3.15 Provision and Contingent Liabilities
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that the
Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the
reporting period, taking in to account the risks and uncertainties surrounding the obligation.
Contingent Liabilities are disclosed when there is a possible obligation which may arise from past events and the existence of which will be
confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or a
present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle the
obligation or reliable estimate of the amount cannot be made.
3.16 Borrowing Cost
Borrowing costs directly attributable to the acquisition, construction or production that necessarily takes a substantial period of time to get ready for its
intended use are capitalized as part of the cost of the asset. All other borrowing costs are expensed in the period in which they incur. Borrowing costs
consists of interest and other costs that an entity incurs in connection with the borrowing of funds. Other borrowing costs are recognized as an expense
in the period in which they are incurred.
Cash and Cash Equivalents
Cash and cash equivalent comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less, which are subject
to an insignificant risk of changes in value.
Trade Receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method,
less provision for impairment, if any
3.17 Taxes on Income
Taxes on income comprises of current taxes and deferred taxes. Current Tax in the statement of profit and loss is determined as the amount of
income-tax payable/recoverable in respect of the taxable income for the current period using tax rates and tax laws enacted during the period,
together with any adjustment to tax payable in respect of previous years.
Deferred Tax is recognised on temporary differences between the carrying amount of assets and liabilities and the corresponding tax bases used
in the computation of taxable profit.
Deferred Tax Assets are recognised subject to the consideration of prudence only to the extent that there is reasonable certainty that
sufficient future taxable income will be available against which such deferred tax assets can be realised. Such deferred tax assets and liabilities
are not recognized if the temporary differences arises from the initial recognition of assets and liabilities in a transaction that affects neither
the taxable profit nor the accounting profit.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the
asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.
Current and deferred tax are recognised in profit or loss, except when they relate to items that are recognised in other comprehensive income or
directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity net of tax
respectively.
3.18 Earnings per Share
Basic Earnings per Share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number
of equity shares outstanding during the period.
The weighted average number of equity shares outstanding during the period is adjusted for events such as bonus issue, bonus element in a rights issue,
share split, and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without a corresponding change
in resources.
For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average
number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.
4. Financial Instruments and Related Disclosures
Capital Management
The Company's objective is to have a strong capital base in order to maximise the shareholders' wealth and to ensure the continuity of the business
from its internal resources and if found necessary, from a judicious use of borrowing facilities to fund requirements for meeting operational requirement
as well as for comprehensive growth of the Company.
5. Financial risk management objectives
The Company's faces a variety of financial risks, including market risk, credit risk and liquidity risk. The Company continues to focus on business
risk management. The Company management seeks to enable the early identification, evaluation and effective management of key risks facing the
business. The Company has strong internal control systems resting on policies and procedures issued by appropriate authorities, process of regular
audits and monitoring of risks.
a) Market risk
The Company's business, primarily agricultural in nature, future cash flows will fluctuate because of adverse weather conditions and lack of future
markets. The Company closely monitors the changes in market conditions and select the sales strategies to mitigate its exposure to risk.
b) Foreign currency risk
The Company undertakes transactions denominated in foreign currency which results in exchange rate fluctuations. Such exchange rate risk primarily
arises from transactions made in foreign exchange. A significant portion of these transactions are in US Dollar and Euro.
c) Foreign currency sensitivity
The impact of sensitivity analysis arising on account of outstanding foreign currency denominated assets and liabilities is insignificant.
d) Interest rate risk
Interest rate risk refers to the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market
interest rates. The objective of the Company is to lessen the impact of adverse interest rate movements on its earnings and cash flows and to
minimise counter party risks.
The Company is exposed to interest rate volatilities primarily with respect to its borrowings from banks.
e) Interest rate sensitivity
Since the borrowings are all short / medium term in nature, the volatility in the interest rate is minimal.
f) Liquidity risk
Liquidity risk is the risk that the Company may encounter difficulty including seasonality in meeting its obligations. The Company mitigates its
liquidity risks by ensuring timely collections of its trade receivables, close monitoring of its credit cycle and ensuring optimal movements of its
inventories.
g) Credit risk
Credit risk is the risk that counter party will not meet its obligations leading to a financial loss. The Company has its policies to limit its exposure
to credit risk arising from outstanding receivables. Management regularly assess the credit quality of its customers. The credit risk of the
Company is relatively low as the Company also sells largely its teas through the auction system which is on cash and carry basis and through exports
which are mostly backed by letter or credit or on advance basis.
6. Fair value measurements
Fair value hierarchy
Fair value of the financial instruments is classified in various fair value hierarchies based on the following three levels:
Level 1 : Quoted prices in active market for identical assets or liabilities
Level 2: Inputs other than quoted price including within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or
indirectly (i.e. derived from prices).
The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximize the use of
observable market data and rely as little as possible on entity-specific estimates. If significant inputs required to fair value an instrument are
observable, the instrument is included in Level 2.
Level 3: Inputs for the assets or liabilities that are not based on observable market data . If one or more of the significant inputs is not based on
observable market data, the fair value is determined using generally accepted pricing models based on a discounted cash flow analysis, with the most
significant input being the discount rate that reflects the credit risk of counterparty. This is the case with listed instruments where market is not
liquid and for unlisted instruments.
The management consider that the carrying amounts of financial assets (other than those measured at fair values) and liabilities recognized in the
financial statements approximate their fair value as on March 31, 2025 and March 31,2024.
There has been no change in the valuation methodology for Level 3 inputs during the year. There were no transfers between Level 1 and Level 2
during the year.
7 The Company further, having exited tea plantation business, looked forward to preparing itself to venture into merchant
exporting of teas to Gulf / West Asia / CIS countries. But due to border skirmish aggravating to war in between Ukraine
and Russia and consequent fallout in and around the region, the company’s merchant exporting plans are put on hold.
Besides, the company has also been trying to venture into retail selling of teas and therefore looking into logistics, guidelines
that entailed most of the year under review. The Company meanwhile could barely earn revenue from interest on its inter
corporate deposits, term deposits with banks and from investments in mutual funds.
8 i) At the Meeting held on 28th July, 2023, the Board recommended shifting of Registered Office of the Company from Tinsukia
in Assam to Kolkata in West Bengal. The Company has got approval from its shareholders at the Annual General Meeting
held on 12th September, 2023. Order dated 19th February, 2024 has been issued by the Office of the Regional Director
(NER) in the matter u/s 13(4) of the Companies Act, 2013 for proceeding on this matter. The Registered Office of the company
is now at Kolkata under Order dated 18th June, 2024 of the Registrar Of Companies, Kolkata.
ii) The Company has filed an application with The Calcutta Stock Exchange for voluntary delisting of its equity shares.
The process of delisting is currently ongoing and subject to necessary approval and compliance with applicable laws and
regulations including SEBI (Delising of Equity Shares) Regulations, 2021.
9 It has been decided by the Company that Retirement Scheme in operation as signed between the Management of
Warren Tea Limited and the erstwhile General Secretary, ACKS, Central Office at Dibrugarh needs to be discontinued
due to the several impediments faced by the Company in its business operation and the ensuing wreckage caused to the
financial health of the Company in the past few years due to various uncontrollable and enforceable events transpired
in the tea market and tea industry.
Notice by the Company in this regard was given vide Section 9-A of the I.D. Act to all concerned in the month of
February, 2022. The matter is subjudice. The Company to act as per the Laws of the Land.
10 The management observed in its board meeting held on 28th March 2024 that since the last four financial years post COVID,
owing to difficulty from increasing cost of production / incessant rains from climate change / pest attacks / fall outs from
pandemic and significant changes in the market scenario all of which had remained largely uncontrollable and thus had
significant impact on company’s profitability, the Company to combat such adverse situations had to dispose of all its
remaining tea estates to consolidate and strengthen its financial performance and as a concrete step towards improvement
of its overall performance. Various cost reduction steps have already been taken considering the current situation. The executive
staff including the substaff are encouraged / allowed to avail of the leave as permissible and the practice of leave encashment
shall be withdrawn in line with the resolution of the board of directors at its meeting held on 13th August 2020. The matter
has been discussed threadbare by the board of directors at its meeting held on 28th March 2024 and hence it has been
resolved that the Board at its sole discretion shall forfeit leave encashment for all employees of the Company at any level,
whose name appear on the payroll of the Company as at 1st January 2019, including the Executive Chairman, all management
staff either at Kolkata corporate office and or at the tea estates, be it staff, substaff, daily rated workers, peons. Leave
encashment is hence withdrawn and hence employees are encouraged to avail leave as is permissible from accumulated
leave balance and fresh accruals.
32 The following additional information (other than what is already disclosed elsewhere) is disclosed
in terms of amendments dated 24th March, 2021 in Schedule III to the Companies Act 2013
with effect from 1st April, 2021
1) No proceedings have been initiated or pending against the company for holding any benami
property under the Benami Transactions (Prohibition) Act, 1988. Hence relevant disclosures
are not applicable.
2) The company does not have any transactions with companies struck off under section 248 of
the Companies Act, 2013. Hence no disclosure required.
3) The company had borrowings from banks on the basis of security of current assets. The periodical
returns or statements of current assets filed by the company with banks or financial institutions are
in agreement with the books of accounts. Borrowings had been repaid in full and there is no
dues to banks and financial institutions.
4) There are no instances of any transactions not recorded in the books of accounts that has
been surrendered or disclosed as income during the year in the tax assessments under the
Income Tax 1961 ( such as search or survey or any other relevant provisions of the Income Tax Act 1961)
5) The Company is not declared as a willful defaulter by any bank or financial institution or other
lender.
6) There are no charges or satisfaction of charges pending to be registered with Registrar of
Companies beyond the statutory period, besides five charges aggregating to an amount of ' 2.47
in all in the name of The Assam State Housing Board for which efforts are on to register satisfaction on
Registrar of Companies site through the Housing Board. Charges were duly satisfied prior to the
implementation of the MCA21 system when the submission was made physically to the Registrar of Companies.
The non-updation on the portal is due to migration issues and is not within the domain of the Company.
7) The Company has not traded or invested in crypto currency or virtual currency during the financial year
8) No funds have been advanced or loaned or invested (either from borrowed funds or share premium or
any other sources or kind of funds) by the Company to or in any other person or entity, including foreign
entities ("Intermediaries") with the understanding, whether recorded in writing or otherwise, that the
intermediary shall lend or invest in party identified by or on behalf of the Company (Ultimate Beneficiaries).
The Company has not received any fund from any party (Funding Party) with the understanding that the
Company shall whether directly or indirectly lend or invest in other persons or entities identified by or on
behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of
the Ultimate Beneficiaries.
9) There is no scheme of arrangement approved by competent authority in terms of sections 230 to 237 of
the Companies Act, 2013 during the year, hence relevant disclosures are not applicable.
33 Figures of Previous Year have been regrouped or rearranged, wherever necessary.
Signatures to Note Nos. 1 to 25
GARV & ASSOCIATES
Firm Registration Number - 301094E
Chartered Accountants
Soma Chakraborty
Ramanand Rustagi Indraneel Banik Executive Director &
Partner Executive Director & Company Secretary
Membership Number - 010467 Chief Financial Officer DIN : 08825627
Kolkata, 20th May, 2025 DIN : 09687872 Membership Number : A11108
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