Neelam Linens and Garments India Ltd Directors Report

The Companys performance during the financial year ended 31st March, 2025 is summarized in the following table.

Amount in Lakhs (INR).

Your Company has seen increase in turnover during the year under review which accounted for Rs. 11,042.73 Lakhs as compared to Rs. 10,233.91 Lakhs in FY 2023-24. The Company has incurred Net Profit of Rs. 267.95 Lakhs as compared to Net Profit of Rs. 246.04 Lakhs in FY 2023-24. Your Company is very much optimistic about the coming year. Since the Company is trying to reduce cost and expand its business, your directors are hopeful that the results will be more encouraging in near future.

During the financial year there is no change in the nature of business of the Company.

Your directors do not recommend any dividend for the financial year ended March 31, 2025 with the objective of preserving the companys reserves for the business growth.

Further, no amount of dividend was required to be transferred to IEPF.

The Company has transferred Rs. 267.95 lakhs to Reserves & Surplus during the financial year ending 31st March, 2025.

Your Company is planning to expand the business by introducing few retail stores internationally mostly in USA. We are also collaborating with various collaboration partners like Instagram, Amazon, etc to enhance the ecommerce business.

Our Strengths:

Your Company has a strong, committed and dedicated workforce, which is a key to its sustained success. The Company believes that motivation, sense of ownership and satisfaction of its people are the most important drivers for its continued growth. Good governance practices combined with strong leadership has been the inherent strength of the Company. On the manufacturing front, we continue to build our capabilities and strengthen our processes. Through our robust efforts in implementing important initiatives in Quality and Compliance, we now see consistent positive outcomes from regulatory inspections. Our audit programs and effective internal controls ensure our compliance of all existing rules and regulations.

The Company does not have any Subsidiary, Joint Venture or Associate Company.

During the year under review, there was no change in the Registered Office of the Company.

The Company was originally incorporated as “Neelam Linens and Garments (India) Private Limited” on September 22, 2010, as a private limited company under the provisions of the Companies Act, 1956 pursuant to Certificate of Incorporation issued by the Registrar of Companies, Mumbai. In order to facilitate fundraising and listing of the Companys securities on the NSE SME Platform and to align with regulatory requirements applicable to a listed entity , the Company was then converted into public limited company pursuant to shareholders resolution passed at the extraordinary general meeting of the Company held on August 12, 2022, and the name of the Company was changed to “Neelam Linens and Garments (India) Limited” and a Fresh Certificate of Incorporation dated September 1, 2022 was issued by the Registrar of Companies, Mumbai.

The Company got listed on NSE SME Platform on 18^th November, 2024 and Corporate Identity Number of the Company is L17299MH2010PLC208010.

10.INITIAL PUBLIC OFFER AND LISTING OF EQUITY SHARES:

The Board of Directors had, in its meeting held on 22^nd March, 2024, proposed the Initial Public Offer (IPO) not exceeding 62,74,000 equity shares at such price as may be decided by the Board of Directors in consultation with the Merchant Banker. The Members of the Company had also approved the proposal of the Board of Directors in their Extra-Ordinary General Meeting held on 13^th April, 2024. Pursuant to the authority granted by the Members of the Company, the Board of Directors appointed Expert Global Consultants Private Limited as Lead Manager and Purva Sharegistry (India) Private Limited as Registrar to the Issue and Share Transfer Agent for the proposed Public Issue. The Company applied to National Stock Exchange of India Limited (“NSE”) for in-principle approval for listing its equity shares on the Emerge Platform of the NSE. National Stock Exchange of India Limited has, vide its letter dated September 23, 2024 granted its In-Principle Approval to the Company. The Company had filed Prospectus to the Registrar of the Companies, Mumbai on November 12, 2024. The Public Issue was opened on Friday, 08 ^th November, 2024 and closed on Tuesday, 12^th November, 2024. The Basis of Allotment was finalized by Company, Registrar to the issue and Merchant Banker in consultation with the NSE on 13^th November, 2024 and allotment was made on 13^th November, 2024. The Company had applied for listing of its total equity shares to NSE and it has granted its approval vide its letter dated 14 ^th November, 2024. The trading of equity shares of the Company commenced on November 18^th, 2024 at Emerge Platform of NSE.

Utilisation of IPO proceeds The Company successfully raised 1,300.32 lakhs through its Initial Public Offering (IPO) and got listed on the NSE SME Platform. Out of the gross proceeds of 1,300.32 lakhs, an amount of 557.41 lakhs was utilized towards funding capital expenditure of the Company towards purchase of Embroidery Machines for expansion, 400.00 lakhs was utilized for repayment of portion of certain outstanding borrowings availed by the Company, 214.80 towards General Corporate purposes and 128.11 towards Issue Expenses.

11. MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE

COMPANY:

During the year ended March 31, 2025, there were no material changes and commitments affecting the financial position of the Company have occurred between the period ended March 31, 2025 to which financial results relate and the date of the Report.

12. SHARE CAPITAL:

During the year under review, there were no changes in the Authorised Share Capital of the Company. Further, the following changes were made in the Paid-up Share Capital of the Company: Pursuant to the Initial Public Offer of Equity Shares by the Company, the Board of Directors, in their meeting held on 13^th November, 2024 has allotted a total of 54,18,000 Equity Shares 10 each at price of 24 per Equity Share (Including a share premium of 14 per equity share) to the successful allottees, whose list have been finalized by the Company, the Registrar to the issue and merchant banker in consultation with National Stock Exchange of India Limited.

The Share Capital of the Company after these changes stood as follows as on the date of Report: Authorized Capital:

The Authorized Capital of the Company is 22,50,00,000/- (Rupees Twenty Two Crore Fifty Lakhs Only) divided into 2,25,00,000 (Two Crore Twenty-Five Lakh Only) Equity Shares of 10 (Rupees Ten Only) each.

Issued, Subscribed and Paid-Up Capital: The present Paid-up Capital of the Company is 20,21,80,000/- (Rupees Twenty Crore Twenty-One Lakhs Eighty Thousand Only) divided into 2,02,18,000 (Two Crore Two Lakhs Eighteen Thousand Only) Equity Shares of 10 (Rupees Ten Only) each.

13. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

i. Change in Directors and Key Managerial Personnels:

The following changes took place at the position of Directors and Key Managerial Personnel of the Company during FY 2024-25:

ii. Composition of Board of Directors and Key Managerial Personnels:

As on March 31, 2025, your Companys Board of Directors comprises of the following Directors:

iii. Board Evaluation:

Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a structured questionnaire was prepared after taking into consideration the various aspects of the Boards functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance.

The performance evaluation of the Independent Directors was completed. The performance evaluation of the Non-Independent Directors was carried out by the Independent Directors. The Board of Directors expressed their satisfaction with the evaluation process.

iv. Meetings of the Board:

The Board of Directors meets at regular intervals to deliberate on key matters concerning the operations, strategy, and overall governance of the Company. Additional Board meetings are convened, as and when required to discuss and decide on various business policies, strategies and other businesses. During the year under review, being the year of listing on the NSE SME Platform, the Company convened and held 16 (Sixteen) Board Meetings on the following dates

Board Meeting dates:

9. 12.11.2024

10. 13.11.2024

11. 03.12.2024

12. 19.12.2024

13. 15.01.2025

14. 05.02.2025

15. 20.03.2025

v. General Meetings:

During the year under review, the following General Meetings were held, the details of which are given as under:

vi. Disclosure by Directors:

The Directors on the Board have submitted notice of interest under Section 184(1) of the Companies Act, 2013 i.e. in Form MBP-1, intimation under Section 164(2) of the Companies Act, 2013 i.e. in Form DIR-8 and declaration as to compliance with the Code of Conduct of the Company.

vii. Independent Directors:

In terms of Section 149 of the Companies Act, 2013 and Rules made there under, the Company has Three Non- Promoter Non-Executive Independent Directors in line with the Companies Act, 2013. The Company has received necessary declaration from each Independent Director under Section 149 (7) of the Companies Act, 2013 that they meet the criteria of independence laid down in Section 149 (6) of the Act. Further, all the Independent Directors of the Company have registered themselves in the Independent Director Data Bank.

In accordance with Schedule IV of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate meeting of Independent Directors was held during the year. At the said meeting, the Independent Directors, interalia, reviewed the performance of Non-Independent Directors and the Board as a whole, the performance of the Chairperson of the Company, and assessed the quality, quantity, and timeliness of flow of information between the Companys management and the Board.

The Company has also adopted a Policy on Familiarization Programme for Independent Directors to enable them to understand the business and operations of the Company and their roles, rights, and responsibilities. The details of such familiarization programme are available on the website of the Company at www.neelamgarments.com.

viii. Performance evaluation:

Pursuant to the provisions of Section 134(3)(p) of the Companies Act, 2013 and the applicable provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Nomination and Remuneration Committee carried out the annual performance evaluation of the Board, its Committees, and individual Directors for the financial year 2024 25. The evaluation was conducted through a structured questionnaire and feedback mechanism, covering various parameters including the composition of the Board and its Committees, effectiveness in decision-making, fulfilment of responsibilities, and active participation of individual Directors in meetings.

Based on the feedback received and reviewed by the Committee, the Board noted that the overall performance of the Board, its committees, and the individual Directors, including the Chairman, was found to be satisfactory. The Board also took note of certain suggestions for improvement, which would be implemented as appropriate.

14. COMMITTEES OF THE BOARD:

The Board of Directors, at its various meetings, has constituted / re-constituted various committees to discuss upon the delegated work. The Board supervises the execution of its responsibilities by the Committees and is responsible for their action. Minutes of all the Committee Meetings are placed before the Board for noting. Following Committee(s) are constituted for better and focused attention on various affairs of the Company:

Audit Committee

Nomination and Remuneration Committee

Stakeholders Relationship Committee

The Composition and other details related to the Committees are as follows:

Audit Committee:

An Audit Committee, duly constituted by the Board of Directors has a well-defined composition of members, terms of reference, powers, role and responsibilities in accordance with Section 177 of the Act and applicable Rules thereto and in accordance with Regulation 18 of SEBI Listing Regulations.

The terms of reference of the Audit committee are broadly as under:

3. Approval of payment to statutory auditors for any other services rendered by the statutory auditors; 4. formulation of a policy on related party transactions, which shall include materiality of related party transactions; 5. reviewing, at least on a quarterly basis, the details of related party transactions entered into by the Company pursuant to each of the omnibus approvals given; 6. examining and reviewing, with the management, the financial statements before submission to the board for approval, with particular reference to: i. Matters required to be included in the Directors Responsibility Statement to be included in the Boards report in terms of clause (c) of sub-section 3 of section 134 of the Companies Act, 2013; ii. Changes, if any, in accounting policies and practices and reasons for the same; iii. Major accounting entries involving estimates based on the exercise of judgment by management; iv. Significant adjustments made in the financial statements arising out of audit findings;

v. Compliance with listing and other legal requirements relating to financial statements; vi. Disclosure of any related party transactions; vii. Qualifications in the draft audit report.

9. Review and monitor the auditors independence, performance and effectiveness of audit process; 10. Approval or any subsequent modification of transactions of the company with related parties which includes omnibus approval for related parties transactions subject to conditions as specified under rules; 11. Scrutiny of inter-corporate loans and investments; 12. Valuation of undertakings or assets of the company, wherever it is necessary;

13. Evaluation of internal financial controls and risk management systems;

14. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;

15. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit; 16. Discussion with internal auditors any significant findings and follow up there on;

17. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board;

18. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern;

19. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors; 20. To oversee and review the functioning of the vigil mechanism which shall provide for adequate safeguards against victimization of employees and directors who avail of the vigil mechanism and also provide for direct access to the Chairperson of the Audit Committee in appropriate and exceptional cases;

21. Call for comments of the auditors about internal control systems, scope of audit including the observations of the auditor and review of the financial statements before submission to the Board; 22. Approval of appointment of CFO (i.e., the whole-time Finance Director or any other person heading the finance function or discharging that function) after assessing the qualifications, experience & background, etc. of the candidate;

23. To investigate any other matters referred to by the Board of Directors;

24. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee;

The Composition of Audit Committee is as follows:

Nomination and Remuneration Committee:

The Company had a Nomination and Remuneration Committee of directors. The Committees constitution and terms of reference is in compliance with the provisions of Section 178 of the Companies Act, 2013. The Committee comprises of 3 (three) members of the Board, the details of the member are as follows:

Term of reference of the Committee, inter-alia, includes the following:

Scheme;

15. Perform such other activities as may be delegated by the Board or specified/ provided under the Companies Act, 2013 to the extent notified and effective, as amended or by the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended or by any other applicable law or regulatory authority. 16. For every appointment of an independent director, the Nomination and Remuneration Committee shall evaluate the balance of skills, knowledge and experience on the Board and on the basis of such evaluation, prepare a description of the role and capabilities required of an independent director. The person recommended to the Board for appointment as an independent director shall have the capabilities identified in such description. For the purpose of identifying suitable candidates, the Committee may: a. use the services of an external agencies, if required; b. consider candidates from a wide range of backgrounds, having due regard to diversity; and c. consider the time commitments of the candidates.

17. Carrying out any other functions required to be carried out by the Nomination and Remuneration Committee as contained in the SEBI Listing Regulations or any other applicable law, as and when amended from time to time.

Stakeholder Relationship Committee:

The Stakeholder Relationship Committee of the Company is constituted in line with the provisions of Section 178 of the companies Act, 2013. The Committee comprises of 3 (three) members of the Board, the details of the member are as follows:

The terms of reference of the Stakeholders Relationship Committee are as under: i. Considering and specifically looking into various aspects of interest of shareholders, debenture holders and other security holders; ii. Resolving the grievances of the security holders of the listed entity including complaints related to transfer / transmission of shares or debentures, including non-receipt of share or debenture certificates and review of cases for refusal of transfer / transmission of shares and debentures, non-receipt of annual report, non-receipt of declared dividends, issue of new/duplicate certificates, general meetings etc. and assisting with quarterly reporting of such complaints; iii. Review of measures taken for effective exercise of voting rights by members; iv. Investigating complaints relating to allotment of shares, approval of transfer or transmission of shares, debentures or any other securities; v. Giving effect to all transfer/transmission of shares and debentures, dematerialisation of shares and re-materialisation of shares, split and issue of duplicate/consolidated share certificates, compliance with all the requirements related to shares, debentures and other securities from time to time; vi. Review of adherence to the service standards adopted by the listed entity in respect of various services being rendered by the registrar and share transfer agent of the Company and to recommend measures for overall improvement in the quality of investor services; vii. Review of the various measures and initiatives taken by the listed entity for reducing the quantum of unclaimed dividends and ensuring timely receipt of dividend warrants/annual reports/statutory notices by the members of the company; and viii. Carrying out such other functions as may be specified by the Board from time to time or specified / provided under the Companies Act or SEBI Listing Regulations, or by any other regulatory authority.

15. CORPORATE GOVERNANCE:

We believe that integrity and transparency are the foundation of strong corporate governance. Our aim is to build and maintain the trust of all stakeholders by conducting our business in a legal, ethical, and sustainable manner. The Board of Directors takes its responsibilities seriously and works in the best interests of all shareholders. We are committed to following high standards of disclosure and governance, and we strive to protect the rights of all shareholders, including minority shareholders, while focusing on creating long-term value.

As our Company has been listed on Emerge Platform of National Stock Exchange Limited, by virtue of Regulation 15 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the compliance with the corporate Governance provisions as specified in Regulation 17 to 27 and Clause (b) to (i) and (t) of Sub-Regulation (2) of Regulation 46 and Para C D and E of Schedule V are not applicable to the Company. Hence Corporate Governance Report does not form a part of this Report, though we are committed for the best corporate governance practices.

16. INVESTOR COMPLAINTS:

Details of Investor Complaints received and redressed during the Financial Year 2024-25 are as follows:

No Complaints were outstanding as on 31st March 2025.

17. COMPLIANCE WITH THE ACCOUNTING STANDARDS:

The Company prepares its accounts and other financial statements in accordance with the relevant accounting principles and also complies with the accounting standards issued by the Institute of Chartered Accountants of India.

18. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 134(5) of the Companies Act, 2013, the Directors of your Company confirm that:

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

b) that the Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at March 31, 2025 and of the profit/loss of the company for the year ended on that date;

c) that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d) that the directors had prepared the annual accounts on a going concern basis;

e) that the directors has 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) that the directors have devised proper system to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.

19. PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE:

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed thereunder.

The Company has constituted an internal complaint committee under Section 4 of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the financial year 2024-25, the Company has not received any complaints on sexual harassment and no complaints are remaining pending as on March 31, 2025.

20. DEPOSITS:

The Company has not accepted any deposit from the general public within the meaning of section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

21. STATUTORY AUDITORS & THEIR REPORT:

The Members at the 14^th Annual General Meeting, appointed M/s. P D M S and Co. Chartered Accountants (FRN: 019621C), as Statutory Auditors of your Company for a period of 5 years from the conclusion of the 14^th Annual General Meeting till the conclusion of the Annual General Meeting to be held in the year 2029, based on the recommendation of the Board of Directors.

The statutory auditors report does not contain any qualifications, reservations, or adverse remarks or disclaimer.

Further, the Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Companies Act, 2013.

22. INTERNAL AUDITOR:

M/s. Dinesh Mehta & Associates, Chartered Accountants had been appointed as an Internal Auditor of the company and they performed the duties of Internal Auditors of the Company for the Financial Year 2024-25 and their report is reviewed by the Audit Committee on quarterly basis.

Further, On the recommendation of Audit Committee, Ms. Manisha Ram Phal Kadian, Chartered Accountants has been proposed to be appointed as an Internal Auditor of the Company in pursuance of Section 138 of the Companies Act, 2013, and applicable provisions of Listing Regulations for the Financial Year 2025-26.

23.COST AUDITOR:

The Company is not required to maintain cost records as per the Companies (Cost Records and Audit) Amendments Rules, 2014 for the Financial Year 2024-2025.

24. SECRETARIAL AUDITOR:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company have appointed CS Naveen Karn of M/s. Naveen Karn & Co Practicing Company Secretary to conduct the Secretarial Audit for the financial year 2024-2025. The Secretarial Audit Report for the year 2024-2025 issued by him in the prescribed Form MR-3 is attached as Annexure D to this Report.

The Secretarial Audit Report issued by M/s. Naveen Karn & Co. Practicing Company Secretary contains remarks for which the Board has provided explanation as under:

Regulation 33 of SEBI (LODR) Regulation, 2015 Delayed in submission of full set of financial results.

Explanation by the Board:

Non-submission had occurred because the Company was newly Listed, it was our first instance with respect to Compliances of SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015. The due dates for complying with Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 was within 45 days of the end of each quarter, i.e. November 14, 2024 for Half year ended September 30, 2024. Our Company got listed on NSE (SME Emerge) platform on November 18, 2024. Hence, we were of the opinion that filing of financial results for Half year ended September 30, 2024 is not applicable to the Company. This misunderstanding led to the delay in the submission.

25. REPORTING OF FRAUDS BY AUDITORS

There are no Fraud reported by Auditors u/s 143(12) of the Companies Act 2013 for the year ended 31st March, 2025.

26. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN

EXCHANGE EARNING& OUTGO:

Information on conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under section 134[3][m] of the Act read with the Companies [Accounts] Rules, 2014, are provided in the Annexure A and forms part of this Report.

27. MANAGEMENT DISCUSSION AND ANALYSIS:

In terms of Regulation 34 and Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the report, providing a review of the performance of the Company and its future outlook, forms part of the Annual Report and is presented in separate section and attached as Annexure E of this report.

28.REMUNERATION TO DIRECTORS & KMP AND DISCLOSURES PURSUANT TO THE

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:

Remuneration to Directors & KMP and the particulars of employees required to be furnished pursuant to Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed herewith as Annexure F to this Report.

29. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE COMPANY

UNDER SECTION 186 OF THE COMPANIES ACT, 2013:

Details of Loan, Guarantee, and Investment covered under the provisions of Section 186 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014, are given in the Notes forming part of the standalone financial statements.

30.WEBSITE:

As per Regulation 46 of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, the Company has maintained a functional website namely www.neelamgarments.com containing information about the Company.

The website of the Company contains information like Policies, Shareholding Pattern, Financial and information of the designated officials of the Company who are responsible for assisting and handling investor grievances for the benefit of all stakeholders of the Company, etc.

31. ANNUAL RETURN

A copy of the annual return as provided under sub-section (3) of section 92 of the Companies Act, 2013 (‘the Act), in the prescribed form, is hosted on the Companys website and can be accessed at www.neelamgarments.com

32. RISK MANAGEMENT:

Risk Management is a risk-based approach to manage an enterprise, identifying events that may affect the entity and manage risks to provide reasonable assurance regarding achievement of entitys objective. The risk management process consists of risk identification, risk assessment, risk prioritization, risk treatment or mitigation, risk monitoring and documenting the new risks. The Company has laid a comprehensive Risk Assessment and Minimization Procedure, which is reviewed by the Audit committee and approved by the Board from time to time. These procedures are reviewed to ensure that executive management controls risk through means of a properly defined framework. In the opinion of your Board, none of the risks which have been identified may threaten the existence of the Company.

33. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR

COURTS:

There are no significant and material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

34. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has in place an adequate budgetary control system and internal financial controls with reference to financial statements. No reportable material weaknesses were observed in the system during the previous fiscal. Further, the Company has laid down internal financial control policies and procedures which ensure accuracy and completeness of the accounting records and the same are adequate for safeguarding of its assets and for prevention and detection of frauds and errors, commensurate with the size and nature of operations of the Company. The policies and procedures are also adequate for orderly and efficient conduct of business of the Company.

The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of the internal control systems and suggests improvements to strengthen the same. The Company has a robust Management Information System, which is an integral part of the control mechanism.

The Audit Committee of the Board of Directors, Statutory Auditors and the Business Heads are periodically apprised of the internal audit findings and corrective actions taken. Audit plays a key role in providing assurance to the Board of Directors. Significant audit observations and corrective actions taken by the management are presented to the Audit Committee of the Board. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit

Committee.

35. CORPORATE SOCIAL RESPONSIBILITY:

Since the provisions as laid down in the Section 135 of the Companies Act, 2013 is not applicable to the Company, hence no such Committee has been formed. However, Company had always tried in its best possible ways to involve itself in social development activities.

36. VIGIL MECHANISM/WHISTLE BLOWER POLICY:

Pursuant to Section 177(9) and (10) of the Companies Act, 2013, and Regulation 22 of the Listing Regulations, the Company has formulated Whistle Blower Policy for vigil mechanism of Directors and employees to report to the management about the unethical behaviour, fraud or violation of Companys code of conduct.

The Whistle Blower Policy and Vigil Mechanism provides a channel to the employees to report to the management concerns about unethical behaviour, actual or suspected fraud or violation of the Codes of Conduct or policy and also provides for adequate safeguards against victimization of employees by giving them direct access to the Chairman of the Audit Committee in exceptional cases. The Protected Disclosures, if any reported under this Policy will be appropriately and expeditiously investigated by the Chairman.

The Policy covers malpractices and events which have taken place / suspected to have taken place, misuse or abuse of authority, fraud or suspected fraud, violation of Company rules, manipulations, negligence causing danger to public health and safety, misappropriation of monies, and other matters or activity on account of which the interest of the Company is affected and formally reported by whistle blowers concerning its employees.

Your Company hereby affirms that no Director/ employee have been denied access to the Chairman of the Audit Committee and that no complaints were received during the year. The policy is available on the Companys website: www.neelamgarments.com.

37. CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

All transactions entered into by the Company during the financial year with related parties were on arms length basis & in ordinary course of business and in compliance with the provisions of section 188 of the Companies Act, 2013 and the SEBI Listing Regulations. The Company has not entered into any material transactions with related parties referred to in Section 188(1) of the Companies Act, 2013 and in compliance with the SEBI Listing Regulations. Accordingly, the details are not required to be given under AOC-2.

Further, details of related party transactions entered into by the Company have also been disclosed in the notes of the standalone financial statements forming part of this Annual Report.

The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its related parties, in compliance with the applicable provisions of the Companies Act 2013, the Rules thereunder and the Listing Regulations. This policy has been uploaded on the website of the Company at www.neelamgarments.com.

38. CODE OF CONDUCT:

Regulation 17(5) of the SEBI Listing Regulations, 2015 requires listed Companies to lay down a Code of Conduct for its directors and senior management, incorporating duties of directors as laid down in the Companies Act, 2013. Your Company has adopted and laid down a code of conduct for all Board members and Senior Management of the company pursuant to Clause 49 of the erstwhile listing agreement. The code of conduct is available on the website of the company. All Board members and senior management personnel have affirmed compliance with the Code of Conduct. A declaration to this effect signed by the Managing Director is given in this Annual Report.

39. COMPLIANCE OF SECRETARIAL STANDARDS:

During the year under review, the Company has complied with the Secretarial Standards issued by The Institute of Company Secretaries of India and approved by the Central Government as required under Section 118(10) of the Companies Act, 2013.

40. RECONCILIATION OF SHARE CAPITAL AUDIT:

As stipulated by Securities and Exchange Board of India (SEBI), Mr. Naveen Maheshwar Karn, Practicing Company Secretary carried out the Reconciliation of Share Capital Audit to reconcile the total admitted capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) and the total issued and listed capital. This audit is carried out every quarter and the report thereon is submitted to Stock Exchange and is also placed before the Board of Directors. No discrepancies were noticed during these audits.

41. INSIDER TRADING:

The Company has adopted a ‘Code of Conduct for Prevention of Insider Trading and Corporate Disclosure Practices in accordance with the SEBI (Prohibition of Insider Trading) Regulations, 1992, as amended. The policy lays down procedures to be followed and disclosures to be made while dealing with shares of the Company and cautioning them of the consequences of violations. Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information, is available on the Companys website.

42. POLICY ON MATERIALITY OF EVENTS AND INFORMATION:

Pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has framed and adopted a Policy on Determination of Materiality of Events and Information. The policy outlines criteria for identifying material events and specifies that events listed under Para A of Part A of Schedule III of the said Regulations shall be mandatorily disclosed to the Stock Exchange, whereas events under Para B shall be disclosed based on the application of materiality guidelines. The Policy is available on the Companys website at www.neelamgarments.comand the same has been complied.

43. PARTICULARS OF EMPLOYEES:

The information required pursuant to Section 197 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the reports and accounts are being sent to the members and others entitled thereto excluding the information on employees particulars which is available for inspection by the members at the Registered office of the company during business hours on working days of the company up to the date of ensuing Annual General Meeting. If any member is interested in inspecting the same, such member may write to the company secretary in advance.

No employee has received remuneration in excess of the limits set out in rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 during FY 2023-24. The statement of Disclosure of Remuneration under Section 197(12) of the Act and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (‘Rules), is annexed as Annexure F and forms an integral part of this Report.

44. COMPLIANCE WITH THE MATERNITY BENEFIT ACT, 1961:

Pursuant to the Companies (Accounts) Second Amendment Rules, 2025, the Company affirms that it is in compliance with the provisions of the Maternity Benefit Act, 1961. The Company remains committed to providing a safe, supportive, and inclusive work environment for women employees, in line with the applicable statutory requirements.

45. GENERAL DISCLOSURE:

Your Directors state that the Company has made disclosures in this Report for the items prescribed in Section 134 (3) of the Companies Act, 2013 and Rule 8 of the Companies (Accounts) Rules, 2014 and other applicable provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, to the extent the transactions took place on those items during the year.

Your Directors further state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

i) Issue of Equity Shares with differential rights as to dividend, voting or otherwise; ii) Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and ESOS; iii) There is no revision in the Board Report or Financial Statement; iv) The details of difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons there of.

ACKNOWLEDGEMENT:

Your Directors take this opportunity to express their grateful appreciation for the excellent assistance and co-operation received from all our Clients, Bankers, Business Associates and the Government and other regulatory authorities and thank all stakeholders for their valuable sustained support and encouragement towards the conduct of the proficient operation of the Company. Your Directors would like to place on record their gratitude to all the employees who have continued their support during the year.