SIGNIFICANT ACCOUNTING POLICIES COMPANY OVERVIEW

Logica Infoway Lid. (Formerly Known As Eastern Logica Infoway Limited) was formed in the year 1995. The company has established two branches one in Delhi and another in Hyderabad in the year 2015 and in Mumbai in the year 2016. The company is engaged in trading of Computer, Laptop, Mobile & Mobile Accessories in Head Office (Kolkata) and Mobiles & Laptops in branches.

1.01 Accounting Convention

The financial Statements are prepared in accordance with applicable Accounting Standards under the historical cost convention on accrual basis.

1.02 Revenue Recognition

All income and expenses are accounted for on accrual basis. Revenue is recognized when no significant uncertainties exist in relation to the amount of eventual receipts. Revenue from operations is net off all the indirect taxes.

1.03 Use of estimates

The preparation of financial statements requires the management of the company to make estimates and assumption that affect the reported balances of assets and liabilities and disclosures relating to contingent liabilities as at the date of the financial statements and the reported amount of revenues and expenses during the period. Difference between the actual results and estimates are recognized in the period in which the results are knowa/ materialized.

1.04 Property. Plant & Equipment

Property,Plant and Equipment are stated at cost net of Cenvat Credit, less accumulated depreciation and impairment loss, if any. Cost comprises of the purchase price and any attributable cost of bringing the asset to working condition for its intended use.

Depreciation:

Depreciation on Property.Plant & Equipment is provided on written down value method at the rates and in the manner prescribed in schedule II of the Companies Act, 2013.

1 05 Stock in Trade

Items of inventories are measured at lower of cost or net realizable value after providing for obsolescence, if any.

1.06 Investment

Investments that are intended to be held for not more than a year arc classified as current investment. All other investments are classified as long-term investments. Current investments arc carried at lower of cost & fair value determined on an individual investment basis. Long-term

2.5.1 The Company has taken Cash Credit facilities from State Bank of India. SME N. S. Road Branch, w ith a sanctioned limit ol \ 50.00 crores and Adhoc Cash Credit of? 8.00 crores which is Secured as follows, as per sanction letter terms:-

(A) Primary Securities (State Bank of India)

I) Exclusive hypothecation charge on all stocks and receivables (both present and future) created out of the Bank finance.

(B) Collateral Securities (State Bank of India)

1) Equitable mortgage of the entire I st floor comprising 3100 Sq ft, more or less, together w ith undivided portion share ol land at premises no 2, Sakiat Palace, situated in ward No. 46 of P.S Bowbazar. Kolkata. in the name of Sri Gaurav Goel, Smt.

Shweta Goel and Sri Rakesh Kumar Goel of Sale deed No. 09062 for 2012. registered in A.R.A - II Kolkata. Dist.

2) Equitable Mortgage of Freehold Residential Flat on Entire first Floor of Property Bearing No.D-941, an area measuring 492 sq. Yard or 411.37 sqm with One Car Parking & one Servant Quarter, situated at New Friends Colony. New Delhi in favor of Shri Gaurav Goel & Smt.Shweta Goel which is duly registered as document No.3752,ln Addl.Book No.l, Volume

No.381,on pagea 108 to 126. dated 09.08.2017 registered in the office of Sub Registrar-V(l),New Delhi.

3) Lien on SBI Mutual Funds of units 486722.757 [Invested amount: ?2.00 Crore: Fund Name: SBI Magnum Medium Duration

FRegG]. _

4) Lien on SBI Mutual Funds of units 1784302.068 [Invested amount: ?10.18 Crore: Fund Name: SBI Magnum Gilt Fund

Regular Growth].

5) Lien on SBI Mutual Funds of units 5077791.61 [Invested amount: ?0.50 Crore; Fund Name: SBI Dy namic Bond Fund-Regular Growth].

(C) Guarantees .

1) Personal guarantee of Mr. Gaurav Goel, Mrs.Shweta Goel. Mr. Rakesh Goel (Personal Guarantee of Shri. R. K. Goel is restricted to the value of the preoperty mortgaged i.e., ? 4.16 Crores (ERV) Guarantee is restricted to the value of the collateral security situated at 2, Saklal place. 1st floor, Kolkata 700072.

2) Corporate Guarantee - M/s. Hintadri Dealcom Pvt Ltd.

The Additional GECL (WCTL) facility shall rank second charge with the existing credit facilities, in respect of existing securities already charged to the Bank as well as cash flows for repayment.

2.5.2 The Company has availed Guaranteed Emergency Credit Line ("GECL") by way of Working Capital I erm Loan Facility front State

Bank of India, N. S. Road Branch Kolkata to the extent of ? 5.30 Crore repayable in 36 equal monthly installment after a moratorium period of 12 months from the date of disbursement of the loan. Moratorium on Principal amount for a period of 12 months and Interest will continue to accrue and become payable during the Moratorium Period. Principal outstanding amount is being repaid in 36 equal monthly instalments i.e ? 14.72 Lakhs after the expiry of the Moratorium Period.___

2.5.3 The Company has availed Guaranteed Emergency Credit Line ("GECL") - Extension by way of Working Capital Term Loan Facility

from State Bank of India, N. S. Road Branch Kolkata to the extent of? 2.65 Crore repayable in 36 equal monthly installment after a moratorium period of 24 months from the date of disbursement of the loan. Moratorium on Principal amount for a period of 24 months and Interest will continue to accrue and become payable during the Moratorium Period. Principal outstanding amount to be repaid in 36 equal monthly instalments i.e ?7.36 Lakhs after the expiry of the Moratorium Period.__,

2.5.4 During the year the company has availed a Cash Credit Facility along with Export Packing Credit (EPC). Packing Credit in I orcign Currency (PCFC), a Working capital demand loan (WCDL) from ICICI Bank Limited R.N.Mukherjee Road Branch of? 25 Crores which is secured as follows, as per sanction letter terms:-

(A) Primary Security

1. Lien of Fixed Deposits with ICICI Bank Limited (A/c No. 000610083440) of? 7.50 crores.

2. Exclusive hy pothecation charge on all stocks and receivables (both present and future) created out of the Bank Finance.

(B) Guarantees:

1. Personal Guarantee of Mr Gaurav Goel and Mrs Sweta Goel _____

2.5.5 During the year the company has availed Channel Financing Facility of ? 2 Crore from ICICI Bank Limited for the purchase ol

inventory from Ingram Micro India Pvt Ltd. Against this facility security is provided is a Fixed Deposit with ICICI Bank of? 10 Lakh and personal Guarantee given by Mr. Gaurav Goel and Mrs. Shweta God.________

2.5.6 During the year the company has availed Channel Financing Facility of ? 2 Crore from ICICI Bank Limited for the

purchase of inventory from Rashi Peripherals Ltd. Against this facility security provided is a Fixed Deposit with ICICI Bank of? 10 Lakh and personal Guarantee given by Mr. Gaurav Goel and Mrs. Shweta Goel.__

2.5.7 During the year the company has availed Channel Financing Facility of? 3 Crore from ICICI Bank Limited tor the

purchase of inventory from Savex Technologies Pvt Ltd. Against this facility security provided is a Fixed Deposit with ICICI Bank of ? 15 Lakh and personal Guarantee given by Mr. Gaurav Goel and Mrs. Shweta Goel.___

2.5.8 During the year the company has availed Channel Financing Facility of? 5 Crore from ICICI Bank Limited for the

purchase of inventory from Redington (India) Ltd. Against this facility security provided is a Fixed Deposit with ICICI Bank ot ? 25 Lakh and personal Guarantee given by Mr. Gaurav Goel and Mrs. Shweta Goel.____

2.5.9 During the year the company has availed Channel Financing Facility of ? 3 Crore from Axis Bank Limited for the purchase of inventory from Savex Technologies Pvt Ltd. Against this facility security provided is a Fixed Deposit with Axis Bank of?

18.00 Lakh and personal Guarantee given by Mr. Gaurav Goel and Mrs. Shweta Goel along with Corporate Guarantee ol

Himadri Dealcom Pvt Ltd. ___

2.5.10 During the year the company has availed Channel Financing Facility of ? 2 Crore from Axis Bank Limited tor the purchase of inventory from Redington (India) Ltd. Against this facility security provided is a Fixed Deposit with Axis Bank of?

12.00 Lakh and personal Guarantee given by Mr. Gaurav Goel and Mrs. Shweta Goel along with Corporate Guarantee of

Himadri Dealcom Pvt Ltd. ^^

2.5.11 The Company has taken Line of Credit facility of ? 5 Crore from Aditya Birla Finance Ltd for Working Capital and

purchase of inventory for the purpose of sales through Amazon Seller Serv ices Limited. Against this loan personal Guarantee given by Mr. Gaurav Goel and Mrs. Shweta Goel._^____i__^_

2.5.12 The Company has availed Channel Financing facility of ? 2.5 Crore from Aditya Birla Finance Ltd tor the purchase ot inventory from Redington India Ltd. Against this loan personal Guarantee given by Mr. Gaurav Goel and Mrs. Shweta Goel.

2.5.13 During the year the Company has availed an Adhoc Limit of Channel Financing facility of ? 0.75 Crore from Aditya

Birla Finance Ltd for purchase of inventory from Redington India Ltd for a period of 125 days in addition to the facility as mentioned in Note 2.5.12 and the same has been evenly squared off during the year.__

2.5.14 The Company has taken Channel Financing i.e Renewal cum enhancement of Purchase Invoice Discounting ot channel

partner buying from Rashi Peripherals Pvt. Ltd., Redington India Ltd. and Superton Electronics Pvt Ltd ot ? 5 Crore from Hero Fincorp Ltd against lien of STDR of ? 40 Lakh brought in the name of third party (Himadri Dealcom Pvt Ltd) and Gurantee given by Mr. Gaurav Goel, Mrs. Shweta Goel and Himadri Dealcom Pvt Ltd. _

2.5.15 The Company has taken Channel Financing i.e Renewal cum enhancement of Purchase Invoice Discounting of channel

partner buying from Savex Technologies Private Limited of ? 3 Crore from Profectus Capital Private Limited against residual charge of inventory and receivables financed by Profectus Capital Private Limited along with secondary security of Cash Collateral to the extent of 10% of Loan Sanction limit and Gurantee given by Mr. Gaurav Goel. Mrs. Shweta Goel and Himadri Dealcom Pvt Ltd. The same has been repaid during the year.______

2.5.16 The Company has taken Channel Financing i.e Renewal cum enhancement of Purchase Invoice Discounting of channel

partner buying from Savex Technologies Private Limited and Ingram Micro India Pvt Ltd of ? 3 Crore from Profectus Capital Private Limited against first and exclusive charge and receivables financed by Profectus Capital Private Limited and Guarantee given by Mr. Gaurav Goel, Mrs. Shweta Goel, and Himadri Dealcom Pvt Ltd. The same has been repaid during the year._

2.5.17 The Company has taken Channel Financing i.e Renewal cum enhancement of Purchase Invoice Discounting of channel partner buying from Ingram Micro India Private Limited of ? 5 Crore from Tata Capital Finance Service Limited lien of STDR of ? 25 Lakhs brought in the name of promoter Mr. Gaurav Goel and Guarantee given by Mr. Gaurav Goel and Mrs. Shweta Goel.

2.5.18 The Company has taken a Term Loan of ? 60 Lakh from Tata Capital Finance Services Limited which was availed as an

additional facility to the extent of 20% of the Channel Financing facility already existing with them of? 3.00 Cr at a floating interest rate of 10.5% P.A, payable in 24 monthly installments with the first installment paid on 15th Aug, 2021 and the last installment due on 15th July, 2023. The same has been repaid during the year.___

2.5.19 The Company has taken Channel Financing i.e Renewal cum enhancement of Purchase Invoice Discounting ot channel

partner buyinu from Savex Technlogies Pvt Ltd, Rashi Peripherals Pvt. Ltd., Redington India Ltd. and Superton Electronics Pvt Ltd of? 5 Crore from Cholamandalam Investment and Finance Company Ltd. Against this loan personal Guarantee given by Mr. Gaurav Goel and Mrs. Shweta Goel. ____

2.5.20 The Company has taken Invoice Based Financing facility for buying from Rashi Peripherals Pvt. Ltd. and Savex Technologies Pvt Ltd of ? 2 Crore and 3 Crore respectively from TVS Credit Services Limited against 10% by way of FD Lien marking and Hypothecation charge to be created on the current assets funded by TVSCS. The same has been repaid during the

year. _ __

2.5.21 During the year the company has availed an Auto Loan from ICICI Bank Limited of? 5,00,000 with an interest rate ot

9 30% and payable in 36 Equated Monthly Installments (EMIs) of ? 15.974.00. EMI beginning from 1st September 2023 and pay able till 1st August 2026. The loan is secured against the hypothecation of the car and charges for the same are registered with the respective Public Vehicle Department where the car is registered. As such, no separate charge with ROC has been registered, as a matter of general practice adopted by the financing bank in such cases.____

2.5.22 During the year the company has availed an Auto Loan from ICICI Bank Limited of ? 36,00,000 with an interest rate ot 9! 16% and payable in 36 Equated Monthly Installments (EMIs) of ? 1,35,450.00. EMI beginning from 1st May 2024 and payable till 1st April 2027. The loan is secured against the hypothecation of the car and charges tor the same are registered with the respective Public Vehicle Department where the car is registered. As such, no separate charge with ROC has been registered, as

a matter of general practice adopted by the financing bank in such cases.____

2.25 Contingent Liability not provided for in respect of Claims not acknowledged as debt by the Company:

1. The Company had received an assessment order cum demand notice from Assessing Officer of Income Tax Act, 1961 vide Letter no. 1TBA/COM/F/17/2019-20/1021886628(1), dated 07.12.2019 for sum of ? 45.74 lakhs under assessment 143(3)/I47 for the period 2012-13. The Company had filled Appeal to the Commissioner of Income Tax as on 06.01.2020 having Acknowledgement No. 287976381060120 the same is still pending.

2. The Company had received an order under Goods and Service Tax Act, 2017 (For Delhi Branch) vide order no.

ZD0702210082714, dated 08.02.2021 for incorrect admissibility of input tax credit of tax paid or deemed to have been paid for sum of ? 28.94 lakhs being towards Tax Payable and ? 5.86 lakhs towards interest thereon and ? 28.94 lakhs towards Penalty for the period from December 2019 to March 2020. Against this order the Company had filled Appeal (Form GST APL-01 (Appeal to Appellate Authority)) as on 16.04.2021 and deposited 10% of Tax Laibility i.e ? 2,89 Lacs and the same is still pending. _ _

3. The Company had received an order under Goods and Service Tax Act, 2017 (For Delhi Branch) vide order no.

ZD0702210082790, dated 08.02.2021 for incorrect admissibility of input tax credit of tax paid or deemed to have been paid for sum of ? 38.66 lakhs being towards Tax Payable and ? 4.45 lakhs towards interest thereon and ? 38.66 lakhs towards Penalty for the period from April 2020 to July 2020. Against this order the Company had filled Appeal (Form GST APL-01 (Appeal to Appellate Authority)) as on 16.04.2021 and deposited 10% of Tax Laibility i.e ? 3.86 Lacs and the same is still pending.

4. The Company had received an order under Goods and Service Tax Act. 2017 (For Delhi Branch) vide order no.

ZD0712231639739, dated 28.12.2023 for incorrect admissibility of Output Tax and Input tax credit of tax paid or deemed to have been paid for sum of ? 20.86 lakhs being towards Tax Payable and ? 20.86 lakhs towards interest thereon and ? 2.08 lakhs towards Penalty for the period from July 2017 to March 2018. Against this order the Company had filled Appeal (Form GST APL-01 (Appeal to Appellate Authority-)) as on 04.03.2024 and deposited 10% of Tax Laibility i.e ? 2.08 Lacs and the same is still pending.__^^_

5. The Company had received an order from Commercial Tax Officer of Government of Telangana, Commercial Taxes Department (For Hyderabad Branch) vide order no. 17930 dated 28.02.2020 for the sum of ? 170.58 lakhs towards tax component for the period 2015-16 to 2017-18. Against this order the Company had filled writ petition before the Honourable Telangana Highcourt as on 18.03.2021 and Highcourt stayed the demand order dated 22.03.2021.

6. The Company had received an order from Commercial Tax Officer of Government of Telangana, Commercial Taxes

Department (For Hyderabad Branch) vide order no.80696 dated 17.12.2020 for the sum of ? 42.65 lakhs towards penally component for the period 2015-16 to 2017-18. Against this order the Company had filled writ petition before the Honourable Telangana Highcourt as on 22.04.2021 and I lighcourt stayed the demand order dated 26.04.2021._

7. The Company had received an order from Commercial Tax Officer of Government of Telangana. Commercial Taxes Department (For Hyderabad Branch) vide order no. CST/36970508396'16-17 dated 28.12.2020 for the sum of ? 43.23 lakhs for the period 2016-17. Demand notice in form CST VIII is issued for this case. Having regard to the order dated 15-05-2020 in l.A.No.l of2020 in W.P.No. 6819 of 2020, there has been an interim stay.

8. Company had received a show cause cum demand notice from Assistant Commissioner. Provident Fund. (Ministry of Labour. Govt oflndia) vide refrcnce no. R-NE/WB/44474/CC-III/08. dated 27.12.2007 for sum of ? 3.2 lakhs being ? 2.47 lakhs towards assessed PF dues and ? 0.56 lakhs towards interest thereon for the period from December 2004 to February- 2007. The Company has taken stay order from Calcutta High Court vide there case no. W.P. 25860 (\V) of 2008 dated 19.12.2008. No further action in this case from department side is reported by the managment on the said stay order, neither is the same reported to have been dropped by the department.

9. The Company had received an assessment order from Sales Tax Officer of West Bengal Tax on Entry of Goods into Local Areas Act,2012 vide Case no. 2016-2017/58/04/E/5 And Memo No: 1224 .dated 21.06.2019 for the period 01.04.2016 to 31.03.2017 for sum of ?2.51 lakhs as tax component, ? 1.39 Lakhs for interest and ? 0.24 Lakhs for late fees. The Same is still pending.

10. The Company had received an assessment order from Sales Tax Officer of West Bengal Tax on Entry of Goods into Local

Areas Act, 2012 vide Case no. 2017-2018/58/04/E/7 and Memo No: 145 .dated 10.06.2020 for the period 01.04.2017 to 10.06.2017 for sum of ? 2.96 lakhs as tax component,? 1.88 lakhs for interest and ? 0.095 lakhs for late fees. The same is still pending.

11. The Company had received an order under Goods and Service Tax Act, 2017 vide order no. ZD070222008461Z, dated 10.02.2022 for mismatch in Output Gst in GSTR I and GSTR 3B for sum of ? 3.86 Crore being towards Tax Payable from April 2021 to December 2021 Against this order the Company had filled Form GST ASMT-11 (Reply to notice issued under section 61 intimating discrepancies in the return) as on 14.02.2022 and the same is still pending.

I inal daia was not available with the Company regarding the business done through the E-Commcrcc business partner at the time of submitting the DP statement to the bank The Revenue and trade receivables front the E-Commerce business and the stock supplied through them for the purpose ol 1)1 statement were ealeulated by the Company on the basis ol data available at that time, however the final data received later on lioin the E-C bmmerce business partner on basis of w hich the books of accounts are reconciled and updated accordingly, becuase of w hich the actual figures as per books of accounts and as per the DP statements vary.