2.18 Provisions, contingent liabilities and contingent assets
Provisions

A provision is recognised when an enterprise has a present obligation as a result of past event; it is probable that an outflow of resources will
be required to settle the obligation, in respect of which a reliable estimate can be made. 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.

Contingent liabilities

Contingent Liabilities are not recognized but disclosed in notes forming part of the financial statements.

Contingent Assets

Contingent Assets are disclosed, where an inflow of economic benefits is probable. Contingent assets are neither recognised nor recorded in
financial statements.

2.19 Exceptional Items

When items of income and expense within profit or loss from ordinary activities are of such size, nature or incidence that their disclosure is
relevant to explain the performance of the enterprise for the period, the nature and amount of such material items are disclosed separately as
exceptional items.

2.20 Leases

Leases are accounted as per Ind AS 116 which has become mandatory from April 1,2019.

Assets taken on lease are accounted as right-of-use assets and the corresponding lease liability is accounted at the lease commencement
date.

Initially the right-of-use asset is measured at cost which comprises the initial amount of the lease liability adjusted for any lease payments
made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the
underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received. The lease liability is
initially measured at the present value of the lease payments, discounted using the Company's incremental borrowing rate. It is remeasured
when there is a change in future lease payments arising from a change in an index or a rate, or a change in the estimate of the guaranteed
residual value, or a change in the assessment of purchase, extension or termination option. When the lease liability is remeasured in this way,
a corresponding adjustment is made to the carrying amount of the rightof-use asset, or is recorded in the Statement of Profit and Loss if the
carrying amount of the right-of-use asset has been reduced to zero. The right-of-use asset is measured by applying cost model i.e. right-of-use
asset at cost less accumulated depreciation and cumulative impairment, if any. The right-of-use asset is depreciated using the straight-line
method from the commencement date to the end of the lease term or useful life of the underlying asset whichever is earlier. Carrying amount
of lease liability is increased by interest on lease liability and reduced by lease payments made. Lease payments associated with following
leases are recognised as expense on straight-line basis:

(i) Low value leases; and

(ii) Leases which are short-term.

Assets given on lease are classified either as operating lease or as finance lease. A lease is classified as a finance lease if it transfers
substantially all the risks and rewards incidental to ownership of an underlying asset. Initially asset held under finance lease is recognised in
balance sheet and presented as a receivable at an amount equal to the net investment in the lease. Finance income is recognised over the

lease term, based on a pattern reflecting a constant periodic rate of return on Company's net investment in the lease. A lease which is not
classified as a finance lease is an operating lease.

The Company recognises lease payments in case of assets given on operating leases as income on a straight-line basis. The Company
presents underlying assets subject to operating lease in its balance sheet under the respective class of asset.

2.21 Income Tax

Income tax expense comprises current tax expense and the net change in the deferred tax asset or liability during the year. Current and
deferred taxes are recognised in Statement of Profit and Loss except when they relate to items that are recognised in other comprehensive
income or directly in equity, in such case, the current and deferred tax are also recognised in other comprehensive income or directly in
equity, respectively. Current tax is measured at the amount of tax expected to be payable on the taxable income for the year as determined in
accordance with the provisions of the Income Tax Act, 1961. Deferred income tax is recognised using the Balance Sheet approach. Deferred
income tax assets and liabilities are recognised for deductible and taxable temporary differences arising between the tax base of assets
and liabilities and their carrying amount, except when the deferred income tax arises from the initial recognition of an asset or liability in a
transaction that is not a business combination and affects neither accounting nor taxable profit or loss at the time of the transaction. Deferred
tax assets are recognised only to the extent that it is probable that either future taxable profits or reversal of deferred tax liabilities will be
available, against which the deductible temporary differences and the carry forward of unused tax credits and unused tax losses can be utilised.
The carrying amount of a deferred tax asset shall be reviewed at the end of each reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised. Deferred tax assets and
liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted by the end of the reporting period and
are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled. Deferred tax assets and liabilities
are off set when there is a legally enforceable right to off set current tax assets and liabilities and when the deferred tax balances relate to
the same taxation authority. Minimum Alternative Tax (‘MAT') credit is recognised as an asset only when and to the extent there is convincing
evidence that the Company will pay normal income-tax during the specified period. In the year in which the MAT credit becomes eligible to be
recognised as an asset, the said asset is created by way of a credit to the statement of profit and loss. The Company reviews the same at each
balance sheet date and writes down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the
effect that Company will pay normal income-tax during the specified period.

2.22 Recent Accounting Pronouncements:

Ministry of Corporate Affairs (“MCA”) notifies new standards or amendments to the existing standards under Companies (Indian Accounting
Standards) Rules as issued from time to time. For the year ended March 31,2024, MCA has not notified any new standards or amendments
to the existing standards applicable to the Company.

2.23 Critical accounting estimates and assumptions:

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of
causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below:

(a) Income taxes

The Company's tax jurisdiction is India. Significant judgements are involved in estimating budgeted profits for the purpose of paying advance
tax, determining the provision for income taxes, including amount expected to be paid/recovered for uncertain tax positions.

(b) Property, plant and equipment

Property, plant and equipment represent a significant proportion of the asset base of the Company. The charge in respect of periodic depreciation
is derived after determining an estimate of an asset's expected useful life and the expected residual value at the end of its life. The useful
lives and residual values of Company's assets are determined by the management at the time the asset is acquired and reviewed periodically,
including at each financial year end. The lives are based on historical experience with similar assets as well as anticipation of future events,
which may impact their life, such as changes in technical or commercial obsolescence arising from changes or improvements in production or
from a change in market demand of the product or service output of the asset.

(c) Defined Benefit Obligation

The costs of providing pensions and other post-employment benefits are charged to the Statement of Profit and Loss in accordance with Ind
AS 19 ‘Employee benefits' over the period during which benefit is derived from the employees' services. The costs are assessed on the basis
of assumptions selected by the management. These assumptions include salary escalation rate, discount rates, expected rate of return on
assets and mortality rates.

(d) Fair value measurement of financial instruments

When the fair values of financials assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices
in active markets, their fair value is measured using valuation techniques, including the discounted cash flow model, which involve various
judgements and assumptions.

(e) Right-of-use assets and lease liability

The Company has exercised judgement in determining the lease term as the noncancellable term of the lease, together with the impact of
options to extend or terminate the lease if it is reasonably certain to be exercised. Where the rate implicit in the lease is not readily available, an
incremental borrowing rate is applied. This incremental borrowing rate reflects the rate of interest that the lessee would have to pay to borrow
over a similar term, with a similar security, the funds necessary to obtain an asset of a similar nature and value to the right-of-use asset in a
similar economic environment. Determination of the incremental borrowing rate requires estimation.

B. Defined Benefit Plan
Gratuity:

In accordance with the payment of Gratuity Act 1972 the company provides for gratuity covering eligible employees. The liability on account
of gratuity is covered partially through a recognized Gratuity Fund managed by Life Insurance Corporation of India (LIC) and balance is
provided on the basis of valuation of the liability by an independent actuary as at the year end.

Major category of plan assets

The group has taken plans from Life Insurance Corporation of India

The following tables set out the funded status of the gratuity plans and the amounts recognised in the Financial Statements as at 31 March
2024 and 31 March 2023.

40 Financial Risk Management

A wide range of risks may affect the Company's business and financial results. Amongst other risks that could have significant influence on the
Company are market risk, credit risk and liquidity risk.

The Board of Directors of the Company manage and review the affairs of the Company by setting up short term and long-term budgets by
monitoring the same and taking suitable actions to minimise potential adverse effects on its operational and financial performance.

40.1 Market risk

The Company is primarily exposed to the following market risks.

40.1.1 Interest rate risk management

Out of total borrowings, large portion represents current borrowings and all the borrowings are with fixed interest rate. And accordingly the
Company is not exposed to interest rate risk. However, the Company continuously monitoring over all factors influence rating and also factors
which influential the determination of the interest rates by the banks to minimize the interest rate risks.

40.1.2 Price Risk

The company is constantly exposed to market inflation risk. The price of direct cost and overhead projected before execution of project are
substainally increased till the completion of project. However company is eligible to claim price escalation amount from the client as per the
terms and condition mentioned in tender document which varies for tender to tender.

40.2 Credit management

Credit risk is the risk of financial loss to the Company if a client or counterparty to a financial instrument fails to meet its contractual obligations,
and arises principally from the Company's receivables from clients and cash. Management has a credit policy in place and the exposure to
credit risk is monitored on an on-going basis.

The Company has a low credit risk in respect of its trade receivables, its major customers being autonomous agencies of Government and
Public Sector Undertaikings. However, as Company grows its customer base, it will experience an increased credit risk environment. The
Company is also exposed to credit risk in respect of its cash and seeks to minimise this risk by holding funds on deposit with major financial
institutions.

(Rs. in crores)

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk was ? 693.02 crores
for March 31,2024 ( ? 685.38 crores for March 31,2023) being the total of the carrying amount of the balances with banks, bank deposits,
investments (excluding equity investments), trade receivables, loans given and other financial assets.

40.3 Liquidity risk management

Liquidity risk refers to the risk that the Company may not be able to meet its financial obligations timely.

Management monitors rolling forecasts of the Company's liquidity position (comprising of undrawn bank facilities and cash and cash
equivalents) on the basis of expected cash flows. This monitoring includes financial ratios and takes into account the accessibility of cash and
cash equivalents.

The table below analyses the maturity profile of the Company's financial liabilities. The following break up is based on the remaining period at
the balance sheet date to the contractual maturity date. The liquidity continues to remain under stress. The Company is going through a very
tight liquidity situation resulting in sub-optimal level of operations thereby impacting profitability. The amounts disclosed in the table are the
contractual undiscounted cash flows.

42 Hon'ble, NCLT, Mumbai, passed Order dated 21.10.2022 in Company Petition no. CP (IB) No.594/MB-IV/2021 filed by STATE BANK OF
INDIA, the Financial Creditor /Petitioner, under section 7 of Insolvency & Bankruptcy Code, 2016 (I&B Code) against the Company, Corporate
Debtor/Respondent, for initiating Corporate Insolvency Resolution Process (CIRP).

Mr. Anurag Kumar Sinha, a Registered Insolvency Professional having Registration Number [IBBI/IPA-001/IP-P00427/2017-18/10750] has
been appointed as Interim Resolution Professional (Later on confirmed as Resolution Professional (RP) by CoC), to carry out the functions as
mentioned under Insolvency and Bankruptcy Code, 2016

The RP filed an application bearing IA No. 5819(MB) of 2023 in the Company Petition under Section 30(6) of the Code before the Hon'ble NCLT
for its consideration and approval of the Resolution Plan. The same is pending for approval before Hon'ble NCLT Mumbai

In terms of Sections 14(4) and 31(3) of the Code, until the resolution plan is approved by the Hon'ble NCLT, the moratorium shall continue to
be in effect and accordingly, the RP shall, continue to manage operations of the Company on a going concern basis during the CIRP.

43 The above audited financial statments were prepared by the management of the Company and RP took the same on record basis. The
Statutory Auditors have carried out the Audit of the Financial Statements for the year ended March 31,2024 vide their report dated May 30,
2024.

44 With respect to the financial statements for the year ended March 31,2024, the RP has signed the same solely for the purpose of ensuring
compliance by the Corporate Debtor with applicable laws, and subject to the following disclaimers:

i. The RP has furnished and signed the report in good faith and accordingly, no suit, prosecution or other legal proceeding shall lie against
the RP in terms of Section 233 of the Code;

ii. No statement, fact, information (whether current or historical) or opinion contained herein should be construed as a representation or
warranty, express or implied, of the RP including, his authorized representatives and advisors;

iii. The RP, in audit of the financial statements and while signing this financial statements, has relied upon the assistance provided by the
Key Managerial Personnel (“KMP”) of the Corporate Debtor, and representations and statements made by the KMP of the Corporate
Debtor, in relation to these financial statements. The financial statements of the Corporate Debtor for the year ended March 31,2024
have been taken on record by the RP solely on the basis of and on relying the aforesaid representations and statements of the aforesaid
directors and the erstwhile management of the Corporate Debtor. For all such information and data, the RP has assumed that such
information and data are in the conformity with the Companies Act, 2013 and other applicable laws with respect to the preparation of
the financial statements and that they give true and fair view of the position of the Corporate Debtor as of the dates and period indicated
therein.

45 Hon'ble National Company Law Tribunal (“NCLT”), Mumbai Bench has passed an order dated 09th October 2023 for initiation of the Corporate
Insolvency Resolution Process (“CIRP”) in respect of Valecha Kachchh Toll Roads Limited (VKTRL), a subsidiary of the Company, under the
provisions of the Insolvency and Bankruptcy Code, 2016 and appointed Mr. Avil Jerome Menezes as Interim Resolution Professional (“IRP”)
(later on confirmed as Resolution Professional(RP) by Committee of Creditors (CoC)) to carry out the functions as mentioned under I & B Code,
2016 for initiation of CIRP.

The Company has given Corporate Guarantees of Rs.990.70 Crores for the loans availed by VKTRL which have been invoked by the secured
financial creditors of VKTRL. However, the Company has not made any provision in this regard in view of initiation of CIRP against VKTRL and
also in view of likely resolution of the account of VEL during CIRP.

The Company has also neither evaluated any impairment provisions for expected credit losses (ECL) as required under Ind AS 109 “Financial
Instruments” nor made any fair valuation as per the requirements of Ind AS 113 “Fair Value Measurements” in respect of its investment made
of Rs. 39.84 crores and loan given of Rs. 73.46 crores to VKTRL, in view of reasons mentioned above.

46 Valecha LM Toll Private Limited (VLMTPL), an erstwhile step down subsidiary of the Company, has been referred to liquidation vide Order
dated 27th October, 2020 of Hon'ble NCLT, Mumbai and liquidation process has commenced. As informed by Liquidator of VLMTPL, all
the assets of VLMTPL have been auctioned except Income Tax receivable and security deposit of sales tax and the proceeds have been
distributed amongst the secured financial creditors of VLMTPL. Further, Corporate Guarantees of Rs.261.14 Crores given by the Company
has been invoked by the secured financial creditors of VLMTPL. However, the Company has not made any additional provision in this regard
in view of likely resolution in CIRP of the Company.

47 The Company has also not evaluated impairment provisions for expected credit losses (ECL) as required under Ind AS 109 “Financial
Instruments” in relation to investments made for Rs.2.19 crores in four subsidiary companies, loans and advances given of Rs.180.45 crores
to four subsidiary companies and one step-down subsidiary company.

Further Corporate Guarantees of Rs. 168.81 Crores given by the Company have also been invoked by the respective secured financial
creditors of one subsidiary and one step down subsidiary. However, the Company has not made any additional provision in this regard in view
of the likely resolution in CIRP of the Company.

48 The Company has not evaluated expected credit losses for long outstanding Trade Receivables of Rs. 303.09 crores which includes Rs.
99.45 crores pertaining to additional claims raised during earlier years on account of escalation and various other reasons which are under
consideration and deliberation before various authorities. The Company has not evaluated impairment provisions for expected credit losses as
required under Ind AS 109 “Financial Instruments” for loans extended to various related parties (other than subsidiaries, step down subsidiaries

and associate company) amounting to Rs. 6.50 crores, loans given to other than related parties amounting to Rs. 26.11 crores and advances
to suppliers amounting to Rs.33.87 crores as at March 31,2024, in view of ongoing CIRP Proceedings against the Company where Resolution
Plan submitted by Resolution Applicant for revival of the Company has already been approved by Committee of Creditors (CoC) and thereafter
it has been filed with the Hon'ble NCLT for the final approval.

49 The Company has not recognised interest payable on its borrowings from Banks and NBFC's since April 1, 2018 in view of the settlement
proposals pursued in the prior year's wherein the Company expected a settlement at an amount lower than the liabilities already recorded in
books of accounts. The Company continues to not recognise the interest payable on its borrowings during the current year ended March 31,
2024 in view of likely resolution in CIRP of the Company.

The Company has also not provided for interest liability which may arise towards delayed payment / non-payment of dues towards tax
deducted at source as on March 31,2024.

50 The Company has an outstanding principal liability of Rs. 22.94 crores as at March 31,2024 payable to public fixed deposit holders. In view of
the already weak financial position of the Company, the Company has not provided any further interest on these outstanding overdue deposits
in Prior years. The Company continues to not recognise any interest payable on the outstanding liability payable to Fixed Deposit holders in
view of submission of resolution plan and likely resolution in CIRP of the Company.

51 Other Non Current Assets as at March 31,2024 includes Rs 31.35 crores receivable towards various indirect taxes from Government Authorities
which are pending for assessments.

52 The Company has many project sites which have either been de-mobilized or completed or otherwise shut / non-operational. The Company
could not obtain details of transactions effecting, if any, through Bank accounts previously operated through such project sites. There have
been no operations in such project sites during the year ended March 31,2024. Such Project Sites comprises total assets of Rs. 84.36 crores
[including Trade Receivables Rs. 70.46 crores and loans to other parties Rs. 5.54 crores referred in note 48 above, balances with revenue
authorities of Rs. 8.33 crores referred in note 51 above] and total liabilities of Rs. 26.70 crores as at March 31,2024.

53 The Company has one in-operative and dormant Bank account for which no bank statements are available with the Company as on March 31,
2024. The Company is in the process of obtaining the statements of such inoperative and dormant bank account.

54 The accounts of certain Banks, Loans & Advances given, Trade Receivables, Other Current Assets, Lenders' liability, Trade Payables and
Other liabilities are subject to confirmations, reconciliations, and adjustments.

55 During the year ended March 31,2024, bank guarantees aggregating to Rs.13.40 crores have been invoked by customers of the Company.
However, the Company has not provided for such invocation of bank guarantees in view of likely resolution in CIRP of the Company.

56 The accumulated losses incurred in the past years have resulted in erosion of Company's peak Net worth. However, in view of the fact that
CIRP has been initiated against the Holding Company which is likely to result in resolution of the Company and since as per provisions of IBC,
2016, as the Company is to be kept as a going concern, audited financial statements are prepared assuming that it will continue as a going
concern.

57 During the ongoing CIRP, the RP has received claims from various operational and financial creditors. In certain instances, the amount of
the claim admitted by RP under CIRP differs from the amount reflecting in the books of accounts of the Company. However, pending receipt
of final order, the Company has not made any reconciliation / adjustments in its books of account vis-a-vis the claims made by the Creditors.
Accordingly, the above audited financial statements are drawn on the basis of figures appearing in the books of accounts of the Company as
on March 31,2024.

58 There are various Legal cases filed by/ against the company. Since the cases are ongoing and the management believes that they have a
strong case. The Company do not foresee any material impacts on the financial statement of the Company.

59 (A) No proceeding has been initiated or pending against the Company for holding any Benami property under the Benami Transactions

(Prohibition) Act, 1988, as amended, and rules made thereunder.

(B) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

(C) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

(D) There were no transactions relating to previously unrecorded income that have been surrendered and disclosed as income during the
year in the tax assessments under the Income Tax Act, 1961.

(E) In the opinion of the Management, there are no transactions with companies struck off. However the Company doesnot have any
documentary evidence to support this claim.

(F) The Company has not advanced or loaned to or invested in funds to any other person(s) or entity(is), including foreign entities
(Intermediaries) with the understanding that the Intermediary shall:

(i) directly or indirectly lend to or invest in other persons or entities identified in any manner whatsoever by or on behalf of the
company (Ultimate Beneficiaries) or

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries

\l\3. Ill UIUI C3f

(G) The Company has not received any fund from any person(s) or entity(is), including foreign entities (Funding Party) with the understanding
(whether recorded in writing or otherwise) that the Company shall

(i) directly or indirectly lend to or invest in other persons or entities identified in any manner whatsoever by or on behalf of the
Funding Party (Ultimate Beneficiaries) or

(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries

(H) The Company has been declared as wilful defaulter by Canara Bank in 2021 and Central Bank of India in 2019.

60 The previous period's figures have been re-grouped/ re-classified wherever required to conform to current period's classification. All figures of
financials are stated as Rs. in Crores except otherwise stated.

In term of our Report attached For and on behalf of Valecha Engineering Limited

For Bagaria & Co. LLP

Chartered Accountants
FRN : 113447W/ W-100019

Anurag Kumar Sinha

Resolution Professional

IBBI/IPA - 001/IP - P00427/2017-18/10750

Vinay Somani Tarun Dutta

Partner Chief Executive Officer

Membership No. 143503

Place : Mumbai. Vijay Kumar H. Modi Anil S. Korpe

Date : 30th May, 2024 Company Secretary & Legal Chief Financial Officer

M.No. FCS 1831