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The Directors are pleased to present the 44^th Directors Report on the business and operations of the Company together with the Audited Accounts for the financial year ended 31^st March, 2024.

During the year under review, the turnover of the company significantly declined 20.56% as compared to last year. Similarly, the PAT of the company also declined by 39.99%. The main reason for decline in turnover and profit is due to sluggish market conditions prevailing from last quarter of FY 2022-23. The textile sector is passing through bad phase for last more than one year. Therefore, the results of the company have also been affected adversely due to overall market scenario but impact on your company is relatively less severe as the company is in value added segment. In order to minimize the impact on bottom line, the company has also discontinued loss making operations, therefore, the turnover of the company has declined significantly during the FY 2023-24.

II THE MANAGEMENT DISCUSSION & ANALYSIS

Spinning Unit, Dharuhera

Due to adverse market conditions in textile sector, the company has discontinued operations of this unit in order to minimize the impact on bottom line. With a long term perspective, the company is planning to develop this unit also as Logistic and Warehousing hub.

Knitting, Garment, Dying & Processing unit, Dharuhera

After COVID 19, the market conditions continue to be grim both on domestic and export front and the company is struggling to procure orders for readymade garments. However, from last quarter of FY 2023-24, the company has been able to get orders from Vishal Mega Mart and the management is hopeful that this unit will also start contributing positively in following years. Besides, the company is also doing dying and processing on job work basis for outside parties. The company is in the process of getting approval of GOTS (Global Organic Textiles Standards) for organic knitting and dying, which is also expected to contribute to top line in future.

Sewing Thread Unit at Kala Amb, Himachal Pradesh

This unit contributes around 90% of company’s total revenue but the operations for this unit have also been impacted adversely due to overall slugging market conditions prevailing in textile sector. In spite of the averse market conditions, the unit continues to make profit. If market scenario improves, the operations of this unit will also improve. However, shortage of labour continues to be cause of concern for the management.

Logistic and Warehousing

The company has amended its Memorandum of Association and included ‘Logistic and Warehousing’ as a new business segment The company was having surplus land and building at its Dharuhera unit, which the company has started developing for this segment. The first phase is complete and the company has garnered a revenue of Rs. 154.52 Las during FY 2023-24. The management is hopeful that this segment shall start contributing to the bottom line significantly in following year.

III PARTICULARS OF INFORMATION FORMING PART OF THE BOARD'S REPORT PURSUANT TO SECTION 134 OF THE COMPANIES ACT, 2013, RULE 8 OF THE COMPANIES (ACCOUNTS RULE 2014 AND RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014.

ANNUAL RETURN

The annual return of the company has been placed on the website of the company and can be accessed at www.pasupatitextiles.com

NUMBER OF MEETING OF BOARD

During the year, four (4) Board Meetings and four (4) Audit Committee Meetings were convened and held. The details are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013

DIRECTOR'S RESPONSIBILITY STATEMENT:

In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that:

i) In the preparation of the annual accounts, the applicable accounting standards have been followed.

ii) The directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 profit or loss of the Company for the year under review.

iii) The directors have 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.

iv) The directors have prepared the annual accounts on a going concern basis.

v) The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

The directors had devised proper system to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively

STATEMENT ON DECLARATION BY THE INDEPENDENT DIRECTORS.

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Listing regulations, 2015.

NOMINATION & REMUNERATION POLICY

The Board has, on the recommendation of the Nomination & Remuneration Committee, framed a Policy for selection, appointment and remuneration of Directors and Key Managerial Personnel. More details of the same are given in the Corporate Governance Report.

EXPLANATION OR COMMENTS ON AUDITORS REPORT AND SECRETARIAL AUDIT REPORT

Auditors' observations relating to Note no. 39 as contained in the Main Report under the para 'Basis of Qualified Opinion' are explained hereunder: -

Note 39: Although, the company has made representation to the competent authority for payment of compensation at market rate in respect of part of company's factory land acquired by Government of Haryana, the company feels that final decision in this regard may take a very long time and moreover there is uncertainty about the success of company's representation. Hence, it has been decided that its affect would be given in company's books as and when actual compensation is received from Government of Haryana.

There is no qualification, reservations or adverse remarks made by secretarial auditor in the Secretarial Audit Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

During the year under review, company has not given any loans, Guarantee or made any investments covered under the provisions of Section 186 of the Companies Act, 2013.

RELATED PARTY TRANSACTIONS

Pursuant to Section 134 of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, the particulars of contracts or arrangements entered into by the Company with Related Parties have been done at arm's length and are in the ordinary course of business. Particulars of the same are being provided in Form AOC-2 which is annexed herewith as Annexure D.

STATE OF COMPANY'S AFFAIRS

Discussion on state of Company's affairs has been covered as part of the Management Discussion and Analysis. AMOUNTS PROPOSED TO BE CARRIED TO RESERVES

Board of Directors does not appropriate any amount to be transferred to General Reserves during the year under review.

DIVIDEND

In view of the requirement of fund for working capital of the company, the Board of Directors is not in a position to recommend any dividend for the year under review.

MATERIAL CHANGES AND COMMITMENTS, IF ANY AFFECTING FINANCIAL POSITION OF THE COMPANY

No material changes and commitments affecting the financial position of the Company have occurred between the end of the financial year of the Company and the date of signing of this Report.

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies(Accounts) Rules, 2014, is annexed herewith as Annexure "B".

RISK MANAGEMENT POLICY

Pursuant to the requirement of SEBI (LODR) Regulations, 2015, the Company has constituted a Risk Management Committee. The details of the Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board's Report. On the recommendation of the Risk Management Committee, the Board has adopted Risk Management Policy, which outlines the program implemented by the Company to ensure appropriate risk management within its system and culture. The Risk Management Policy is also posted on the website of the Company. The Company's risk management program comprises of a series of processes, structures and guidelines which assist the Company to identify, assess, monitor and manage its business risks, including any material changes to its risk profile. To achieve this, the Company has clearly defined the responsibility and authority of the Company's Board of Directors and of the Risk Management Committee to oversee and manage the risk management program while conferring responsibility and authority on the Company's senior management to develop and maintain the risk management program in light of the day to day needs of the Company. Regular communication and review of risk management practices provide the Company with important checks and balances to ensure the efficacy of its risk management program.

CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES

The relevant provisions of the Companies Act, 2013 and Listing regulations are not applicable to our company. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013, and Regulation 17 of the SEBI (LODR) Regulations, 2015 the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as evaluation of the working of its Audit, Nomination & Remuneration and other Committees. The board's performance for the current year was assessed on the basis of participation of directors, quality of information provided/available, quality of discussion and contribution etc. The overall performance of the Board and Committee's of the Board was found satisfactory. The overall performance of Chairman, Executive Directors and the Non-executive Directors of the Company is satisfactory. The review of performance was based on the criteria of performance, knowledge, analysis, quality of decision making etc.

CHANGE IN THE NATURE OF BUSINESS

During the year under review, there has been no change in the nature of business of the Company.

DETAILS OF APPOINTMENT AND RESIGNATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. Vidit Jain retires by rotation and being eligible, offers himself for re-appointment.

Directors appointed/resigned during the FY 2023-24

During the financial year under review, Mr. Chander Mohan Sharma retired by rotation at the annual general meeting held on 28/09/2023 and was re-appointed. Mr. Umesh Chandra Tripathi was re-appointed as an Independent Director of the Company, not liable to retire by rotation, for a second term of five consecutive years with effect from February 14th, 2024. Also Mrs. Reema Kalhan was re-appointed as an Independent Director of the Company, not liable to retire by rotation, for a second term of five consecutive years with effect from May 28th, 2024.

However, after the closure of financial year, there has been no change in the directorship of the Company.

Key Managerial Personnel (KMP) appointed and resigned during the F.Y 2023-24

During the financial year, no changes took place in Key Managerial Personnel.

NAMES OF THE COMPANIES WHICH HAVE BECOME/ CEASED TO BE SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR

The Company did not have any subsidiaries, associates or joint ventures during the year.

DEPOSITS

The Company has not accepted deposits under Chapter V of the Companies Act, 2013.

SIGNIFICANT ORDERS PASSED BY REGULATORS, COURTS OR TRIBUNALS IMPACTING GOING CONCERN AND COMPANY'S OPERATIONS

To the best of our knowledge, the Company has not received any such orders from Regulators, Courts or Tribunals during the year, which may impact the going concern status or the Company's operations in future.

INTERNAL CONTROL SYSTEMS

Your Company has evolved a system of internal controls to ensure that the assets are safeguarded and transactions are authorised, recorded and correctly reported. The internal control system is supplemented by management reviews and independent periodical reviews which evaluate the functioning and quality of internal controls and provides assurance of its adequacy and effectiveness. The scope of internal audit covers a wide variety of operational methods and, as a minimum, ensures compliance with specified standards with regard to availability and suitability of policies and procedures, extent of adherence, reliability of management information system and authorization procedures including steps for safeguarding of assets. The reports of internal audit are placed before Audit Committee of the Directors and Board. Audit Committee and board reviews such audit findings and the adequacy of internal control systems. The Statutory Auditors and the Internal Auditors of the Company also interact with the Audit Committee and Board to share their findings and the status of corrective actions under implementation.

INFORMATION FORMING PART OF THE DIRECTORS' REPORT PURSUANT TO RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OFMANAGERIAL PERSONNEL) RULES, 2014

The provisions of Rule 5(2) & (3) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 requiring particulars of the employees in receipt of remuneration in excess of Rs. 1 Crore and 2 Lacs per year to be disclosed in the Report of Board of Directors are not applicable to the Company as none of the employees was in receipt of remuneration in excess of Rupees One Crore and two Lacs during the financial year 2022-23. The information in accordance with the provisions of Section 197 of the Companies Act, 2013 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed as Annexure-C.

A statement comprising the names of top 10 employees in terms of remuneration drawn and every person employed throughout the year, who were in receipt of remuneration in terms of Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms an integral part of this report. However, the same is not being sent along with this Annual Report to the Members of your Company in line with the provision of Section 136 of the Companies Act, 2013. Members who are interested in obtaining these particulars may write to cs@pasupatitextiles.com and these documents will be made available for inspection electronically from the date of circulation of this Annual Report up to the date of AGM.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Board of Directors has adopted the Vigil Mechanism / Whistle Blower Policy. The policy has provided a mechanism for Directors, Employees and other persons dealing with the Company to report to the Chairman of the Audit Committee, any instance of unethical behavior, actual or suspected fraud or violation of the Code of Conduct of the Company. The details of the policy has been uploaded at the website of the Company @ www.pasupatitextiles.com

COMPOSITION OF AUDIT COMMITTEE

The composition of the Audit Committee has been mentioned in the Corporate Governance Report annexed to this report.

AUDITORS• STATUTORY AUDITORS

M/s. B K Shroff & Co. Chartered Accountants, can continue as Statutory Auditors till the conclusion of the Forty Seventh Annual General Meeting to be held in the year 2027.

• COST AUDITORS

The Central Govt. has approved the appointment of Mr. Satnam Singh Saggu, Cost Accountants as cost auditors for conducting Cost Audit for the Financial Year 2024-25. The report of Cost Auditors in respect of audit of the cost records of the Company for the year ended 31^stMarch 2024 will be submitted to the Central Government in due course.

• SECRETARIAL AUDITORS

The Company has undertaken Secretarial Audit for the financial year 2023-24 which, inter alia, includes audit of compliance with the Companies Act, 2013, and the Rules made under the Act, Listing Regulations and applicable Regulations prescribed by the Securities and Exchange Board of India and Foreign Exchange Management Act, 1999 and Secretarial Standards issued by the Institute of the Company Secretaries of India. The Secretarial Audit Report forms part of this Annual Report. The Report of the Secretarial Audit as submitted by Sumit Bajaj & Associates is annexed herewith as Annexure-A.

• ANNUAL SECRETARIAL COMPLIANCE REPORT

The Company has undertaken an audit for the Financial Year 2023-24 for all applicable compliances as per Securities and Exchange Board of India Regulations and Circulars/Guidelines issued thereunder. The Annual Secretarial Compliance Report duly signed by Sumit Bajaj & Associates, Practicing Company Secretaries has been submitted to the Stock Exchange.

CORPORATE GOVERNANCE

The Company conforms to the norms of Corporate Governance as envisaged in the Listing Regulations with the BSE Limited. Pursuant to Regulation 34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Report on the Corporate Governance and the Auditors Certificate on Corporate Governance are annexed to this report.

OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

In order to prevent sexual harassment of women at work place a new act The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 has been notified on 9^thDecember, 2013. Under the said Act every company is required to set up an Internal Complaints Committee to look into complaints relating to sexual harassment at work place of any women employee.

Company has adopted a policy for prevention of Sexual Harassment of Women at workplace and has set up Committee for implementation of said policy. During the year Company has not received any complaint of harassment.

APPRECIATION

The Board of Directors acknowledge with gratitude the co-operation and assistance extended by all its stakeholders, including its shareholders, employees/workers, bankers, customers, business associates and employees. The company also conveys special thanks to Central & State Government and its Bankers, who have helped the company from time to time for their continued support.