(s) Provisions and contingent liabilities

Provisions are recognised when the company has a present legal or constructive obligation as a result of
past events, it is probable that an outflow of resources will be required to settle the obligation and the
amount can be reliably estimated.

Provisions are measured at the present value of management's best estimate of the expenditure required
to settle the present obligation at the end of the reporting period.

Contingent Liabilities are disclosed in respect of possible obligations that arise from past events but their
existence will be confirmed by the occurrence or non occurrence of one or more uncertain future events
not wholly within the control of the Company or where any present obligation cannot be measured in terms
of future outflow of resources or where a reliable estimate of the obligation cannot be made.

(t) Employee benefits

(I) Short term obligations

Liabilities for wages and salaries, including non-monetary benefits if any, 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.

(ii) Other long term employee benefit obligations

The liabilities if any, which needs to be settled after 12 months from the end of the period in which the
employees render the related services are measured as the present value of expected future payments to
be made in respect of services provided by employees up to the end of reporting period using the
projected unit credit method.

(iii) Post-employment 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 obligations 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.

Remeasurement gains and losses arising from experience adjustments and changes in actuarial
assumptions are recognised in the period 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.

(iv) Defined contribution plans

Contribution to Provident Fund is made in accordance with the provisions of the Employees Provident
Fund and Miscellaneous Provisions Act, 1952 and is charged to the Statement of Profit and Loss.

(u) Estimates and judgements

The preparation of financial statements requires the use of accounting estimates which, by definition, will
seldom equal the actual results. Management has made judgements, estimates and assumptions that
affect the application of accounting policies and reported amounts of assets and liabilities as at the date of
financial statements and reported amount of income and expenses during the period.

The areas involving critical estimates orjudgements are:

• Estimation of current tax expense and payable

• Designation of financial assets /liabilities through FVTPL

• Estimation of defined benefit obligation

• Recognition of deferred tax assets for carried forward tax losses

Estimates and judgements are continually evaluated. They are based on historical experience and
other factors, including expectations of future events that may have a financial impact on company
and that are believed to be reasonable under the circumstances.

(v) Cash Flow Statement :

The cash flow statement is prepared in accordance with the Indian Accounting Standard (Ind AS)-7
“Statement of Cash Flows” using indirect method for operating activities.

(w) Earning per share

(I) Basic earning per share

Basic earning per share is calculated by dividing :

- The profit attributable to equity share holders and

- By the weighted average number of equity shares outstanding during the financial year.

(ii) Diluted earning per share

Diluted earning per share adjusts the figures used in the determination of basic earning per share to
take in to account :

- The after income tax effect of interest and other financing costs associated with dilutive potential
equity shares, and

- The weighted average number of additional equity shares that would have been outstanding
assuming the conversion of all dilutive potential equity shares.

27. Contingent liabilities not provided for

a) Excise/Service Tax/GST/Income Tax/ Other Government Authorities have raised demands of Rs.
2081.33 Lacs (31 March 2025: Rs.2069.42 Lacs) out of which a sum of Rs. 573.22 Lacs (31 March 2025:
Rs. 550.65 Lacs) has been deposited against said demand. Further these demands have been contested
in appeal and no provision has been made in the financial statement.

b) The Company has given a Bank Guarantee for Rs.1.79 Lacs (31 March 2025 : Rs. 6.69 Lacs) in favour of
Ministry of Textiles.

30. Other notes

I. Salaries & wages incurred during the year on repairs and maintenance of Building and Plant & Machinery
etc. have been charged to former accounts and not shown separately.

II. In the opinion of the board, the value of Current Assets, Loans and Advances have a value in the ordinary
course of business at least equal to that stated in the balance sheet

III. Some balances of Trade Payables , Advances and Trade Receivables are subject to their Confirmation.

IV. Borrowing cost amounting Rs. 32.69 (31st March 2025 : Rs. Nil Lacs) has been capitalized during the
year.

V. Material events occurring after the balance sheet date are taken into cognizance.

VI. To meet its CSR Obligation under section 135 of Companies Act, 2013 and as per the company's CSR
policy approved and adopted by the Board of Directors, company joined hands with Group Companies
under one umbrella, to undertake the CSR projects through Oswal Foundation. Oswal Foundation is a
Registered Society formed in the year 2006 having its charitable objects in various fields .It has already
registered itself with the Ministry of Corporate Affairs with vide Registration no. CSR0000145 for
undertaking CSR activities. The foundation has undertaken “Health Care Project”, as approved by the
consortium at Mohan Dai Oswal Cancer Hospital and Research Foundation, Ludhiana

During the financial year 2025-26, CSR committee recommended Rs.90.96 lakhs (Previous year
Rs.524.00 lakhs), for CSR obligation being two percent of the average net profits of the company for three
immediately preceding financial years. Accordingly, to fulfil its obligation under CSR, Board on the
recommendation of CSR Committee decided to contribute an amount of Rs.66.11 lakhs (Previous year
Rs.501.51 Lakhs ) paid to the Oswal Foundation for undertaking Health care projects as approved by the
consortium of the Group Companies formed to undertake CSR activities through Oswal Foundation,
donation of Garments of Rs. 17.06 Lakhs to Indian Red Cross Society for victims of flood. Rs. 5.00 Lakhs
have been paid to Child Mental Health Foundation of India for climate education and practical awareness
and responsible environmental practices and Rs. 2.79 lakhs for others miscellaneous CSR activities

VII. The Additional Commissioner of CGST, Chandigarh, issued an order dated 03.02.2025 and raised a
demand of Rs. 448.09 Lacs along with an equivalent amount of penalty. The company is contesting this
demand by filing an appeal with the Commissioner (Appeals), Chandigarh. An amount of Rs. 500 Lacs
has already been deposited under protest. No provision has been made in the financial statements for this
disputed demand, as the obligation is contingent upon the outcome of the appeal, the amount deposited
of Rs. 500 Lacs has been shown under advances recoverable in cash or kind. However, the disputed
demand is disclosed as a contingent liability.

VIII. The company is operating in single segment i.e Textiles. Hence segment reporting as required under IND
AS 108 (Operating Segments) is not applicable.

IX The figures of the previous period/year have been regrouped/recasted wherever considered necessary
to correspond to current period/year disclosures.

Major Customer

Sales of the company is evenly distributed, disclosure of major customer is not being made. There is no single
customer having sale more than 10% of the turnover of the company.

31. Material accounting judgements, estimates and assumptions

The preparation of the Company's financial statements requires management to make judgements, estimates
and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the
accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions
and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or
liabilities affected in future periods.

Judgements

In the process of applying the Company's accounting policies, management has made the following judgements,
which have the most significant effect on the amounts recognised in the financial statements:

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimating 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. The Company based its assumptions and estimates on
parameters available when the financial statements were prepared. Existing circumstances and assumptions
about future developments, however, may change due to market changes or circumstances arising that are
beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

Defined benefit plans (gratuity benefits)

The cost of the defined benefit gratuity plan and other post-employment benefits and the present value of the
gratuity obligation are determined using actuarial valuations. An actuarial valuation involves making various
assumptions that may differ from actual developments in the future. These include the determination of the
discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and
its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All
assumptions are reviewed at each reporting date.

The parameter most subject to change is the discount rate. In determining the appropriate discount rate for plans
operated in India, the management considers the interest rates of government bonds in currencies consistent
with the currencies of the post-employment benefit obligation.

The mortality rate is based on publicly available mortality tables for the specific countries. Those mortality tables
tend to change only at interval in response to demographic changes. Future salary increases and gratuity
increases are based on expected future inflation rates. Further details about gratuity obligations are given in
Note 35.

Fair value measurement of financial instruments

When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be
measured based on quoted prices in active markets, their fair value is measured using other valuation
techniques. The inputs to these models are taken from observable markets where possible, but where this is not

feasible, a degree of judgement is required in establishing fair values. Judgements include considerations of
inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the
reported fair value of financial instruments.

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

Impairment of non-financial assets

Impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount,
which is the higher of its fair value less costs of disposal and its value in use. The fair value less costs of disposal
calculation is based on available data from binding sales transactions, conducted at arm's length, for similar
assets or observable market prices less incremental costs for disposing of the asset. The value in use
calculation is based on a DCF model.

32. Financial risk management objective and policies

The Company's principal financial liabilities comprise loans and borrowings, trade and other payables. The main
purpose of these financial liabilities is to finance the Company's operations and to support its operations. The
Company's financial assets include loans, trade and other receivables, and cash & cash equivalents that derive
directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company's senior management
oversees the management of these risks. The Company's senior management is supported by a financial risk
committee that advises on financial risks and the appropriate financial risk governance framework for the
Company. This financial risk committee provides assurance to the Company's senior management that the
Company's financial risk activities are governed by appropriate policies and procedure and that financial risks
are identified, measured and managed in accordance with the Company's policies and risk objectives. The
Board of Directors reviews and agrees policies for managing each risk, which are summarised as below:

(A) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of
changes in market prices. Market risk comprises three types of risk: 'interest rate risk, currency risk and other
price risks. Financial instruments affected by market risk include loans and borrowings, deposits and
payables/receivables in foreign currencies.

a) 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 exposure to 'the risk of changes in market
interest rates relates primarily to the Company's long term debt obligations with floating interest rates. The
company is carrying its borrowings primarily at variable rates. For floating rates borrowings, the analysis
is prepared assuming the amount of the liability outstanding at the end of the reporting period was
outstanding 'for the whole year. A 50 basis point Increase or decrease is used when reporting interest rate
risk internally to Key management personnel and represents management's assessment of the
reasonably possible change in interest rates.

The Company's exposure price risk arises from investments held and classified in the balance sheet
either as fair value through other comprehensive income or at fair value through profit or loss. To manage
the price risk arising from investments, the Company diversifies its portfolio of assets.

B) Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or

customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating
activities (primarily trade receivables)

Credit risk management

The Company assesses and manages credit risk based on internal credit rating system. Internal credit rating is
performed for each class of financial instruments with different characteristics. The Company assigns the
following credit ratings to each class of financial assets based on the assumptions, inputs and factors specific to
the class of financial assets.

(I) Low credit risk on reporting date
(ii) Moderate credit risk

Based on business environment in which the Company operates, a default on a financial asset is considered when the
counter party fails to make payments within the agreed time period as per contract. Loss rates reflecting defaults are
based on actual credit loss experience and considering differences between current and historical economic
conditions.

Assets are written off when there is no reasonable expectation of recovery, such as a debtor declaring bankruptcy or a
litigation decided against the Company. The Company continues to engage with parties whose balances are written off
and attempts to enforce repayment.

Recoveries made are recognised in statement of profit and loss.

Cash & cash equivalents and bank deposits

Credit risk related to cash and cash equivalents and bank deposits is managed by only accepting highly rated banks
and diversifying bank deposits and accounts in different banks across the country.

Trade receivables

Credit risk related to trade receivables are mitigated by taking bank guarantees/letter of credit, from customers where
credit risk is high. The Company closely monitors the credit-worthiness of the debtors through internal systems that are
configured to define credit limits of customers, thereby, limiting the credit risk to pre-calculated amounts. The Company
assesses increase in credit risk on an ongoing basis for amounts receivable that become past due and default is
considered to have occurred when amounts receivable become one year past due.

Other financial assets measured at amortised cost

Other financial assets measured at amortized cost includes loans and advances to employees, security deposits and
others. Credit risk related to these other financial assets is managed by monitoring the recoverability of such amounts
continuously.

(i) Trade Receivables

Customer credit risk is managed by each business location subject to the Company's established policy, procedures
and control relating to customer credit risk management. Credit quality of a customer is assessed and individual credit
limits are defined in accordance with the assessment both in terms of number of days and amount.

An impairment analysis is performed at each reporting date on an individual basis for major clients. In addtion, a large
number of minor receivables are grouped into homogenous groups and assessed for impairment collectively. The
maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in
Note 6.1 Trade receivables are unsecured but considered good subject to provision made thereon.

The Company monitors its risk of a shortage of funds by estimating the future cash flows. The Company's
objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts,
cash credit facilities and bank loans. The Company assessed the concentration of risk with respect to
refinancing its debt and concluded it to be low. The Company has access to a sufficient variety of sources of
funding and debt maturity within 12 months can be rolled over with existing lenders. The Company has access to
the following undrawn borrowing facilities at the end of the reporting periods -

33. Capital management

For the purpose of the Company's capital management, capital includes issued equity capital, share premium
and all other equity reserves attributable to the equity holders of the Company. The primary objective of the
Company's capital management is to maximise the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions
and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may
adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company

35. Post-Employment Obligations - Gratuity

The Company provides for gratuity for employees as per the Payment of Gratuity Act, 1972. Employees who are
in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on
retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days
salary multiplied for the number of years of service. For the funded plan the Company makes contributions to
recognised funds in India.

37. Earning Per Share

Basic/Diluted EPS amounts are calculated by dividing the profit for the year attributable to equity
holders of the company by weighted average number of Equity shares outstanding during the
year. The following reflects the income and share data used in the basic and diluted EPS
computations:

The carrying amounts of trade receivables, trade payables,advances to employees, cash and cash equivalents and
other bank balances are considered to be the same as their fair values, due to short term nature. The fair values for
security deposits were calculated based on cash flows discounted using a current lending rate.

They are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs including
counterparty credit risk.

40. Other Information

(i) The Company do not have any Benami property, where any proceeding has been initiated or pending against the
Company for holding any Benami property

(ii) The Company do not have any transactions with companies struck off.

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

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

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

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

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

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

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

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

(vii) The Company have not any such transaction which is not recorded in the books of accounts that has been
surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961
(such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).