3.3 (a) The Company acquired a plot of land situated at CTS 625 of link road Kandivali West Mumbai and the conveyance deed was
executed by the vendors in favors of the company on 01-02-2011. However a third party has challenged the conveyance executed by the vendors. Presently the suit for ownership of the said plot is pending before the High Court Bombay
3.3(b) Estimation of fair value
The fair valuation is based on current prices in the active market for similar properties. The main inputs used are quantum, area, location, demand, restrictive entry to the complex, age of building and trend of fair market rent.
3.3 (c) This valuation is based on valuations done by an Accredited Independent registered valuer details as given below.
3.4 (a) In view of negative net worth in the stepdown subsidiary Company namely Mora Tollways Ltd and Atlanta Ropar Tollways Private Ltd, Company has made provision for diminution in the value of its investment in equity shares of these equity shares in the previous year.
3.4 (b)Fair value of Shares of The Shamrao Vithal Co-op Bank Limited and DN S Bank Limited are recognized based on valuation report dated.11th September, 2017.
f in Lakhs)
4 Contingent liabilities and commitments
Following are the contingent liabilities and commitments as on March 31,2024
a. Bank Guarantees issued by Banks aggregating to '3,963.95 Lakhs (March 31, 2023 '3,976.45 Lakhs)
b. In respect of subsidiaries, the Company has extend financial support in the form of equity or debt as per the agreed means of finance, in respect of the projects being undertaken by the respective subsidiaries, including any capital expenditure for regulatory compliance and to meet shortfall in the expected revenues/debt servicing. Future cash flows in respect of the above matters can only be determined
based on the future outcome of various uncertain factors.
c. Estimated amount of contracts remaining unexecuted on capital account (net of advances paid) and not provided for 'Nil (March 31,
2023 ' Nil.).
d. Disputed Income Tax Liability of '2,511.49 Lakhs (March 31, 2023 '2,511.49 Lakhs)
e. Disputed Service Tax Liability of '673.86 Lakhs (March 31, 2023 '673.86 Lakhs)
f. Disputed Sales Tax & Value Added Tax Liability of '2,931.29 Lakhs (March 31, 2023 '2,931.29 Lakhs)
g. In respect of (e) and (f) above it is not practicable for the Company to estimate the closer of this issues and the consequential timing of cash flows, if any
5. During the year, the company has awarded project of Redevelopment of land and building by Highway Milton CHS Ltd at Borivali vide Letter of Intent (LOI) dated.23-04-2024, having construction area approximately 5,00,493 sq.fts.
The company filed Special Leave Petition (SLP) against the rejection of 3 claims, interest @ 20% p.a. compounded annually and payment as per cashflow in the matter of Mumbra Bypass by Hon'ble Division bench of High Court at Bombay u/s 37 of A & C Act. The said SLP was heard substantially and the decision on said SLP is awaited.
6 Project status of Subsidiaries
i. Atlanta Infra Assets Limited
Improvement, Operation and Maintenance including strengthening and widening of existing 2 lane road to 4 lane dual carriageway from Km.9.200 to Km.50.000 of NH-6 (Nagpur-Kondhali Section) in the State of Maharashtra on Build, Operate and Transfer (BOT) Basis”T h e said project was completed on 22-09-2011 and received Commercial Operation Certificate from the Competent Authority and collection of toll from the users of the facility is in progress.
ii. MORA Tollways Limited
M/s MORA Tollways Limited is a Special Purpose Vehicle (SPV) subsidiary Company constituted for the work of “Four Lanning of Mohania-Ara Section of NH-30 (Km.0.000 to Km. 116.760).
The Concession Agreement with Bihar State Road Development Corporation (Authority) was terminated by MORA Tollways Limited (Company) on 20.02.2015 for Authority Defaults and the Company had claimed termination payment amounting to '61,052.73 Lakhs plus interest. MORA Tollways Ltd has filed Writ Petition No.7259 of 2015 for payment and the Honorable High Court of Patna by Order dated 22.09.2015 has held termination by MORA Tollways Ltd as valid and legal directed the Authority to pay termination payment of '61,052.73 Lakhs plus interest. The appeals are finally disposed by the Supreme Court of India directing adjudication of termination payment by the Arbitral Tribunal. The Arbitral Tribunal vide Award dated 21.05.2019 rejected the SPV’s claim for termination payment amounting to '61,052.73 Lakhs plus interest and awarded NIL amount against the said claim. The said Award is challenged by MORA Tollways Limited under Section 34 of the Arbitration and Conciliation Act, 1996 before the Hon'ble High Court, Patna and the out come of the same is pending.
iii. Atlanta Ropar Tollways Private Limited Project undertaken by SPV:
Development and Operation and Maintenance of Ropar - Chamkur - Sahib - Neelon - Doraha (up to NH 1) Road on Design, Build, Finance, Operate and Transfer (DBFOT) basis in the State of Punjab, vide concession agreement entered on October 05,2011.
The said SPV has completed the said project and received Commercial Operation Certificate from the competent Authority on 08-11-2016 and having right to collect the toll from the users of the facility during the concession period.
On 05-08-2021 the Authority (PIDB) has terminated the Concession Agreement vide letter no.PWD-BR-3012/21/2021-3BR3/178/1 dated.05-08-2021. By virtue of termination of Concession Agreement, the BOT (Intangible Asset) and toll collection right have been takeover
7 Employee benefit obligations
The Company has classified various employee benefits as under: a. Defined contribution plans
i. Provident fund
ii. Employees’ Pension Scheme, 1995
c. Post employment obligation Gratuity
The Company has a defined benefit plan, governed by the Payment of Gratuity Act, 1972. The plan entitles an employee, who has rendered at least five years of continuous service, to gratuity at the rate of fifteen days basic salary for every completed years of services or part thereof in excess of six months, based on the rate of basic salary last drawn by the employee concerned.
i. Significant estimates: actuarial assumptions
Valuations in respect of gratuity have been carried out by an independent actuary, as at the Balance Sheet date,
Based on the following assumptions:
The above sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. While calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognized in the balance sheet. The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior period.
13 Fair value measurements
The carrying amounts of trade receivables, cash and cash equivalents, bank balance other than cash and cash equivalents, other financial assets, trade payables, capital creditors are considered to be same as their fair values, due to their Short-term nature.
The carrying value of borrowings, deposits given and taken and other financial assets and liabilities are considered to be reasonably same as their fair values. These are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs including counter party credit risk
c) Fair value hierarchy
This section explains the judgment's and estimates made in determining the fair values of the financial instruments that are (a) recognized and measured at fair value and (b) measured at amortized cost and for which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the company has classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.
d) Valuation processes
The Company obtains assistance of independent and competent third party valuation experts to perform the valuations of financial assets and liabilities required for financial reporting purposes, including level 3 fair values. Discussions of valuation processes and results are held betweei the Company and the value on periodically basis.
e) Valuation technique used to determine fair values
The main level 3 inputs used by the Company are derived and evaluated as follows:
The fair value of financial instruments is determined using discounted cash flow analysis.
The carrying amount of current financial assets and liabilities are considered to be the same as their fair values, due to their short term nature.
The fair value of the long-term Borrowings with floating-rate of interest is not impacted due to interest rate changes, and will not be significantly different from their carrying amounts as there is no significant change in the under-lying credit risk of the Company borrowing (since the date o: inception of the loans). Further, the Company has no long-term Borrowings with fixed rate of interest.
For financial assets and liabilities that are measures at fair value, the carrying amount is equal to the fair values.
Note:
Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices.
Level 2: The fair value of financial instruments that are not traded in an active market (for example over-the-counter derivatives) is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on entity-specific estimates. If al significant inputs required to fair value an instrument are observable, the instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case foi unlisted equity securities which are included in level 3.
There are no transfers between any levels during the year.
The Company’s policy is to recognize transfer into and transfer out of fair value hierarchy levels as at the end of the reporting period.
14 Financial risk management
The Company’s business activities expose it to a variety of financial risks, namely liquidity risk, market risks and credit risk.
a. Credit risk f in Lakhs)
The Company is exposed to credit risk, which is the risk that counterparty will default on its contractual obligation resulting in a financial loss to the Company
Credit risk arises from cash and cash equivalents, financial assets carried at amortized cost and deposits with banks and financial institutions, as well as credit exposures to trade customers including outstanding receivables.
Credit risk management
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss.
The Company’s credit risk arises from accounts receivable balances. Major customers of the Companies include public sector enterprises and state owned companies having high credit quality. Accordingly, the Company’s customer credit risk is very low. With respect to intercorporate deposits/ loans given to subsidiaries, the Company will be able to control the cash flows of those subsidiaries as the subsidiaries are wholly owned by the Company.
For banks and financial institutions, only highly rated banks/institutions are accepted. Generally all policies surrounding credit risk have been managed at company level.
b. Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, company treasury maintains flexibility in funding by maintaining availability under committed credit lines.
Management monitors rolling forecasts of the Company’s liquidity position and cash and cash equivalents on the basis of expected cash flows. This is generally carried out at local level in the operating subsidiaries of the Company in accordance with practice and limits set by the Company. These limits vary by location to take into account the liquidity of the market in which the entity operates. In addition, the Company’s liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.
c Market risk Cin Lakhs)
Market risk is the risk that the fair values of future cash flows of a financial instrument will fluctuate because of volatility of prices in the financial markets. Market risk can be further segregated as: a) Foreign currency risk and b) Interest rate risk.
(i) Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. Company does not have any foreign currency loans, receivables or payables, hence the risk towards foreign currency risk is not applicable to the Company.
For that reason, sensitivity analysis with respect to foreign currency risk has not been disclosed
(ii) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s main interest rate risk arises from long-term borrowings with variable rates, which expose the Company to cash flow interest rate risk. During March 31, 2024, March 31, 2023 and March 31,2022 of the Company’s borrowings at variable rate were mainly denominated in Rupees.
The Company’s fixed rate borrowings are carried at amortized 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 a change in market interest rates.
15 Capital Management i. Risk Management
The Company’s objectives when managing capital are to safeguard the Company’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
ii. During the year Company have received No Dues Certificate from Consortium Bankers under Compromise and Negotiated Settlement with the Consortium Bankers, the Working Capital term loan, Cash credit liability and non fund base liability has been settled and paid full negotiated amount.
iii. No dividend declared during the year (previous year Nil.)
16 Segment reporting
Presently, the Company is engaged in only one segment viz 'Construction activity' and as such there is no separate reportable segment as per Ind AS 108 'Operating Segments'. Presently, the Company's operations are predominantly confined in India.
18 Corporate social responsibility(CSR)
As per the section 135 of the Companies Act, 2013, the Company is required to spend 'Nil (previous year March 31, 2023 ?Nil.).
19 Additional Regulatory Information: Ratios (asper Annexure)
20 The company has regrouped, reclassified & rearranged the previous period figures wherever necessary to confirm the current year's presentation.
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