bills receivable and book debts and all movable current assets , both present and future.

10 Investments:

Particulars Nos.As at As at As at

March 31, 2018 Nos. March 31, 2017 Nos. April 1, 2016 ₹ ₹ ₹

Equity instruments-fully paid up investment in units of mutual fund- quoted at amortised costSingapore Telecommunications Limited -No par value

- - - - 9,000 23.52

Fixed incomeVedanta Resource 6.75070616 JDREG

- - - - 2,00,000 134.48

Total - - 158.00

Note:

Aggregate amount of quoted investments - - 158.00 Aggregate amount of unquoted investments - - - Aggregate amount of impairment in the value of investments

- - -

Note: Trade receivable are receivable in normal operating cycle and are shown net of an allowance for doubtful debts


113

11 Trade receivables: (` in lakhs)




Dues from related parties considered good (Refer note 52) 101.89 0.27 0.27 Dues from other trade receivables considered good 52,919.19 42,203.57 51,824.33 Dues from other trade receivables considered doubtful 15,527.11 7,823.65 2,340.67

68,548.19 50,027.49 54,165.27 Less: Allowance for doubtful debts 15,527.11 7,823.65 2,340.67

Total 53,021.08 42,203.84 51,824.60

Note:

1. Trade receivable are receivable in normal operating cycle and are shown net of an allowance for doubtful debts

2. First pari passu charge by way of hypothecation or indenture of mortgage and /or pledge of borrowers current assets, namely, stock of raw materials, semi finished and finished goods, stores and spares not relating to plant and machinery (consumable stores and spares), bills receivable and book debts and all movable current assets , both present and future.

12 Cash and cash equivalents:



Balances with banks:- in current accounts 643.18 186.45 968.71 - Deposits with original maturity of less than 3 months* - 1.18 2.64

Cash on hand 291.16 17.15 25.15 Total 934.34 204.78 996.50

(* maturity period less than three months and pledged with banks for credit facilities availed)

13 Bank balances other than cash and cash equivalents:



Unpaid dividend accounts** 3.52 3.52 4.52 Deposits with maturity of more than 3 months but less than 12 months ***

207.01 361.57 576.35

Total 210.53 365.09 580.87

(**earmarked for payment of unpaid dividend only) (*** pledged with banks for credit facilities availed)

14 Loans:



Unsecured, considered good (unless otherwise stated)Loans and advances to employees and others 52.58 3,699.05 297.02 Loans to body corporates Considered good 947.83 1,975.35 1,678.33 Considered doubtful 454.33 - -

1,402.16 1,975.35 1,678.33 (Less): Provision against doubtful loans (454.33) - -

947.83 1,975.35 1,678.33 Total 1,000.41 5,674.40 1,975.35

114


15 Other financial assets: (` in lakhs)



Unsecured, considered good (unless othwise stated)Sundry depositsConsidered good - 87.80 77.54 Considred doubtful - 7.25 7.25

- 95.04 84.79 (Less): Provision against doubtful deposits - (7.25) -7.25 - 87.80 77.54 Accrued interest on loans, fixed deposits and bonds 170.13 185.81 181.32

Total 170.13 273.61 258.86

16 Other current assets:



Unsecured considered good (unless otherwise stated)Unbilled revenue (Refer note 45) - 493.45 128.23 Prepaid expenses 407.51 522.88 650.60 Advances to suppliers - From related parties considered good (Refer note 52) 1.15 37.49 24.78 - Others considered good 9,207.17 17,650.11 2,351.46 - Others considered doubtful 471.50 - -

9,679.81 17,687.61 2,376.24 (Less): Provision for doubtful advances (471.50) - -

9,208.32 17,687.61 2,376.24 Balance with Government authorities 127.60 50.69 96.44

Total 9,743.42 18,754.62 3,251.52

17 Share capital:

17.1 Equity share capital:

ParticularsAs at




Authorised share capital :"Equity shares of ₹ 2 (as at March 31, 2017 ₹ 2 as at April 1, 2016 ₹ 2) each fully paid up (Refer note 17.2)"

3750,00,000 7,500.00 3750,00,000 7,500.00 3750,00,000 7,500.00

750,00,000 7,500.00 3750,00,000 7,500.00 3750,00,000 7,500.00

Issued, subscribed and fully paid up:Equity shares of ₹ 2 (as at March 31, 2017 ₹ 2 as at April 1, 2016 ₹ 2) each fully paid up

2922,69,622 5,845.39 922,69,622 5,845.39 2922,69,622 5,845.39

Total 2922,69,622 5,845.39 2922,69,622 5,845.39 2922,69,622 5,845.39

17.2 The Authorized Share Capital of the Holding Company was increased from ₹ 7500.00 to ₹ 17500.00 by way of approval of the members of the Holding Company on December 9, 2017 as per the recommendation of the Board of the Directors on November 3, 2017. The filing of SH-7 has not been completed by the Holding Company and hence the record of the MCA has not been updated accordingly. The Board has considered the cancellation of the increase in authorized capital due to bad financial position and less chance of further issue of shares to public. The Board is proposing members to reverse the resolution and keep the authorized share capital at ₹ 7500.00 as before the passing of the resolution on December 9, 2017.


115

17.3 Reconciliation of number of equity shares outstanding and amounts at the beginning and at the end of the reporting year:

(` in lakhs)

ParticularsAs at




Outstanding at the beginning of the year

2922,69,622 5,845.39 2922,69,622 5,845.39 2922,69,622 5,845.39

Outstanding at the end of the year 2922,69,622 5,845.39 2922,69,622 5,845.39 2922,69,622 5,845.39

17.4 Terms/rights attached to equity shares

Each holder of equity shares is entitled to one vote per share. they have a right to receive dividend proposed by the Board of Directors and approved by the shareholders in the ensuing Annual General Meeting, right to receive annual report and other quarterly / half yearly / annual report/ notices and right to get new shares proportionately in case of issuance of aditional shares by the Company.

In the event of liquidation of the Group, the holders of equity shares will be entitled to receive remaining assets of the Group, after the distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

17.5 Shareholders holding more than 5% of the paid up equity share capital of the group:

Particulars



As at April 1, 2016

No. of shares held

% of hold-ing

No. of shares held

% of hold-ing

No. of shares held

% of hold-ing

Name of the shareholdersNitin M.Shah 400,40,171 13.70% 543,26,835 18.59% 602,26,835 20.61%Nitin M. Shah (HUF) 87,61,197 3.00% 154,62,000 5.29% 154,62,000 5.29%Saroj N. Shah 619,63,633 21.20% 619,63,633 21.20% 619,63,633 21.20%Rahul N. Shah 188,31,333 6.44% 188,31,333 6.44% 188,31,333 6.44%Kunal N. Shah 306,73,000 10.49% 306,73,000 10.49% 306,73,000 10.49%

18 Other equity:

Particulars Note As at March 31, 2018


As at April 1, 2016

General reserve 18 (i) 2,320.37 2,320.37 2,320.37 Securities premium reserve 18 (ii) 1,338.94 1,338.94 1,338.94 Statutory reserve 18(iii) 391.05 391.05 391.05 Foreign currency translation reserve 18(iv) 5,189.53 4,681.59 5,424.72 Retained earnings 18 (v) 19,338.59 36,019.55 42,397.40

Total 28,578.48 44,751.50 51,872.48



As at April 1, 2016

18 (i) General ReserveBalance at the beginning and at the end of the year 2,320.37 2,320.37 2,320.37 Movement during the year - - - Balance at the end of the year 2,320.37 2,320.37 2,320.37

18 (ii) Securities Premium AccountBalance at the beginning of the year 1,338.94 1,338.94 1,338.94 Movement during the year - - - Balance at the end of the year 1,338.94 1,338.94 1,338.94

18 (iii) Statutory ReserveBalance at the beginning and at the end of the year 391.05 391.05 391.05 Movement during the year - - - Balance at the end of the year 391.05 391.05 391.05

116




As at April 1, 2016

18 (iv) Foreign Currency Translation ReserveBalance at the beginning of the year 4,681.59 5,424.71 - Add:Movement during the year 507.94 (743.12) 5,424.72 Balance at the end of the year 5,189.53 4,681.59 5,424.72

18 (v) Retained earningsBalance at the beginning of the year 36,019.55 42,397.40 32,543.95 Add: Profit/(loss) attributable to the Group (16,720.61) (6,360.32) 9,853.45 Items that will not be reclassified to profit or loss :- Remeasurement of defined benefit obligation 39.65 (17.53) - - Exchange differences on translation of foreign operations - - - Balance at the end of the year 19,338.59 36,019.55 42,397.40

Note Nature of reserves

a) General reserve

The General reserve is used from time to time to transfer profits from retained earnings for appropriation purposes. As the General reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the General reserve will not be reclassified subsequently to the Statement of Profit and Loss.

b) Securities premium reserve

Securities premium account comprises of premium on issue of shares. The reserve is utilised in accordance with the specific provision of the Companies Act, 2013.

c) Statutory reserve

Statutory reserve is created as per the regulations of Articles of association foreign wholly owned subsidiary.

d) Retained earnings

Retained earnings represents surplus/accumulated earnings of the Group and are available for distribution to shareholders.

19 Long term borrowings:



SecuredFrom financial institutions/non banking financial companies 3,936.63 5,731.61 6,842.03 (Refer Notes 19.1- 19.4 )

From banks - - 657.97 (Refer Notes 19.6 and 19.7)

Vehicle loan 41.34 47.50 - (Refer Note 19.5 and 19.8)

3,977.97 5,779.11 7,500.00 Less: Current maturities of long-term debt 1,505.71 1,866.96 1,519.25

Total 2,472.26 3,912.15 5,980.75

19.1 IFCI Limited

19.1.1 The term loan outstanding as at March 31, 2018 of ₹ Nil (as at March 31, 2017 ₹ 778.12 as at March 31, 2016 ₹ 1,815.62) is secured by exclusive first charge on the commercial property owned by the promoters, situated at Ghatkopar - Mumbai and industrial land at village Khalapur, district - Raigarh, exclusive pledge of 9,529,587 (as at March 31, 2017 ₹ 95.30; April 1, 2016 ₹ 95.74) equity shares of the Company, owned by the promoters, so as to give security cover of 1.5 times of the loan amount and personal guarantee of Nitin M Shah and Rahul N Shah.

19.1.2 The aforesaid loan was repayable in 8 quarterly installments of ₹ 259.37 each at the end of 15th,18th, 21st, 24th, 27th, 30th, 33rd and 36th month, starting from November 03, 2014 and rate of interest ranges from 14% per annum to 14.50% per annum.

19.1.3 Loan has been fully repaid in current year, Company is in process of releasing the charge.

(` in lakhs)


117

19.2 Aditya Birla Finance Limited

19.2.1 The term loan outstanding as at March 31, 2018 of ₹ 377.38 (as at March 31, 2017 ₹ 425.83; April 1, 2016 ₹ 483.65) is secured by exclusive charge on office no. 801, 8th floor, Wing C, Neelkanth Business Park, Kirol Road, Vidyavihar West, Mumbai 400086.

19.2.2 The aforesaid loan is repayable in 84 monthly installments of ₹ 9.46 each starting from April 05, 2015 and carries rate of interest of 12.35% per annum.

19.2.3 The Holding Company has defaulted in the repayment of Aditya Birla Term loan. The amount of total overdue outstanding as at March 31, 2018 is ₹ 17.07 on account of principal since January 2018 and ₹ 11.29 on account of interest since January 2018.

19.3 IFCI Limited

19.3.1 The term loan outstanding as at March 31, 2018 of ₹ 3,044.23 (as at March 31, 2017 ₹ 4,000.00; April 1, 2016 ₹ 4,000.00) is secured by exclusive charge on the immovable property owned by Nitin M. Shah (HUF) situated at 7001, 70th floor, World One Tower, Lower Parel, Mumbai 400 013, exclusive charge on an immovable property owned by the promoters such that the combined distress value of both the properties shall provide a cover of one time of the loan outstanding , pledge of 19,200,803 (as at March 31, 2017 19,200,803; April 1, 2016 14,590,803) equity shares of the Company owned by the promoters, so as to give security cover of 1.25 times of the loan amount and personal guarantee of Nitin M Shah and Rahul N Shah.

19.3.2 The aforesaid loan is for a period of five years including moratorium period of two years. Repayment will be in 36 equal monthly installments beginning from 25th month and continuing till 60th month and rate of interest ranges from 14% to 14.50% per annum.

19.3.3 The Holding Company has defaulted in the repayment of IFCI Term loan. The amount of total overdue outstanding as at March 31, 2018 is ₹ 44.23 on account of principal since March 2018.

19.4 PNB Housing Finance Limited

19.4.1 The term loan outstanding as at March 31, 2018 of ₹ 515.02 (as at March 31, 2017 ₹ 527.65, April 1, 2016 ₹ 542.76) taken from a financial institution is co-borrowed along with Nitin M. Shah and Rahul N. Shah, promoters of the Company which is secured by mortgage of property owned by the Company and situated at C-802, Neelkanth Business Park, Kirol Road, Vidyavihar -W, Mumbai 400 077.

19.4.2 Loan is repayable in 180 equal monthly installments of ₹ 6.62 each commencing from July 10, 2015 and carries an interest rate of 12.00% per annum.

19.4.3 The Holding Company has defaulted in the repayment of PNB Housing finance term loan. The amount of total overdue out-standing as at March 31, 2018 is ₹ 4.47 on account of principal since January 2018 and ₹ 15.41 on account of interest since January 2018.

19.5 Emirates Islamic Bank (Nitin Ventures Fze)

19.5.1 Vehicle loan outstanding as at March 31, 2018 ₹ 17.13 (as at March 31, 2017 of ₹ 25.21, April 1, 2016 ₹ 39.73) is repayable in 48 equal monthly installments of ₹ 1.08.

19.5.2 Security Hypothecation of the underlying asset. 19.5.3 Rate of interest is 6.40% per annum . 19.6 Invest Bank (Nitin Ventures Fze) 19.6.1 Term loan of ₹ nil (as at March 31, 2017 ₹ nil, April 1, 2016 ₹ 398.97) is repayable in 36 equal monthly instalments of ₹ 20.24

each. 19.6.2 Security Hypothecation of the underlying asset. 19.6.3 Rate of interest is 6.50% per annum.

19.7 Invest Bank (Nitin Ventures Fze) 19.7.1 Term loan of ₹ nil (as at March 31, 2017 ₹ nil, April 1, 2016 ₹ 355.73) is repayable in 36 equal monthly instalments of ₹ 13.00

each. 19.7.2 Security Hypothecation of the underlying asset. 19.7.3 Rate of interest is 6.50% per annum.

19.8 ICICI Bank Limited

91.8.1 Vehicle loan taken from a bank and outstanding as at March 31, 2018 of ₹ 28.66(as at March 31, 2017 ₹ 34.93; April 1, 2016 ₹ Nil) is secured by the hypothecation of the underlying asset.

19.8.1. The aforesaid loan is re-payable in 30 monthly installments of ₹ 0.78 each and carries rate of interest of 9.51% per annum.

118


20 Provisions: (` in lakhs)



Provision for employee benefits: (Refer note 33.1) - Gratuity (funded) 453.83 388.30 310.84 - Leave encashment (un funded) 376.90 - -

Total 830.73 388.30 310.84

21 Deferred tax (liabilities) (net) (i) Movement in deferred tax liabilities for the year ended March 31, 2018





March 31, 2017 March 31, 2018Property, plant and equipment - - - - provision for doubtful debts and Advances and disallowances under Section 43B of the Income tax Act, 1961

- - - -

- - - -

(ii) Movement in deferred tax liabilities for the year ended March 31, 2017





March 31, 2016 March 31, 2017Property, plant and equipment (105.50) (105.50) - - Provision for doubtful debts and Advances and disallowances under Section 43B of the Income tax Act, 1961

66.15 66.15 - -

(39.36) (39.36) - -

Note: The Company is not recognising deferred tax assets due to prudence and in the absence of probability of future taxable profit.

22 Short-term borrowings:



Secured (Refer Note 22.1 to 22.7 )Loans repayable on demand from banks- Cash credit 47,429.76 14,983.39 10,306.51 - Temporary overdraft/Working capital demand loan 16,895.22 12,634.87 1,956.35 - Bank loans 4.45 228.80 12,256.86 -Bills discounted 3,680.26 1,039.63 2,381.96 -Trust Receipts - 441.20 917.64 -Bank overdraft 5,495.21 1,321.68 1,244.83 Foreign currency loans* 189.02 1,714.01 15,343.88

73,693.92 32,363.58 44,408.03 Unsecured (Refer Note 22.8)From banks - 4,216.04 3,548.81 From Directors/Relative of a Director (Refer Note 52) 5,207.46 2,717.06 - From Others 104.64 - -

5,312.09 6,933.10 3,548.81 Total 79,006.02 39,296.69 47,956.84

(* includes buyers line of credit/packing credit availed by the Group)

22.1 IDBI Bank limited, Bank of Baroda, Dena Bank and Axis Bank Limited (Holding Company).

22.1.1 The borrowings are availed through a consortium agreement with above banks with IDBI Bank Limited being the lead bank.

22.1.2 Security

First pari passu charge by way of hypothecation or indenture of mortgage and /or pledge of borrowers current as-sets, namely, stock of raw materials, semi finished and finished goods, stores and spares not relating to plant and


119

machinery (consumable stores and spares), bills receivable and book debts and all movable current assets , both present and future.

First pari passu charge on immovable and movable assets of the Company both present and future including its location at (i)factory at A-117,TTC Industrial area, Pawana Village, Navi Mumbai-400 705 (ii) office premises at 501/502 Delta Technology Street, Hiranandani Gardens, Powai, Mumbai - 400 076 and (iii)immovable properties of Eurotech Cylinders Private Limited, situated at EL-29, TTC Industrial Area, Mahape, Navi Mumbai 400 701 (only for IDBI Bank Limited).

Personal guarantees of Nitin M. Shah and Rahul N. Shah


Working capital loan and other non-fund based facilities.

22.1.4. Rate of interest ranges from 11.65% to 14.5% per annum.

22.1.5 The Holding Company has defaulted in the repayment of Bank of baroda borrowing, the amount of overdue outstanding as at March 31, 2018 is ₹ 5,049.79 on account of principal Since June 2017 and ₹ 124.60 on account of interest Since June 2017.

22.1.6 In respect of Bank of baroda borrowing, from June 30, 2017, the Holding Company’s account has become NPA. However provision for interest on the said loan (based on prime landing rate) of ₹ 517.30 has been made. Further no provision is made for Penalty/ overdue interest in the absence of specific claim.

22.1.7 The Holding Company has defaulted in the repayment of Dena bank borrowing, the amount of overdue outstanding as at March 31, 2018 is ₹ 2,930.53 on account of principal since July 2017 and ₹ nil on account of interest.

22.1.8 In respect of Dena bank borrowing, from July 31, 2017, the Holding Company’s account has become NPA. However provision for interest on the said loan (based on prime landing rate) of ₹ 186.40 has been made. Further no provision is made for Penalty/ overdue interest in the absence of specific claim.

22.2 IDBI Bank Limited:(Holding Company)

22.2.1 Primary security: First pari passu charge on immovable properties of Eurotech Cylinders Private Limited at EL-29, TTC, Navi Mumbai 400 705.

Collateral security: Second pari passu charge on (i) entire current assets and movable assets of the Company both present and future (ii) 501/502 Delta, Technology Street, Hiranandani Gardens, Powai, Mumbai 400076 and its factory at A-117, TTC Industrial Area, Pawana Village, Navi Mumbai 400 705. Pledge of promoters shares held in the Company to the extent of 100% of the exposure.

Personal guarantees of the Nitn M. Shah and Rahul N. Shah

22.2.2 Credit facilities availed: Standby letter of credit

22.2.3 The Holding Company has defaulted in the repayment of IDBI bank borrowing, including the devolvement of stand by letter of credit for subsidiary company of ₹ 4,193.83. The amount of total overdue outstanding as at March 31, 2018 is ₹ 17,492.23 on account of principal since January 2018 and ₹ 2,236.15 on account of interest since January 2018.

22.2.4 From January 10, 2018, the Holding Company’s account has become NPA. However provision for interest on the said loan (based on prime landing rate) of ₹ 579.04 has been made. Further no provision is made for Penalty/ overdue interest in the absence of specific claim.

22.3 Axis Bank Limited: (Holding Company)

22.3.1 Primary security: Negative lien on receivables of Nitin Ventures Fze and New Age Company LLC.

22.3.2 Collateral security: Pledge of the Company’s shares having aggregate market value of atleast 75% of the facility amount.

Pari passu second charge on fixed asset of the Companys (i)factoryatA-117, TTC Industrial area,Pawana Village, NaviMumbai-400705(ii) office premises at 501/502 Delta Technology Street, Hiranandani Gardens, Powai, Mumbai-400076 and (iii) on the entire current assets of the Company both present and future.

PDC’s for the facility amount of Nitin Ventures Fze and New Age Company LLC to the Dubai branch of the bank.

Personal guarantees of Nitn M. Shah and Rahul N. Shah.


Stand by letter of credit.

22.3.4 The Holding Company has defaulted in the repayment of Axis bank borrowing, including the devolvement of stand by letter of credit for subsidiary company of ₹ 11,757.50. The total amount of overdue outstanding as at March 31, 2018 is ₹ 18,564.22 on account of principal since August 2017 and ₹ 190.25 on account of interest since August 2017.

22.3.5 From August 11, 2017, the Holding Company’s account has become NPA. However provision for interest on the said loan (based on prime landing rate) of ₹ 876.54 has been made. Further no provision is made for Penalty/ overdue interest in the absence of specific claim.

120


22.4 IDBI Bank Limited :(Eurotech Cylinders Private Limited)

22.4.1 Primary security

First charge on the current assets of the Company both present and future, collateral security by way of equitable mortgage (second charge) on office premise at D-20/4, T.T.C. Industrial Area, Turbhe, Navi Mumbai 400 705 belonging to the Holding Company and also corporate guarantee of the Holding Company.

22.4.2 Collateral security

Corporate guarantee of the holding company


Working capital loan.

22.4.4 Rate of interest ranges from 14% to 14.25% per annum.

22.5 Axis Bank Limited (Nitin Ventures FZE)

22.5.1 Primary security Secured against stock and book debts.

22.5.2 Collateral security Corporate guarantee of the holding company

22.5.3 Credit facilities

Working capital loan of as at March 31, 2018 ₹ nil (as at March 31, 2017 ₹ 12,140.94 as at March 31, 2016 ₹ 12,099.12) backed by stand by letter of credit (SBLC) from Axis Bank Limited, India.

22.5.4 Rate of interest being 4.85% + 3 Month Libor.

22.6 Invest Bank (Nitin Ventures FZE)

22.6.1 Primary security

Plant and machinery and for bills discounting acceptable third party post dated cheques. Collateral security First degree mortgage over property owned by Nitin M. Shah including his personal guarantee. First degree mortgage over property owned by the Entity in which a KMP has substantial interest alongwith corporate

guarantee of Nitin Ventures FZE for credit facility availed by New Age Company LLC.

22.6.2 Credit facilities

Business term loans and bills discounting facility.

22.6.3 Trust receipt availed are to be utilised for the settlement of bills under sight / acceptances / regular / local letters of credit issued by the bank. Repayment on the agreed maturity dates for each Trust Receipt.

22.6.4 Bank borrowings to the group is governed by restrictive covenants relating to the subsidiary’s net worth gearing ratio and interest cover.

22.6.5 Rate of interest is 6.5% per annum.

22.7 Details of unsecured loans:

227.1 Unsecured loans represents amounts withdrawn by foreign subsidiaries against standby letter of credit facility availed and is guaranteed by the Holding Company.

22.7.2 Interest rate on foreign buyers credit is LIBOR plus spread.

23 Trade payables: (` in lakhs)



Total outstanding dues of micro and small enterprises(Refer note 23.1) 41.28 22.49 13.25 Total outstanding dues other than micro and small enterprises 11,501.47 32,977.51 10,497.45

Total 11,542.75 33,000.00 10,510.70


121

23.1 To the extent, the Group has received intimation from the “suppliers” regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006, the details are provided as under: (` in lakhs)



1 the principal amount remaining unpaid to any supplier at the end of the accounting year.

33.29 17.60 8.76

2 interest due thereon remaining unpaid to any supplier as at the end of the accounting year.

2.01 0.40 0.07

3 the amount of interest paid along with the amount of the payment made to the supplier beyond the appointed day.

- - -

4 the amount of interest due and payable for the year of delay in making payment (which have been paid but beyond the appointed day during the year) but without adding the interest specified under the Micro, Small and Medium Enterprises Development Act, 2006.

2.08 0.99 1.09

5 the amount of interest accrued and remaining unpaid; and 7.98 4.89 4.49 6 the amount of further interest remaining due and

payable even in the succeeding years, until such date when the interest dues above are actually paid.

3.99 3.50 3.41

24 Other financial liabilities:



Current maturities of long-term debt (Refer Note 19) 1,505.71 1,866.97 1,519.25 Interest accrued on borrowings 2,249.54 72.19 183.13 Unpaid dividends* 3.52 3.52 4.42 Outstanding liability for expenses 1,513.29 42.87 60.50 Book overdrawn balances - 0.03 840.90 Employee benefits payable 429.90 389.57 983.07

Total 5,701.96 2,375.15 3,591.27

(* There are no unpaid dividends which are required to be transferred to Investor Education and Protection Fund)

25 Provisions:



Provision for employee benefits (Refer Note 33.1): - Gratuity (funded) 22.23 35.21 28.23 - Leave encashment (un funded) 5.17 234.12 21.88 For corporate dividend tax on proposed dividend 74.97 74.96 74.97

Total 102.37 344.29 125.08

25 Other current liabilities: (` in lakhs)



Invoices raised in respect of incomplete contracts 28,710.14 - 851.64 Less: Adjustment against aggregated amount of cost incurred and recognised profit (less recognised losses) (Refer Note 45)

23,622.96 - 778.13

5,087.17 - 73.51 Income received in advance 9.93 8.64 8.47 Statutory dues payable 11.47 140.09 67.16 Advance from customers 745.31 112.08 668.80

Total 5,853.88 260.81 817.94

122


27 Income tax liabilities (net) (` in lakhs)



Income Tax (Net of advance tax) 24.79 - -

Total 24.79 - -

28 Revenue from operations:


March 31, 2018 March 31, 2017 ₹ ₹

Sale of products (including excise duty net of sales return) 83,491.01 1,27,335.61 Sale of services (AMC) 5,194.37 5,018.51 Operating revenue-consultancy fees 89.35 335.37

Total 88,774.73 1,32,689.49

28.1 Detail of Sale of Products / Services


March 31, 2018 March 31, 2017 ₹ ₹

Primary project related activities 54,939.47 65,248.07 Cylinders, fire protection, detection equipments etc. 28,551.54 62,087.54

Total 83,491.01 1,27,335.61

Goods and Service Tax (GST) has been effective from July 1, 2017. Consequently, excise duty, value added tax (VAT), Service tax etc. have been replaced with GST. Until June 30, 2017, ‘Sale of product’ included the amount of excise duty recovered on sales. With effect from July 1, 2017, ‘Sales of products’ excludes the amount of GST recovered. Accordingly, revenue from ‘Sale of Products’ and ‘Revenue from operations’ for the year ended March 31, 2018 are not comparable with those of the previous year.

29 Other income:


March 31, 2018 March 31, 2017 ₹ ₹

Interest Income received on Financial Assets - Carried at amortised cost - deposits with banks 21.82 29.56 - loans given 220.69 313.46 - over due trade receivables and others 39.96 6.49 Dividend Income on current investments - 4.00 Service charges and other miscellaneous receipts 4.96 2.26 Foreign Exchange Gain (net) 129.44 5.63 Liability no longer required written back 94.59 52.21 Debts written off in earlier years, now recovered 40.83 11.45

Total 552.29 425.06

30 Cost of materials and components consumed: (` in lakhs)


March 31, 2018 March 31, 2017 ₹ ₹

Raw Materials at the beginning of the year 20,498.58 20,500.67 Add: Purchases (net) 49,414.05 39,154.12

69,912.63 59,654.79 Less: Raw Materials at the end of the year 22,418.84 20,498.58

Total 47,493.79 39,156.21

31 Purchases of stock-in-trade:


March 31, 2018 March 31, 2017 ₹ ₹

Fire alarm, detection equipments etc. 1,244.96 54,085.01 Cylinders etc. 169.13 2,153.16

Total 1,414.09 56,238.17


123

32 Changes in inventory of stock-in-trade: (` in lakhs)


March 31, 2018 March 31, 2017 ₹ ₹

Closing inventoriesStock in trade 530.73 5,793.32

Opening inventoriesStock in trade 5,793.32 2,255.75

Total 5,262.59 -3,537.55

33 Employee benefits expense:


March 31, 2018 March 31, 2017 ₹ ₹

Salaries, wages and bonus 5,126.37 4,937.01 Contributions to provident and other funds (Refer note 33.1 ) 28.31 25.31 Contributions to gratuity fund (Refer note 33.1) 140.55 148.02 Employees welfare 99.85 116.25

Total 5,395.08 5,226.59

33.1 Employee benefit obligations (Holding Company)

i) Defined Contribution Plans

Provident Fund: Contribution towards provident fund for employees is made to the regulatory authorities, where the Company has no further obligations. Such benefits are classified as Defined Contribution Schemes as the Company does not carry any further obligations, apart from the contributions made on a monthly basis.

Contribution to Defined Contribution Plans, recognized as expense for the year as under:


March 31, 2018 March 31, 2017 ₹ ₹

Employer's Contribution to Provident Fund 23.49 21.98 Employer's Contribution to Employees State Insurance Corporation 4.75 3.25 Company's contribution to Maharashtra Labour Welfare Fund 0.07 0.08

Total 28.31 25.31

ii) Defined Benefits Plans

Gratuity: The Company provides for gratuity, a defined benefit plan (the “Gratuity Plan”) covering eligible employees in accordance with the Payment of Gratuity Act, 1972. The Gratuity Plan provides a lump sum payment to vested employ-ees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee’s salary and the tenure of employment. The Company’s liability is actuarially determined (using the Projected Unit Credit method) at the end of each year. The fair value of the plan assets of the trust administered by the Company, is deducted from the gross obligation.

The following table sets forth the status of the gratuity plan of the Company, and the amounts recognized in the Balance sheet and Statement of profit and loss.

Funding :

The Company makes annual contributions to the Group Gratuity cum Life Assurance Schemes administered by the LIC, a funded defined benefit plan for qualifying employees

Reconciliation of the net defined benefit obligation:


March 31, 2018 March 31, 2017 ₹ ₹

Opening defined benefit obligation 123.82 92.90 Benefits paid from the fund (10.86) (4.58)Benefit paid directly by the employer (0.47) - Current service cost 14.62 10.40 Interest cost 9.03 7.47 Past service cost - -

124



March 31, 2018 March 31, 2017 ₹ ₹

Actuarial losses / (gain) recognized in other comprehensive income changes in demographic assumptions - - changes in financial assumptions (4.79) 8.51 experience adjustments (35.02) 9.12 Liabilities assumed / (settled) - -

Closing defined benefit obligation 96.33 123.82 Reconciliation of the fair value of plan assets:


March 31, 2018 March 31, 2017 ₹ ₹

Opening fair value of plan assets 0.00 28.18 Interest Income 2.04 2.27 Employer contributions - 2.02 Benefits paid (10.86) (4.58)Actuarial gains on Plan Assets (0.16) 0.10 Closing fair value of plan assets (8.99) 27.99

Balance sheet reconciliation



Opening defined benefit obligation 123.82 92.90 86.15 Opening fair value of plan assets - (28.18) (30.29)Expenses recognised in profit and loss 21.61 15.60 8.86 Expenses recognised in Other Comprehensive Income (39.65) 17.53 - Employer contributions - (2.02) - Benefits paid (0.47) - -

Net (Asset) / Liability recognised in the Balance sheet 105.31 95.83 64.72

Expenses recognised in Statement of Profit and Loss:


March 31, 2018 March 31, 2017 ₹ ₹

Current service cost 14.62 10.41 Interest cost 6.99 5.20 Past Service Cost - -

21.61 15.61 Remeasurements recognised in other comprehensive income (` in lakhs)


March 31, 2018 March 31, 2017 ₹ ₹

Actuarial (gain) loss on defined benefit obligation (39.81) 17.62 Return on plan assets excluding interest income 0.16 (0.09)

(39.65) 17.53 Analysis of plan assets



Insurer managed funds (%) 100% 100% 100%Others (%) 0% 0% 0%

100% 100% 100%

(` in lakhs)


125

Maturity profile of defined benefit obligation (` in lakhs)

ParticularsAs at

March 31, 2018 March 31, 2017 ₹ ₹

1 Year 12.09 25.49 2 to 5 years 9.77 11.36 6 to 10 years 35.69 32.37 More than 10 years 190.34 236.39


Principal actuarial assumption used to determine net periodic benefit cost and benefit obligation at the reporting dates;

Particulars As atMarch 31, 2018 March 31, 2017

Discount Rate (p.a.) 7.78% 7.29%Salary escalation rate (p.a.) 7.00% 7.00%Expected rate of return on assets 7.78% 7.29%Attrition rate 2.00% 2.00%Mortality rate during employment Indian Assured Lives

Mortality(2006-08)Indian Assured Lives

Mortality(2006-08)Mortality rate after employment NA NA

Notes :

Salary escalation rate: The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

Discount rate: The discount rate is based on the prevailing market yields of Indian government securities for the estimated term of the obligations.

Assumptions regarding future mortality experience are set in accordance with the statistics published by the Life Insurance Corporation of India.

The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled. There has been significant change in expected rate of return on assets due to change in the market scenario.

Sensitivity analysis

Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligations by the amounts shown below;


March 31, 2018 March 31, 2017 ₹ ₹

Projected Benefit Obligation on Current Assumptions - - Discount Rate: 0.5% increase (4.53) (5.78)Discount Rate: 0.5% decrease 4.89 6.29

Future salary growth: 0.5% increase 4.90 6.28 Future salary growth: 0.5% decrease (4.58) (5.83)

Change in Rate of Employee Turnover : 0.5% Increase 0.20 (0.07)Change in Rate of Employee Turnover : 0.5% Decrease (0.22) 0.07

iii) Compensated absences

The Company accrues for the compensated absences, a long term employee benefit plan based on the entire available leave balance standing to the credit of the employees at year end. The value of such leave balance eligible for carry forward, is determined by actuarial valuation as at the Balance sheet date and is charged to Statement of profit and loss in the period determined. The provision as at balance sheet dates are as follows:



Compensated absences liability 6.01 21.88 21.88

126


Actuarial assumption (` in lakhs)

Particulars As at As at As at March 31, 2018 March 31, 2017 April 1, 2016

Discount rate 7.78% 7.29% 8.04%Long–term rate of compensation increase 7.00% 7.00% 7.00%Surplus recognised in Statement of Profit and Loss towards compensated absences are ₹ 15.88 (March 31, 2017 ₹ Nil)

34 Finance costs:


March 31, 2018 March 31, 2017 ₹ ₹

Interest expense on: Borrowings - - From Banks and others 6,191.54 4,718.37 - From Directors (Refer note 52) 499.69 133.36 Others (Interest on delayed payment of Income tax & dividend distribution tax) 62.92 59.06 Other borrowing costs - Processing fees 40.03 47.77 - Bank Charges 550.33 544.97 - Others 2.30 526.08

Total 7,346.81 6,029.61

35 Depreciation and amortisation expense:


March 31, 2018 March 31, 2017 ₹ ₹

Depreciation on property, plant and equipment 2,228.22 1,354.90 Amortisation of intangible assets 1,576.62 1,115.78

Total 3,804.84 2,470.68

36 Other expenses:


March 31, 2018 March 31, 2017 ₹ ₹

Sub-contract charges and site expenses 18,216.57 17,871.16 Conveyance and travelling 266.29 342.27 Miscellaneous expenses 449.06 798.26 Rent and lease rent (Refer note 41) 508.67 592.97 Repairs - Other assets 42.31 58.06 Repairs-Building 26.35 29.90 Insurance premium 159.71 147.97 Payment to Auditors (exclusive of service tax & GST) (Refer note 38) 46.79 48.36 Legal and professional fees 258.07 612.05 Donations and charities 6.21 23.11 Loss on sale of securities - 14.27 Vehicle expenses 196.56 219.65 Sitting fees to Non Executive Directors 0.60 5.20 Sales promotion and advertisement 347.34 118.17 Bad debts written off/liquadated damages 113.59 1,593.88 Provision for doubtful deposits, advances and claims 1,019.28 - Survey cost incurred for mineral rights - 3.59 Distribution expenses (net) 1,760.44 2,244.29 Rates and taxes 509.14 22.19 Loss on sale of Tangible assets 2.06 210.14 Loss on claims receivable (Refer note 50) 2,544.49 - Provision for doubtful debts 7,703.46 5,482.98 Loss on fair valuation of bonds 4.91 0.70 Loans written off 762.92 150.00 Impairment loss on property, plant and equipment [Refer note 3 (2)] 723.15 - Foreign Exchange Loss / Gain (Net) - 689.13

Total 35,667.97 31,278.30


127

37 Earnings Per Share (EPS): (` in lakhs)


March 31, 2018 March 31, 2017 ₹ ₹

Loss for the year (16,720.61) (6,360.32)Amount available for equity share holders (16,720.61) (6,360.32)Weighted average number of equity shares (nos.) 2922,69,622 2922,69,622Basic EPS (5.72) (2.18)Diluted EPS (5.72) (2.18)

38 Payments to auditors (exclusive of service tax & GST):


March 31, 2018 March 31, 2017 ₹ ₹

Statutory audit fees 38.44 38.46 Limited review fees 6.00 6.00 Certification fees 2.00 2.00 Re-imbursement of expenses 0.35 1.90

Total 46.79 48.36

39 Segment information: In line with the provisions of IND AS 108 ‘Operating segments’ and basis the review of operations being done by the Senior Manage-

ment, the operations of the Group fall under fire protection/detection equipments and allied activities, which is considered to be the only reportable segment by the Management.

40 Corporate Social Responsibility Expense :


March 31, 2018 March 31, 2017 ₹ ₹

Gross amount required to be spent by the group during the yearCorporate Social Responsibility Expense - 24.95

Amount spent during the year (paid in cash)i) Construction/acquisition of any asset - - ii) On purposes other than (i) above - -

Amount spent during the year (yet to paid in cash)i) Construction/acquisition of any asset - - ii) On purposes other than (i) above - -

Total

41 Operating lease: (a) In respect of a property acquired on lease, the future minimum lease rentals payable on non-cancellable lease are as follows: (Parent

Company):

Particulars

Future minimum lease payments As at As at As at


Not later than one year - 7.72 8.88 Later than one year and not later than five years - 32.83 35.72 Later than five years - - 4.83

Total - 40.55 49.43

Note: In the previous year, the impact of escalation in lease payments which may arise is not considered due to its uncertainty.

(a) Lease payments recognised in the Consolidated Statement of Profit and Loss ₹ 508.67 (March 31, 2017 ₹ 592.97)

(b) Lease rentals are charged on the basis of agreed terms.

42 Consequent to dilution of equity stake in Worthington Nitin Cylinders Private Limited (WNCPL) in December 2010, the group has taken over the outstanding claim of a derivative contract amounting to ₹ 501.33 (excluding interest). As advised by the legal counsel, it has opined that the said contract is not valid as per the Reserve Bank of India regulations and hence, no liability is expected to devolve on the Group and hence the Management of the Group is of the view that no provision is required. The Group has filed a petition in the Hon’ble High Court of Bombay challenging the legality of the contract. The petition is pending for disposal.

128


43 Contingent liabilities not provided for in respect of:* (` in lakhs)

Sr. No. Particulars

BalanceAs at

March 31, 2018`


`

As at April 1, 2016

`

i Performance/bid-bond and other guarantees 13,141.08 4,404.64 9,984.79 ii Cheques discounted - - 1,111.50 iii Letters of credit 923.13 388.32 95.51 vi Claim against the Group not acknowledged as debts:

- Income Tax demands for:[(A.Y. 2009-10 - 2014-15) (amount paid under protest ₹ 84.00 (March 31, 2017: ₹ 84.00, April 01, 2016 ₹ 84.00)]

1,133.46 1,133.46 748.69

-Sales tax[(A.Y. 2011-12 and A.Y. 2012-13) (amount paid under protest ₹ 32.41 (March 31, 2017: ₹ 32.41, April 01, 2016 ₹ 32.41)]

60.13 60.13 37.96

-Other matters 376.25 644.83 644.83

Note:

Contingent liabilities in respect of above matters arising in the ordinary course of business, it is anticipated that no material liabilities will arise.

44 Commitments:

Estimated amount of contracts remaining to be executed on capital account ₹ 124.66 (as at March 31, 2017 ₹ 354.24 as at April 1, 2016 ₹ 404.23).

45 Disclosures pursuant to Ind AS 11 ‘Construction Contracts’: (Holding Company)

Sr. No. Particulars

BalanceAs at

March 31, 2018`


`

As at April 1, 2016

`

(a) Contract revenue recognised for the financial year* 2,888.72 5,250.57 22,052.71 (b) Aggregate of contract costs incurred and recognised profit

(less recognised losses) upto the reporting date for contracts in progress

783.67 1,018.20 778.14

(c) Advances received for contracts in progress - 10.53 11.82 (d) Retention money for contracts in progress 195.06 - - (e) Gross amount due from customers for contract work (asset) 441.64 944.97 961.66 (f) Gross amount due to customers for contract work (liability) - 41.02 108.18

( * in respect of completed and contracts in progress)

46 Income taxes

a. Income tax expense is as follows:

Year ended March 31, 2018

₹ March 31, 2017

₹ Statement of Profit and LossCurrent tax:Tax for the year - - Adjustments for current tax of prior periods 52.47 2.58 Total current tax expense 52.47 2.58 Deferred tax:Deferred tax expenses - (39.36)Total deferred tax expense - (39.36)

Income tax expense 52.47 (36.78)Other comprehensive incomeDeferred tax related to OCI items:Net loss / (gain) on remeasurements of defined benefit plans - -


129

In view of losses incurred during the years ended March 31, 2018 and March 31, 2017, no provision for income tax is made for the aforesaid years ended.

b. Reconciliation of effective tax rate (` in lakhs)

A reconciliation of income tax expense as included in the statement of profit and loss to the amount computed by applying the weighted average enacted income tax rate to income before income taxes is summarized below:

Year ended March 31, 2018 March 31, 2017

% ₹ % ₹ Loss before tax (17,061.77) (3,759.29)Tax at the Indian tax rate 0.00 - 0.00 -

Tax effect of: Prior Year tax adjustments (0.31) 52.47 - - Others - - (0.98) (36.78)

(17,009.29) (3,796.06)

47 With regard to the Holding Company’s investment in Equity Shares of WNCPL of ₹ 1,164.26 as at March 31, 2018 (as at March 31, 2017 ₹ 770.63; April 1, 2016 ₹ 3,408.44), the Management is in discussion with the majority shareholders of WNCPL and expects to recover the carrying amount. Hence the Management believes that no impairment provision is required.

48 Trade receivables for the year ended March 31, 2018 includes ₹ 27,673.23 (as at March 31, 2017 ₹ 16,698.10; April 1, 2016 ₹ nil) against exports/domestic sales made in earlier years, payments for which are not forthcoming. The Holding Company’s Management is making all efforts to recover the same and is confident of recovery. Hence, no specific provision is considered necessary.

49 The balances of Trade receivables amounting to ₹ 3459.95 (other than those covered under note (48) above), Trade payables amounting to ₹ 1,867.47 and Loans to body corporates amounting to ₹ 331.08 are subject to reconciliation. The Management is in the process of reconciling the same and do not expect any consequential impact in the financial statements in this regard.

50 Pursuant to High Court order dated September 05, 2017, The Holding Company has written off its share of costs incurred in an oil block exploration of ₹ 2,263.73 being no longer recoverable and has also made provision of ₹ 280.76 towards amount payable to Gas Authority of India Limited (GAIL) on un paid cash calls.

51 Goodwill on consolidation:

ParticularsFor the year ended For the year ended For the year ended


Opening balance 10,069.20 10,301.26 7,107.78 Add/(less) : Exchange difference during the year on transla-tion of goodwill of foreign subsidiary - (232.06) 3,193.48

10,069.20 10,069.20 10,301.26

52 Related party disclosures: (i) Parties where control/significant influence exists and/or other related parties with whom transactions (material) have taken place include:

No Name of the related party Relationship1 Worthington Nitin Cylinders Private Limited Associate

2 Nitin M. Shah (Non Executive Director up to May 30, 2018 and from May 30, 2018 Chairman and Non Executive Director) } Key Management Personnel (KMP)

Represented on the Board

3 Rahul N. Shah (Whole time Director up to December 12, 2017 and CEO from May 30, 2018)

4 Kunal N. Shah (Whole time Director up to December 12, 2017 and COO from May 30, 2018)

5 Kailat Vaidhyanathan (Non executive director)6 Saroj N. Shah (spouse of Nitin M. Shah) }7 Nitin M. Shah (HUF)

Relatives of KMP’s8 Rahul N. Shah (HUF) 9 Reshma N. Shah (daughter of Nitin M. Shah)10 New Age Industries LLC, UAE (100% subsidiary of Nitin

Ventures FZE, UAE) }11 New Age Electromechanical Contracting Company LLC, UAECompanies in which a KMP has

significant influence12 Nitie Fire Protection Oil and Gas Field Services LLC, UAE

130


(ii) Transactions with related parties (including re-imbursement): (` in lakhs)

Sr. No. Particulars


₹ ₹ I Capital transactions

Assets1 Advances to suppliers / loans given

AssociateWorthington Nitin Cylinders Private Limited 8.72 42.99

2 Advances given for supply of goods, now received backAssociateWorthington Nitin Cylinders Private Limited 46.91 30.28

Equity and Liabilities1 Unsecured loans (including interest payable)

KMP'sNitin M. Shah 1,587.47 2,207.94 Rahul N.Shah 423.06 1,167.48

2 Unsecured loans/security deposit repaidKMP'sNitin M. Shah 2.82 760.60 Rahul N.Shah 17.00 3.50

II Revenue transactionsIncomeAssociateWorthington Nitin Cylinders Private Limited 101.63 -

Reimbursement of bank charges / Expenses/interest Nitin M. Shah (HUF) - 0.67 Nitin M. Shah - 1.01 Rahul N. Shah (HUF) - 0.73 Expenditure

1 Rent (net of taxes)KMP/Relative of a KMPNitin M. Shah - 8.00 Saroj N. Shah - 8.00

2 Remuneration**KMP'sRahul N. Shah 15.40 19.93 Kunal N. Shah 15.40 19.79

3 Professiona FeesKailat Vaidhyanathan 12.11 8.90

4 Interest/Reimbursement of expensesKMPNitin M. Shah 291.80 95.55 Rahul N. Shah 207.89 37.81

(**excluding incremental liability for gratuity as employee wise breakup of such liability based on estimation is not ascertainable)


131

(iii) Amounts outstanding for related parties: (` in lakhs)

Sr. No. Particulars


₹ ₹ ₹ I Assets

(i) Other non-current investments Equity Shares

AssociateWorthington Nitin Cylinders Private Limited 1,164.26 770.63 3,408.44

(ii) Trade receivables (net of trade payables, if any)AssociateWorthington Nitin Cylinders Private Limited 101.63 - -

Enterprise in which a KMP has significant influenceNew Age Electromechanical Contracting LLC 0.27 0.27 0.27

(iii) Advances (includes outstanding towards reimbursement of expenses and advance for supply of goods)AssociateWorthington Nitin Cylinders Private Limited 1.15 37.49 24.78

II Equity and Liabilities(i) Short term borrowings

KMP'SNitin M. Shah 3,395.50 1,519.05 - Rahul N Shah 1,811.96 1,198.01 -

(ii) Dues (Excluding outstanding salary payable, if any)KMPNitin M. shah 3.60 3.60 1.89 Relative of a KMPSaroj N. Shah 3.60 3.60 - Kailat Vaidhyanathan 1.17 - -

(iii) Outstanding Salary PayableRahul N Shah 1.08 1.08 - Kunal N Shah 1.85 1.85 -

Notes:

Related party relationships are as identified by the Company on the basis of information available and relied upon by the auditors.

132


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133

54 Salient features of financial statements of subsidiaires/associate as per Companies Act, 2013

Part A

Subsidiaries

Particulars Reporting currency

Share capital

Eurotech Cylinders

Private Limited, India

Nitin Ventures FZE, UAE *

Nitin Global PTE Limited,

Singapore

Nitin Fire Protection

Middle East Fze, UAE

Share capital INR 1.00 1,102.09 47.61 Nil USD NA 27.24 1.00 Nil

Reserve and surplus INR 736.41 53,305.43 (445.62) Nil USD NA 809.72 (7.12) Nil

Total assets INR 2,730.54 1,02,438.23 4,863.44 6.70 USD NA 1,578.26 74.77 0.10

Total liabilities INR 2,730.54 1,02,438.23 4,863.44 6.70 USD NA 1,578.26 74.77 0.10

Investments INR - - - - USD - - - -

Turnover (excluding other income) INR 12.85 83,270.94 - - USD NA 1,292.08 - -

Profit/(loss) before taxation INR (1,420.59) 4,401.53 (878.83) - USD NA 67.88 (13.55) -

Provision for taxation* INR - - - - (*including deferred tax and charge for earlier years)

USD - - - -

Profit/(loss) after taxation INR (1,420.59) 4,401.53 (878.83) - USD NA 67.88 (13.55) -

Proposed dividend INR - - - - USD NA - - -

% of shareholding - 100 100 100 100 (* includes New Age Co. LLC (UAE) and Firetec Systems Limited (UK))

Exchange rates INR INR / USD

31-Mar-18Closing 65.0441Average 64.4549

Part BAssociateStatement pursuant to Section 129 (3) of the Companies Act , 2013 related to associate Company

Shares of associate held by the Company on the year end

Profit/(loss) for the year

Sr.no. Name of Associates

Latest audited balance

sheet date

No. Amount of investment in associate

₹

Extent of holding

(%)

Networth attributable to shareholding as

per latest audited balance sheet

₹

Considered in consolidation

Not considered in consolidation

Description of how there is significant

influence

Associate 1 Worthington

Nitin Cylinders Private Limited

March 31, 2018

23,36,496 1,164.26 40 1,164.26 Yes NA Due to percentage of holding

134


55 Financial Instruments - Accounting Classifications and 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 of liquidation sale.

The following methods and assumptions were used to estimate the fair values:

Fair value of cash and cash equivalent, bank balances other than cash and cash equivalent, trade receivables, trade payables, other current financial liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique: Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities

Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data. (` in lakhs)

As at April 01, 2016Carrying value Fair value

Amortised Cost₹

FVTPL₹

FVTOCI₹

Total₹

Level 1₹

Level 2₹

Level 3₹

Non current financial assetsInvestments - 400.82 - 400.82 400.82 - - Other financial assets 2,794.21 - - 2,794.21 -

Total 2,794.21 400.82 - 3,195.03 400.82 - - Current financial assetsInvestments - 158.00 - 158.00 158.00 - - Trade receivables 51,824.60 - - 51,824.60 - - - Cash and cash equivalents 996.50 - - 996.50 - - - Bank balances other than cash and cash equivalents

580.87 - - 580.87 - - -


Total 55,636.17 158.00 - 55,794.17 158.00 - - Non current financial liabilitiesBorrowings 5,980.75 5,980.75 - - -


Total 62,058.81 - - 62,058.81 - - -


Amortised Cost₹

FVTPL₹

FVTOCI₹

Total₹

Level 1₹

Level 2₹

Level 3₹



365.09 - - 365.09 - - -




Total 74,671.83 - - 74,671.83 - - -


135


Amortised Cost₹

FVTPL₹

FVTOCI₹

Total₹

Level 1₹

Level 2₹

Level 3₹

Non current financial assetsOther financial assets 4,061.96 - - 4,061.96 - - -

Total 4,061.96 - - 4,061.96 Current financial assetsTrade receivables 53,021.08 - - 53,021.08 Cash and cash equivalents 934.34 - - 934.34 - - - Bank balances other than cash and cash equivalents

210.53 - - 210.53 - - -

Loans 1,000.41 - - 1,000.41 - - - Other current financial assets 170.13 - - 170.13 - - - Total 55,336.50 - - 55,336.50 - - -

Non current financial liabilitiesBorrowings 2,472.26 - - 2,472.26 - - -

Total 2,472.26 - - 2,472.26 - - -

CurrentBorrowings 79,006.02 - - 79,006.02 - - - Trade payables 11,542.75 - - 11,542.75 - - - Other current financial liabilities 5,701.96 - - 5,701.96 - - -

Total 96,250.73 - - 96,250.73 - - - 56 Financial risk management objectives and policies

The Group has exposure to the following risks arising from financial instruments:

- Credit risk;

- Liquidity risk; and

- Market risk

The Group’s board of directors has overall responsibility for the establishment and oversight of the Group’s risk management framework who is also responsible for developing and monitoring the Groups’s risk management policies.

The Group’s risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed periodically to reflect changes in market conditions and the Group’s activities. The Group, through its training, standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.

The board of directors oversees how management monitors compliance with the Group’s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Group.

Credit risk

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. To manage this, the Group periodically assesses the financial reliability of customers, taking into account the financial condition, current economic trends, and analysis of historical bad debts and ageing of accounts receivable. Individual risk limits are set accordingly.

The Group considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoin basis throughout each reporting period. To assess whether there is a significant increase in credit risk that Group cao-mpares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers reasonable and supportive forwarding-looking information such as:

i) Actual or expected significant adverse changes in business,

ii) Actual or expected significant changes in the operating results of the counterparty,

iii) Financial or economic conditions that are expected to cause a significant change to the counterparty’s ability to meet its obligations,

iv) Significant increases in credit risk on other financial instruments of the same counterparty,

Financial assets are written off when there is no reasonable expectation of recovery, such as a debtor/borrower failing to engage in a repayment plan with the Group. Where receivables/loans have been written off, the Group continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these are recognised in Statement of Profit and Loss.

Trade and other receivables

The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Group grants credit terms in the normal course of business. Credit terms are in line with industry trends.

(` in lakhs)

136


Summary of the Group’s exposure to credit risk by age of the outstanding from various customers is as follows: (` in lakhs)


`


`

As at April 1, 2016

`

Less than 180 days 29,234.32 23,724.59 29,553.82 From 181 - 365 days 5,747.18 7,172.35 13,322.42 More than 365 days 33,566.69 19,130.55 7,288.97 Total 68,548.19 50,027.49 50,165.21 Less : Provision for Doubtful Debts (15,527.11) (7,823.65) (2,340.67)Total 53,021.08 42,203.84 47,824.54

Expected credit loss assessment for customers as at April 1, 2016, 31 March 31, 2017 and March 31, 2018

Exposures to customers outstanding at the end of each reporting period are reviewed by the Group to determine credit losses. Given that the macro economic indicators affecting customers of the Group have not undergone any substantial change, the Group expects the historical trend of minimal credit losses to continue.

The movement in the allowance for impairment in respect of trade and other receivables during the year was as follows:

Particulars (`)Balance as at April 01, 2016 2,340.67 Impairment loss recognised 5,482.98 Amounts written off / written back - Balance as at March 31, 2017 7,823.65 Impairment loss recognised 7,703.46 Amounts written off / written back - Balance as at March 31, 2018 15,526.11

Cash and bank balance

The Group held cash and bank balance with credit worthy banks and financial institutions of ₹ 1,159.90, ₹ 8,749.57 and ₹ 1,577.37 as at March 31, 2018, March 31, 2017 and April 1, 2016, respectively.The credit worthiness of such banks and financial institutions is evaluated by the management on an ongoing basis and is considered to be good.

Investment in bonds, equity shares and fixed income instruments: The Group held investments in bonds of ₹ Nil, ₹ 25.41 and ₹ 558.82 as at March 31, 2017 and April 01, 2016 respectively. The Group

limits its investment in bonds equity shares and fixed income instruments in instruments having a credit rating which indicates high credit quality. The Group monitors the changes in credit risk.

B) Market risk

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign currency exchange rates, equity prices and other market changes that affect market risk sensitive instruemtns. Market risk is attributable to all market risk sensitive financial instruments including investments and deposits, foreign currency receivables and payables.

The Group market risk is managed by the board of directors which evaluates and excercises independent control over the entire process of market risk management. It also recommends risk management objectives and policies ans also management of cash resources, implementing hedging strategies for foreign currency exposures and ensuring compliance with market risk limits and policies.

a) Foreign 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. The Group’s exposure to the risk of changes in foreign exchange rates relates primarily to its operating activities. The Group manages its foreign currency risk by hedging transactions that are expected to occur within a maximum 12 month periods for hedges of forecasted sales and purchases in foreign currency.

The Group’s exposure to foreign currency risk at the end of the reporting period expressed in ₹, are as follows:

Foreign currency exposure US$ EUR GBP TotalApril 1, 2016Financial assetsTrade receivables 22,789.61 - 20.23 22,809.84 Loans - - - - Net exposure to foreign currency risk (assets) 22,789.61 - 20.23 22,809.84 Financial LiabilitiesBorrowings 15,343.89 - - 15,343.89 Trade payables 2,536.51 1.55 378.63 2,916.69 Other financial liabilities 93.96 - - 93.96 Net exposure to foreign currency risk (liabilities) 17,974.36 1.55 378.63 18,354.54


137

Foreign currency exposure US$ EUR GBP TotalRupee Conversion Rate 66.33 75.10 95.09

March 31, 2017Financial assetsTrade receivables 21,786.64 - 17.21 21,803.85 Net exposure to foreign currency risk (assets) 21,786.64 - 17.21 21,803.85 Financial LiabilitiesBorrowings 1,714.01 - - 1,714.01 Trade payables 2,449.92 0.67 395.77 2,846.36 Net exposure to foreign currency risk (liabilities) 4,163.93 0.67 395.77 4,560.37 Rupee Conversion Rate 64.84 69.25 80.88

March 31, 2018Financial assetsTrade receivables 23,566.57 - 19.64 23,586.21 Net exposure to foreign currency risk (assets) 23,566.57 - 19.64 23,586.21 Financial LiabilitiesTrade payables 2,462.95 - 426.41 2,889.36 Net exposure to foreign currency risk (liabilities) 2,462.95 - 426.41 2,889.36Rupee Conversion Rate 65.04 80.62 92.28

Foreign currency sensitivity

The table below demonstrates sensitivity impact on profit after tax and total equity due to change in foreign exchange rates of currencies where it has significant exposure:

Foreign currency (USD)As at March 31, 2018 As at March 31, 2017

2% Increase 2% Decrease 2% Increase 2% Decrease₹ ₹ ₹ ₹

US$ 422.07 (422.07) 352.45 (352.45)EUR - - (0.01) 0.01 GBP (8.14) 8.13 (7.57) 7.57 Increase / (decrease) in profit and loss 413.94 (413.94) 344.87 (344.87)

b) Interest rate risk

Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair value interest rate risk is the risk of changes in fair values of fixed interest bearing investments because of fluctuations in the interest rates. Cash flow interest rate risk is the risk that the future cash flows of floating interest bearing investments will fluctuate because of fluctuations in the interest rates. In order to optimize the Group’s position with regards to interest expenses and to manage the interest rate risk, treasury performs a comprehensive corporate interest rate risk management by balancing the proportion of fixed rate and floating rate financial instruments in its total port-folio. Accordingly, the Group endeavors to gradually reduce the exposure to variable interest rate borrowings.

The Group’s main interest rate risk arised from short-term borrowings and long term borrowings with fixed rates, which expose the Group to cash flow interest rate risk. The Group’s borrowings at fixed rate were mainly denominated in INR and US$. The Group’s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of change in market interest rates.

c) Exposure to interest rate risk

The Group’s interest rate risk arises from borrowings. The interest rate profile of the Group’s interest-bearing borrowings is as follows:

ParticularsAs at

March 31, 2018 `


`

As at April 1, 2016

`

Floating rate borrowings 73,693.92 36,579.63 44,766.84 Fixed rate borrowings 9,290.06 8,496.17 10,690.00

Total 82,983.98 45,075.80 55,456.84

d) Sensitivity (` in lakhs)

Profit or loss is sensitive to higher/lower interest expense from borrrowings as a result of changes in interest rates. A reasonably possible change of 50 basis points in interest rates at the reporting date would have increase/(decreased) and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency exchange rates, remain constant.

(` in lakhs)

138


Particulars March 31, 2018₹

March 31, 2017₹

Interest rates - Increase by 50 basis points (50 basis points) (229.46) (105.82)Interest rates - decrease by 50 basis points (50 basis points) 229.46 105.82

C) Liquidity Risk

Liquidity risk is the risk that the Group will encounter in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The approach of the Group to manage liquidity is to ensure , as far as possible, that these will have sufficient liquidity to meet their respective liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risk damage to their reputation. The Group assessed the concentration of risk with respect to refinancing its debt and concluded it to be low.

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments.

As on March 31, 2018 within 1 year More than 1 year TotalBorrowings (including interest accrued but not due and interest accrued and due)

87,840.76 2,472.26 90,313.02

Trade payables 11,542.75 - 11,542.75 Other financial liabilities 1,946.70 - 1,946.70 Bank guarantee (including financial guarantee and letter of credit) * - 14,064.21 14,064.21

Total 1,01,330.21 16,536.47 1,17,866.68

As on March 31, 2017 within 1 year More than 1 year TotalBorrowings 46,675.17 3,912.15 50,587.32 Trade and other payables 33,000.00 - 33,000.00 Other financial liabilities 436.00 - 436.00 Bank guarantee (including financial guarantee and letter of credit)* - 4,792.95 4,792.95

Total 80,111.17 8,705.10 88,816.27

As on April 1, 2016 within 1 year More than 1 year TotalBorrowings 52,154.89 5,980.75 58,135.64 Trade and other payables 10,510.70 - 10,510.70 Other financial liabilities 1,888.89 - 1,888.89 Bank guarantee (including financial guarantee and letter of credit)* - 10,080.31 10,080.31

Total 64,554.48 16,061.06 80,615.54

57 Capital management:

The Company manages its capital to ensure that the Company while maximising the return to stakeholders through optimisation of debt and equity balance. The capital structure of the Company consists of net debt (borrowings as detailed in Note 19 and Note 22 offset by cash and bank balances) and total equity of the Company.

The gearing ratio at the end of the reporting period was as follows:

ParticularsAs at

March 31, 2018 March 31, 2017 April 01, 2016₹ ₹ ₹

Debt 82,983.98 45,075.79 55,456.84 Less: Cash and bank balances 1,144.87 569.87 1,577.37 Net debt 81,839.11 44,505.92 53,879.47 Total equity 34,423.87 50,596.90 57,717.87 Capital and net debt 1,16,262.98 95,102.82 1,11,597.34 Gearing ratio (%) 0.70 0.47 0.48

58 The table below provide summarised financial information for the associate that are material to the group. The information disclosed reflects the amount presented in financial statements of the relevant associate and not the Company’s share of those amounts.

i Summarised Balance Sheet (` in lakhs)

ParticularsAs at

March 31, 2018₹

March 31, 2017₹

April 01, 2016₹

Current Assets- Cash and cash equivalents 146.01 5.35 5.43

(` in lakhs)


139

ParticularsAs at

March 31, 2018₹

March 31, 2017₹

April 01, 2016₹

- Other current assets 634.00 1,301.39 1,356.53 Total Current assets 780.01 1,306.74 1,361.96 Total Non-current assets 2,608.41 3,126.52 2,942.90 Current Liabilities 477.77 1,395.07 1,349.39 Total Current liabilities 477.77 1,395.07 1,349.39 Non-current liabilities - - - Total Non-current liabilities - - - Net Assets 2,910.66 3,038.19 2,955.48

ii Reconciliation to carrying amounts

ParticularsFor the year ended For the year ended

March 31, 2018 March 31, 2017₹ ₹

Opening net assets 3,038.19 2,955.48 Loss for the year (127.53) (1,028.89)Other comprehensive income - - Closing net assets 2,910.66 1,926.58 Group’s share in % 40% 40%Group’s share in ₹ 1,164.26 770.63 Carrying amount 1,164.26 770.63

iii Summarised statement of profit and loss

ParticularsFor the year ended For the year ended

March 31, 2018 March 31, 2017₹ ₹

Revenue 415.60 - Loss for the year (127.53) (1,028.89)Other comprehensive income - - Total comprehensive income (127.53) (1,028.89)

59 The Holding Company has incurred net loss of ₹ 19,157.71 during the year ended March 31, 2018 and, as of that date, the Holding Company’s current liabilities exceeded its total assets by ₹ 13,645.07. This indicates that a material uncertainty exists that may cast significant doubt on the Holding Company’s ability to continue as a going concern. Based on future business plans, the Holding Company’s Management is confident that the Holding Company will be able to generate profit in future periods and meet its financial obligations as they arise and hence, the financial statements have been prepared on going concern basis.

60 Transition to Ind AS reporting As stated in Note 2 A., the financial statements for the year ended March 31, 2018 are prepared in compliance with Ind AS. The adoption of Ind AS was carried out in accordance with Ind AS 101, using April 01, 2016 as the transition date. Ind AS 101 requires

that all Ind AS standards that are effective for the first Ind AS Financial Statements for the year ending March 31, 2018, be applied consistently and retrospectively for all fiscal years presented.

All applicable Ind AS have been applied consistently and retrospectively wherever required. The resulting difference between the carrying amounts of the assets and liabilities in the financial statements under both Ind AS and Previous GAAP as of the Transition Date have been recognized directly in equity at the Transition Date.

On transition the Company did not revise estimates previously made under IGAAP except where required by Ind AS Reconciliations: The following reconciliations help to understand the effect of significant differences arising from the transition from

Previous GAAP to Ind AS in accordance with Ind AS 101:

A Reconciliation of equity: (` in lakhs)

Particulars Note no. As at

March 31, 2017₹

April 01, 2016₹

Total net worth as per Indian GAAP 55,429.01 59,021.19 Interest on loans given a 5.66 - ECL on Trade Receivables d (4,838.17) (1,249.00)Loss on fair valuation of bond e 0.41 1.11 Revaluation of Property, Plant and Equipments f - (55.43)

Total net worth as per Ind AS 50,596.90 57,717.87

140


B Reconciliation between Profit as previously reported and total comprehensive income as per Ind AS for the year ended March 31, 2017 (` in lakhs)

Particulars Note no. For the year ended

March 31, 2017 ₹

Loss under previous GAAP (2,793.63)Current practices and Ind AS gap differencesInterest on loans given a 6.11 Remeasurement of defined benefit plan c 17.53 ECL on Trade Receivables d (3,589.17)(Loss) on fair valuation of bond e (0.70)Net (loss) after tax as per Ind AS (6,359.87)Other comprehensive incomeTransfer of currency fluctuation reserve to retained earnings b (743.12)Remeasurement of defined benefit plan c (17.53)Income tax relating to the above items - Total Comprehensive Income for the year (net of tax) (7,120.52)

C Reconciliation of changes in cash and cash equivalent as per Ind AS for the year ended March 31, 2017 There were no differences between the Statement of Cash Flows presented under Ind AS and under IGAAP

Particulars Note no. For the year ended

March 31, 2017 ₹

Cash & Cash equivalent as per previous GAAP 204.79 Changes in cash & cash equivalent due to Ind AS adjustments - Cash & Cash equivalent as per Ind AS 204.79

Notes to the reconciliation: a Interest on loans given Company has booked interest income on loans given to body corporate in accordance under Ind AS

b Foreign currency translation reserve In accordance with Ind AS 101, the Group has adopted the exemption to consider its cumulative currency translation differences

for all foreign operations deemed to be zero as at April 01, 2016. Accordingly the foreign currency translation reserve (FCTR) accumulated as of April 01, 2016 has been transferred to retained earnings.Further, under IGAAP FCTR generated on translation of foreign operations was accounted as reserves, however under Ind AS the same is accounted through OCI statement. Adjustment to that effect has been considered in the financials.

c Actuarial gain/loss on employee benefit plan As per Ind AS 19, actuarial gains and losses relating to defined employee benefit plans are recognized in other comprehensive

income as compared to being recognized in the Statement of profit and loss under IGAAP. d Trade Receivables As per Ind AS 109,the Company is required to apply expected credit loss model for recognising the allowance for doubtful debts.

As a result, the Company has estimated lifetime expected credit losses and recorded the same as at the transition date. e Investments Under previous GAAP, investments in bonds were recorded at cost. Under Ind AS, investments are required to be valued at fair value.

The Company has classified these instruments as fair value through profit and loss and adjusted the amounts as on transition date.f Revaluation of Property, Plant and Equipments In accordance with Ind AS 101, the Group has adopted the exemption to consider its revaluation reserve differences deemed to be

zero as at April 01, 2016.

For and on behalf of the Board of Directors Niin Fire Protection Industries Limited Sd/- Sd/- Sd/- Nitin M. Shah Kailat Vaidhyanathan Rahul N. Shah Chairman and Non Executive Director Chief Executive Officer Non Executive Director DIN No. 00077323 DIN No. 00073232 Sd/- Sd/- Bharat K. Shah Sraban Kumar Karan Chief Financial Officer Company Secrtetary Mumbai Mumbai June 14, 2018 June 14, 2018


141

NITIN FIRE PROTECTION INDUSTRIES LIMITEDReg. Off.: 801 & 802, C-wing, Neelkanth Business Park, Kirol Road, Vidhyavihar (W), Mumbai - 400086.

Phone: +91-22-40457000, Fax No. +91 22 25701110CIN - L29193MH1995PLC092323 Email: [email protected] Website: www.nitinfire.comBranch Office: 501, Delta, Technology Street, Hiranandani Powai, Mumbai – 400 076.

Please complete the attendance slip and hand it over at the entrance of the Meeting hall.Please also bring your copy of the Annual Report.

ATTENDANCE SLIPI hereby record my presence at the 23rd Annual General Meeting of the Company held on Saturday, the September 29, 2018 at 2.30 p.m. at BTTC / KCCMS (K. C. College of Management Studies) BLDG., 1st floor, above lings Pavalion, Mahakavi Bhushan Marg, Behind Regal Cinema, Colaba, Mumbai 400039

Regd Folio No.: /DPID NO :________________________________________________________________________________________

No. of shares :________________________________________________________________________________________

Name of the shareholder :________________________________________________________________________________________(in capital letters)

______________________________Signature of the shareholder or proxy

Form No. MGT-11Proxy form

[Pursuant to section 105(6) of the Companies Act, 2013 and rule 19(3) of the Companies (Management and Administration) Rules, 2014]

23rd Annual General Meeting on September 29, 2018CIN: L29193MH1995PLC092323Name of the company: NITIN FIRE PROTECTION INDUSTRIES LIMITEDRegistered office: 501, Delta, Technology Street, Hiranandani Powai, Mumbai – 400 076Branch office:

Name of the member (s)Registered AddressE-mail Id:Folio No/ Client Id :DP ID:

I/we being the member(s) holding ........................................................................................ shares of the above named company, hereby appoint.

1. Name: .............................................................................................................. E-mail Id: ..........................................................

Address: ......................................................................................................................................................................................

Signature: .......................................................................................................... or failing him .................................................

2. Name: .............................................................................................................. E-mail Id: ..........................................................

Address: ......................................................................................................................................................................................

Signature: .......................................................................................................... or failing him .................................................

3. Name: .............................................................................................................. E-mail Id: ..........................................................

Address: ......................................................................................................................................................................................

Signature: ....................................................................................................................................................................................

142


as my/our proxy to attend and vote (on a poll) for me/us and on my/ our behalf at the 23rd Annual General Meeting of the company, to be held on Saturday, September 29, 2018 at 2.30 p.m. at BTTC / KCCMS (K. C. College of Management Studies) BLDG., 1st floor, above lings Pavalion, Mahakavi Bhushan Marg, Behind Regal Cin-ema, Colaba, Mumbai 400039, and at any adjournment thereof in respect of such resolutions as are indicated below:

1. Ordinary resolution to receive, consider and adopt the Audited Balance Sheet and the Audited Statement of Profit & Loss (Standalone & Consolidated) for the year ended 31st March, 2018 and Cash Flow Statement of the Company for the financial year ended March 31, 2018, together with the Reports of the Board of Directors and the Report of the Auditors thereon.

2. Ordinary resolution for appointment of Mr. Nitin M. Shah (DIN – 00073232), Director, who retires by rotation and being eligible offers himself for re-appointment.

3. Special Resolution for appointment of Mr. Nitin M. Shah

(DIN–00073232), as the Managing Director and fix his remuneration.

4. To reverse the resolution passed by members on December 9, 2017 with respect to increase in authorized share capital

Signed this…… day of……… 2018

Signature of shareholder Signature of Proxy holder(s)

Affix revenueStamp of `1/-

Notes:

(i) The Proxy Form in order to be effective should be duly com-pleted and deposited at the Registered Office of the Company, not less than 48 hours before the commencement of the Meet-ing.

(ii) The Proxy Form shall be signed by the appointer or his attorney duly authorized in writing, or if the appointer is a body corpo-rate, be under its seal or be signed by an officer or an attorney duly authorized by it.

(iii) The Proxy Form is valid only if it is properly stamped and such stamp is cancelled.

(iv) Blank, incomplete or undated Proxy Form shall not be consid-ered valid.

(v) The proxy-holder shall prove his/her identity at the time of at-tending the Meeting.


143

Form No. SH-13-Nomination Form[Pursuant to section 72 of the Companies Act, 2013 and rule 19(1) of the Companies

(Share Capital and Debentures) Rules 2014]

To,

(Name of the Company) _____________________________________________________________________________________________

(Address of the Company) ___________________________________________________________________________________________

___________________________________________________________________________________ Pin code ______________________

I/ We _________________________________________________________________________________________________________

residing at ________________________________________________________________________________________________________

________________________________________________________________________________ the holder(s) of the securities particulars

of which are given hereunder wish to make nomination and do hereby nominate the following person in whom shall vest, all the rights in

respect of such securities in the event of my/our death.

1) Particulars of the Securities (in respect of which nomination is being made)

Nature of

securities

Folio No. No. of

securities

Certificate

No.

Distinctive No.

From To

2) Particulars of Nominee

Name: Date of Birth : ___/___/_____Please affix

recent passportsize photographof the Nomineesigned across

Father’s/ Mother’s/Spouse’s name :

Occupation : Nationality :

E-mail id :Phone No : Relationship with

the security holder :Address: _______________________________________________________________________________________________________________________________________________________________________________________________________________________________ Pin code _________________

Signature of the Nominee

3) In case Nominee is a Minor

Date of birth : ___/___/_____ Date of attaining Majority :___/___/_____

Name of guardian :

Address of Guardian: ___________________________________________________________________________________________________________________________________________________________________________ Pin Code _________________

Name of the Security Holder(s) Signature1.

2.

3.

Name of witness Signature of Witness with date

Address of witness : ______________________________________________________________________________________________________________________ Pin code : ________________Place : Date : ___/___/_____

144



165

Mahakavi Bhushan Marg, Behind Regal Cinema, Colaba, Mumbai 400039” is given below: