Paos Industries Ltd

TO THE MEMBERS

Dear Members,

Your Directors have the pleasure in presenting the 34th Annual Report of the Company together with the Audited Accounts (Standalone and Consolidated) for the financial year ended 31stMarch, 2024.

FINANCIAL RESULTS

The financial figures for the year under review are given below:

(Rs. In Lakhs)

The company has not carried on any business activity during the year under review.

FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

The financial statements have been prepared as per the Ind-AS whereby the preferential share capital has been classified into debt liability and to find out the present value the nominal value of these preference shares has been discounted @10% being rate of dividend payable on these shares. The dividend/interest accrued there-upon for the relevant financial year has been included and booked as "finance cost" however since the last threeyears, the amortization of Deferred Revenue through the Statement of Profit & Loss Account has been discontinued in order to stop booking notional "Other Income". The loss for the FY 2024 stands at Rs.29.59 Lakhs as compared to Rs. 29.04 lakhs during FY 2023.

The company had made investment in the Joint Venture namely PAOS Productions, which become negative since FY 2021. The Company was one of the Partners in PAOS PRODUCTIONS till 30-09-2023. However, the Company has withdrawn its partnership from the said Joint Venture with effect 01-10-2023. Consequently, consolidation of accounts of the Company with the accounts of PAOS Productions for the year ending March 31, 2024 is not required and therefore the consolidated statements as at 31-03-2024 have not been prepared by the Company.

INFORMATION ON STATE OF COMPANY'S AFFAIR

The company has not carried any commercial activity during the year under review. It has no labour force but employed only administrative personnel.

DIVIDEND

Your Directors express their inability to recommend any dividend for the year.

DEPOSITS

During the year under review, the Company has not accepted or renewed any deposits falling within the purview of the Companies Act, 2013 and the rules made there-under however the company has received and accepted money/loan only from its Managing Director namely Sh. Sanjeev Bansal which does not fall within the definition ofdepositsin terms of Rule 2(1)(c) of the Companies (Acceptance of Deposits), Rule, 2014, as amended. The amount of said money/loan stands at Rs. 1438.73 Lakhs as on 31.03.2024. These borrowings from director are interest free and presently the exact date of their repayment is not certain because the company is not carrying on any commercial or business activity and does not have any operating assets as on date to repay it, hence its classification as per Ind-AS is not presently feasible.

However, these loans are financial liability and have been presented and disclosed under Non-Current Borrowings considering them to be not being paid within One year.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

Since no Dividend declared and paid during last year, the provisions of Section 125 of the Companies Act, 2013 does not apply.

TRANSFER TO RESERVES IN TERMS OF SECTION 134 (3) (J) OF THE COMPANIES ACT, 2013

The profit/loss of the current year has been transferred to the Reserves& Surplus.

CHANGES IN EQUITY SHARE CAPITAL

There is no change in the Equity Share Capital of the company during the year under review.

CHANGES IN DIRECTORS& KEY MANAGERIAL PERSONNEL

During the year under review, there is no change in Directors of the company.

Sh. Sanjeev Bansal is liable to retire by rotation and being eligible offer herself for re-appointment.

During the year under review, there is no change in the Key Managerial Personnel.

PARTICULARS OF LOAN, GUARANTEES AND INVESTMENTS UNDER SECTION 185

During the Financial Year 2023-2024, the Company has not given any loan or Guarantee or provided security in connection with a loan to any other body corporate and person and also the company has not made any investment in any other body corporate.

INDIAN ACCOUNTING STANDARDS (Ind AS)

As mandated by the Ministry of Corporate Affairs, the Company has adopted Indian Accounting Standards ("Ind AS") and the Standalone and Consolidated Financial Results for the year 2023-2024 have been prepared in accordance with Ind-AS prescribed under Section 133 of the Companies Act, 2013 read with the relevant rules issued there under and the other recognized accounting practices and policies to the extent applicable.

STATUTORY AUDITOR

The members had appointed M/s Rakshit Khosla& Associates, Chartered Accountants (FRN:017151N), Ludhiana as Statutory Auditors of the Company to hold office from the conclusion of 30th Annual General Meeting until the conclusion of 35th Annual General Meeting of company, subject to ratification of the appointment by the members at every AGM in accordance with the provisions of the Companies Act, 2013 and the Rules made there-under. The appointment of M/s Rakshit Khosla & Associates, Chartered Accountants (FRN:017151N), Ludhiana as Statutory Auditors shall be for the Statutory Audit of FY 2020-2021 to FY 2024-2025 (both inclusive)

STATUTORY AUDIT REPORT

The Auditor's Reports on the Standalone Financial Statements for the financial year 2023-24 do not contain any qualification, reservation or adverse remark. The Auditor's Reportsareannexed to the financial statements.

COST AUDIT

As the company is not into operation and does not carry on any manufacturing activities hence the provisions regarding applicability of Cost Audit are not applicable to the company.

SECRETARIAL AUDITORS

As required under section 204 of the Companies Act, 2013 and Rules there-under, the Board has appointed M/s Rajeev Bhambri & Associates, Practicing Company Secretaries as the Secretarial Auditor and the said firm had conducted the secretarial audit for the financial year 2023-2024. The Secretarial Auditors' Report for the financial year 2023-24 does not contain any qualification, reservation or adverse remark. The Auditor's Report is enclosed with this report.

DETAILS REGARDING FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12)

During the year under review, the auditors i.e. statutory auditors and secretarial auditors have not reported any matter under section 143(12) of the Act, and therefore, no details are required to be disclosed under section 134(3)(ca) of the Act.

INTERNAL AUDITORS

The Company has adequate internal financial controls in place and the same is operating effectively having regard to company's size and operations.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

Pursuant to Section 197(12) of the Act, read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, every listed company is required to disclose information related to remuneration paid during the year. The detailed information in this regard is annexed to this report as "Annexure I".

RELATED PARTY TRANSACTIONS

The company has not entered into any specificcontract, arrangement and transaction(s) with any of related parties during the year under review. However, during the year under review, the company had paid remuneration to the Company Secretary and Chief Financial Officer (KMPs) and had obtained loan from Managing Director, the detail of these transactions is stated in the Notes to accounts to Financial Statements. However, The company had made investment in the Joint Venture namely PAOS Productions, which become negative since FY 2021. The Company was one of the Partners in PAOS PRODUCTIONS till 30-09-2023. However, the Company has withdrawn its partnership from the said Joint Venture with effect 01-10-2023. Consequently, consolidation of accounts of the Company with the accounts of PAOS Productions for the year ending March 31, 2024 is not required and therefore the consolidated statements as at 31-03-2024 have not been prepared by the Company. Moreover, the carrying amount of Company's investment in the joint venture namely M/s PAOS Productions had become negative since more than two years on account of which the Standalone as well as the consolidated financial statements are same since then because according to provisions of Ind AS 28 when the Group's share of Losses in an equity-accounted investment.

The Board of Directors of company has adopted Related Party Transaction Policy and the same is available on the link: www.paosindustries.in

Further all the necessary detail of transaction entered with the related parties as defined under section 188 of the Companies Act, as defined under section 2(76) of the said Act are attached herewith in Form-AOC-2 for your information as "Annexure-II".

DETAILS AND INFORMATION AS REQUIRED UNDER SECTION 134(3) (l) OF THE COMPANIES, ACT 2013

No material changes and commitments have taken place between the end of the financial year of the Company to which balance sheet relates and date of report, which affects the financial position of the Company.

INVESTOR SERVICES

The Company is committed to provide the best services to the shareholder/investors. M/s Link Intime India Private Limited, New Delhi is working as Registrars and Share Transfer Agents (RTA) of the Company for transfer, dematerialization of shares and other investor related services. No correspondence/ enquiry from any shareholder/investor is pending with the company for reply.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The company is not engaged in the manufacturing activities or any other commercial activity as such your Directors express their inability to comment upon the conservation of energy, technology absorption measures and there is no the foreign exchange earnings and outgo during the year under review.

EXTRACT OF ANNUAL RETURN

The extract of Annual Return, in format MGT-9, for the financial year 2023-24 has been enclosed with this report as "Annexure III".

As required under section 134 (3)(a) of the Act, the Annual Return is put up on the company's website and can be assessed at link www.paosindustries.in

DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES

The company had made investment in the Joint Venture namely PAOS Productions, which become negative since FY 2021. The Company was one of the Partners in PAOS PRODUCTIONS till 30-09-2023. However, the Company has withdrawn its partnership from the said Joint Venture with effect 01-10-2023. Consequently, consolidation of accounts of the Company with the accounts of PAOS Productions for the year ending March 31, 2024 is not required and therefore the consolidated statements as at 31-03-2024 have not been prepared by the Company.

There is no subsidiary/Joint Ventures/Associates of the company as on 31.03.2024.

DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

There is no change in composition of Key Managerial Personnel during the year under review. The detail of Directors and Key Managerial Personnel at close of Financial Year 2024 is as per following:

*Smt. Ruchika Gulati has resigned from the post of Company Secretary and Compliance Officer w.e.f19.04.2024.

** Sh. Daljeet Singh has appointed as Company Secretary and Compliance Officer of the Company w.e.f. 20.04.2024.

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received the necessary declaration from each independent director in accordance with section 149 (7) of the Companies Act 2013, that he/she meets the criteria of independence as laid out in sub section (6) of section 149 of the Companies Act, 2013.

DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNAL

No material order has been passed by any regulator/court/tribunal during the year under review.

STATEMENT IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROL WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.

NUMBER OF MEETINGS

During the financial year 2023-2024 the Board of Directors met 4 (Four) times. Further, the brief detail of Meetings of Board of Directors and its Committee Meetings is given in corporate governance report which forms the part of Annual Report.

RISK MANAGEMENT POLICY

The Board of Directors of your Company has adopted the Risks Management Policy. The policy establishes the process for the management of risk faced by the Company. The aim of risk management is to maximize opportunities in all activities and to minimize adversity. This policy applies to all activities and processes associated with the normal operations of company.

The Policy is to assist the Board of Directors in fulfilling its responsibilities with regard to enterprise risk management. Further, the Policy strives to assist the Board in framing, implementing and monitoring the risk management plan for the Company and reviewing and guiding the risk policy. The Policy on Risks Management may be accessed at www.paosindustries.in

EVALUATION BY BOARD OF ITS OWN PERFORMANCE, ITS COMMITTEE AND INDIVIDUAL DIRECTORS WITH REFERENCE TO SECTION 134 (3) (p) OF THE COMPANIES ACT, 2013 AND RULE 8(4) OF THE COMPANIES (ACCOUNTS) RULES 2014

Pursuant to the above said provisions of the Companies Act, 2013, the Board has carried out an evaluation of its own performance, directors individually as well as the evaluation of the Committees as per the Criteria laid down in the Nomination Remuneration Evaluation policy. Further the Independent directors have also reviewed the performance of the Non-Independent Directors and Board as a whole including reviewing the performance of the Chairperson of the

Company taken into account the views of the Executive Directors and Non-Executive Directors vide their separate meeting.

AUDIT COMMITTEE

Pursuant to the provisions of 177 of the Companies, Act and Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has constituted Audit Committee with the objectives to monitor, supervise and effective management of company's finance, to ensure effective internal financial controls and risk management systems with high level of transparency and accuracy.

The Chairman of Audit Committee is an Independent Director and all the members of the Audit Committee are nonexecutive directors. The composition of the Audit Committee consists of two Independent Directors viz. Smt. Meenu Uppal (Chairperson) & Sh. Jatin Duugal (Member) and one Non-Executive Director namely Smt. Rama Bansal. The Audit Committee met Four times during the year, the details of which are given in the Corporate Governance Report which forms the part of this Annual Report.

(e) AND SECTION 178(3)

Pursuant to the provisions of 178 of the Companies, Act and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has adopted Nomination & Remuneration Policy for Directors, KMPs and Senior Management Personnel. The said Policy is available at www.paosindustries.in

DISCLOSURE IN RELATION TO VIGIL MECHANISM

In pursuance of the provisions of section 177(9) & (10) of the Companies Act, 2013 and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Policy is formulated to provide opportunity to employees and directors to report to management concerns about unethical behavior, actual or suspended fraud or violation of the Code of conduct or policy. The mechanism provides for adequate safeguards against victimization of employees and directors who express their concerns and also provides for direct access to Chairman/Members of Audit Committee in exceptional cases. The policy is applicable to all employees and directors of the Company.

The policy on Vigil Mechanism and Whistle Blower Policy as approved by the Board may be accessed on the Company's website at the link www.paosindustries.in

SECRETARIAL AUDIT REPORT

Secretarial Audit Report in format MR-3 by M/s Rajeev Bhambri & Associates, Company Secretaries is annexed with the Board Report. Secretarial Audit Report is annexed herewith as "Annexure IV". There is no adverse remark in it requiring explanation(s) by the Board.However, Secretarial Auditor stated that company has complied with the provisions except that UPSI disseminated was captured with delay in the software for Structured Digital Database as required in Regulations 3(5) and 3(6) of Securities and Exchange Board of lndia (Prohibition of lnsider Trading) Regulations, 2015 (PIT Regulations).

DIRECTORS RESPONSIBILTY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013 the Board of Directors of the Company confirms that-

(a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) They had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the loss of the company for that period;

(c) They had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) They had prepared the annual accounts ongoing concern basis;

(e) They had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

(f) They had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

MANAGEMENT DISCUSSION AND ANLYSIS REPORT

Management Discussion and Analysis Report as required under the Regulation 34 (2) (e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015is given in the Annexure-VI forming part of this report.

CORPORATE GOVERNANCE REPORT

Pursuant to Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015 the report on Corporate Governance together with Practicing Company Secretary's Certificate on compliance with this regard and Managing Director's declaration in this regarding compliance of code of conduct by Board Members and Senior Management Personnel is attached as Annexure-VII and forms part of this Annual Report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

During the year under review, there were no significant and material orders passed by the regulatorsor courts or tribunals, which may impact the going concern status of the Company and its operationsin future.

GENERAL DISCLOSURE

Your Director state that no Disclosure or Reporting is required in respect of the following items as there is no transaction on these items during the year under review.

1. Details relating to Deposits covered under Chapter V of the Act.

2. Issue of Equity Shares with Differential right, as to dividend, voting or otherwise.

3. Issue of shares with including sweat equity shares to employees of the Company under any scheme.

4. No significant or Material order were passed by the regulators or courts or tribunal which impacted thegoing concern status and company's operation in future, your director further state that during theyear under review, there were no case filed pursuant to Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013.

ACKNOWLEDGEMENTS

Your Directors wish to express their grateful appreciation for the valuable support and co-operation received from subbrokers, business associates, vendors, bankers, financial institutions, investors, stakeholders, registrar and share transfer agent, other business affiliates and media.

The Board places on record its sincere appreciation towards stakeholders for their continued co-operation and support to the company and look forward to the continuance of this supportive relationship in future.

Your Directors also places on record their deep sense of appreciation for the devoted services of the employees during the period under review.