PC Jeweller Ltd Directors Report

Dear Members,

Your Directors have pleasure in presenting the 19^th Annual Report of the Company along with the audited financial statements for the financial year ended March 31,2024.

FINANCIAL SUMMARY

The financial performance of your Company on standalone basis is summarized below:

(? in crore, except earnings per share)

Particulars	2023-24	2022-23
Revenue from operations	189.45	2,359.46
Other income	43.85	147.85
Total income	233.30	2,507.31
Profit / (loss) before finance costs, depreciation and tax	(125.05)	272.70
Less: Finance cost	504.53	491.69
Less: Depreciation & amortisation expenses	19.69	25.85
Profit / (loss) before tax	(649.27)	(244.84)
Less: Tax Expense	-	94.27
Net profit / (loss) after tax	(649.27)	(339.11)
Other comprehensive income for the year, net of tax	2.15	0.46
Total comprehensive income / (loss) for the year	(647.12)	(338.65)
Earnings per equity share (in ?):
Basic	(13.95)	(7.29)
Diluted	(13.95)	(7.29)
Paid-up share capital	465.40	465.40
Other equity	2,432.53	3,079.65

COMPANYS PERFORMANCE AND STATE OF AFFAIRS

The Company is one of the prominent jewellery companies in the organised jewellery retail sector in India. It is engaged in the business of trade, manufacture and sale of gold, diamond, precious stone, gold and diamond studded jewellery as well as silver articles. As on March 31, 2024, the Company has total of 60 showrooms including 6 franchisee showrooms and also has 4 manufacturing units in India covering 12 States and 3 Union Territories.

The Company offers wide range and variety of jewellery to cater not only to wedding jewellery but party and daily wear

also. In view of the changing trends, customers preferences and demands, the Company keeps on launching new jewellery designs and collections from time to time. The Company has launched a number of jewellery collections over the years. Some of the Companys prominent jewellery collections are Anant, Dashavatar, Bandhan, Amour, Wedding Collection, Animal Collection, Folia Amoris, The Fluttering Beauty, Mens Collection, Hand Mangalsutra etc.

The Company is engaged in jewellery business, in which trust and goodwill of a brand is a major impact factor. Due to the litigations and negative promotion about the Company, the customer sentiments towards the Companys future and existence got affected adversely during the year under review. As a result of which, although the Companys showrooms were operational, but the quantum of operations was very low / negligible. This led to a fall in the Companys revenue and its operational levels as well during the year. The revenue from operations of the Company decreased from Rs. 2,359.46 crore during previous year to Rs. 189.45 crore. Further, the reduction in operations has also resulted in losses at EBIDTA as well as PBT level for the Company. Consequently, the Companys net loss increased to Rs. 649.27 crore as compared to Rs. 339.11 crore during the previous year.

During the financial year 2021-22, the Companys lenders classified its accounts as Non-Performing Assets, which was contested by the Company in various legal fora and the matter is currently sub-judice. Subsequently, the Company and its lenders were involved in various litigations. During the year under review, State Bank of India ("SBI") also filed a petition with National Company Law Tribunal, Delhi ("NCLT") against the Company under the Insolvency and Bankruptcy Code, 2016 ("IBC 2016") for initiation of corporate insolvency resolution process. The Company has from time to time responded to all the legal notices, petitions and plaints suitably.

The Company has also taken proactive action in resolving the legal cases by approaching its lenders to resolve the issue of unpaid debt with a One Time Settlement ("OTS") proposal. After several rounds of negotiations, during third quarter of the year under review, the lenders had in-principle agreed to take forward the OTS proposal to their respective internal / competent authorities for approval and the upfront payment for the furtherance of the proposal was deposited in a no lien account with SBI by a Promoter Group entity.

Subsequently, the internal / competent authorities of 2 banks, namely, SBI (Lead Bank) and Axis Bank, have given their acceptances / approval to the Companys OTS proposal during the fourth quarter of the year under review.

Further, owing to the above positive development, after end of the year SBI had also filed an application under IBC 2016 before Honble NCLT for withdrawal of its earlier petition on account of the settlement terms agreed between SBI and the Company. Subsequently, NCLT vide its order dated April 30, 2024 allowed SBI to withdraw the petition and dismissed the same as withdrawn.

Keeping in view the aforesaid positive developments, the Company has again started focusing on increasing its brand presence and has started its marketing initiatives for the same. The Company continues to maintain a wide network of showrooms. Also, the core strengths of the Company in the form of manufacturing & designing capabilities, skilled staff, soft skills in the form of systems and procedures, customer policies, etc. remain intact. Supported by its strong historical financials, the Company is aware of its growth potential and hence is also revamping all other aspects of its business operations such as, preparing to launch new jewellery collections, revamping its franchisee business, cost optimization etc.

CAPITAL STRUCTURE

Authorised Share Capital: The authorised share capital of the Company remained unchanged at Rs. 760 crore comprising of 50 crore equity shares of Rs. 10/- each and 26 crore preference shares of Rs. 10/- each.

Paid-Up Share Capital: The paid-up share capital of the Company also remained unchanged at Rs. 465,40,38,960/- comprising of 46,54,03,896 equity shares of Rs. 10/- each.

DIVIDEND

The Board of Directors ("Board") has not recommended any dividend for the year.

TRANSFER TO RESERVES

The Board has not proposed transfer of any amount to the reserves.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

As on March 31,2024, the Company had 6 Directors comprising of 2 Executive Directors and 4 Non-Executive Independent Directors including 1 Woman Director.

During the year Shri Suresh Kumar Jain, Independent Director, ceased to be a Director of the Company w.e.f. September 19, 2023 due to completion of his second and final term as an Independent Director of the Company. Shri Ramesh Kumar Sharma is liable to retire by rotation at the 19^th Annual General Meeting ("AGM") of the Company and being eligible, offered himself for re-appointment as a Director of the Company.

Pursuant to Regulation 36 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("LODR Regulations") and Secretarial Standard 2 issued by the Institute of Company Secretaries of India, the details of Shri Ramesh Kumar Sharma form part of the Notice convening the 19^th AGM.

During the year under review, no changes have taken place among Key Managerial Personnel of the Company.

SUBSIDIARY COMPANIES

As on March 31,2024, the Company has following 3 wholly owned non-material subsidiaries:

i) Luxury Products Trendsetter Private Limited: It is engaged in the business of manufacturing / job working and trading of jewellery. During the year under review its revenue from operations was Rs. 0.26 crore and it registered net profit of Rs. 0.68 crore.

ii) PCJ Gems & Jewellery Limited: It is authorized to carry on the business of manufacturing and trading of all kinds of jewellery. However, it has not commenced business operations during the year under review.

iii) PC Jeweller Global DMCC: It is engaged in the business of jewellery trading. During the year under review its revenue from operations was Rs. 1.02 crore and it registered net profit of Rs. 6.06 crore.

During the year under review, PC Universal Private Limited ceased to be a subsidiary of the Company w.e.f. September 8, 2023 due to issue of additional shares to a third party and consequent increase in its paid-up share capital.

During the year under review, no company has become subsidiary of the Company.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 (the "Act") a statement containing salient features of the financial statements of the subsidiaries (Form AOC - 1) is annexed as "Annexure - 1" to this Report. Please refer Note 56 of the consolidated financial statements for the financial year ended March 31,2024 for the details of contribution of the subsidiaries to the overall performance of the Company. The financial statements of all the subsidiaries are available on the Companys website www.pcjeweller.com in Investors section.

ASSOCIATE AND JOINT VENTURE COMPANIES

The Company do not have any associate or joint venture company within the meaning of Section 2(6) of the Act and no company has become or ceased to be associate or joint venture company during the year.

CONSOLIDATED FINANCIAL STATEMENTS

The consolidated financial statements of the Company have been prepared in accordance with the accounting principles applicable in India including Indian Accounting Standards (IND AS) specified under Section 133 of the Act read with the Rules made thereunder and forms part of the Annual Report.

SECRETARIAL STANDARDS

The Company has complied with the applicable provisions of Secretarial Standards 1 and 2 issued by the Institute of Company Secretaries of India and notified by the Ministry of Corporate Affairs.

COST RECORDS

The Company is not required to maintain cost records as specified under Section 148 of the Act.

STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS

All Independent Directors of the Company have confirmed their independence and submitted declaration of independence with the Company in accordance with the provisions of the Act and LODR Regulations. They have also confirmed that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgement and without any external influence.

BOARD MEETINGS

During the year, 6 Board meetings of the Company were held on May 30, 2023; August 14, 2023; August 22, 2023, November 14, 2023; February 14, 2024 and March 22, 2024 respectively.

AUDIT COMMITTEE

Audit Committee of the Company comprises of 4 Directors including 3 Independent Directors. Dr. Manohar Lal Singla,

Independent Director, is the Chairman of the Committee. For further details, please refer to Report on Corporate Governance.

PUBLIC DEPOSITS

During the year under review, the Company has neither invited nor accepted any deposits from the public under Chapter V of the Act. There was no public deposit outstanding as at the beginning and end of the year under review.

PARTICULARS OF LOANS, GUARANTEES AND INVESTEMENTS

The details of loans given and investments made by the Company are disclosed in the notes forming part of the financial statements. The Company has not provided any guarantee.

PARTICULARS OF CONTRACTS / ARRANGEMENTS WITH RELATED PARTIES

All the related party transactions entered into by the Company during the year under review were on an arms length basis and in the ordinary course of business. The Company had not entered into any contract / arrangement / transaction with related parties, which could be considered as material in accordance with the Companys Policy on Materiality of and Dealing with Related Party Transactions. Hence, disclosure in Form AOC - 2 is not required. The details of transactions with related parties during the year have been disclosed in Note 37 of the standalone financial statements.

PARTICULARS OF TRANSACTIONS WITH ANY PERSON OR ENTITY BELONGING TO PROMOTER / PROMOTER GROUP HOLDING 10% OR MORE SHAREHOLDING

Shri Balram Garg and Smt. Krishna Devi hold more than 10% shares in the Company. The details of transactions of the Company with them during the year under review are as under:

(T in crore)

Particulars	Year ended March 31, 2022
Rent paid:
Shri Balram Garg	0.01
Smt. Krishna Devi	0.03

RISK MANAGEMENT

The Company has put in place a Risk Management Policy to define a framework for identification, assessment, categorisation and treatment of risks and selecting appropriate risk management approach. The Companys outlook in dealing with various risks associated with the business includes the decision on acceptance of risks, avoidance of risks, transfer of risks and risks tolerance level. Pursuant to Regulation 21 of LODR Regulations, the Company has

constituted a Risk Management Committee, which comprises of 3 Directors including 1 Independent Director. For further details on Risk Management Committee, please refer to Report on Corporate Governance.

INTERNAL CONTROL SYSTEMS

The Company has effective internal control systems in place, which ensures that all the assets of the Company are safeguarded and protected against any loss from unauthorized use or disposition. The Company has also put in place adequate internal controls with reference to the financial statements commensurate with the size and nature of operations of the Company. Such controls were tested and test results summary of the testing done based on key controls shown effective controls prevailing within the Company during the year under review.

Internal auditor of the Company also periodically carry out review of the internal control systems and procedures and their reports are placed before Audit Committee for review. There were no significant comments / findings in the reports of Internal auditor during the year under review.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN END OF THE FINANCIAL YEAR AND DATE OF THE REPORT

There have been no material changes and commitments affecting financial position of the Company between end of the financial year and the date of the report except as under:

> State Bank of India ("SBI") filed an application under the Insolvency and Bankruptcy Code, 2016 before National Company Law Tribunal, Delhi ("NCLT"), for withdrawal of its earlier petition on account of the settlement terms agreed between SBI and the Company. Subsequently, NCLT vide its order dated April 30, 2024 allowed SBI to withdraw the petition and dismissed the same as withdrawn.

> The shareholders of the Company in its meeting held on August 8, 2024 approved raising of funds for an aggregate amount of up to Rs. 2,705.14 crore by issuance of up to 48,13,42,500 Fully Convertible Warrants on a preferential basis to the persons belonging to Promoter Group and NonPromoter, Public Category

> Out of the 14 consortium lenders of the Company, 12 lenders have accepted / approved the One Time Settlement proposal submitted by the Company towards settlement of their outstanding debts.

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

A) CONSERVATION OF ENERGY

The Company is committed towards conservation of energy and emphasises on optimal use of energy and avoid wastages at its premises.

B) TECHNOLOGY ABSORPTION

The Company has not carried out any research and development activities.

C) FOREIGN EXCHANGE EARNINGS AND OUTGO

The Companys foreign exchange earnings and outgo during the year were Nil.

DISCLOSURE AS PER SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Pursuant to the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed thereunder, the Company has adopted a policy against sexual harassment. The Company has constituted Internal Complaints Committee for redressal of the complaints on sexual harassment. During the year under review, the Company had not received any complaint on sexual harassment and no complaint was pending as on March 31, 2024.

WHISTLE BLOWER POLICY

The Company has in place a Whistle Blower Policy, which provides a formal mechanism for all the employees and Directors of the Company to report about unethical behaviour, actual or suspected fraud or violation of the Companys code of conduct and leak of unpublished price sensitive information etc. and provides reassurance that they will be protected from reprisals or victimization for whistle blowing.

During the year under review, the Company had not received any complaint under Whistle Blower Policy and no complaint was pending as on March 31,2024. The Policy is available on the Companys website www.pcjeweller.com in Investors section.

BOARD EVALUATION

The Company has in place the Board approved criteria for evaluation of performance of the Board, its Committees and individual Directors. Annual performance evaluation of the Board, its Committees and the Directors is carried out on the basis of evaluation forms, which include a rating mechanism.

The Board carried out annual performance evaluation of its own performance on the basis of evaluation forms received from all the Directors. The performance of each Committee of the Board was evaluated by the Board, based on evaluation forms received from members of the respective Committee. Further, performance of individual Directors (except Shri Suresh Kumar Jain, who ceased to be a Director of the Company during the year under review) was evaluated by Nomination and Remuneration Committee as well as the Board on the basis of evaluation forms received from all the Directors except the Director being evaluated. Independent Directors also reviewed the performance of the Board and NonIndependent Directors at their separate meeting.

The criteria for performance evaluation of the Board and its Committees amongst others include their composition, processes, information and functioning, terms of reference of the Committees, etc. The criteria for performance evaluation of the Directors including Independent Directors amongst others include their contribution at the meetings, devotion of time and efforts to understand the Company, its business, their duties and responsibilities and adherence to the code of conduct, etc.

Based on the feedbacks received, the consolidated report on the performance of the Board, its Committees and individual Directors was placed before the Board. The Board expressed satisfaction over the performance of the Board, its Committees and the Directors.

SIGNIFICANT / MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

No significant / material orders have been passed by the regulators or courts or tribunals impacting the going concern status of your Company and its operations in future. However, during the year under review, State Bank of India ("SBI") filed a petition against the Company with National Company Law Tribunal, Delhi ("NCLT") for initiation of corporate insolvency resolution process. Subsequently, after end of the year under review, pursuant to an application submitted by SBI, NCLT vide its order dated April 30, 2024 allowed SBI to withdraw the earlier petition and dismissed the same as withdrawn.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Act, your Directors confirm that:

a) in the preparation of the annual accounts, the applicable accounting standards had been followed and there were no material departures from the same;

b) the Directors 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 profit and loss of the Company for that period;

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

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

e) 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; and

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

EMPLOYEE STOCK OPTION PLAN

With the objective of retaining talent and reward loyalty, the Company has in place PC Jeweller Limited Employee Stock Option Plan 2011 ("ESOP 2011"). ESOP 2011 is in compliance with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021. During the year under review, no changes were made in ESOP 2011.

The disclosure relating to ESOP 2011 as required under the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 is available on the Companys website and can be accessed through the link https://corporate.pcjeweller.com/wp-content/ uploads/201 5/06/investors/downloads/FY-2025/Others/ ESOP-Disclosure-under-the-SEBI-SBEB-&-SE-Regulations-2021. pdf. The certificate of secretarial auditor with respect to the implementation of ESOP 2011 will be available for inspection by Members during the 19^th AGM.

POLICY ON DIRECTORS APPOINTMENT & REMUNERATION AND CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES & INDEPENDENCE OF A DIRECTOR

Nomination & Remuneration Policy of the Company is designed to identify the persons for appointment as Director(s) and who may be appointed in Senior Management including Key Managerial Personnel ("KMP") as well as determining the remuneration of the Director, KMP and other employees and to attract, motivate and retain manpower by creating a congenial work atmosphere, encouraging initiatives, personal growth and team work by creating a sense of belonging and involvement, besides offering appropriate remuneration packages.

The objective of Policy on Criteria for determining Qualifications, Positive Attributes and Independence of a Director is to define the criteria for determining the qualifications, positive attributes and independence of a Director.

No changes have been made in both the policies during the year. Both the policies are available on the Companys website and can be accessed through the link https://corporate.pcjeweller.com/ codes-policies/

MANAGEMENT DISCUSSION AND ANALYSIS

As per LODR Regulations, Management Discussion and Analysis Report forms part of the Annual Report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

As per LODR Regulations, Business Responsibility and Sustainability Report forms part of the Annual Report.

DIVIDEND DISTRIBUTION POLICY

In terms of Regulation 43A of LODR Regulations, the Company has in place a Dividend Distribution Policy. The Policy is available on the Companys website and can be accessed through the link https://corporate.pcjeweller.com/wp-content/uploads/2015/06/ investors/corporate-governance/Dividend-Distribution-Policy. pdf

ANNUAL RETURN

In accordance with Section 92(3) of the Act read with the Companies (Management and Administration) Rules, 2014, Annual Return is available on the Companys website and can be accessed through the link https://corporate.pcjeweller.com/ annual-return/

AUDITORS AND THEIR REPORTS STATUTORY AUDITORS

During the year under review, M/s Arun K. Agarwal & Associates, Chartered Accountants (Firm Registration No. 003917N) (hereinafter referred to as "AKA") resigned as statutory auditor of the Company on August 14, 2023 (after issue of Limited Review Reports on financial results of the Company for the quarter ended June 30, 2023) on the ground of economic viability.

Thereafter, on the recommendation of Audit Committee, the Board of the Company approved the appointment of M/s A H P N & Associates, Chartered Accountants (Firm Registration No.

009452N) (hereinafter referred to as "AHPN") as statutory auditor of the Company w.e.f. August 22, 2023 to fill the casual vacancy caused by the resignation of AKA and to hold the office till the conclusion of the 18^th AGM and for further 5 consecutive years from the conclusion of the 18^th AGM till the conclusion of the 23^rd AGM and the same was approved by Members of the Company at the 18^th AGM.

The notes to the financial statements referred to in statutory auditors report are self-explanatory and do not call for any further explanations or comments. However, the explanations or comments of the Board on the qualification, reservation or adverse remark or disclaimer made in statutory auditors report are as under:

1) Para 4 (i) of Independent Auditors Report regarding providing of discounts of T 513.65 crore to export customers during the financial year ended March 31, 2019

The management had extended the discounts as on March 31,2019 to its overseas buyers in view of the genuine business problems and operational issues being faced by them. The discount extended amounted to one-time discount of 25% of the export value of outstanding receivables as on March 31, 2019. The discount extended was in accordance with the FED Master Direction No. 16/2015-16 dated January 1, 2016 issued by the Reserve Bank of India. Subsequently, the Company had obtained approvals from Authorized Dealer Banks for reduction in the receivables corresponding to discounts amounting to Rs. 330.49 crore and approval for the balance amount i.e. Rs. 183.16 crore is under process. The discount extended was in accordance with the aforesaid Master Direction and the management does not expect any material penalty to be levied and therefore no provision for the same has been recognized in the financial statements.

2) Para 4 (ii) of Independent Auditors Report regarding adequacy of the provision of expected credit loss relating to overdue overseas trade receivables and its consequential impact and adjustments on the standalone financial statements

The Company has computed and applied cumulative expected credit loss on the outstanding export receivables of Rs. 263.68 crore as on March 31, 2024 and the same is in accordance with the laid down accounting norms. The Company is exploring various options for recovery of its overseas trade receivables and is confident of the recovery of the same.

3) Para 4 (iii) of Independent Auditors Report regarding inventory value and its consequential impact and adjustments on the standalone financial statements

Debt Recovery Appellate Tribunal, Delhi has stayed the ex- parte order of seizing the inventory passed by Debt Recovery Tribunal, Delhi ("DRT"). However, the inventory lying at few locations of the Company is still under the custody of DRT and the matter is sub-judice. But given the nature of the Companys inventory, it does not envisage any adverse impact of the on-going litigations on the net realizable value of the inventory.

4) Para 5 of Independent Auditors Report regarding material uncertainty related to going concern

The Company is optimistic about resolving pending legal issues with its lenders amicably soon and believe that its status as a going concern remains intact.

5) Para ii (a) of Annexure - A to Independent Auditors Report regarding physical verification of inventory lying at few locations

The Auditors observation is a statement of fact and the management does not have anything further to comment on the same.

6) Para ii (b) of Annexure - A to Independent AuditorsReport regarding variances in quarterly returns or statements filed with the banks with the books of accounts of the Company

As compared to the total value of the Companys inventory, the variances in the value of inventory are almost negligible and have arisen only due to minor corrections during finalization of the financial statements.

Statements for the quarter ended March 2024 were submitted by the Company after issue of Independent Auditors Report on the standalone financial statements.

7) Para iii (c), (d) and (e) of Annexure - A to Independent Auditors Report regarding loans / advances granted by the Company

The Company has in earlier years granted loans for business purposes to its two subsidiaries as they do not enjoy any credit facility from any bank / financial institution. However, during the year, the Company has not granted any fresh loans to them. Also there is a reduction in the quantum of these loans during the year. Although there is no specific schedule of repayment, but the loan is to be repaid within specified period from the date of the receipt of each tranche of loan and also carries agreed rate of interest. The provision for impairment of loans has been made in accordance with the laid down accounting norms.

The staff advances have been extended to permanent employees of the Company in the normal course for their personal requirements.

8) Para vii (b) of Annexure - A to Independent Auditors Report regarding arrear of undisputed statutory dues outstanding for a period of more than six months as on March 31, 2024

The liquidity constraints being faced by the Company have delayed the payment. However, as on date the same stands adjusted against the income tax refunds for the assessment years 2015-16 and 2016-17.

9) Para ix (a) of Annexure - A to Independent Auditors Report regarding default in repayment of loans (including interest) to Bankers

The Company is contesting the matter of "default" in various legal fora and this matter is currently sub-judice. However, the Company has taken proactive action in resolving the legal cases by approaching its lenders to resolve the issue of unpaid debt with a One Time Settlement ("OTS") proposal.

As on date, the internal / competent authorities of 12 banks out of 14 consortium members banks have given their acceptances / approval to the Companys OTS proposal.

10) Para xvii of Annexure - A to Independent Auditors Report regarding cash losses incurred

The cash losses are the result of proportionately greater decrease in revenue as compared to the expenses incurred during the year.

11) Para xx (b) of Annexure - A to Independent Auditors Report regarding unspent CSR amount pursuant to ongoing project not yet transferred to special account

The Companys liquidity position had become very constrained after March 2020 on account of lockdowns and frequent disruptions in business due to spread of Covid-19 pandemic. Although, the Company had identified an ongoing project for making requisite CSR expenditure during financial years 2020-21 and 2021-22 but its banking transactions got highly restricted during financial year 202122 causing further liquidity constraints for the Company. Further, the Companys lenders had frozen its bank accounts and have started legal proceedings for recovery of their dues during the year. Hence, the Company could neither spend nor transfer the unspent amount to Unspent CSR Account. However, the Company is committed to meet its CSR obligations after resolution of the banking issues and improvement in the liquidity position.

SECRETARIAL AUDITOR

In accordance with Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company appointed M/s R S Sharma & Associates, Company Secretaries, a peer reviewed firm, as a secretarial auditor of the Company for the year under review.

Secretarial Audit Report is annexed herewith as "Annexure - 2" to this Report. The explanations or comments of the Board on the obserations made in Secretarial Audit Report are as under:

1) Regarding the composition of the Board did not have sufficient number of directors liable to retire by rotation

The Company will do the needful to ensure necessary compliance in due course.

2) Regarding unspent CSR amounts for the financial years 2020-21 and 2021-22 pursuant to ongoing project(s) are not transferred to special account

Please refer to point no. 11 of the explanations or comments of the Board on the qualification etc. in statutory auditors report.

3) Regarding non-disclosures / delayed disclosures of certain events pursuant to the provisions of Regulations 4, 30 and Part A of Schedule III of LODR Regulations and SEBI Circular dated November 21, 2019

The Company has been disclosing the required / relevant information in its quarterly results as well as results presentations. However, to settle the matter amicably relating to the alleged non-compliances, the Company submitted a settlement application with the SEBI under the SEBI (Settlement Proceedings) Regulations, 2018 and subsequently also filed relevant pending disclosures with the exchanges.

DETAILS IN RESPECT OF FRAUDS

Statutory and secretarial auditors of the Company have not reported any fraud under Section 143(12) of the Act during the year under review.

REPORT ON CORPORATE GOVERNANCE

As per LODR Regulations, Report on Corporate Governance forms part of the Annual Report. The Corporate Governance Compliance Certificate from Practicing Company Secretary is annexed as "Annexure - 3" to this Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of the employees of the Company is annexed as "Annexure - 4" to this Report.

CORPORATE SOCIAL RESPONSIBILITY

The Corporate Social Responsibility Policy of the Company lays down the guidelines and mechanism for undertaking socially useful programs for welfare and sustainable development of the community, in the local area and around areas of operations of the Company including other parts of the Country. The Policy is available on the Companys website and can be accessed through the link https://corporate.pcjeweller.com/codes-policies/

The Company was not required to spend any amount towards CSR activities during the year under review because average net profit of the Company as per Section 135(5) of the Act was negative. Annual Report on CSR activities pursuant to Section 135 of the Act and the Rules made thereunder is annexed as "Annexure - 5" to this Report.

OTHER DISCLOSURES

During the year under review:

• There was no change in the nature of business of the Company.

• No issue of equity shares with differential rights as to dividend, voting or otherwise, was made.

• No issue of sweat equity shares to directors or employees was made.

• No Whole-time Director received remuneration from any of the subsidiary(ies) of the Company.

• The equity shares of the Company have not been suspended from trading by SEBI.

• State Bank of India ("SBI") filed a petition with National Company Law Tribunal, Delhi ("NCLT") against the Company under the Insolvency and Bankruptcy Code, 2016 ("IBC

2016"). However, after end of the year under review, SBI filed an application under IBC 2016 before NCLT, for withdrawal of its earlier petition on account of the settlement terms agreed between SBI and the Company. Subsequently, NCLT vide its order dated April 30, 2024 allowed SBI to withdraw the petition and dismissed the same as withdrawn.

The Company had submitted One Time Settlement ("OTS") proposal with its consortium of lenders comprising of total 14 banks. Out of 14 banks, 2 banks have approved the OTS proposal during the year. Further, after end of the year under

review, 10 more banks have approved the OTS proposal till date.

ACKNOWLEDGEMENT

Your Directors would like to convey their sincere gratitude and place on record appreciation for the continued support and co-operation of the Companys customers, suppliers, investors and regulatory authorities. Your Directors also appreciate the commendable efforts, teamwork and professionalism of the employees of the Company at all levels.

For and on behalf of the Board

	Sd/-	Sd/-
Place: New Delhi	(RAMESH KUMAR SHARMA)	(BALRAM GARG)
Date: August 14, 2024	Executive Director	Managing Director
	DIN: 01980542	DIN: 00032083