CONTENTS · 2017-09-28 · experience of our promoters in the gems & jewellery industry. We have also established a leading edge in design and creativity, presence across the jewellery

ANNUAL REPORT 2017TARA JEWELS LIMITED

A YEAR OF BUILDING BRANDS

A Year of Building Brands ... . . . . . . . . . . . . . . . . . . . . . . . . . 01At a Glance.... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 02Our Presence ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 04Our Mission and Vision ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . 05 Our Values .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 06 Our Cherished Clientele .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 07Our Alluring Brands.... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 08Our Presence Across Retailing Models .. . . . . . . . . 09Chairman’s Statement ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10Board of Directors .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Corporate Information ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13Management Team .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14Our Financial Scorecard ... . . . . . . . . . . . . . . . . . . . . . . . . . . . 16Awards & Recognition ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Created Differentiated Jeweller y Brands to Earn Customer Trust .. . . . . . . . . . . . . . . . . . . . 20 Leveraged Advanced Technologies to Produce Customised Jeweller y .. . . . . . . . . . . . . . . . 22Built a Seamless & Secure User Experience.... .24 Management Discussion and Analysis . . . . . . . . . . 26Board’s Repor t .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46Corporate Governance Repor t .. . . . . . . . . . . . . . . . . . . . . 78Independent Auditors’ Repor t .. . . . . . . . . . . . . . . . . . . . 99 Annexure to the Independent Auditors’ Repor t .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101Balance Sheet.... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106Statement of Profit and Loss .. . . . . . . . . . . . . . . . . . . . 107Cash Flow Statement ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108Notes.... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111Consolidated Independent Auditor ’s Repor t 163Consolidated Balance Sheet .. . . . . . . . . . . . . . . . . . . . . 166Consolidated Statement of Profit and Loss .. 167Consolidated Cash Flow Statement.... . . . . . . . . . 168Notes.... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 171 Notice .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 219

CONTENTS

RANDS

A YEAR OF

UILDING

We are an integrated jewellery company and specialty retailers of studded gold, platinum and silver jewellery to upmarket and mid-range departmental stores and regional outlets in the world’s key international jewellery markets. We are backed by a strong pedigree and exclusive designs and strong manufacturing capabilities. Our portfolio comprises a thoughtfully curated assortment of inspiring and stunning designs, showcasing the art of elegance. Our vast library of IP designs includes a core line of jewellery which is timeless across generations and created with unequalled expertise and attention to detail.

Mitigating risks, identifying opportunities and strategising our business model for scaleble growth is an integral part of our global business strategy. We live our mission every day to create a solid and cohesive jewellery brands. Through a portfolio of strong brands, we are seeking new growth opportunities by expanding in the existing markets, adding new geographies and increasing traction in the E-Commerce route. We gain the requisite strength to steer this ahead with the presence of advanced, high-tech equipment at our manufacturing facilities. Our computer-aided design software, 3-D laser printing and patented technologies help us produce the most intricate jewellery designs.

FY2017 was a year of building our brands further in the key markets of the world. As a key strategy to optimise growth, we are moving away from Brick & Mortar stores and realigning our focus more towards Internet-based and Made-to-Order jewellery. We are using digitisation as a platform for conveying information, shaping brand identity and building customer relationships. We are also strengthening our presence by entering into exclusive manufacturing and supply agreements with large jewellery retailers in US, UK, Europe, South Africa and Australia. We are bettering our realisations and embarking on several key initiatives to propel the company towards maximising quality growth and entering into newer dimensions of revenue generation.

We take pride in our well-spread portfolio of studded gold, platinum and silver jewellery. We have been the pioneers in jewellery manufacturing with patented technologies and internationally acclaimed celebrity designers.

___

20 COUNTRIES

PRESENCE ACROSS THE

GLOBE ___

___

20 YEARSEXPERIENCE IN

JEWELLERY INDUSTRY

___

___

07INTERNATIONAL

BRANDS ___

Tara Jewels Limited2

AT A

LANCE

We are an integrated player in the jewellery industry with experience in Designing, Manufacturing and Retailing of jewellery. We are one of the world’s few manufacturers with an indigenously developed manufacturing capability. We take pride in maintaining long-standing relationships with leading global retailers and cater to a diverse audience across 20 countries in 5 continents.

OUR COMPETITIVE EDGES

Annual Report 2016-17 3

Strong hold in manufacturing

Asset light jewellery retail model High precision technology

Supplier to large global retailers

OUR MANUFACTURING CAPABILITIES

1,000Skilled

Craftsmen

80,000 Sq. Ft.Total Area

Under Manufacturing

3Manufacturing

Units

80%Current Installed

Capacity Utilisation

39 Designers

50,000+Designs

120,000Units

Manufactured Per Month

600-700New Designs

Introduced Per Month

INDIA RETAIL

EXPORT

NET SALES IN FY2017 (` MILLION)

12,446.31

3,081.24

DESIGNING MANUFACTURING BRANDED JEWELLERY

HI-END LUXURY JEWELLERY

RETAILING

OUR PRESENCE ACROSS THE VALUE CHAIN


Canada

South Africa

U. K.Europe

China

Australia

India

U. S. A.

AT A GLANCE

OUR GLOBAL PRESENCE

To delight our customers, stakeholders and employees

through excellence in service and design, transparent and clear communication, accountable

commitments and assured rewards.

To be the preferred jeweller to the world


OUR ISSION

OUR ISION

L O R E M I P S U M

EXCEED EXPECTATIONS

Always over deliver.

“SERVICE BEFORE SELF”

Remain customer centric. Educate &

Respect the customer.

CLEAR AND EFFECTIVE COMMUNICATION

Minimise the gap between reality and

perception, through transparency

and clarity.

RELIABLE AND SUSTAINABLE

Through responsible sourcing,

consistent delivery, product quality

and service.

DELIGHT

Customer delight, employee delight

and stake holder delight.

Honour and pride in everything we do.

OUR

ALUES


The largest Global Retailer

No. 1 Off-mall Destination Jeweller

in the US

Largest Online Retailer of Diamonds

Specialty Retail Jewellery chain

in US

No. 1 Specialty Jeweller

in UK

Leading Regional Departmental Store

in South Africa

Leading Chain Store Group in South Africa

Largest SpecialtyJewellery Retailer in the

US, UK and Canada

One of the biggest Mid-Range

DepartmentalStores in US

A Warren Buffett company

No.1 Specialty Jeweller in the US

CHRYST Switzerland


OUR HERISHED

C LIENTELE


OUR LLURING

BRANDS


OUR PRESENCE ACROSS RETAILING MODELS

EXCLUSIVE OUTLETS

PARTNERSHIP WITH LEADING

PLAYERS IN UK, US AND

SOUTH AFRICA

GLOBAL ONLINE JEWELLERY

PLAYER

SPECIALTY JEWELLER WITH

DECADES OF EXPERIENCE

RAJEEV SHETHChairman & Managing Director


HAIRMAN’SLETTER

Dear Shareholders,

On behalf of our Board of Directors, it is a great pleasure to share with you our FY2017 Annual Report. While navigating through a challenging business environment, our management delivered satisfactory performance during the year. We took affirmative steps to deliver sustainable financial performance on a consistent basis.

As the market in US and Europe continued to be tough, we focused on preserving our leadership in the business and on strengthening our capabilities. We managed to maintain industry leading margins

– a testament to the proactive and timely decisions taken by our management team.

A Year of Building BrandsWe maintained a healthy equilibrium as we focused on growing our product lines and improving the existing product assortment. We added new customers and geographies, well supported by our state-of-the-art design, manufacturing and retail capabilities and served diverse markets and continents. With most of our business coming from exports, we aim to become the most endearing, trusted and inspiring house of jewellery brands.


Our single-mindedness lingers on branded jewellery advancing more latitude in the global jewellery market. We are also fortifying our retail trails by leveraging our asset light franchisee model, which is helping us moderate our capital allocation. We continue to scale higher by enriching our aura in the online jewellery market through the E-Commerce model. Our technology and manufacturing capabilities are being capitalised to supply jewellery at affordable price points. We are now fast transforming into a multi-brand jewellery house, supported by several brands targeting different consumer segments.

Our PedigreeWe are an integrated player in the jewellery industry in India, with a portfolio of studded gold, platinum and silver jewellery. We have been the pioneers in jewellery manufacturing with our cutting-edge manufacturing facilities and patented technologies, which have revolutionised low-cost jewellery manufacturing in India. With a range of over 50,000 designs, we cater to a diverse audience across 20 countries in 5 continents. We currently operate our owned stores across metros, Tier 1, 2 & 3 cities. We derive strength from our domain expertise and the experience of our promoters in the gems & jewellery industry. We have also established a leading edge in design and creativity, presence across the jewellery value chain and an established global clientele.

Spearheading a TransformationA vast library of 11,000+ IP designs has converted us into a pivot for jewellery customisation and forerunners in digitisation. We have catalysed a colossal industry transformation by moving away from the archaic way of Brick & Mortar format to Internet-based and Made-to-Order be-spoke jewellery through our low-cost and revolutionary format of retailing branded jewellery. Our advanced, high-tech equipment such as computer-aided design (CAD) software and computer-aided manufacturing (CAM) hardware, such as 3D laser printing and patented technologies enables us advance this technological revolution. Our design team uses the latest technology to produce distinctive, exceptional, elegant, bespoke and intricate jewellery pieces utilising our low-cost format.

We are also experiencing good traction in our overseas business with new customers, geographies

and strong brands. We are gradually engaging in 2nd and 3rd launches of our products due to the growing disposable incomes and rising aspiration levels. With the pattern of online buying rising, jewellery we sell through the e-Commerce route is rising. We have signed exclusive manufacturing and supply agreements with several large jewellery retailers in US, UK and Europe and added design cells in several regions. Our footprint in South Africa and Australia is also surging.

Bullish on Industry GrowthWe continue to take advantage of the industry revolution through our brands and cutomer relationships. We are quite bullish on the growth of organised jewellery. We are embarking on new initiatives to propel the company into newer dimensions of revenue generation. Our strategy continues to be that of growing our cash generating business and strong branding efforts, leading to margin expansion. Our domain expertise in design, coupled with world class manufacturing facilities, puts us in a favourable position to address these challenges.

Going ForwardMoving ahead, we evolved through a long journey transforming us into a business that represents the pinnacle of jewellery design, quality and innovation. We also maintain our standards for governance and transparency for shareholders, investors and stakeholders.

Throughout the year, we continued to take proactive measures to counter macro-economic challenges and implementing key strategic initiatives. This was done with the aim of securing future continuous growth in revenues and net profit. Considering our initiatives and underlying fundamentals, we are in a strong position to continue our long-term growth ambitions.

We thank our customers, shareholders and partners for choosing Tara over the past year. We look forward to delivering exceptional products and sustainable value for them again in the next financial year.

Rajeev Sheth

Chairman & Managing Director


OARD OF DIRECTORS

Mr. Rajeev Sheth is the Chairman and Managing Director of our Company. He holds a graduate degree in Commerce from Mumbai University. He also holds a Diploma in Gemology from Gemological Institute of America. He has approximately 35 years of experience in the jewellery business. He started his career by promoting Rose International and thereafter became the Promoter and Managing Director of Intergold India Limited from 1989 to 1999.

Mr. Sanjay Sethi is Executive Director and CFO of our Company. He is a Chartered Accountant and all-India ranker with 10th rank. He is also a Cost Accountant by profession and Post Graduate from Delhi School of Economics. He is responsible for overall planning and control of finance function. He has more than 27 years of experience with various organisations, in India and abroad.

Ms. Alison Lazerwitz is a Nominee Director (Non-Executive Non Independent) with over twenty five years’ experience with international legal issues, including leading compliance functions, and the development of international corporate integrity initiatives. Alison began her career in Philadelphia, Pennsylvania as a litigator with the law firm, Duane Morris. She then worked in the in-house legal departments of ARAMARK and the Wood Company in the U.S., where she was the company’s General Counsel, reporting to the CEO and to the Board of Directors. In 2002 Alison left the US and spent nine years in Paris working for Sodexo, the international leader in outsourced services. Alison was first the Chief Legal Officer for Sodexo and then the Senior Vice President for International Development. In 2010, Alison joined Swarovski as Executive Vice President and General Counsel. Alison is a member of the Board of Directors of the Women’s Network for a Sustainable Future. Alison’s hobbies include exploring the countryside, different cultures, art, ballet, opera and food.

Ms. Fern Mallis is a Non-Executive Independent Director. She holds a Bachelors Degree of Fine Arts from the University of Buffalo. Ms. Mallis has more than four decades of experience in architecture, design and fashion industries. She has worked with Conde Nast Publications (Mademoiselle Magazine), Fashion Director Gimbel´s East Department Store and Pres Fern Mallis Public Relations. She was the Senior Vice President of International Design Center, New York, the Executive Director of Council of Fashion Designers of America from 1991 to 2001 and the Senior Vice President of IMG Fashion from 2001 to 2010.

Mr. Rajiv Lochan Jain is a Non- Executive Independent Director. He is B. Tech. (Hons.) in Chemical Engineering from IIT, Kharagpur and MBA from the University of New Hampshire, USA. He served as Chief Executive Officer and Managing Director of Akzo Nobel India Limited from April, 2003 to May, 2009. He successfully led the portfolio reshaping of ICI India Ltd. from a diversified chemical Company to a focused and fastest growing player in the paints business. He was also the Chairman of both ICI’s Research Company in India and the joint-venture company of ICI with Orica, Australia. He advises global and local companies on their entry and growth strategies for India and serves as Director on the Board of Gujarat Alkalies and Chemicals Limited and Fresenius Kabi Oncology Ltd.


ORPORATE INFORMATION

COMPANY SECRETARY & COMPLIANCE OFFICERMS. NIVEDITA NAYAK

STATUTORY AUDITORSM/S C. B CHHAJED & CO,

CHARTERED ACCOUNTANTS,

DGP HOUSE,

GROUND FLOOR, 88-C,

OLD PRABHADEVI ROAD,

MUMBAI - 400025

INTERNAL AUDITORSBDO INDIA LLP,

LEVEL 9, THE RUBY,

SENAPATI BAPAT ROAD,

DADAR (WEST),

MUMBAI - 400028

REGISTRAR AND SHARE TRANSFER AGENTSLINK INTIME INDIA PVT. LIMITED,

C 101, 247 PARK,L B S MARG, VIKHROLI WEST,

MUMBAI - 400083

BANKERS• STATE BANK OF INDIA

• PUNJAB NATIONAL BANK

• UNION BANK OF INDIA

• STATE BANK OF PATIALA

• CENTRAL BANK OF INDIA

• BANK OF INDIA

• AXIS BANK

• IDBI BANK

• EXIM BANK

• CORPORATION BANK

• CANARA BANK

• VIJAYA BANK

REGISTERED OFFICEPLOT NO. 122, 15TH ROAD, NEAR IDBI

BANK, M.I.D.C, ANDHERI (EAST), MUMBAI-400093

CORPORATE OFFICEPLOT NO. 29 (P), & 30 (P), SUB PLOT A,

SEEPZ SEZ, ANDHERI (EAST),

MUMBAI - 400096

CIN NO: L52393MH2001PLC 131252

OUR MANUFACTURING PLANTSa. Plot No. 122, 15th Road,

Near IDBI Bank, M.I.D.C, Andheri (East),

Mumbai - 400093

b. Plot No. 29(P), & 30(P), Sub Plot A,

SEEPZ SEZ, Andheri (East),

Mumbai - 400096

c. Unit No. GJ-7, SDF VII, SEEPZ SEZ,

Andheri (East), Mumbai - 400096


OUR ANAGEMENT

TEAM

Mr. Ravindran M.P is Chief Operating Officer of

our Company. He holds a Post Graduate Degree

in Computer Science and Masters in Business

Administration in Systems Management from Mumbai

University. He is in charge of customer service,

trading and outsourcing operations in our Company.

He has approximately 26 years of experience in the

areas of jewellery and engineering.

Mr. Tateos Tateossian is the Group Senior Vice

President – Operations. He holds Bachelor’s Degree

in Electronics Engineering from Kliment Ohridski,

Bulgaria. He joined the Company on July 13, 2009.

He is responsible for planning, production and

quality assurance. He has approximately 40 years of

experience in the field of jewellery manufacturing.

Mr. Sajid Salim Sakarwalla is the Vice President

– Diamond Procurement. A Graduate Diamond

from Gemological Institute of America, he is also

certified as an Accredited Jewellery Professional from

GIA. He holds a Graduation Degree in Commerce

from Mumbai University and aMastersDegree

in Management Studies (MMS-Finance) from

NarseeMonjee Institute of Management Studies,

Mumbai University. He joined the Company on

October 11, 2002 and is in charge of the overall

diamond division.

Ms. Aarti Sheth Cooper is the Vice President -

Business Development (exports division) of our

Company. She holds a Bachelor of Science degree

in International Business and Marketing from Drexel

University;Masters of Science degree in international

employment relations; and Human Resource

Management from London School of Economics.

She is responsible for overall sales review, business

development and strategic alliances management of

the institutional retail clients in U.S. She also plays an

active role in managing product development for all

the US markets.

Mr. Rajesh Kumar Gupta, is the General Manager

Accounts and Costing. He is a qualified Chartered

Accountant and ICWA. He has approximately 23 years

of experience in the field of accounts and costing.

Mr. Chander Gurnani is the General Manager-

Finance. He is a qualified Chartered Accountant,

responsible for managing finance and tax matters

of the Company. Hehas approximately 17 years of

experience in the field of accounts and finance.


Mr. Pravin Patil is the General Manager-Human

Resources and Administration. He holds a Master’s

Degree in Labour Studies and Graduation in Law

from Mumbai University. He is responsible for human

resources and administrative division of the Company.

Mr. Patil has approximately 25 years of experience

in the area of human resource and administration in

hospitality and jewellery industry.

Mr. Vishal Adhyapak is the General Manager-

Information Technology of the Company. He holds

a Diploma in Mechanical Engineering from Mumbai

University. He is in charge of information technology

division of the Company. He has approximately 16

years of experience in the field.

Mrs. Nivedita Nayak is the Company Secretary

and Compliance Officer. She is fellow member of

the Institute of Company Secretaries of India. She

also holds degree in Bachelor of Law and Bachelor

of Commerce from Mumbai University. She is

responsible for handling all the Company Secretarial

and Legal matters. She has experience of around 7

years in the field of Secretarial and Legal.

INTERNATIONAL BUSINESS Mr. Jeffrey Shlakman is the President-Merchandising

and product development of our Company. He

holds a Degree in Architecture and graduated from

The Cooper Union. He is responsible for providing

creative direction to the design and merchandising

team. He also has direct sales responsibilities. He

has 35 years of experience in diamond and jewellery

manufacturing business.

SUBSIDIARY COMPANY Mr. Nilesh J. Agashiwala joined Fabrikant-Tara

International LLC, Tara’s USA division, as their Chief

Financial Officer in 2015. Mr. Agashiwala has over

27 years of experience working with variety of

companies, including jewelry wholesaler, private

equity, public accounting firms. Mr. Agashiwala holds

a bachelors degree in Finance and Economics from

the University of Mumbai, India, and is currently

pursuing his CPA designation.

Ms. Ambica Singh is the Chief Operating Officer

of our subsidiary Fabrikant Tara International LLC.

She has over 31 years of experience in increasingly

responsible roles within the jewelleryindustry. As

the Chief Operating Officer, Ambica is responsible

for the overall leadership of the FTI office and its

performance and staff, along with key productivity

areas such as inventory control, dilution monitoring

and identifying efficiencies and savings.

Mr. Stuart Marcus is the Vice President-Sales of

our Subsidiary Fabrikant-Tara International LLC. He

holds a Bachelor of Arts degree in Marketing from

the Northeastern University, Boston. He is responsible

for diamond fashion and bridal sales to many of

our accounts. He has approximately 32 years of

experience in jewellery and four years in table top

merchandise.


OUR INANCIAL

SCORECARD

FY2013

1,63

5.45

1,69

5.40

1,73

5.30

1,80

1.31

1,55

2.76

FY2014 FY2015 FY2016 FY2017

FY2013

50.3

8

73.6

7

43.6

25.4

4

-4.6

2

FY2014 FY2015 FY2016 FY2017

NET SALES (` Crore)

PROFIT AFTER TAX (` Crore)


EARNINGS PER SHARE (`)

FY2013

20.4

8

35.7

3

17.7

3

10.3

3

-1.8

8

FY2014 FY2015 FY2016 FY2017

FY2013

153.

4

157.

6

158.

6

124.

37

101.

68

FY2014 FY2015 FY2016 FY2017

EBITDA (` Crore)

FY2013

16

1311

86

FY2014 FY2015 FY2016 FY2017

ROCE (%)

BOOK VALUE (`)

FY2013

201 21

9 237

248

242

FY2014 FY2015 FY2016 FY2017


We always endeavour to deliver the best results to our customers. Our achievements have been encouraged and recognised through various awards and accolades we have received in several categories over the years.

WARDS & ECOGNITION

Highest Export Performance Award for 2009 - 2010

Highest Export Performance Award for 2008 - 2009

Highest Export Performance Award for 2007- 2008

Highest Net Foreign Exchange Earner” Award for 2009 - 2010

Second Highest Net Foreign Exchange Earner” Award for 2008 - 2009

Second Highest Net Foreign Exchange Earner” Award for 2007 - 2008


The second highest exporter of studded jewellery for the year 2008 - 2009

The second highest exporter of studded jewellery for the year 2007 - 2008

The “Global Supplier of the Year” Award for 2007 from Walmart

Awarded “LUXURY RETAILER OF THE YEAR” at the Star Retailer Awards 2013

Nominated for the Best 360 Marketing of the Year 2012

The Best Store Design of the Year - Single Brand category at the ET Retail Awards 2013

Awarded “Print Campaign of the Year 2012”

z Global Supplier of the Year Twice Awarded by Walmart

z Overall Excellence Award Second highest exporter in the category of studded precious metal jewellery exports in EPZ, by The Gem and Jewellery Export Promotion Council in year 2007, 2008 and 2009

z Conferred with “Star Trading House” status - By the Ministry of Commerce & Industry and have been the highest exporter in gems and jewellery sector for the years FY2009 and FY2010

INTERNATIONAL BUSINESS

CREATED DIFFERENTIATED JEWELLERY BRANDS TO EARN

CUSTOMER TRUST

We aim to become the most endearing, trusted and inspiring house of jewellery brands. Our elegant, innovative and differentiated jewellery brands are created by our dedicated and talented team and well supported by state-of-the-art design, manufacturing and retail capabilities. We continue to grow our product lines by launching new categories, collections and continuing to drive premium pricing through innovation.

We are a specialty retail

jewellery store brand

targeting customers, style

seekers and influencers. We

provide affordable, high

quality and tasteful jewellery

to specialty retail jewellery

store chains and care about

our merchandise brands. Our

vision is to connect with our

customers through our brands

and earn their trust.

Fashion jewellery is critical

to our business. Our aim is

stronger engagement, loyalty

and trust in our brands. We

want to be the destination

for any type of jewellery and

want to make every guest

think about our brands

when they first enter the

jewellery marketplace. We are

focussed more on fashion-

oriented products and identify

fashion trends in jewellery at

affordable price points.

Creating a Strong PortfolioWe are vertically integrated

with presence in all parts of

the diamond supply chain with

our manufacturing facilities

in India. We constantly live

our mission to create solid

and cohesive jewellery brands.

Through our portfolio of strong

brands, we seek new growth

opportunities by expanding

in the existing markets,

adding new geographies and

increasing traction through the

E-Commerce route.

Leveraging Social MediaOur core strategy is to be the

“best-in-class” in the digital

ecosystem as we reach out to

our customers through the

E-Commerce and social media

touch-points. We are using

digitisation as a platform for

conveying information, shaping

brand identity and building

customer relationships. We

are bettering our realisations

and embarking on several

key initiatives to propel the

company towards maximising

quality growth and entering

into newer dimensions of

revenue generation.


O U R B U S I N E S S S T R AT E G I E S D U R I N G T H E Y E A R U N D E R R E V I E W

OUR KEY STRENGTHS

Robust brands

Select merchandise

Excellent customer service

Resilient supply chain

High-quality manufacturing

Advertising efficiency


TIMELESS ACROSS GENERATIONS

We work continuously on implementing new product initiatives, new collection and innovative technologies to continue winning more consumers. Our vast library of IP designs includes a core line of jewellery which is timeless across generations and created with unequalled expertise and attention to detail. As a key strategy to optimise growth, we are moving away from Brick & Mortar stores and realigning our focus more towards Internet-based and Made-to-Order jewellery. We sell our products across countries through a network of exclusive and non-exclusive distributors, wholesalers and retailers.


LEVERAGED ADVANCED TECHNOLOGIES TO PRODUCE

CUSTOMISED JEWELLERY

We are backed by a strong pedigree of exclusive designs, manufacturing capabilities and high-tech equipment. Digitisation in design manufacturing through CAD/CAM and 3D printing machines led us to produce customised jewellery at competitive rates.

Our manufacturing facilities

enable us efficiently design

and produce a wide variety

of unique products to meet

the evolving needs of our

customers. Our portfolio

comprises of a thoughtfully

curated assortment of

inspiring and stunning

designs, showcasing the art of

elegance.

We operate more than 80,000

sq. ft. of manufacturing space

through 3 manufacturing

units, employing over

1,000 experienced gold and

diamond jewellery craftsmen,

which gives us a competitive

position in the industry. We

gain the requisite strength

to steer this ahead with

the presence of advanced,

high-tech equipment at our

manufacturing facilities.

Advanced and Patented TechnologiesWe use advanced, high-

tech equipment such as

computer-aided design (CAD)

software and computer-

aided manufacturing (CAM)

hardware, such as 3D laser

printing and patented

technologies. This helps us

move towards Made-to-Order

bespoke jewellery through our

low-cost format and producing

the most intricate jewellery

designs. Our design team

uses the latest technology

to produce distinctive,

exceptional, elegant and

intricate jewellery pieces.

We are bringing about

a transformational and

tectonic shift in the way

jewellery is being designed

and manufactured. We are

pioneering the revolution

through our cutting-edge

manufacturing technology and

our vast library of IP designs.

We have over 1,000 craftsmen

producing 600-700 different

jewellery models every month

in gold and studded diamond

jewellery. We have signed up

manufacturing and supply

agreements with independent

and specialty retailers in US,

UK and Europe.



BUILT A SEAMLESS AND SECURE

USER EXPERIENCE

E-Commerce is an important touchpoint of our business strategy. We reach out to our customers through the E-Commerce route to create a seamless and secure user experience. We are engaging with them on a platform that they are most comfortable with. Moving ahead, we expect online sales to account for a significant portion of our sales.

We live in an age where online

buying has become the norm.

Our jewellery sold through

the E-Commerce platform is

growing. We have tied up with

reputed E-Commerce and

online portals including

Amazon, Velvet Case, and

Shoppers Stop as part of

our endeavour to offer our

jewellery online globally. We

also sell our jewellery through

our online platform - Tara

Jewellers Online.

Our objective behind this is

to participate in the broader

trends in jewellery retailing,

besides catering to our global

network of retail outlets and

jewellery stores. A major driver

to get our jewellery online

is to cater to the changing

consumer behavior, especially

of young Indian women who

are exposed to global trends

and are increasingly shopping

online.

Jewellery retailing allows

companies, such as ours, to

offer our customers a wider

choice of designs, without

actually keeping the physical

stocks. For the customers,

it replicates the comfort

and convenience associated

with shopping at the luxury

showrooms. It offers customers

the jewellery of their choice

delivered at home for trial

at no cost. Online retailing

enables us to offer our

customers the convenience

to place an order from the

comforts of an individual’s

home. There are other

incentives such as giving the

customer time to decide and

not making it obligatory for

customers to purchase at the

very first visit.

Riding the Industry WaveWe wish to capture a share

of the growing online retail

market in India, which is

projected to touch US$ 22

billion by 2018, with free

delivery and heavy discounting,

as per an estimate by CLSA

Asia Pacific Markets. The

global jewellery market is

expected to touch US$ 257

billion in 2017. Growth in

the global jewellery market

is being fueled by the shift

to the E-Commerce, with the

global online jewellery market

accounting for 4% to 5% of

this and expected to capture

10% of the market by 2020.

Online fashion jewellery sales

is projected to take an even

bigger slice, capturing 15% of

the market by 2020.

The online jewellery market

is experiencing tremendous



growth in Asia, in particular,

where it witnessed a CAGR of

62.2% during 2011 to 2014.

As global luxury E-Commerce

approaches a tipping point,

the luxury category’s share of

online sales is seen doubling

from 6% to 12% by 2020,

and accounting for 18% of

the luxury sales to be made

online by 2025, making online

luxury sales worth about US$

80 billion annually. This growth

has resulted in established

jewellery retailers to

move online.

Winning with Gen-YWith an increased online

presence, we are trend-setting

across generations by catering

to the needs and tastes of

Generation X, Y and Z, who

prefer buying jewellery online.

We continue to innovate

into winning trends and

categories and emphasise

winning with the Gen-Y

through our products

and channels. Besides

our scalable business

model and expansion in

the overseas markets, our

increased online presence in

propelling future growth.



INDIA ECONOMIC OVERVIEWIndia remains the fastest growing large developing economy,

as it benefits from strong private consumption and the

gradual introduction of significant domestic reforms,

according to a United Nations report. India has positioned

itself as the most dynamic emerging economy among the

largest countries. India’s economy grew by 7.1% in FY2017,

slower than 8% recorded in the previous year and equal to

CSO’s estimate of 7.1%. Real GDP growth in the first half

of FY2016 was 7.2%, on the weaker side of the 7.0% to

7.75% growth projected by the Economic Survey of 2015-16

and the projection of 7.4% in the Economic Survey of

2016-17. It is expected to remain the fastest growing

economy on the back of high private consumption levels and

gradually implemented domestic reforms.

Having sunk to its lowest level in the past five years in

January 2017, Consumer Price Inflation (CPI) in India

averaged at 4.7% during FY2017 with an increasing pressure

on food as well as the uptick in global oil and commodity

ANAGEMENT ISCUSSION

& NALYSIS

India has positioned itself as the most dynamic emerging economy among the

largest countries. Its economy grew by 7.1% in FY2017, slower than 8% recorded

in the previous year and equal to CSO’s estimate of 7.1%.

___

7.1%India’s

Economic Growth in

FY2017 ___


rates. The sharper-than-expected fall in inflation over the past

few months has already started correcting as remonetisation

gained currency. According to Crisil, CPI inflation is seen

averaging at 5% in FY2018, 30 basis points higher than that

in FY2017. The Reserve Bank of India has raised its inflation

projection for FY2018, expecting the index to average 4.5%

in the first half and 5.0% in the second half, taking it above

its medium-term target.

Against this backdrop of robust macro-economic stability, the

year was marked by two major domestic policy developments

– the passage of the transformational Goods and Services

Tax (GST) by both Houses of Parliament implemented on

July 1, 2017; and the action to demonetise the two highest

denomination notes. The GST will create a common Indian

market, improve tax compliance and governance, and boost

investment and growth. This is a bold new experiment in the

governance of India’s cooperative federalism.

Demonetisation has led to short-term costs on industries

dealing predominantly in cash, severely impacting them in the

first few months, but still holds the potential for long term

benefits. These benefits will allow growth to return to trend

in 2017-18.

Benefits of Demonetisation:

• Transition from unorganised to organised sector

• Less usage of cash for transaction among the major

countries as India has one of the highest usage of cash

• Greater tax compliance


INDUSTRY OVERVIEWGems & Jewellery - GlobalThe global gems & jewellery industry is seen becoming a

US$ 443 billion industry by 2022. This is on account of the

booming tourism industry, establishment of a large number

of exclusive showrooms by leading players, and rising

online availability of gems & jewellery. Demand for gems &

jewellery across the globe is dominated by Asia-Pacific and

North America. Expanding urbanisation, changing lifestyles,

growing E-Commerce sales, rising presence of organised retail

channels, growing number of premium product launches and

synchronised distribution networks is projected to drive the

global jewellery market during the forecast period. Demand

for diamond in gold, platinum, gemstones and pearl jewellery

has always been high, regardless of prices, globally. Further,

major players operating in global gems & jewellery market are

changing their product portfolios and increasing their focus

on making customised jewellery, as per consumer demands.

Advancements in jewellery making process, along with

availability of a range of certification bodies such as

Kimberly Process Certification Scheme and Bureau of Indian

Standards (BIS) hallmarking are anticipated to pump growth

in the global market in the coming years. Asia-Pacific is

also emerging as the fastest growing market across the

globe, on account of high demand from India, China,

Vietnam, Thailand, Japan and Indonesia. High demand for

gems & jewellery in the region can also be attributed to

rising disposable incomes, and aggressive marketing and

promotional strategies by leading players.

Global Market - Trends & Developments:

• Growing Use of 3-D Jewellery Printing

• Increasing Demand for Smart Wearable Jewellery

• Changing Preferences of Youth Population

• Rising Demand for Branded Jewellery

• Technological Advancements in Jewellery Manufacturing

• Growth in Organised Retail Formats and E-Commerce

• Emergence of New Product Categories

• Aggressive Marketing and Promotional Strategies


Gems & Jewellery - IndiaThe Gems & Jewellery sector plays a significant role in the

Indian economy, contributing around 6% to 7% to India’s

GDP. India is the 2nd largest consumer of gold jewellery in

the world, with a 29% share of the total global demand

for gold jewellery. Gold jewellery makes up for about 80%

of India’s ` 3,00,000-crore Gems & Jewellery market. India

is the world’s largest gold consumer and imports a sizeable

chunk of its total annual consumption of around 900-1,000

tonnes. It is one of the fastest growing sectors and extremely

export oriented and labour intensive. The gems & jewellery

sector in India is home to more than 500,000 players. India

is one of the largest exporters of gems & jewellery and

the industry is considered to play a vital role in the Indian

economy as it contributes a major chunk to India’s foreign

exchange earnings. UAE, US, Russia, Singapore, Hong Kong,

Latin America and China are the biggest importers of Indian

jewellery. India exports about 95% of the world’s diamonds,

as per statistics from the Gems & Jewellery Export Promotion

Council (GJEPC). According to a report by Research and

Markets, the jewellery market in India is expected to grow at

a Compound Annual Growth Rate (CAGR) of 15.95% over

the period 2014-2019.

A FICCI AT-Kearney study projects the Indian jewellery market

to touch close to US$ 85 billion or ` 5,30,000 crore by

2018. According to India Retail Report 2015, total jewellery

retail market is worth ` 2,01,344 crore (US$ 33.56 billion)

growing at 24-26% and is expected to touch ` 383,000 crore

(US$ 63.87 billion) by 2017. Modern retail is estimated at

10% of the total market and is expected to grow by a little

under 22%. The jewellery market in India is expected to see

reasonable growth in the coming years.

The Indian government presently allows 100% Foreign

Direct Investment (FDI) in the sector through the automatic

route. The cumulative Foreign Direct Investment (FDI)

inflows in diamond and gold ornaments in the period April

2000-September 2016 were US$ 851.34 million, according

to Department of Industrial Policy and Promotion (DIPP). The

Government has recently undertaken various measures to

promote investments and to upgrade technology and skills

to promote ‘Brand India’ in the international market. India is

deemed to be the hub of the global jewellery market because

of its low costs and availability of high-skilled labour. India is

the world’s largest cutting and polishing centre for diamonds,

with the cutting and polishing industry being well supported

by Government policies.

Gems & Jewellery TradeBased on its potential for growth and value addition, the

Government has declared the Gems & Jewellery industry as

a thrust area for export promotions. India’s Gems & Jewellery

industry is expected to grow from the present US$ 41,833

Mio (` 251,000 Crore) to US$ 88,333 Mio (` 530,000 Crore)

by 2018. The overall net exports of Gems & Jewellery during

April-December 2016 stood at ` 175,879.24 crore

(US$ 26.28 billion), whereas exports of cut and polished

diamonds stood at ` 113,171.17 crore (US$ 16.91 billion).

Exports of gold coins and medallions was ` 25,819.48 crore

(US$ 3.86 billion) and silver jewellery export was ` 18,010.72

crore (US$ 2.69 billion). According to the Gems & Jewellery

Export Promotion Council (GJEPC), the apex industry body,

the export of gems and jewellery is likely to witness a growth

of about 10% during FY2017 due to increasing demand from

US and Europe.

Jewellery ExportsExports of gems & jewellery grew 9.5% to about US$ 29

billion during April-January 2016-17, compared to US$ 26.5

billion during April-January period of FY2016. Demand was

driven largely by demand in India's major markets, such as

the US. This was higher than exports of US$ 26.5 billion

INDIA’S GEMS & JEWELLERY INDUSTRY IS EXPECTED TO GROW FROM US$ 41,833 MIO (` 251,000 CRORE) TO US$ 88,333 MIO (` 530,000 CRORE) BY 2018. THE OVERALL NET EXPORTS DURING APRIL-DECEMBER 2016 STOOD AT ` 175,879.24 CRORE (US$ 26.28 BILLION).


registered during April-January period of FY2016, according

to the data from GJEPC. Gems and jewellery contribute

about 14% to India’s overall exports. Rise in export shipments

were mainly supported by cut and polished diamonds, which

stood at US$ 18.5 billion during the period, as compared to

US$ 16.5 billion a year ago. Export of silver jewellery grew

by 20% to US$ 2.94 billion during the period of last fiscal.

Overall exports of silver started registering positive growth

and was the main contributor in gems & jewellery shipments.

Shipments of gold jewellery, however, contracted to US$ 3

billion during the period under review, from US$ 3.13 billion

a year ago. Exports of gold medallion and coins too dipped

to US$ 4.32 billion in April-January 2016-17. GJEPC estimates

India's gems & jewellery exports to move up by 10% for

FY2018.

Value of Gems & Jewellery Exports from India (In US$ Million)

February 2016 3,378.28

March 2016 2,507.71

April 2016 2,741.51

May 2016 2,893.65

June 2016 2,773.90

July 2016 2,479.25

August 2016 3,033.30

September 2016 3,419.37

October 2016 4,167.57

November 2016 1,684.37

December 2016 2,611.27

January 2017 2,663.86

February 2017 3,451.72

YoY Growth in Export of Gems & Jewellery from India (In US$ Billion)

Year Export Value

FY2005 15.66

FY2006 16.70

FY2007 17.16

FY2008 20.92

FY2009 24.89

FY2010 29.44

FY2011 43.05

FY2012 43.21

FY2013 39.14

FY2014 34.99

FY2015 36.22

FY2016 32.63

FY2017 35.55

Source: GJEPC

India's gems & jewellery exports jumped by 8.95% for

financial year 2016-17 on recovery in demand from the

United States (US), Hong Kong and the United Arab Emirates

(UAE). The three destinations account for over 75% of

India's overall shipment of precious ornaments by value. Data

compiled by GJEPC showed India's net exports of gems &

jewellery at US$ 35.55 billion (` 238,252.79 crore) for the

financial year 2016-17, compared with US$ 32.63 billion (`

213,871.29 crore) for the corresponding period

last year.

EXPORTS OF GEMS & JEWELLERY GREW 9.5% TO ABOUT US$ 29 BILLION DURING APRIL-JANUARY 2016-17, WITH DEMAND BEING DRIVEN LARGELY BY DEMAND IN INDIA’S MAJOR MARKETS, SUCH AS THE US.


US – Key Demand Driver for India ExportsThe US economy is on a revival path after witnessing a

slowdown in the past few years. The consumer sentiment has

turned positive and buyers have started coming to the market

for the purchase of new jewellery. Apart from US, jewellery

demand also moved up in Hong Kong and the United Arab

Emirates. While Hong Kong reported increase in jewellery

demand for their supply to China and other destinations

in the north east, demand from UAE rose despite the 5%

import duty levied by the Government in the region. In UAE,

local consumption of jewellery was impacted due to a decline

in crude oil prices (being majorly oil driven economies). Re-

routing of exports to the African and European countries

will not get impacted due to duty levy. Meanwhile, cut and

polished diamonds contributed around 60% of India's overall

exports of precious metals and stones. While exports of gold

jewellery jumped by a marginal 1.92% to US$ 8.7 billion

for 2016-17, shipment of coloured gemstones declined by a

marginal 3% to US$ 419.9 million.

Organised Jewellery Segment in IndiaWhile the overall retail Gems & Jewellery sector is growing by

10% annually, the organised retail segment has been expanding

by 30% to 40% in recent years. Currently, the organised

segment accounts for 22% of the total market. The unorganised

segment, primarily comprising local and independent stores,

makes up for 78% of the retail Gems & Jewellery market.

With changing lifestyles and growing disposable incomes, the

outlook and buying patterns of consumers in the recent years

have changed rapidly. Indian consumers now demand greater

transparency, better service and a more compelling value

proposition driven by brand and fashion.

The Indian retail sector is growing rapidly and this growth

is significantly driven by large retailers and brands. The

leading brands are pulling the organised market and are

opening opportunities to grow. The large brands are also

increasing their reach at a fast pace through setting up of

retail showrooms, on-line sales portals and franchise routes,

especially in Tier 1 & 2 cities. These players are also offering

a variety of discount schemes including financing schemes to

consumers to further boost sales. Future growth outlook for

the sector looks reasonably robust. However, competition is

expected to be stiff and very consumer centric. Besides this,

there are challenges posed by the unorganised sector which

still account for more than 80% of the market.

India’s branded Gems & Jewellery Sector is facing competition

with the entry of branded players. Branded jewellery players,

with their own manufacturing set-ups, pan-India network of

showrooms, strong online presence and access to funds at

relatively cheaper rates pose a challenge for smaller players with

less number of operational showrooms and no funding support.


Branded Jewellery – On the RiseConsumers are beginning to move towards branded

jewellery and are willing to pay a justified premium for high

quality and inventive designs. As a consequence, the share

of the organised segment has grown substantially. In the

past decade, India witnessed the emergence of organised

and branded players. The share of branded jewellery

increased from 20% to nearly 35% and is expected to grow

strongly. The growth of organised sector is also aided by

the emergence of large organised jewellery manufacturers

who serve the rapidly growing organised retail industry. The

curated collection in branded jewellery ranges from daily

wear such as light weight necklace sets, rings, pendants,

earrings, bangles to more occasion-related exclusive designs.

These are targeted at young consumers looking for chic

gifting options for special occasions such as Anniversaries,

Birthdays and Valentine’s Day. Branded jewellers are more

equipped than the local organised players to appease

consumers’ growing demand for design innovation and

variety. An increase in disposable incomes has also been

an important factor for an increase in sales of jewellery. In

India, customised jewellery is a niche market and is showing

significant growth year-on- year and would likely take

precedence in the near future.

Change in Consumer PreferencesThere is a dynamic change in consumer preferences in

jewellery as customers have become more astute and aware

about trends and quality. The key reasons for growth of

demand in the jewellery industry include an increasing

disposable income, growing number of working women and

fostering new talent. The challenges include factors such

as the unorganised sector, involvement of huge working

capital, dependency on import for raw materials and a labour

intensive market. The prime trends in India’s jewellery market

are the changing tastes and preferences of consumers,

festive season sales, emergence of new distribution channels

and inclination towards branded jewellery. Consumers are

demanding new designs and varieties in jewellery, and

branded jewellers are able to fulfil their changing demands

better than the local unorganised players. Moreover, increase

in per capita income has led to an increase in sales of

jewellery, as jewellery is a status symbol in India.

Increasing Role of E-CommerceThe overall online retail market in India is estimated to have

risen to US$ 6 billion in 2015, compared with US$ 3.5 billion

in 2014, according to Gartner Inc. CLSA Asia Pacific Markets

forecasts this to grow to US$ 22 billion by 2018. The online

jewellery market is expected to be worth US$ 2.5 billion

over the next 5-10 years. Currently, it accounts for less than


0.1% of the US$ 55 billion jewellery market. The online

retail jewellery market is growing steadily due to changing

consumer behaviour, especially of the young Indian women

exposed to global trends. According to the annual online

shopping growth report compiled by Forrester Consulting

and Google search trends, about 100 million people in India

will shop online by 2016, and about 40% of these will be

women. However, the total sale of online jewellery ventures

(including traditional players) in 2015 amounted to US$ 200

million or ` 1,256 crore. After the Government eased import

curbs on gold bars and coins, jewellers have been tying up

with Amazon.com Inc., Flipkart Online Services Pvt. and Ebay

Inc. Online retailing offers convenience of purchasing from

the comforts of an individual’s home. Moreover, it allows

other incentives such as giving customers time to decide and

not making it obligatory for them to purchase at their very

first visit. Offline jewellers realise the potential and the need

for being present online.

Impact of GSTThe Goods & Services Tax (GST) on raw materials in the

gems & jewellery industry has been fixed at 0.25% and on

ready material at 3%. Although it is higher than the current

applicable taxes, including 1% excise duty and 1.5% VAT,

it is below the anticipated GST of 5%. Customs duty will

continue to be 10% and processing charges will be taxed

at 5%. The average processing charges are around 12%

of the gold price. So, the total taxes and duties which

amounted to nearly 12.4%, will now be 14% post GST.

Organised players will be the biggest beneficiaries of this as

the cost gap between organised and unorganised players will

come down. The industry has welcomed the Government's

decision and are happy that the Centre has created a special

category, which will help the industry. Gold jewellery demand

is expected to grow by 9% in value and 6% in volume

during 2017, following rapid formalisation of the sector,

according to a report by the rating agency ICRA. Following

a tumultuous 2016, jewellery demand has rebounded

sharply. Easing liquidity pressures with fading impact of

demonetisation, extended wedding season,

better farm output and rising income levels have been

supporting growth.

Government InitiativesA conducive policy environment and with jewellery being

a focus area in the Government’s ‘Make in India’ push

manufacturing in this sector is expected to get a fillip. Where

India enjoys an advantage is in skilled craftsmanship and

uniqueness of design.

• In the Union Budget 2017-18, the Government of India

offered tax cuts for the middle class and other sections

of the society (5% for the ` 250,000-500,000 tax slab;

which was 10% initially). All these measures will drive

consumption, which will be favourable to the gems and

jewellery industry.

• The Government’s proposal to cut corporate tax rates to

25% for micro, small and medium enterprises (MSMEs)

having annual turnover up to ` 50 crore (US$ 7.5 million)

will benefit a large number of gems and jewellery

exporters from MSME category.

• The Government’s announcement on establishing gold

spot exchange could help in India’s participation in

determining gold price in the international markets.

• The demonetisation move is encouraging people to use

plastic money, debit/ credit cards for buying jewellery.

This is good for the industry in the long run and will

create more transparency.

• The Reserve Bank of India (RBI) announced norms for

gold monetisation scheme, which allows individuals,

trusts and mutual funds to deposit gold with banks

GOLD JEWELLERY DEMAND IS EXPECTED TO GROW BY 9% IN VALUE AND 6% IN VOLUME DURING 2017, FOLLOWING RAPID FORMALISATION OF THE SECTOR. FOLLOWING A TUMULTUOUS 2016, JEWELLERY DEMAND HAS REBOUNDED SHARPLY.


in return for interest, to help reduce gold imports and

alleviate pressure on trade balance.

• RBI has liberalised gold import norms. With this, star

and premier export houses can import the commodity,

while banks and nominated agencies can offer gold for

domestic use as loans to bullion traders and jewellers.

• India has signed a Memorandum of Understanding

(MoU) with Russia to source data on diamond trade

between the two countries. India is the top global

processor of diamonds, while Russia is the largest rough

diamond producer. The Government of India is planning

to establish a special zone with tax benefits for diamond

import and trading in Mumbai, in an effort to develop

the city as a rival to Antwerp and Dubai, which are

currently the top trading hubs for diamond.

• Due to shortage of skilled manpower, the Gems and

Jewellery Skill Council of India is planning to train over

four million people till 2022. The council aims to train,

skill and enhance 4.07 million people by 2022. The

council plans to tie up with the existing training institutes

including Gemological Institute of America (GIA) and

Indian Gemological Institute (IGI), along with setting

up of new institutes in major diamond cutting and

processing centres.

• The GJEPC has also proposed to develop a jewellery park

on Thane-Belapur Road which is around five kilometers

from Mumbai with a view to boost the Mumbai-based

jewellery industry by providing modern facilities and

services.

• Indian Institute of Gems & Jewellery (IIGJ) Mumbai, a

project of the GJEPC, has come-up with a three-year

Graduate Program in Jewellery Design & Manufacturing

Techniques with an introduction to Management

studies, in collaboration with Welingkar Institute of

Management.

• In September 2015, the Government of India approved

the gold monetisation plan in the form of revamped Gold

Deposit Scheme (GDS) and the Gold Metal Loan (GML)

Scheme to mobilise tonnes of gold stored in households

and temples across the country. The Union Cabinet

also approved the introduction of Sovereign Gold Bond

Scheme, under which gold bonds denominated in grams

of gold will be issued to individuals by the Reserve Bank

of India (RBI), in consultation with Ministry of Finance.

Rising Market Opportunities

• Entering New Markets

The sector is exploring new locations to diversify

business and to minimise the risk. Russia, Middle East

and China are a few of the emerging destinations that

are witnessing an increase in jewellery demand. The

Indian gems & jewellery players can tap these countries

to diversify and increase their business. India’s vast, low

cost and extremely skilled workforce provides it with a

competitive edge over other countries. By moving up

the value chain and processing larger stones, India can

further increase its value share in total exports.

• Value Addition

There exists a huge opportunity for Indian players to do

value addition to the low cost gold and diamonds items

and can export such jewellery. India has an advantage of

manufacturing affordable gold and diamond jewellery

for the world market.

• Jewellery Retail

The Indian retail sector provides an excellent opportunity

for the Indian players to manufacture and sell their

jewellery through the retail channels that are fast

catching up in the Indian markets.

• Outsourcing Hub

India can become an outsourcing hub for designing and

manufacturing jewellery. There is an increased trend of

outsourcing designing and manufacturing of jewellery

from India by global retail players.

INDIA’S VAST, LOW COST AND SKILLED WORKFORCE PROVIDES IT WITH A COMPETITIVE EDGE. BY MOVING UP THE VALUE CHAIN AND PROCESSING LARGER STONES, INDIA CAN FURTHER INCREASE ITS VALUE SHARE IN EXPORTS.


Industry OutlookIn the coming years, growth in Gems & Jewellery sector

would be largely contributed by the development of large

retailers/brands. Established brands are guiding the organised

market and are opening opportunities to grow. Increasing

penetration of organised players provides variety in terms

of products and designs. Also, the relaxation of restrictions

of gold import is likely to provide a fillip to the industry. The

improvement in availability along with the reintroduction

of low cost gold metal loans and likely stabilisation of gold

prices at lower levels is expected to drive volume growth

for jewellers over short to medium term. The demand for

jewellery is expected to be significantly supported by the

recent positive developments in the industry.

The Gems & Jewellery industry is launching several initiatives

to further its share of global trade in the sector. With a

share of over 60%, India is already a major player in the

manufacturing of diamonds across the world. Besides

furthering its current impact on world’s diamond trade,

the industry is now aiming to have the same influence in

the trade of precious gems, including precious and semi-

precious stones. The industry, which already employs 4.6

million people, has a huge potential of skilling labour and

contributing to the decline in India’s unemployment rates.

Another key focus is the export potential of the industry.

With India being a cutting and polishing hub for diamonds,

the Government aims to make India a preferred destination

for diamond manufacturing and an international diamond

trading hub.

COMPANY OVERVIEWTara Jewels Limited is an integrated player in the global

jewellery industry founded in 1994 by Rajeev Sheth, a first

generation entrepreneur and a gemologist with over 40 years

of experience in jewellery manufacturing and retailing.

We are the manufacturers of international brands and co-

branded jewellery. We have over two decades of experience

in the international market with leading retailers across

the globe. Our experience ranges from designing and

manufacturing to retailing of jewellery.

We are predominantly an exporter and retailer of studded

diamond jewellery in over 20 countries and five continents,

including US, UK and Europe. Our products are available

across 12,000 points of sale. We also have an online presence

through Amazon, Velvet Case, Shoppers Stop and Tara

Jewellers Online.


Our Portfolio

Brands Retailers

Zac Posen Walmart

Monquie Luillier Kays

Facets Zales

Heart to Heart Helzberg

Cherished Hearts Blue Nile

Heart Essence JC Penny

Forever Bride Signet UK

Secrets of the Sea Foschini

Bevilles, Chryst

We operate in the Branded Jewellery segment of the

jewellery value chain through our diversified product mix of

gold and diamond studded jewellery. We currently operate

company-owned stores across Metros, Tier I, Tier II and Tier III

Indian cities. Our basket includes products of Gold, Platinum

and Silver. We offer an extensive range of fine jewellery

catering to consumers through our chain of 4 retail stores.

Our portfolio of products includes studded gold, platinum

and silver jewellery.

OUR CORE COMPETENCIES

Strategic Initiatives adopted in FY2017

a. Reduction in interest burden

b. Reduction in operating cost

c. Change in Auditors in USA

Our Manufacturing Capacity

Strong promoter/management

background in Retail and Branding

High precision jewellery

manufacturing technology

Experienced supplier to large global

retailers

OUR CAPABILITIES

55,000 Designs

20 Countries

5 Continents

DESIGNING MANUFACTURING RETAILING

OUR CHANNELS OF SALE

OUR PRESENCE IN THE VALUE CHAIN


MAJORITY INDIAN

EXPORTS

PRESENCE OF TARA JEWELS LIMITED

PROCESSED DIAMONDS

ROUGH DIAMONDS

JEWELLERY

BRANDED JEWELLERY

HIGH-END LUXURY

JEWELLERY

JOB WORK

BRICK AND MORTAR

E-COMMERCE RETAIL PARTNERS


Our Manufacturing CapacityOur presence spans across the value chain – from designing

to manufacturing and retailing of jewellery – with

patented technologies and state-of-the-art manufacturing

processes. We have 3 manufacturing facilities spread across

approximately 80,000 sq. ft., employing 1,000 craftsmen

and 39 designers. Our current installed capacity is 120,000

units per month, while our current capacity utilisation is 80%

in a single shift. We use state-of-the-art equipment in our

manufacturing processes and rely on essential technologies

such as wax setting technology. Our multi-skilled workforce

makes use of our patented turntable technology.

Our Business Performance in FY2017Total Revenues

`12,495.03 Million Exports

Total Sales

`3,081.24 Million

India Domestic

`12,446.31 Million

International Business

Gross Profit

`231.27 Million

India Domestic

`1,736.56 Million

International Business

` 3,083.46 Million

India Retail

Our Competencies in Manufacturing:• State-of-the-art equipment at manufacturing facilities

• Advanced technologies such as wax-setting

• Owning the patented turntable technology

• Multi-skilled workforce

• Use of robotics technology for stone setting in studs

Our Competitive Advantages:• SAP implemented across all the manufacturing units

• Manufacturing of jewellery using patented and state-of-

the-art technologies

• High precision jewellery manufacturing technology

• Fully automated jewellery casting plant

• Applied for grant of patents for invisible plate setting

technology for setting princess diamonds in wax

• Applied for grant of patents on resizable ring technology,

enabling resizing of rings without disturbing the shape or

falling of stones in studded rings


Innovation Through Technology:Patented Technologies - Invisible setting

- Patented turntable technology – an indigenously developed manufacturing facility for

increase in productivity and versatility

Continuous innovation in

technology

- High-end jewellery cell developed for high-end manufacturing, using techniques

followed by ultra-luxury jewellery companies

- Implemented factory within factory concept to increase productivity and reduce cycle

time

Access to advanced

technology and modern

machinery

- State-of-the-art equipment for wax injection, laser, investment and casting

- 100% CAD/CAM product development

- Microscope setting

- Machine shop for machine made bands, automated machine stone setting, miracle

plates and britecut texturing

- Platinum casting facility

OUR MANUFACTURING

TOOLS

LASER LITHOGRAPHY

MICROSCOPIC PRECISION SETTING

MACHINE MADE BANDS

INVISIBLE SETTINGS

MACHINED GRAVING

CAD AND CAM


Our Business VerticalsA. RETAIL MODEL

a. International Retail

We export studded jewellery to global retailers

and leading chain stores across 12,000 points of

sale globally. Almost 90% of our revenues are

contributed by the overseas markets. We promote

7 brands globally across segments and geographies.

During the year, we launched some of our signature

collection in new geographies. Our jewellery is

primarily exported to Australia, Canada, European

Union, South Africa, United Kingdom and United

States of America.

We have strategic tie-ups with reputed global

branded jewellery retailers and international chains

in the global market. We co-brand our merchandise

with reputed jewellery retailers to enhance brand

recognition and repeat orders. We also leverage

the E-Commerce platform to sell our brands. Our

jewellery is also available online in one of the world’s

leading E-commerce platforms Amazon, Velvet

Case, Shoppers Stop and Tara Jewellers Online for

jewellery sales.

OUR GLOBAL TIE-UPS WITH BRANDED JEWELLERY RETAILERS

WALMART

JC PENNY

ZALES

SIGNET

KAY JEWELLERS

JARED

ERNEST JONES

STERNS

AMERICAN SWISS

BLUE NILE

H. SAMUEL

HELZBERG

CHRYST SWITZERLAND


b. India Retail

Being an integrated player in the jewellery industry,

we are present in the affordable luxury segment

with our jewellery ranging in an average ticket

size of ` 50,000. Our presence is spread across

manufacturing, designing, exports and retailing

of jewellery, targeting the aspiring Indians at the

base of the socio-economic pyramid. Our jewellery

is displayed on Browse Walls, Collection Walls and

Consultation Tables, which reduces the inventory

requirement and leads to limited operating cost.

Our low-cost format and asset light model enables

us to capture the captive audience at these stores

and offer brand visibility. This format is targeted

to generate gifting and impulse purchases with

a wide range of jewellery available from ` 1,000

to ` 40,000. We accept orders for larger designs

depending upon the customer requirement. Our

collection on offer ranges from daily wear (light

weight necklace sets, chains, rings, pendants,

bracelets, earrings and bangles) to more occasion

related exclusive designs. The format enables

customers to purchase any casual / fashion jewellery

or a gift purchase during their visit to the stores.

Re-engineering India Retail

We are expanding our retail footprint in the

domestic market by adopting an asset light strategy.

We reduced our number of outlets from 19 in

FY2016 to 4 stores by the end of FY2017. These

small-format stories are aimed towards increasing

our revenues from the export vertical and relying

less on the domestic market. A lesser number of

outlets lowers our inventory requirement and limits

operating cost. At these outlets, we are consciously

reducing the sale of plain gold jewellery and

emphasising more towards high-margin products

such as Diamond, Kundan and Made-to-Order

jewellery.

Leveraging the E-Commerce Route

We have established a significant presence in the

online segment. We are leveraging the E-Commerce

platform to reach out and cater to new-age

customers. Our association with online retailing

portals helps us retail our daily wear to signature

collection. The channel not only helps us reach out

to Generation Y, but also in creating a strong brand

recall and creating high-end customer experience

and also redefining the way jewellery is sold to our

customers.

B. EXPORT MODEL

We understand the demands of global consumers and

serve distinct markets across various continents. We

export diamond and coloured stone studded jewellery

and branded jewellery to international jewellery retailers.

About 90% of our revenues are contributed by the

export of diamond and diamond studded jewellery to

global retailers with an extensive distribution network.

We have a global product development team, led by the

sales team in US. We are the exclusive manufacturers of

fresh and strong brands. We earn 90% of our revenue

from US, UK, China, Australia, South Africa, European

Union and Canada. Our key brands — Zac Posen,

Monique Lhullier and Trio’s — performed well during the

year across all the outlets.


Our End-to-End Value ChainRough Diamonds Processed

Diamonds

Job Work

Unbranded Branded High-End Luxury

Highlights on Exports:

• Zac Posen, Monique Lhullier and Trio’s performed well

at Helzberg, Blue Nile and Walmart

• In the process of launching Zac Posen at Foschini,

South Africa

Awards & CertificationsInternational

• Awarded as “Global Supplier of the Year” second time

by Walmart

• Bagged Overall Excellence Award (Second-highest

exporter in the category of studded precious metal

jewellery exports in EPZ) by The Gem & Jewellery Export

Promotion Council in year 2007, 2008, 2009

• Conferred with the status of a “Star Trading House” by

the Ministry of Commerce & Industry; Been the highest

exporter in gems and jewellery for FY2009 and FY2010

• Won the “Luxury Retailer of the Year” award at the Star

Retailer Awards 2013

• Bagged “Best Store Design of the year - Single Brand

category” at the Economic Times Retail Awards, 2013

• Won “Print campaign of the Year 2012” at the Retail

Jeweller India Awards, 2012

• Received the Responsible Jewellery Council (RJC)

Certification, 2014 by meeting the highest ethical, social

and environmental standards

Retail

• Luxury Retailer of the Year” at the Star Retailer Awards

2013

• Best Store Design of the year – Single Brand category” at

the Economic Times Retail Awards 2013

• Print Campaign of the Year 2012” at the Retail Jeweller

India Awards 2012

Business OutlookWe are launching several initiatives to enhance our market

share. We have been leveraging our domain expertise,

industry know-how and manufacturing capabilities in order

to drive innovation, expand collection, enhance footprint


and delight our customers. We are also capitalising on our

asset light model of expansion to cater to the rising demand

for branded jewellery to optimise margins and enhance

profitability. Our skilled labour is helping us fast become a

cutting and polishing hub for diamonds. Our objective is to

be the preferred destination for diamond manufacturing and

an international diamond trading hub.

As part of our key strategy in aiding growth and profitability,

we are significantly expanding our presence in the global

market, introducing region specific collection, focussing on

new strategies to enhance market share, satiate the appetite

of all the age groups and cater to repeat orders from existing

clients. We hope to capture the robust demand in the

branded retail segment, re-emphasise our brands, build new

brands and increase brand recognition.

Financial OverviewStandalone:During the year under review, the Company earned a total

revenue of ` 1,197 crore, as against ` 1,363.54 crore in the

previous financial year. The net loss after Tax suffered by the

Company during the year under review was ` 11.82 crore,

as against a Profit After Tax of ` 9.25 crore achieved by the

Company in the previous financial year.

Consolidated:During the year under review, the Company earned a total

revenue of ` 1,557.85 crore, as against ` 1,807.30 crore

in the previous year. The net loss after Tax suffered by the

Company during the year under review was ` 4.62 crore,

as against a Profit After Tax of ` 17.91 crore achieved by the

Company in the previous financial year.

Human ResourcesHuman Resource is the most vital factor to achieve the goals

of any organisation. Being a progressive organisation, we

believe in the strength of our most vital asset – our strong

workforce. To maintain our competitive edge in a highly

dynamic industry, we recognise the importance of having

a workforce which is consumer focussed, performance

driven and future capable. We continually strive to attract

fresh talent to build a highly skilled and motivated pool

of resources. Several initiatives are being taken to ensure

optimal development and management of human resources

by imparting need-based training to employees across

categories.

The Company’s Human Resources philosophy is to establish

and build a strong performance and competency driven

culture with greater sense of accountability and responsibility.

The Company acknowledges that its major asset is its

employees. The expertise of the management team, the

professional training provided to the staff, their personal

commitment and their spirit of teamwork together enhance

the Company’s networth. The Company has taken various

steps for strengthening organisational competency through

involvement and development of employees as well as

installing effective systems for improving their productivity

and accountability at functional levels.

Key Risks and Concerns Your Company has put into place a detailed Risk

Management Policy. It has tried to identify the various types

of risks and integrate risk management activities at all levels

in the Company. The details about the risk management

policy are given in the Boards’ Report.

WE HAVE BEEN LEVERAGING OUR DOMAIN EXPERTISE, INDUSTRY KNOW-HOW AND MANUFACTURING CAPABILITIES TO DRIVEN INNOVATION, EXPAND COLLECTION, ENHANCE FOOTPRINT AND DELIGHT OUR CUSTOMERS.


• Business Threats The gems and jewellery sector in India is unorganised and

fragmented. Around 90% of the players operate in the

unorganised sector mostly in family-run operations. The

nature of the sector prevents it from achieving economies

of scale.

Mitigation: The Company is engaged in the export of

gems and jewellery whereas the unorganised players are

in the domestic market only. Overseas importers place the

orders based on credentials and the company’s promoters

being associated in this business for three decades are not

affected by such competition.

• Predominance of the US market The Indian gems and jewellery sector is pre-dominantly

dependent on the US markets, which is its top export

destination. The growth of gems and jewellery sector is

heavily dependent on the growth of demand in the US

market.

Mitigation: Company is exporting to Middle East market

only and is not affected by US market scenario.

• Exchange Rate/Currency Risk The gems and jewellery sector is affected by the rupee/

dollar exchange rate because it is export oriented. Any

volatility in the exchange rates affects the margins of the

players.

Mitigation: The Company would do forward cover for

imports and exports and insulates itself from fluctuation

in exchange rate.

• High Level of Inventories As the gems and jewellery sector is highly dependent

on imports for its raw materials, the players have to

maintain a high level of inventory. However, maintaining

this inventory becomes difficult for the players during the

slack season, as it carries inventory price risk.

Mitigation: The Company does not envisage holding

large inventory and as it is a merchant exporter the

purchases would be made based on orders only and for

domestic sales it expects to have an inventory turnover

of 3 to 5 times and thereby reduce the risk of inventory

holding substantially.

• Competition from Other Luxury Goods With the increase in disposable income and the change

in standard of living, the demand for luxury goods such

as perfumes, consumer electronics, leather, automobile

and gadgets are also increasing. The gems and jewellery

sector is experiencing competition from these luxury

goods, which is eating into the market share of the sector.

Mitigation: The market potential is huge and the

competition from other consumer goods would not

dent company’s turnover. The estimated turnover of the

company is very small when compare to total export

turnover of the county. Therefore the risk is negligible.

• Artificial Jewellery The sector also faces a challenge in the form of

integration of synthetic or man-made diamonds. With

the advent of technology, it is difficult to differentiate

between natural and artificial jewellery. This may hit the

sale of low-cost jewellery in the long run.

Mitigation: There are different classes of people who

buy real gold jewellery and artificial jewellery. Artificial

items are more use by youngsters and office goers for

day-to-day use, whereas the real gold jewellery is used for

occasions and as a tool for savings of earnings. Therefore

this competition is also small and negligible.

WE HAVE TAKEN VARIOUS STEPS FOR STRENGTHENING ORGANISATIONAL COMPETENCY THROUGH INVOLVEMENT AND DEVELOPMENT OF EMPLOYEES AS WELL AS INSTALLING EFFECTIVE SYSTEMS.


Internal Control Systems and their AdequacyThe Company has an adequate internal control system,

commensurate with the size of its operations. The Company’s

Audit Committee reviews the internal control systems and

internal auditors’ recommendations from time to time. All

efforts are being made to make the internal control systems

more effective. We identify new risks and re-evaluate old

risks during the year, in the process of considering risk

mitigating strategies. Some of the risks that our Company’s

core businesses are exposed to include credit risk, market risk,

operational risk and legal risk. It is also exposed to specific

risks in connection with the management of investments

and the environment within which it operates. The Company

manages cost escalation risk through processes aimed at

optimising costs through suppliers and through rigorous

contracts and procurement.

We seek to understand, limit and manage the adverse

impacts arising from external and internal events. Our risk

management team safeguards and protects the Company’s

assets against unauthorised use or disposition, maintenance

of proper accounting records and verification of authenticity

of all transactions. Within the Company, the directors are

responsible for maintenance of a sound system of internal

controls. This is done through a continuous process of

identifying, evaluating and managing the risks faced by

the company. The Company’s effectiveness on internal

control is also checked by external agencies. This results in

an unbiased and independent examination of the adequacy

and effectiveness of the internal control system and aims to

achieve the objective of optimal functioning of the Company.

Cautionary StatementThis document contains statements about expected future

events, financial and operating results of Tara Jewels Limited,

which are forward-looking. By their nature, forward-looking

statements require the Company to make assumptions

and are subject to inherent risks and uncertainties. There is

significant risk that the assumptions, predictions and other

forward-looking statements will not prove to be accurate.

Readers are cautioned not to place undue reliance on

forward-looking statements as a number of factors could

cause assumptions, actual future results and events to differ

materially from those expressed in the forward-looking

statements. Accordingly, this document is subject to the

disclaimer and qualified in its entirely by the assumptions,

qualifications and risk factors referred to in the management’s

discussion and analysis of Tara Jewels Limited’s Annual

Report, 2016-17.


ToThe Members,Tara Jewels Limited

Your Directors take pleasure in presenting their 16th Annual Report on the business and operations of the Company together with audited financial statements for the year ended March 31, 2017.

FINANCIAL RESULTS (`in Crore)

Particulars Standalone Consolidated

FY 2016-17 FY 2015-16 FY 2016-17 FY 2015-16

Total Income 1197.00 1363.54 1557.85 1807.30

Less: Expenditure 1210.96 1347.71 1562.33 1779.82

Profit/(Loss) Before Tax (13.96) 15.83 (4.48) 27.47

Less: Tax (2.14) 6.58 0.14 9.57

Net Profit /(Loss) For Year (11.82) 9.25 (4.62) 17.91

Earnings Per Share (EPS) (4.80) 3.76 (1.88) 7.27

PERFORMANCE REVIEWStandalone:During the year under review, the Company earned a total revenue of ̀ 1197 crores against ̀ 1363.54 crores in the Previous Year. The net loss after Tax suffered by the Company for the year under review was ` 11.82 crores against the Profit after Tax of `9.25 crores achieved by the Company in the previous Financial Year.

Consolidated:During the year under review, the Company earned a total revenue of ` 1557.85 crores against ` 1807.30 crores in the Previous Year. The net loss after Tax suffered by the Company for the year under review was ` 4.62 crores against the Profit After Tax of ` 17.91 crores achieved by the Company in the previous Financial Year.

MANAGEMENT DISCUSSION AND ANALYSISAs per SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015, a detailed Management Discussion and Analysis Report is presented in a separate section as part of this annual report.

DIVIDEND & RESERVES In view of the loss incurred by the Company, the Directors do not recommend dividend on the Equity Share Capital of the Company for the Financial Year ended March 31, 2017.No amount has been transferred to reserve during the financial year under review.

SHARE CAPITAL The paid up share capital of the Company as on March 31,2017 stood at `246,228,500/-During the year under review the Company has not issued any shares nor has granted any stock option or sweat equity. None of the directors of the company hold instruments convertible into equity shares of the company.

EMPLOYEES STOCK OPTION SCHEMEParticulars of Employee Stock Options are given in “Annexure A” to this report.

SUBSIDIARY COMPANIES AND THEIR PERFORMANCE / FINANCIAL POSITIONThe Subsidiaries and Step down Subsidiaries of the Company as on March 31, 2017 are as follows:

BOARD’S REPORT


Subsidiary Companies:Tara (Hong Kong) LimitedTara Jewels Holdings Inc

Step Down Subsidiaries:Tara China Jewelry Limited- Subsidiary of Tara (Hong Kong) LimitedFabrikant Tara International, LLC- Subsidiary of Tara Jewels Holdings Inc

In accordance with Section 129 (3) of the Companies Act, 2013 and Indian Accounting Standards, the Company has prepared the Consolidated Financial Statements of the Company and all its subsidiaries, which forms part of this Annual Report. The Statement in form AOC-1(Annexure B) containing salient features of the financial statements of Company’s Subsidiaries is attached to this report.

DIRECTORSa. The current policy is to have an appropriate mix of executive, non-executive and independent directors to maintain the independence of the Board, and separate its functions of governance and management. The Board consists of 5 members, 2 of whom are executive or whole-time directors, and 2 are independent directors and 1 is Nominee Director. The Board periodically evaluates the need for change in its composition and size.

Declaration by Independent DirectorsThe Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act,2013, that he/she meets the criteria of Independence as provided in sub-section (6) of Section 149 of the Companies Act, 2013 and Regulation 16(1) (b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

CHANGES IN CONSTITUTION OF BOARDThe following changes have taken place in the Board of Directors/Key Managerial Personnel of the Company during the year 2016-17 and upto the date of this Report:

SrNo

Name Designation Appointment Resignation Date Of Appointment/Resignation

1 Mr. Bimal Desai Chief Financial Officer - YES May 13, 2016

2 Mr. Vishnu Prakash Garg Chief Financial Officer and Executive Director

YES - May 23, 2016

3 Mr. Stuart Marcus Director YES - September 2, 2016

4 Mr. Jeffrey Shlakman Director YES - September 2, 2016

5 Mr. Mariano de la torree Nominee Director - YES December 9, 2016

6 Ms. Alison Lazerwitz Nominee Director YES - February 10, 2017

7. Mr. Rakesh Kalra Director - YES May 29, 2017

8 Mr. Stuart Marcus Director - YES May 29, 2017

9 Mr. Jeffrey Shlakman Director - YES May 29, 2017

10 Mr. Vishnu Prakash Garg Chief Financial Officer - YES May 29, 2017

11 Mr. Sanjay Sethi Chief Financial Officer YES - June 20, 2017

12 Mr. Nikkhil Vaidya Director - YES August 4, 2017

13 Mr. Shanti Saroop Khindra Director - YES August 10, 2017

14 Mr. Vishnu Prakash Garg Director - YES August 10, 2017

15 Mr. Ravindran M.P Executive Director - YES August 10, 2017

16 Mr. Sanjay Sethi Executive Director YES - August 10. 2017


BOARD’S REPORT

b. Board/ Committee Meetings:During the year under review, four meetings of the Board took place. Details of Board Meetings and Committee Meetings have been provided in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between any two Board Meetings was within the period prescribed by the Companies Act, 2013.

Board Meeting dates are finalized in consultation with all directors and agenda papers backed up by comprehensive notes and detailed background information are circulated well in advance before the date of the meeting thereby enabling the Board to take informed decisions. A detailed presentation is also made to apprise the Board of important developments in industry, segments, business operations, marketing, products etc.

c. Familiarization Programme with Independent Directors:Pursuant to provisions of SEBI (Listing and Disclosures Requirements) Regulations, 2015, during the year under review the Company prepared and pursued the Familiarization Programme for Independent Directors as hosted on Company’s website at www.tarajewels.in (weblink:www.tarajewels.in/investorrelations/corporategovernance/policies) d. Performance Evaluation:The Board of Directors has carried out an annual evaluation of its own performance, board committees and individual directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI Listing Regulations”).

The performance of the board was evaluated by the board after seeking inputs from all the directors and senior managerial personnel.

The performance of the Committees and effectiveness of Committee Meetings was evaluated by the board after taking into consideration the inputs provided by the Committee Members.

The Board and the nomination and remuneration committee reviewed the performance of the individual directors on the basis of Nomination and Remuneration Policy laid down by the said committee and approved by the Board.

In a separate meeting of Independent directors, performance of non-independent directors, performance of the board as a whole and performance of the chairman was evaluated taking into account the views of executive directors and non-executive directors. The same was considered by the board of directors at its meeting. e. Policy for Selection, Appointment and Remuneration of Directors/Key Managerial Personnel/Senior Man-agement Personnel including Criteria for their performance evaluation:The Company has adopted a policy titled as “Nomination & Remuneration Policy” which interalia includes Company’s policy on Board Diversity, selection, appointment and remuneration of directors/Key Managerial Personnel/Senior Management Personnel, criteria for determining qualifications, positive attributes, independence of a director and criteria for performance evaluation of the Directors.

The Nomination & Remuneration Policy as approved by the Board is attached as Annexure “C” to the Board’s Report and also uploaded on the Company’s website www.tarajewels.in and details of criteria laid down and the Remuneration Policy are given in the Corporate Governance Report.


BOARD’S REPORT

AUDIT COMMITTEEa. Pursuant to the provisions of Sections 177 (8) of the Companies Act, 2013,read with Rule 6 and 7 of the Companies

(Meetings of the Board and its Powers) Rules, 2013, and Regulation 18 of SEBI(Listing Obligations and Disclosure Requirements) Regulations, 2015 the Audit Committee consists of the following Members :

SR. No.

Name Designation

1 Mr. Nikkhil Vaidya * Chairman (Independent Director)

2 Mr. Rajiv Jain* Member (Independent Director)

3 Mr. Sanjay Sethi* Member (Executive Director)

4 Mr. Rakesh Kalra * Member (Independent Director)

5 Mr. Ravindran M.P* Member (Executive Director)

*Mr. Rajiv Jain appointed as a Member of Committee w.e.f May 29, 2017 and Mr. Rakesh Kalra resigned as a Member and also from Board w.e.f May 29, 2017.

*Mr. Nikkhil Vaidya resigned as a Member and also from Board w.e.f August 4, 2017.

*Mr. Sanjay Sethi appointed as a Member of Committee and on Board w.e.f August 10, 2017 and Mr. Ravindran M.P resigned as a Member and also from Board w.e.f August 10, 2017.

During the year 2016-17, there were no instances, where the Board of Directors did not accept the recommendations of the Audit Committee.

VIGIL MECHANISM The Company has established a vigil mechanism/Whistle Blower Policy and oversees through the committee for expressing genuine concerns by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided to any complainant to have direct access to the Chairman of the Audit Committee. The Vigil Mechanism Policy of the Company is placed on Company’s website i.e.www.tarajewels.in.(weblink:www.tarajewels.in/investorrelations/corporategovernance/policies)

AUDITORSa. Statutory Auditors Pursuant to the provisions of section 139(2) of the Companies Act, 2013 no listed Company shall appoint a firm of

Auditors for more than two terms of five consecutive years. However as per third proviso to said sub-section (2) in case of an existing Company i.e. as on 1st April, 2014 if an Auditor has already completed the abovementioned term, then the said firm can continue for a period of another three years commencing from the date of the 1st Annual General Meeting of the Company held from the commencement of the Companies Act, 2013. The existing Auditors of the Company M/s. C.B. Chajjed and Co., Chartered Accountants (Firm Registration No. 101796W) shall be completing their term of extended three years at the conclusion of the ensuing Annual General Meeting and therefore the Company has to appoint another firm of Auditors at the ensuing Annual General Meeting.

On the recommendation of the Audit Committee, the Board proposes the appointment of M/s GMJ & Co, Chartered Accountants (Firm Registration No. 103429W) as the Statutory Auditors of the Company for a period of 5 years, to hold office from the conclusion of this AGM till the conclusion of the twenty-first AGM to be held in the year 2022 (subject to ratification of their appointment at every AGM) and to fix their remuneration by the members at the ensuing Annual General Meeting of the Company.

As regards Statutory Auditor’s remark for not depositing undisputed statutory dues with prescribed authorities within prescribed time, the Board is making its best efforts to be regular in depositing undisputed statutory dues.

b. Secretarial Auditor M/s Sunil Agrawal, Practicing Company Secretaries, was appointed to conduct the Secretarial Audit of the Company for

the financial year 2016-17, as required under Section 204 of the Companies Act, 2013 and rules made thereunder.


BOARD’S REPORT

The Secretarial Audit report for Financial year 2016-17 forms part of Annual Report as Annexure D to the Board’s Report.

Qualification in Secretarial Audit Report: The Company is not regular in depositing statutory dues i.e. Provident funds, ESI, Profession Tax with concerned authority.

Board’s Explanation: The Board is making efforts to be regular in depositing the statutory dues.

c. Cost Auditor Cost Auditor is not required to be appointed by the Company since it is located in a SEZ Zone, as per the circular issued

by the Ministry in this regard.

INTERNAL CONTROL SYSTEM AND COMPLIANCE FRAMEWORKThe Company has strong internal control framework which includes level controls, whistle blower policy, rigorous management reviews and MIS and strong internal audit mechanism. There are robust financial control processes with appropriate checks and balances, defined policies and procedures to ensure reasonable assurance with regard to financial information. Process controls deployed ensure adherence to policies and procedures, efficiency in operations and reduce risk of frauds.

The rigorous internal controls, management overseas results, thorough review of internal audit reports by the Audit Committee and implementation of action plans makes the internal financial controls strong in the Company.RISK MANAGEMENT

The Board of Directors has constituted Risk Management Committee constituting directors and non-director members. The Board based on the recommendations of the Risk Management Committee has also adopted “Risk Management Policy” of the Company which is hosted on Company’s website at www.tarajewels.in.

The Committee through its Risk Council shall assess critical and non-critical risks, viz., Strategic, Operational, Financial, Regulatory etc. and risk register would be prepared for identifying and mitigating risks in each identified area. Your Company continues to attach a high degree of importance to this area and shall ensure that necessary Risk Mitigation Process is in place for each identified risk area at all times.

RELATED PARTY TRANSACTIONSAll the transactions with related parties are in the ordinary course of business and on arm’s length basis; and the details of material related party transactions or arrangement have been furnished in Form AOC-2 (Annexure E) attached to this report. All the Related Party Transactions entered during the year under review are set out under notes to accounts to the Financial Statements.

The policy on Related Party Transactions and on Materiality of Related Party Transactions as approved by the Board are uploaded on the Company’s website at Weblink: www.tarajewels.in/investorrelations/corporategovernance/policies).

None of the Directors has any pecuniary relationships or transactions vis-à-vis the Company except by way of remuneration paid to the Managing Director and Whole - time Director and sitting fees and Commission paid to other Non-Executive Directors

MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEESINFORMATION AS REQUIRED UNDER RULE 5(2) & 5 (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report.


BOARD’S REPORT1)

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BOARD’S REPORT

2) Details of Employees who were: (a) Employed throughout the Financial Year under review and in receipt of remuneration for the Financial Year in the

aggregate of not less than ̀ 1,02,00,000 per annum: Apart from information furnished above, their were no other employees in this category.

(b) Employed for the part of the Financial Year under review and in receipt of remuneration at the rate of not less than ` 8,50,000/- per month: There were no employees in this category.

3) There was no employee either throughout the financial year or part thereof who was in receipt of remuneration which in the aggregate was in excess of that drawn by the Managing Director or Whole-time Director and who held by him-self or along with his spouse or dependent children two percent or more of the Equity Shares of the Company.

4) *Ms. Divya Rajeev Sheth and Ms. Aarti Farshid Cooper are daughters of Mr. Rajeev Sheth, Managing Director of the Company

However the information required under section 197 (12) of the Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not being sent along with this Report to the Members of the Company as per the provision of Section 136 of the Companies Act, 2013. Members who are interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the Company. The aforesaid Annexure is also available for inspection by Members at the Registered Office of the Company, 21 days before the 16th Annual General Meeting during the business hours on working days.

LOANS, GUARANTEES OR INVESTMENTSDetails of Loans, Guarantees and Investments, if any covered under the provisions of Section 186 of the Act are given in the notes to the Financial Statements.

CORPORATE SOCIAL RESPONSIBILITYPursuant to the provisions of Section 135 of the Act, read with CSR Rules, the Company has constituted CSR Committee and formulated CSR Policy. A Board level committee has been constituted consisting of the following members:

Name Designation

Mr. Rajeev Sheth Chairman and Member

Mr. Sanjay Sethi* Member

Ms. Fern Mallis Member

Mr. Ravindran MP* Member

* Mr. Sanjay Sethi appointed as a Member of Committee w.e.f August 10, 2017 and Mr. Ravindran M.P resigned as a Member and also from Board w.e.f August 10, 2017.

Initiative Taken:The Company has not made any expenditure on CSR activities as the Company is still exploring the appropriate project in which the CSR expenses can be made so as to provide the maximum benefit to the society at large. The Company intends to contribute the money for CSR activities as soon as the appropriate project is identified.

DEPOSITS During the year 2016-17, the Company did not accept any deposit from public.

SIGNIFICANT AND MATERIAL ORDERSThere are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company’s operations in future.


BOARD’S REPORT

EXTRACT OF ANNUAL RETURNThe extract of the Annual Return pursuant to the sub-section (3) of Section 92 of the Companies Act, 2013 prepared in form MGT 9 is annexed herewith as “Annexure F”.

DIRECTORS’ RESPONSIBILITY STATEMENTThe financial statements are prepared in accordance with the Generally Accepted Accounting Principles (GAAP) under the historical cost convention on accrual basis except for certain financial instruments, which are measured at fair values. GAAP comprises mandatory accounting standards as prescribed under Section 133 of the Companies Act, 2013 (‘the Act’), read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). There are no material departures from prescribed accounting standards in the adoption of these standards.

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) and 134 (5) of the Companies Act, 2013:

a) in the preparation of the annual accounts for the financial year ended March 31, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

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

c) 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;

d) the Directors have prepared the annual accounts on a going concern basis; e) the Directors have 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 have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

CORPORATE GOVERNANCEAs per SEBI (Listing and Disclosures Requirements) Regulations, 2015 a separate section on Corporate Governance practices followed by the Company is provided in the Corporate Governance section of the Annual Report. The certificate from practising Company Secretary on compliance with the condition of corporate governance of Listing Regulation is given in Annexture G of this Report.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARN-INGS AND OUTGO(a) CONSERVATION OF ENERGY:- The Company is very much conscious of conservation of energy and all measures are being taken to minimize the

consumption of energy wherever possible.

(b) TECHNOLOGY ABSORPOTION:- The Company has not acquired any technology during the Financial Year under review. The efforts for research and

development is an ongoing process throughout the year.

(c) FOREIGN EXCHANGE EARNING & OUTGO:- Part of Notes to Accounts of Financial Statement.


BOARD’S REPORT

MATERIAL CHANGES AND COMMITMENT IF ANY EFFECTING THE FINANCIAL POSITION OF COMPANY WHICH HAVE OCCURRED BETWEEN THE FINANCIAL YEAR END OF THE COMPA-NY TO WHICH FINANCIAL RESULTS RELATE

Except as disclosed elsewhere in this report, there have been no material changes and commitments which can affect the financial position of the Company occurred between the end of the financial year of the Company and date of this report.

CHANGES IN NATURE OF BUSINESS AND REVISION IN THE BOARD’S REPORTThere are no changes in nature of business and also revision in the Board’s Report during the year.

HUMAN RESOURCEYour Company firmly believes that employees are the most valuable assets and key players of business success and sustained growth. Various employee benefits, recreational and team building programmes are conducted to enhance employee skills, motivation as also to foster team spirit. Company also conducts in house training programmes to develop leadership as well as technical/functional capabilities in order to meet future talent requirements. Industrial relations were cordial throughout the year.

POLICY ON PREVENTION OF SEXUAL HARASSMENTThe Company has a policy on prevention of Sexual Harassment in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Harassment, Redressal) Act, 2013. The Committee has been set up to redress complaints received regarding Sexual Harassment. All Employees (permanent, contractual, temporary, trainees) are covered under this policy.During the year 2016-2017 no complaints were received regarding sexual harassment.

APPRECIATIONYour Directors place on record their sincere thanks and appreciation for the confidence reposed and continued support extended by Central and State Governments, Bankers, Customers, Suppliers and Shareholders. Your Board would like to place on record its sincere appreciation to the employees at all levels for the dedicated efforts and contribution in playing a very significant part in the Company’s operations.

For and on behalf of the Board of Directors

Sd/- RAJEEV SHETHPlace : Mumbai Chairman and Managing Director Date : August 10, 2017 (DIN: 00266460)


BOARD’S REPORT

ANNEXTURE - A

(a) Employee Stock Option Plan The Employee Stock Option Plan (ESOP) is designed to provide incentives to employees above the designation of managers to deliver long term returns. Participation in the plan is at the board's discretion and no individual has a contractual right to participate in the plan or to receive any guaranteed benefits. Once vested, the options remain exercisable for a period of 4 years. When exercisable, each option is convertible into one equity share of ` 10 each. The exercise price of the share options is ` 230. Movement during the period The number and weighted average exercise prices (WAEP) of the options and movement during the period is as follows:

Year ended March 31, 2017 Year ended March 31, 2016

Numer of options

WAEP Numer of options

WAEP

Opening balance 111,678 230 111,678 230

Granted duing the period - - - -

Exercised during the period - - - -

Forfeited /lapsed during the period (5,395) - - -

Expired during the period - - - -

Closing balance 106,283 230 111,678 230

Vested and exercisable 63,770 33,503

Share options outstanding at the end of the period have the following expiry date and exercise prices

Amount in `

Particluars Grant date Expiry date Exercise price (`)

Share options as at March 31,

2017

Share options as at March 31,

2016

Share options as at April 1,

2015

ESOP 2013 - Grant C

25-Jul-13 25-Jul-17 230 106,283 111,678 111,678

Total 106,283 111,678 111,678

Weighted average remaining contractual life of options outstanding at the end of period

0.32 Years 1.32 Years 2.32 Years

(b) Expense arising from share based payment transactionsTotal expenses arising from share based payment transactions recognised in profit or loss as part of employee benefit expense were as follows:

Amount in `

Year ended March 31, 2017


Employee stock option 447,460 895,107

Total employee share-based payment expense 447,460 895,107


BOARD’S REPORT

ANNEXTURE - B AOC 1

Salient Features of Financial Statements of Subsidiary / Associates / Joint Ventures as per Companies Act , 2013 Part “A”: Subsidiaries

(Amount in `)

1. Sl. No. I II III

2. Name of the subsidiary Tara Jewels Holdings, Inc. *

Tara (Hong Kong) Limited

Tara China Jewelry Limited **

3. Reporting period for the subsidiary concerned, if different from the holding company’s reporting period

N.A. N.A. N.A.

4. Reporting currency and Exchange rate as on the last date of the relevant Financial year in the case of foreign subsidiaries.

USD*** USD*** USD***

5. Share capital 113,299,500 464,117 4,134,035

6. Reserves & surplus (including foreign currency translation reserve)

188,163,200 408,879,846 (60,916)

7. Total assets 2,407,254,658 2,533,203,903 10,411,294

8. Total Liabilities 2,105,791,958 2,123,859,940 6,338,175

9. Investments - 4,135,007 -

10. Turnover 4,956,962,113 8,485,767,683 4,482,216

11. Profit before taxation 31,770,014 66,879,406 913,763

12. Provision for taxation 15,486,049 8,604,226 -

13. Profit after taxation 16,283,965 58,275,180 913,763

14. Other Comprehensive Income (7,111,909) (9,971,701) (251,796)

15. Total Comprehensive Income 9,172,056 48,303,479 661,967

16. Proposed Dividend - - -

17. % of shareholding 100 100 100

* Based on Consolidated figures with Fabricant-Tara International LLC

** Wholly owned subsidiary of Tara (Hong Kong) Limited.

*** Exchange rate as at end of the year USD 1 = `64.84

Part “B”: Associates and Joint VenturesStatement pursuant to Section 129 (3) of the Companies Act, 2013 related to Associate Companies and Joint Ventures is not applicable to the company since, there are no associates or joint ventures of the Company.

As Per Our Attached Report of Even DateFor C. B. Chhajed & Co. For and on Behalf of Board of Directors Chartered Accountants

C. B. Chhajed Rajeev Sheth Ravindran M. P. Nivedita NayakPartner Managing Director Executive Director Company Secretary (DIN NO:00266460) (DIN : 07188069) [FCS:8479]

Place : Mumbai Dated : May 29, 2017


BOARD’S REPORT

ANNEXTURE - C NOMINATION AND REMUNERATION POLICY

Introduction:In pursuance of the Company’s policy to consider human resources as its invaluable assets, to pay equitable remuneration to all Directors, Key Managerial Personnel (KMP) and employees of the Company, to harmonize the aspirations of human resources consistent with the goals of the Company and in terms of the provisions of the Companies Act, 2013 and the listing agreement as amended from time to time this policy on nomination and remuneration of Directors, Key Managerial Personnel and Senior Management has been formulated by the Committee and approved by the Board of Directors.

Objective and purpose of the Policy:

The objective and purpose of this policy are:

• To lay down criteria and terms and conditions with regard to identifying persons who are qualified to become Directors (Executive and Non-Executive) and persons who may be appointed in Senior Management and Key Managerial positions and to determine their remuneration.

• To determine remuneration based on the Company’s size and financial position and trends and practices on remuneration prevailing in peer companies, in the media industry.

• To carry out evaluation of the performance of Directors, as well as Key Managerial and Senior Management Personnel.

• To provide them reward linked directly to their effort, performance, dedication and achievement relating to the Company’s operations.

• To retain, motivate and promote talent and to ensure long term sustainability of talented managerial persons and create competitive advantage. In the context of the aforesaid criteria the following policy has been formulated by the Nomination and Remuneration Committee and adopted by the Board of Directors at its meeting held on February 10, 2015.

Effective Date:This policy shall be effective from 1st April, 2014.

Constitution of the Nomination and Remuneration Committee:The Board has changed the nomenclature of Remuneration Committee by renaming it as Nomination and Remuneration Committee on Board Meeting held on May 28, 2014.

The Board has the power to reconstitute the Committee consistent with the Company’s policy and applicable statutory requirement from time to time.

Definitions:

• Board means Board of Directors of the Company.

• Directors means Directors of the Company.

• Committee means Nomination and Remuneration Committee of the Company as constituted or reconstituted by the Board.

• Company means Tara Jewels Limited.

• Independent Director means a director referred to in Section 149 (6) of the Companies Act, 2013.

• Key Managerial Personnel (KMP) means-

(i) Executive Chairman and/or Managing\Director;

(ii) Whole-time Director;

(iii) Chief Financial Officer;

(iv) Company Secretary;

(v) Such other officer as may be prescribed under the applicable statutory provisions / regulations.


BOARD’S REPORT

• Senior Management means personnel of the Company occupying the position of Chief Executive Officer (CEO) of any unit / division or Vice President including Vice President of any unit / division of the Company. Unless the context otherwise requires, words and expressions used in this policy and not defined herein but defined in the Companies Act, 2013 as may be amended from time to time shall have them earning respectively assigned to them therein.

Applicability:

The Policy is applicable to

• Directors (Executive and Non-Executive)

• Key Managerial Personnel

• Senior Management Personnel

General:

• This Policy is divided in three parts: Part – A covers the matters to be dealt with and recommended by the Committee to the Board, Part – B covers the appointment and nomination and Part–C covers remuneration and perquisites etc.

• The key features of this Company’s policy shall be included in the Board’s Report.

PART – AMATTERS TO BE DEALT WITH, PERUSED AND RECOMMENDED TO THE BOARD BY THE NOMINATION AND REMUNERA-TION COMMITTEE:

The Committee shall:

• Formulate the criteria for determining qualifications, positive attributes and independence of a director.

• Identify persons who are qualified to become Director and persons who may be appointed in Key Managerial and Senior Management positions in accordance with the criteria laid down in this policy.

• Recommend to the Board, appointment and removal of Director, KMP and Senior Management Personnel.

PART–BPOLICY FOR APPOINTMENT AND REMOVAL OF DIRECTOR, KMP AND SENIOR MANAGEMENT

• Appointment criteria and qualifications:

1. The Committee shall identify and ascertain the integrity, qualification, expertise and experience of the person for appointment as Director, KMP or at Senior Management level and recommend to the Board his/ her appointment.

2. A person should possess adequate qualification, expertise and experience for the position he / she is considered for appointment. The Committee has discretion to decide whether qualification, expertise and experience possessed by a person is sufficient/satisfactory for the concerned position.

3. The Company shall not appoint or continue the employment of any person as Whole time Director who has attained the age of seventy years. Provided that the term of the person holding this position may be extended beyond the age of seventy years with the approval of shareholders by passing a special resolution based on the explanatory statement annexed to the notice for such motion indicating the justification for extension of appointment beyond seventy years.

• Term/Tenure:

1. Managing Director/Whole-time Director:

- The Company shall appoint or re-appoint any person as its Executive Chairman, Managing Director or Executive Director for a term not exceeding five years at a time. No re-appointment shall be made earlier than one year before the expiry of term.

2. Independent Director:

- An Independent Director shall hold office for a term up to five consecutive years on the Board of the Company and will be eligible for re-appointment on passing of a special resolution by the Company and disclosure of such appointment in the Board's report.


BOARD’S REPORT

- No Independent Director shall hold office for more than two consecutive terms, but such Independent Director shall be eligible for appointment after expiry of three years of ceasing to become an Independent Director. Provided that an Independent Director shall not, during the said period of three years, be appointed in or be associated with the Company in any other capacity, either directly or indirectly. However, if a person who has already served as an Independent Director for 5 years or more in the Company as on 1st October, 2014 or such other date as may be determined by the Committee as per regulatory requirement, he / she shall be eligible for appointment for one more term of 5 years only.

- At the time of appointment of Independent Director it should be ensured that number of Boards on which such Independent Director serves is restricted to seven listed companies as an Independent Director and three listed companies as an Independent Director in case such person is serving as a Whole-time Director of a listed company.

• Evaluation: The Committee shall carry out evaluation of performance of every Director, KMP and Senior Management Personnel at

regular interval (yearly).Criteria for evaluation of Board and Committee as a whole is attached on last page of policy. Performance evaluation will be done by grading the performance as Poor, Good, Excellent or NA (No Opportunity to Observe).

• Removal: Due to reasons for any disqualification mentioned in the Companies Act, 2013, rules made thereunder or under any other

applicable Act, rules and regulations, the Committee may recommend, to the Board with reasons recorded in writing, removal of a Director, KMP or Senior Management Personnel subject to the provisions and compliance of the said Act, rules and regulations.

• Retirement: The Director, KMP and Senior Management Personnel shall retire as per the applicable provisions of the Companies Act,

2013 and the prevailing policy of the Company. The Board will have the discretion to retain the Director, KMP, Senior Management Personnel in the same position / remuneration or otherwise even after attaining the retirement age, for the benefit of the Company.

Board Diversity:The Board of the Company may consciously be drawn in a manner that at least one director from each of the following field is on the Board of the Company.Human Resource, Banking and finance,Legal and general administration,

Any other field as may be decided by the Nomination and Remuneration Committee of the Company.

PART–CPOLICY RELATING TO THE REMUNERATION FOR THE WHOLE-TIME DIRECTOR, KMP AND SENIOR MANAGEMENT PER-SONNEL

• General:

1. The remuneration / compensation / commission etc. to the Whole-time Director, KMP and Senior Management Personnel will be determined by the Committee and recommended to the Board for approval. The remuneration / compensation / commission etc. shall be subject to the prior/post approval of the shareholders of the Company and Central Government, wherever required.

2. The remuneration and commission to be paid to the Whole-time Director shall be in accordance with the percentage / slabs / conditions laid down in the Articles of Association of the Company and as per the provisions of the Companies Act, 2013, and the rules made thereunder.

3. Increments to the existing remuneration / compensation structure may be recommended by the Committee to the Board which should be within the slabs approved by the Shareholders in the case of Whole-time Director.

4. Where any insurance is taken by the Company on behalf of its Whole-time Director, Chief Executive Officer, Chief Financial Officer, the Company Secretary and any other employees for indemnifying them against any liability, the premium paid on such insurance shall not be treated as part of the remuneration payable to any such personnel. Provided that if such person is proved to be guilty, the premium paid on such insurance shall be treated as part of the remuneration.


BOARD’S REPORT

• Remuneration to Whole-time / Executive / Managing Director, KMP and Senior Management Personnel:

1. Fixed pay: The Whole-time Director / KMP and Senior Management Personnel shall be eligible for a monthly remuneration

as may be approved by the Board on the recommendation of the Committee. The breakup of the pay scale and quantum of perquisites including, employer’s contribution to P.F, pension scheme, medical expenses, club fees etc. shall be decided and approved by the Board on the recommendation of the Committee and approved by the shareholders and Central Government, wherever required.

2. Minimum Remuneration: If, in any financial year, the Company has no profits or its profits are inadequate, the Company shall pay remuneration

to its Whole-time Director/Managing Director in accordance with the provisions of Schedule V of the Companies Act, 2013 and if it is not able to comply with such provisions, with the previous approval of the Central Government.

3. Provisions for excess remuneration: If any Whole-time Director/Managing Director draws or receives, directly or indirectly by way of remuneration

any such sums in excess of the limits prescribed under the Companies Act, 2013 or without the prior sanction of the Central Government, where required, he / she shall refund such sums to the Company and until such sum is refunded, hold it in trust for the Company. The Company shall not waive recovery of such sum refundable to it unless permitted by the Central Government.

• Remuneration to Non-Executive/Independent Director:

1. Remuneration/Commission: The remuneration / commission shall be fixed as per the slabs and conditions mentioned in the Articles of Association

of the Company and the Companies Act, 2013 and the rules made thereunder.

2. Sitting Fees: The Non- Executive / Independent Director may receive remuneration by way of fees for attending meetings of

Board or Committee thereof. Provided that the amount of such fees shall not exceed ` One lakh per meeting of the Board or Committee or such amount as may be prescribed by the Central Government from time to time.

3. Commission: Commission may be paid within the monetary limit approved by shareholders, subject to the limit not exceeding

1% of the profits of the Company computed as per the applicable provisions of the Companies Act,2013.

4. Stock Options: An Independent Director shall not be entitled to any stock option of the Company.

AMENDMENT The Company reserves its right to amend or modify this Policy in whole or in part, at any time without assigning any reason whatsoever. However, no such amendment or modification will be binding unless the same is dully approved and notified by the Committee and Board of Directors of the Company.


BOARD’S REPORT

ANNEXTURE - D

To ,The Members,Tara Jewels LimitedPlot No. 29(P) & 30(P)Sub- Plot- ‘A’, SEEPZ (SEZ),Andheri (E)Mumbai- 400096

Our report of even date is to be read along with this letter.

1. Maintenance of Secretarial Records is the responsibility of the management of the company. Our responsibility is to express an opinion on these secretarial records based on our audit.

2. I have followed the audit practices and processes as were appropriate to obtained reasonable assurance about the correctness of the contents of the secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records, we believe that the processes and practices, we followed provide are reasonable basis for our opinion.

3. I have not verified the correctness and appropriateness of financial records and books of accounts of the company. I relied on the statutory report provided by the Statutory Auditor as well as Internal Auditor of the company for the financial year ending March 31, 2017

4. Wherever required I have obtained the management representation about the compliance of laws, rules and regulations and happening of events etc.

5. The compliance of the provision and other applicable laws, rules, regulations, standards is the responsibility of management. Our examination was limited to the verification of procedures on test basis.

6. The secretarial audit reports neither an assurance as to the future liability of the company nor of the efficacy or effectiveness with which the management has conducted the affairs of the company.

For SUNIL AGARWAL & CO.Company Secretaries

Place: MUMBAIDate: 29/05/2017

Sd/- SUNIL AGARWAL

(Proprietor) FCS No. 8706 C.P. No. 3286


BOARD’S REPORT

Form No. MR-3

SECRETARIAL AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2017[Pursuant to section 204(1) of the Companies Act, 2013 and rule No.9 of the Companies (Appointment and

Remuneration Personnel) Rules, 2014]

To, The Members,Tara Jewels LimitedPlot No. 29(P) & 30(P),Sub- Plot- ‘A’, SEEPZ (SEZ),Andheri (E),Mumbai- 400096.

I have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by TARA JEWELS LIMITED (hereinafter called "the company"). Secretarial Audit was conducted in a manner that provided me a reasonable basis for evaluating the corporate conducts / statutory compliances and expressing my opinion thereon.

Based on my verification of the Company’s books, papers, minute books, forms and returns filed and other records maintained by the Company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, I hereby report that in my opinion, the Company has, during the audit period covering the financial year ended on 31st March, 2017 complied with the statutory provisions listed hereunder and also that the Company has proper Board - processes and compliance - mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

I have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended on 31st March, 2017 according to the provisions of:

(i) The Companies Act, 2013 (the Act) and the rules made there under;

(ii) Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the rules made there under as amended from time to time.

(iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed there under;

(iv) Foreign Exchange Management Act, 1999 and the Rules and Regulations made there under to the extent of Foreign Direct Investment and Overseas Direct Investment (There were no instances of Foreign Direct Investment and Overseas Direct Investments during the year. However, the company has complied with the requirements of filing required forms with Reserve Bank of India for providing Bank Guarantee to the Foreign Subsidiaries, and there were no External Commercial Borrowings;

(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’) as amended from time to time:

(a) The Securities and Exchange Board of India (Substantial acquisition of Shares and Takeovers) Regulations, 2015 as amended from time to time;

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992 and SEBI (Prohibition of Insider Trading) Regulations, 2015;

(c) The Securities and Exchange Board of India (Issue of Capital and Disclosure (Requirements) Regulations, 2009 as amended as Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015;

(d) The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 as amended from time to time;

(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 as amended as Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 are not applicable, as the company has not issued any Debt instruments;


BOARD’S REPORT

(f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 and as amended as Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and dealing with client;

(g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009 as amended as Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 are not applicable, as the company has not applied for Delisting of shares from any stock exchanges and;

(h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998 as amended from time to time are not applicable, as the company has not bought back any securities during the year under audit.

I have also examined compliance with the applicable clauses of the following:

(i) Secretarial Standards issued by The Institute of Company Secretaries of India;

(ii). The Listing Agreements entered into by the Company with:

(a.) Bombay Stock Exchange Stock Exchange Limited

(b.) National Stock Exchange of India Limited During the period under review the Company has complied with the provisions of the Acts, Rules, Regulations, Guidelines

and Standards as mentioned above.

I further report that,

Based on the information provided by the company, its officers and authorized representative during the conduct of audit, and also on the review of compliances report by the respective Department Heads /Company Secretary /CEO /KMP taken on record by the board of directors of the company, in my opinion, adequate systems and process and control mechanism exists in the company to monitor and ensure compliance with applicable general laws, rules, regulations and guidelines detailed as under:

LABOUR LAWS

(a) Factories Act, 1948

(b) Payment of Gratuity Act 1972

(c) Payment of Wages Act, 1936

(d) Minimum Wages Act, 1947

(e) Employee’s Provident Funds & Miscellaneous Provisions Act, 1952 and Rules made there under

(f) Payment of Bonus Act, 1965

(g) Employee’s State Insurance Act, 1948

(h) Contract labour ( Regulations & Abolition) Act, 1970

(i) The Equal Remuneration Act, 1976

(j) The Maternity Benefits Act, 1961

(k) Industrial disputes Act, 1947

(l) The Bombay Shops & Establishment Act, 1948

(m) Customs Act 1952

(n) The Maharashtra Value Added Tax Act, 2002

(o) The Central Sales Tax Act, 1956

(p) Provisions of Finance Act, 2015 read with Service Tax Rules, 1994 and CENVAT Credit Rules, 2004

(q) The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013


BOARD’S REPORT

ENVIRONMENTAL LAWS

(a) Air (Prevention & Control of Pollution) Act, 1981

(b) Water (Prevention & Control of Pollution) Act, 1974

(c) Hazardous Waste (Management & Handling) Rules, 1989

(d) Environment (Protection) Act, 1986

SEEPZ (SEZ) RELATED COMPLAINES The Company has complied with the requirements of the applicable Laws and Rules and Guidelines as required for

establishment of the manufacturing units in SEZ .

The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Executive Directors and Independent Directors. The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act.

Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were

sent in advance, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.

Majority decision is carried through while the dissenting members’ views are captured and recorded as part of the minutes.

I further report that, during the audit period I observed that the company is not regular in depositing statutory dues i.e provident Funds, ESI, Profession Tax with the concerned Authority.

For SUNIL AGARWAL & CO. Company Secretaries

Sd/-

SUNIL AGARWAL (Proprietor)Place: MUMBAI FCS No. 8706Date: 29/05/2017 C.P. No. 3286


BOARD’S REPORT

ANNEXTURE - E

FORM NO. AOC - 2

Disclosure of particulars of contracts/arrangements entered into by the Company with related parties referred to in sub-section (1) of Section 188 of the Companies Act, 2013 including certain arm’s length transactions under third proviso thereto. [Pursuant to Clause (h) of sub-section (3) of Section 134 of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014].

1 No contracts or arrangements or transactions were entered into by the Company with related parties during the year ended March 31, 2017, which were not at arm’s length basis.

2 The details of related party transactions including material related party transactions are as follows:

SR. No.

Name of the releated Party and nature of relationship

Nature of contracts/arrangements/transactions

Duration of the contracts/arrangements/transactions

Salient terms of the contracts or the arrangements or transactions including the value

Date of approval by the Audit Committee/Board

Amount paid as advances

1 Fabrikant Tara International LLC.U.S.A (Wholly owned subsidiary of Tara Jewels Holding Inc., a wholly owned subsidiary)

Sale of Goods Ongoing transactional net margin method `1,649,874,842/-

approval obtained on quarterly basis

Nil

2 Tara (Hong Kong) Ltd. Hong Kong (Wholly owned subsidiary)

Sale of Goods Ongoing transactional net margin method ` 3,145,372,848/-


Nil


Purchase of Goods

Ongoing transactional net margin method ` 956,514,721/-


Nil


Purchase of Goods

Ongoing transactional net margin method ` 2,235,421,221/-


Nil


Labour Charges Paid

Ongoing transactional net margin method ` 154,524/-


Nil


Purchase of Fixed Assets



Nil


Labour Charges Received

Ongoing transactional net margin method ` 4,694,481/-


Nil





Nil


BOARD’S REPORT

ANNEXTURE - F

FORM NO. MGT 9

Pursuant to Section 92 (3) of the Companies Act, 2013 and rule 12(1) of the Company (Management & Administration ) Rules, 2014.

EXTRACT OF ANNUAL RETURN AS ON FINANCIAL YEAR ENDED ON MARCH 31, 2017 I REGISTRATION & OTHER DETAILS:

i CIN L52393MH2001PLC131252

ii Registration Date #March 16, 2001

iii Name of the Company Tara Jewels Limited

iv Category of the Company Company Limited by shares/Indian Non-Government Company

v Address of the Registered office & contact details

Address : Plot No.122, 15th Road, Near IDBI Bank, MIDC

Town / City : Andheri (East), Mumbai- 400093

State : Maharashtra

Country Name : India

Telephone (with STD Code) : 022-66774444

Fax Number : 022-66774464

Email Address : [email protected]

Website, if any: www.tarajewels.in

vi Whether listed company YES

vii Name and Address of Registrar & Transfer Agents (RTA ):-

Name of RTA: LINK INTIME INDIA PVT LIMITED

Address : C 101, 247 Park, L.B.S Marg

Town / City : Vikroli (East), Mumbai- 400083

State : Maharashtra

Pin Code: 400078

Telephone : 022-49286000

Fax Number : 022-49186060

Email Address : [email protected]


BOARD’S REPORT

II. PRINCIPAL BUSINESS ACTIVITY OF THE COMPANY

All the business activities contributing 10 % or more of the total turnover of the company shall be stated:-

Sl. No.

Name and Description of main products / services

NIC Code of the Product / service % to total turnover of the company

1 Jewellary 321 100%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES -

S. No.

NAME AND ADDRESS OF THE COMPANY

CIN/GLN HOLDING/ SUBSIDIARY /ASSOCIATE

% of shares held Applicable Section

1 Tara Jewels Holdings Inc N.A Subsidiary 100% 2(87)

2 Fabrikant Tara International LLC *

N.A Subsidiary 2(87)

3 Tara Hong Kong Limited N.A Subsidiary 100% 2(87)

4 Tara China Jewelry Limited* N.A Subsidiary 2(87)

* Both the Companies are Step Down Subsidiaries of our Wholly Owned Subsidiary

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

i. Category-wise Share Holding

Sr No

Category ofShareholders

Shareholding at the beginning of the year - 2016

Shareholding at the end of the year - 2017

% Changeduring

the yearDemat Physical Total % of Total

Shares

Demat Physical Total % of Total

Shares

(A) Shareholding of Promoter and Promoter Group

[1] Indian

(a) Individuals / Hindu Undivided Family

14766398 0 14766398 '59.9703 14746398 0 14746398 '59.8891 '-0.0812

(b) Central Government / State Government(s)

0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(c) Financial Institutions / Banks

0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(d) Any Other (Specify)

Bodies Corporate 33600 0 33600 '0.1365 33600 0 33600 '0.1365 '0.0000

Sub Total (A)(1) 14799998 0 14799998 '60.1068 14779998 0 14779998 '60.0255 '-0.0813

[2] Foreign

(a) Individuals (Non-Resident Individuals / Foreign Individuals)

0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(b) Government 0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(c) Institutions 0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(d) Foreign Portfolio Investor 0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(e) Any Other (Specify)

Sub Total (A)(2) 0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

Total Shareholding of Promoter and Promoter Group(A)=(A)(1)+(A)(2)

14799998 0 14799998 '60.1068 14779998 0 14779998 '60.0255 '-0.0813


BOARD’S REPORT

Sr No




% Changeduring


Shares


Shares

(B) Public Shareholding

[1] Institutions

(a) Mutual Funds / UTI 0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(b) Venture Capital Funds 0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(c) Alternate Investment Funds

0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(d) Foreign Venture Capital Investors

0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(e) Foreign Portfolio Investor 225080 0 225080 '0.9141 0 0 0 '0.0000 '-0.9141

(f) Financial Institutions / Banks

0 0 0 '0.0000 31979 0 31979 '0.1299 '0.1299

(g) Insurance Companies 0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(h) Provident Funds/ Pension Funds

0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(i) Any Other (Specify)

Sub Total (B)(1) 225080 0 225080 '0.9141 31979 0 31979 '0.1299 '-0.7842

[2] Central Government/ State Government(s)/ President of India

Sub Total (B)(2) 0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

[3] Non-Institutions

(a) Individuals

(i) Individual shareholders holding nominal share capital upto ` 1 lakh.

3405434 3 3405437 '13.8304 4466235 253 4466488 '18.1396 '4.3092

(ii) Individual shareholders holding nominal share capital in excess of ` 1 lakh

2243431 196521 2439952 '9.9093 1731296 196521 1927817 '7.8294 '-2.0799

(b) NBFCs registered with RBI 0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(c) Employee Trusts 0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

(d) Overseas Depositories(holding DRs) (balancing figure)

0 0 0 '0.0000 0 0 0 '0.0000 '0.0000


BOARD’S REPORT

Sr No




% Changeduring


Shares


Shares

(e) Any Other (Specify)

Hindu Undivided Family 274286 0 274286 '1.1139 250180 0 250180 '1.0160 '-0.0979

Foreign Companies 1800000 0 1800000 '7.3103 1800000 0 1800000 '7.3103 '0.0000

Non Resident Indians (Non Repat)

35548 0 35548 '0.1444 54219 0 54219 '0.2202 '0.0758

Other Directors 3300 0 3300 '0.0134 3300 0 3300 '0.0134 '0.0000

Non Resident Indians (Repat)

251610 0 251610 '1.0219 359685 0 359685 '1.4608 '0.4389

Clearing Member 282351 0 282351 '1.1467 206317 0 206317 '0.8379 '-0.3088

Bodies Corporate 1105288 0 1105288 '4.4889 742867 0 742867 '3.0170 '-1.4719

Sub Total (B)(3) 9401248 196524 9597772 '38.9791 9614099 196774 9810873 '39.8446 '0.8655

Total Public Shareholding(B)=(B)(1)+(B)(2)+(B)(3)

9626328 196524 9822852 '39.8932 9646078 196774 9842852 '39.9745 '0.0813

Total (A)+(B) 24426326 196524 24622850 '100.0000 24426076 196774 24622850 '100.0000 '0.0000

(C) Non Promoter - Non Public

[1] Custodian/DR Holder 0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

[2] Employee Benefit Trust (under SEBI (Share based Employee Benefit) Regulations, 2014)

0 0 0 '0.0000 0 0 0 '0.0000 '0.0000

Total (A)+(B)+(C) 24426326 196524 24622850 '100.0000 24426076 196774 24622850 '100.0000 '0.0000

ii Shareholding of Promoters

Sr No

Shareholder's Name Shareholding at thebeginning of the year - 2016

Shareholding at theend of the year - 2017

% change inshareholding

during the yearNo. of

SharesHeld

% of total

Shares of the

company

%of SharesPledged

/encumbered to

total shares

No. ofShares

Held

% of total

Shares of the

company

%of SharesPledged/

encumbered to

total shares

1 RAJEEV SHETH 14522893 '58.9814 '13.5450 14502893 '58.9001 '48.5577 '-0.0813

2 AARTI SHETH 114440 '0.4648 '0.0000 114440 '0.4648 '0.0000 '0.0000

3 DIVYA SHETH 114440 '0.4648 '0.0000 114440 '0.4648 '0.0000 '0.0000

4 DIVYA JEWELS INTERNATIONAL PVT LTD

33600 '0.1365 '0.0000 33600 '0.1365 '0.0000 '0.0000

5 PURNIMA RAJEEV SHETH 14625 '0.0594 '0.0000 14625 '0.0594 '0.0000 '0.0000

Total 14799998 '60.1068 '48.5577 14779998 '60.0255 '48.5577 '-0.0813


BOARD’S REPORT

iii Change in Promoters’ Shareholding (please specify , if there is no change)

Sr No.

Name & Type of Transaction

Shareholding at the beginning of

the year - 2016

Transactions during the year

Cumulative Shareholding at the end of

the year - 2017

No. of Shares

Held

% of Total Shares of The

Company

Date of Transaction

No. of Shares

No of Shares

Held


Company

1 RAJEEV SHETH* 14522893 58.9814 14522893 58.9814

Transfer 10 Mar 2017 (8575175) 5947718 24.1553

Transfer 24 Mar 2017 8555175 14502893 58.9001

AT THE END OF THE YEAR 14502893 58.9001

2 AARTI SHETH

114440 0.4648 114440 0.4648


3 DIVYA SHETH

114440 0.4648 114440 0.4648


4 DIVYA JEWELS INTERNATIONAL PVT LTD

33600 0.1365 33600 0.1365


5 PURNIMA RAJEEV SHETH

14625 0.0594 14625 0.0594


* Change in shareholding of Mr. Rajeev Sheth is due to sale of 20,000 share by Punjab National Bank.

# In case of other Promoter’s Holdings no changes during the year.

iv Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs)

Sr No.



the year - 2016



the year - 2017

No. of Shares

Held


Company

Date of Transaction

No. of Shares

No of Shares

Held


Company

1 CRYSTALON FINANZ AG 1800000 7.3103 1800000 7.3103


2 SUBRAMANIAN P 158218 0.6426 158218 0.6426

Transfer 14 Oct 2016 228635 386853 1.5711


3 M R RAJARAM 284902 1.1571 284902 1.1571

Transfer 16 Sep 2016 (10000) 274902 1.1165


BOARD’S REPORT

Sr No.



the year - 2016



the year - 2017

No. of Shares

Held


Company

Date of Transaction

No. of Shares

No of Shares

Held


Company

Transfer 14 Oct 2016 (40000) 234902 0.9540

Transfer 04 Nov 2016 (5000) 229902 0.9337

Transfer 27 Jan 2017 (5000) 224902 0.9134

Transfer 10 Feb 2017 (1500) 223402 0.9073

Transfer 17 Feb 2017 (5000) 218402 0.8870


4 FABRIKANT H K TRADING LIMITED

196521 0.7981 196521 0.7981


5 ANUJ ANANTRAI SHETH 185000 0.7513 185000 0.7513


6 KIFS INTERNATIONAL LLP 0 0.0000 0 0.0000

Transfer 15 Jul 2016 115000 115000 0.4670


7 AMRIT PETROLEUMS PVT LIMITED

69309 0.2815 69309 0.2815


8 JAGDISH AMRITLAL SHAH 68706 0.2790 68706 0.2790


9 JIGNESH MADHUKANT MEHTA

65000 0.2640 65000 0.2640

Transfer 31 Mar 2017 (500) 64500 0.2620


10 NARENDRA SINGHANIA 55555 0.2256 55555 0.2256



BOARD’S REPORT

v Shareholding of Directors and Key Managerial Personnel

Shareholding of each Directors and each Key Managerial Shareholding at the beginning of

the year

Cumulative Shareholding during the year

No. of shares % of total shares of the

company

No. of shares % of total shares of the

company

1. Mr. Rajeev Sheth, Chairman and Managing Director* 14522893 #58.98%

Transfer -8575175 #34.83% 5947718 #24.1553%

Transfer 8575175 #34.83% 14502893 #58.90%

2. Mr. Vishnu Prakash Garg, Executive Director & CFO # NIL NIL

3. Mr. Ravindran M.P, Executive Director # NIL NIL

4. Mr. Nikkhil Vaidya, Independent Director # NIL NIL

5. Mr. Rajiv Jain, Independent Director 300 300 #0.001%

6. Mr. Rakesh Kalra, Independent Director # NIL NIL

7. Mr. Shanti Saroop Khindria, Independent Director # NIL NIL

8. Ms. Fern Mallis, Independent Director NIL NIL

9. Mr. Mariano De La Torrre, Nominee Director # NIL NIL

10. Ms. Alison Lazerwitz, Nominee Director & NIL NIL

11. Mr. Stuart Marcus, Director# NIL NIL

12. Mr. Jeffrey Shlakman, Director # NIL NIL

13. Ms. Nivedita Nayak, Company Secretary NIL NIL

14. Mr. Sanjay Sethi, Executive Director & CFO & NIL NIL

*The above changes in Mr. Rajeev Sheth Shares are on account of Sale of 20,000 Shares by Punjab National Bank

# Mr. Rakesh Kalra, Mr. Stuart Marcus, Mr. Jeffrey Shalkman Resigned w.e.f May 29, 2017, Mr. Mariano de la torree resigned w.e.f December 9, 2016, Mr. Ravindran M.P, Mr. Vishnu Prakash Garg, Mr. Shanti Saroop Khindria resigned w.e.f August 10, 2017, Mr. Nikkhil Vaidya resigned w.e.f August 4, 2017.

& Ms. Alison Lazerwitz appointed w.e.f February 10, 2017

# Mr. Vishnu Prakash Garg resigned as CFO w.e.f May 29, 2017

& Mr. Sanjay Sethi appointed as CFO w.e.f June 20, 2017 and as a Executive Director w.e.f August 10, 2017


BOARD’S REPORT

V INDEBTEDNESS

Indebtedness of the Company including interest outstanding/accrued but not due for payment(Amount in `)

Secured Loans including Deposits

Unsecured Loans Deposits Total Indebtness

Indebtedness at the beginning of the financial year

i) Principal Amount 5,755,824,696 - - 5,755,824,696

ii) Interest due but not paid

- - - -

iii) Interest accrued but not due

194,614 - - 194,614

Total (i+ii+iii) 5,756,019,310 - - 5,756,019,310

Change in Indebtedness during the financial year

• Addition (185,407,473) 8,064,008 (177,343,465)

• Reduction - - - -

Net Change (185,407,473) 8,064,008 - (177,343,465)

Indebtedness at the end of the financial year

i) Principal Amount 5,561,401,873 8,064,008 - 5,569,465,881

ii) Interest due but not paid

6,960,484 - - 6,960,484

iii) Interest accrued but not due

2,249,480 - - 2,249,480

Total (i+ii+iii) 5,570,611,837 8,064,008 - 5,578,675,845


BOARD’S REPORT

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director, Whole-time Directors and/or Manager:

Sr. No.

Particulars of Remuneration Name of MD/WTD/ Manager Total Amount in `

Mr Rajeev V. Sheth

Mr. Vishnu Prakash Garg

Mr Ravindran M. P.

1 Gross salary

(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961

12,000,000 4,430,543 2,947,049 19,377,592

(b) Value of perquisites u/s 17(2) Income-tax Act, 1961

- - - -

(c) Profits in lieu of salary under section 17(3) Income tax Act, 1961

- - - -

2 Stock Option - - - -

3 Sweat Equity - - - -

4 Commission - - - -

- as % of profit - - - -

- others, specify… - - - -

5 Others, please specify - - - -

Total (A) 12,000,000 4,430,543 2,947,049 19,377,592

Ceiling as per the Act (being 10% of the net profits

of the company calculated as

per section 198 of the

Companies Act, 2013.


BOARD’S REPORT

B. Remuneration to other directors:

Sr. No.

Particulars of Remuneration

Name of Directors Total Amount

in `Ms. Fern Mallis Mr. Nikhil

VaidyaMr. Rakesh

KalraMr. Shanti

Saroop Khindria

Mr. Rajiv Jain

1 Independent Directors

• Fee for attending board / committee meetings

60,000 160,000 160,000 40,000 80,000 500,000

• Commission - - - - - -

• Others, please specify - - - - - -

Total (1) - - - - - -

2 Other Non-Executive Directors

• Fee for attending board / committee meetings

- - - - - -

• Commission - - - - - -

• Others, please specify - - - - - -

Total (2) - - - - - -

Total (B)=(1+2) - - -

Total Managerial Remuneration

60,000.00 160,000.00 160,000.00 40,000.00 80,000.00 500,000.00

Overall Ceiling as per the Act

(being 1% of the net profitsbof the company

calculated as per section 198 of the

Companies Act, 2013)


BOARD’S REPORT

C. REMUNERATION TO KEY MANAGERIAL PERSONNEL OTHER THAN MD/MANAGER/WTD

Sr. No.

Particulars of Remuneration CFO Company Secretary

Total Amount

in `

Gross salary

(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961

652,759 629,039 1,281,798

(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 - - -

(c) Profits in lieu of salary under section 17(3) Incometax Act, 1961 - - -

Commission

- as % of profit - - -

- others, specify… - - -

Others, please specify - - -

Total 652,759 629,039 1,281,798

VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES:

TYPE Section of the Companies Act

Brief Description Details of Penalty/Punishment/Compoundingfees imposed

Authority (RD/NCLT/COURT)

A. COMPANY

Penalty

Punishment NONE

Compounding

B. DIRECTORS

Penalty

Punishment NONE

Compounding

C. OTHER OFFICERS IN DEFAULT

Penalty

Punishment NONE

Compounding


BOARD’S REPORT

ANNEXTURE G

PRACTISING COMPANY SECRETARY’S CERTIFICATE ON CORPORATE GOVERNANCE[Regulation 34(3) read with Para E of Schedule V of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015]

ToThe Members of TARA JEWELS LIMITEDPlot No. 29(O) & 30(P)Sub- Plot- ‘A’, SEEPZ (SEZ),Andheri (E)Mumbai- 400096

I have examined the compliance of conditions of Corporate Governance by TARA JEWELS LIMITED (“Company”) for the year ended March 31, 2017, as stipulated in Regulation 34(3) read with Para C of Schedule V of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

I have conducted my examination on the basis of the relevant records and documents maintained by the Company and furnished to me for the purpose of the review and the information and explanations given to me by the Company during the course of such review.

The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company. In my opinion and to the best of my information and according to the explanations given to me, I certify that the Company has in all material respects complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.

I further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company. For SUNIL AGARWAL &CO. Company Secretaries

Sd/-Date: May 29, 2017 SUNIL AGARWAL Place: Mumbai Proprietor C.P. No. 3286


The Report on Corporate Governance as prescribed by the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“the Listing Regulations”) is given below:

A. COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCE Your Company adheres to best practices in Corporate Governance based on certain key principles, including fairness and

integrity, transparency and disclosure, accountability, equal treatment to all the shareholders and social responsibility. Corporate Governance extends beyond corporate laws. Its fundamental objective is not merely to fulfil legal requirements, but also the institution of and adherence to systems and procedures, ensuring the commitment of the Board of Directors in managing the Company’s affairs in a transparent manner to maximise the long-term value of the shareholders at large.

Your Company has adopted an appropriate Corporate Governance framework to ensure timely and accurate disclosure of all material matters, including financial position, performance, ownership and governance.

Your Company’s policies and practices relating to the Corporate Governance are discussed in the following sections:

B. BOARD OF DIRECTORS (i) Board Membership Criteria The members of the Board of Directors of your Company are expected to possess the required expertise, skill and

experience to effectively manage and direct your Company to attain its organisational goals. They are expected to be persons with vision, leadership qualities, proven competence and integrity, and with a strategic bent of mind.

Each member of the Board of Directors of your Company is expected to ensure that his/her personal interest does not run in conflict with your Company’s interests. Moreover, each member is expected to use his/her professional judgement to maintain both the substance and appearance of independence and objectivity.

(ii) Composition of the Board The Board of Directors of your Company has an optimum combination of Executive and Non-executive Directors to

have a balanced Board Structure. The Board has Five Directors, and except the Chairman & Managing Director and one Whole-Time Director, all other three Directors are Non-executive. Out of the three Non-executive Directors, two are Independent Directors and one is Non Independent Director i.e Nominee Director. The Chairman of the Board of Directors of your Company is a Non-Independent Director.

The composition of the Board of Directors of your Company as on the date of this Report, along with the other Directorships held by each of the Directors is brought out in the following tables:

Name of Director Position Relationship with other Directors

No. of otherDirectorships#

No. of other Board Committee(s) of whichhe / she is aMember*

No. of other Board Committee(s) of whichhe / she is aChairman*

Mr. Rajeev Sheth(DIN: 00266460)

Chairman & Managing Director

None 3 NIL NIL

Mr. Ravindran M.P (DIN:07188069)@

Executive Director None NIL NIL NIL

Mr. Vishnu Prakash Garg(DIN: 00024991)@


Mr. Mariano Fernando de la Torre (DIN: 07087405)@

Nominee Director None NIL NIL NIL

CORPORATE GOVERNANCE REPORT


Name of Director Position Relationship with other Directors

No. of otherDirectorships#

No. of other Board Committee(s) of whichhe / she is aMember*

No. of other Board Committee(s) of whichhe / she is aChairman*

Mr. Rajiv Lochan Jain(DIN: 00161022)

Non-executive & Independent Director

None 2 2 NIL

Mr. Rakesh Kalra(DIN: 00780354)@


None 5 4 1

Mr. Nikkhil Vaidya(DIN: 02942549)@


None NIL NIL NIL

Ms. Fern Mallis(DIN: 03270532)


None NIL NIL NIL

Mr. Shanti Saroop Khindria(DIN: 03271292)@


None NIL NIL NIL

Mr. Jeffrey Shlakman (DIN:07545964 )@

Non-executive & Non Independent Director

None NIL NIL NIL

Mr. Stuart Marcus (DIN:07545966)@

Non-executive & Non Independent Director

None NIL NIL NIL

Ms. Alison Lazerwitz (DIN: 07706809)$

Nominee Director None NIL NIL NIL

Mr. Sanjay Sethi(DIN: 01152580) %


# Excludes Directorships in Foreign Companies and Section 8 Companies.* Includes only Audit Committee and Stakeholders’ Relationship Committee.@ Mr. Mariano de la torree resigned as a Nominee Director w.e.f December 9, 2016, Mr. Rakesh Kalra resigned as a Director w.e.f May 29, 2017, Mr. Jeffrey Shlakman resigned as a Director w.e.f May 29, 2017, Mr. Stuart Marcus resigned as a Director w.e.f May 29, 2017, Mr. Nikkhil Vaidya resigned as a Director w.e.f August 4, 2017, Mr. Vishnu Prakash Garg resigned as a Director w.e.f August 10, 2017, Mr. Shanti Saroop Khindria resigned as a Director w.e.f August 10, 2017 and Mr. Ravindran M.P resigned as a Director w.e.f August 10, 2017.$ Ms. Alison Lazerwitz appointed as a Nominee Director w.e.f February 10, 2017.% Mr. Sanjay Sethi appointed as Executive Director w.e.f August 10, 2017.

iii) Board Meetings / Annual General Meeting During the year 2016-17, the Board of Directors of your Company met 4 times on May 23, 2016, September 2,

2016, December 9, 2016 and February 10, 2017.

The previous Annual General Meeting was held on September 19, 2016. The Details regarding the attendance of Directors at the Board Meetings and the Annual General Meeting held

during 2016-17 are presented in the following table:

Director No. of Board Meetings Whether Last AGM Attended (Yes/No)

Held Attended

Mr. Rajeev Sheth 4 4 YES

Mr. Ravindran M.P 4 3 NO

Mr. Vishnu Prakash Garg 4 4 YES



Director No. of Board Meetings Whether Last AGM Attended (Yes/No)

Held Attended

Ms. Fern Mallis 4 3 NO

Mr. Nikkhil Vaidya 4 4 YES

Mr. Rajiv Lochan Jain 4 4 YES

Mr. Rakesh Kalra 4 4 NO

Mr. Shanti Saroop Khindria 4 2 NO

Mr. Mariano De la Torree 4 1 NO

Mr. Stuart Marcus 4 2 NO

Mr. Jeffrey Shlakman 4 2 NO

Ms. Alison lazerwitz 4 1 NO

(iv) Membership Term and Retirement Policy According to your Company’s Articles of Association, at every Annual General Meeting, one-third of the Directors

for the time being are liable to retire by rotation or, if their number is not three or a multiple of three, then the number nearest to one-third, shall retire from office.

The Directors to retire by rotation at every Annual General Meeting shall be those who have been longest in office

since their last appointment. However, as between persons who became Director on the same day and those who are to retire shall (unless they otherwise agree among themselves) be determined by lot. A retiring Director shall be eligible for re-appointment.

(v) Code of Conduct Your Company’s Board of Directors has prescribed a Code of Conduct for all Board Members and the Company’s

Senior Management. The Code of Conduct is available on your Company’s website, www.tarajewels.in.

All the Board Members and the Senior Management personnel of your Company have affirmed their compliance with the Code of Conduct for the year ended March 31, 2017. A declaration to this effect signed by the Managing Director is given at the end of this report.

(vi) Code of Conduct for Prohibition of Insider Trading In accordance with the SEBI (Prohibition of Insider Trading) Regulations, 2015, the Board has approved and adopted

a code of conduct governing all the directors, senior management and other employees of the Company. The Company Secretary of the Company is the Compliance Officer in respect of compliance of the code.

(vii) Profile of Directors under SEBI (Listing and Disclosure Requirements) Regulations, 2015 In compliance with SEBI (Listing and Disclosure Requirements) Regulations, 2015 brief resume, expertise and

details of other directorship, membership in committees of Directors of other Companies and shareholding in the Company of the Directors proposed to be re-appointed / appointed are attached along with Notice of annual general meeting.

C. BOARD COMMITTEES In compliance with both the mandatory and non-mandatory requirements under SEBI (Listing and Disclosure Requirements)

Regulations, 2015 and the applicable laws, your Company’s Board of Directors constituted the following Committees:

(i) Audit Committee

(ii) Nomination and Remuneration Committee

(iii) Stakeholders' Relationship Committee



(iv) Finance Committee

(v) Allotment Committee

(vi) Compensation Committee

(vii) Management & Administration Committee

(viii) Corporate Social Responsibility Committee

(ix) Risk Management Committee The Chairman of the Board, in consultation with the Company Secretary and the respective Chairman of these Committees,

determines the frequency of the meetings of these Committees. The Board of Directors has also adopted the following policies in line with the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 and the Companies Act, 2013 for the effective and defined functioning of the respective Committees of the Board:

a) Whistle Blower Policy (Vigil mechanism)

b) Internal Financial Control Policy;

c) Related Party transaction Policy;

d) Risk Management Policy;

e) Corporate Social Responsibility Policy

f) Nomination and Remuneration Policy

g) Disclosure Policy

h) Audit Committee Mechanism

i) Familiarization Programme for Independent Directors

j) Insider Trading Code, 2015

k) Code of Conduct for the Members of Board & Senior Management Personnel

l) Documents Retention Policy

m) Policy on Material Related Party Transaction

n) Policy on disclosure of material events and information.

(i) Audit Committee The Audit Committee of the Board of Directors of your Company consists of the following Members as on March

31, 2017:

1. Mr. Nikkhil Vaidya- Chairman and Member upto August 4, 2017

2. Mr. Rakesh Kalra- Member upto May 29 , 2017

3. Mr. Rajiv Jain- Member from May 29, 2017

4. Mr. Ravindran M.P- Member upto August 10, 2017

5. Mr. Sanjay Sethi- Member from August 10, 2017

The Company Secretary of the Company acts as the Secretary of the Committee. The Company’s Audit Committee met four times during 2016-17 on May 23, 2016, September 2, 2016, December

9, 2016 and February 10, 2017.



The following table presents the details of attendance at the Audit Committee meetings held during 2016-17:

Members No. of Meetings Held No. of Meetings Attended Category

Mr. Nikkhil Vaidya 4 4 Independent Director

Mr. Rakesh Kalra 4 4 Independent Director

Mr. Ravindran M.P 4 2 Executive Director

Mr. Nikkhil Vaidya, the Chairman of the Audit Committee was present at the Company’s Previous Annual General Meeting held on September 19, 2016.

The composition, role, terms of reference as well as powers of the Audit Committee are in accordance with the provisions of SEBI (Listing and Disclosure Requirements) Regulations, 2015 and Section 177 of the Companies Act, 2013.

The role of the audit committee shall include the following:

(1) oversight of the listed entity’s financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible;

(2) recommendation for appointment, remuneration and terms of appointment of auditors of the listed entity;

(3) approval of payment to statutory auditors for any other services rendered by the statutory auditors;

(4) reviewing, with the management, the annual financial statements and auditor's report thereon before submission to the board for approval, with particular reference to:

(a) matters required to be included in the director’s responsibility statement to be included in the board’s report in terms of clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013;

(b) changes, if any, in accounting policies and practices and reasons for the same;

(c) major accounting entries involving estimates based on the exercise of judgment by management;

(d) significant adjustments made in the financial statements arising out of audit findings;

(e) compliance with listing and other legal requirements relating to financial statements;

(f) disclosure of any related party transactions;

(g) modified opinion(s) in the draft audit report;

(5) reviewing, with the management, the quarterly financial statements before submission to the Board for approval;

(6) reviewing, with the management, the statement of uses / application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer document / prospectus / notice and the report submitted by the monitoring agency monitoring the utilization of proceeds of a public or rights issue, and making appropriate recommendations to the board to take up steps in this matter;

(7) reviewing and monitoring the auditor’s independence and performance, and effectiveness of audit process;

(8) approval or any subsequent modification of transactions of the listed entity with related parties;

(9) scrutiny of inter-corporate loans and investments;

(10) valuation of undertakings or assets of the listed entity, wherever it is necessary;

(11) evaluation of internal financial controls and risk management systems;

(12) reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;

(13) 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;



(14) discussion with internal auditors of any significant findings and follow up there on;

(15) 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;

(16) 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;

(17) 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;

(18) to review the functioning of the whistle blower mechanism;

(19) approval of appointment of chief financial officer after assessing the qualifications, experience and background, etc. of the candidate;

(20) Carrying out any other function as is mentioned in the terms of reference of the audit committee.

The audit committee shall mandatorily review the following information:

(1) management discussion and analysis of financial condition and results of operations;

(2) statement of significant related party transactions (as defined by the audit committee), submitted by management;

(3) management letters / letters of internal control weaknesses issued by the statutory auditors;

(4) internal audit reports relating to internal control weaknesses; and

(5) the appointment, removal and terms of remuneration of the internal auditor shall be subject to review by the audit committee.

(6) statement of deviations:

(a) quarterly statement of deviation(s) including report of monitoring agency, if applicable, submitted to stock exchange(s) in terms of Regulation 32(1).

(b) annual statement of funds utilized for purposes other than those stated in the offer document/prospectus/notice in terms of Regulation 32(7).

The Audit Committee acts as a Link between the Management, the Statutory Auditors, Internal Auditors and the Board of Directors.

The detailed terms of reference of Audit Committee are available on your Company’s website, www.tarajewels.

co.in.

(ii) Nomination and Remuneration Committee The Nomination and Remuneration Committee of the Board of Directors of your Company consists of the following

Members as on March 31, 2017:

1. Mr. Rakesh Kalra- Chairman upto May 29, 2017

2. Mr. Nikkhil Vaidya- Chairman from May 29, 2017 to August 4, 2017

3. Mr. Rajiv Jain- Member

4. Ms. Fern Mallis- Member from May 29, 2017

The Company Secretary of the Company acts as the Secretary of the Committee.

The Company’s Nomination and Remuneration Committee met three times during the year 2016-17viz. May 23, 2016, September 2, 2016 and February 10, 2017.



The following table presents the details of attendance at the Nomination and Remuneration Committee meetings held during 2016-17:



Mr. Rakesh Kalra 3 3 Independent Director

Mr. Rajiv Jain 3 3 Executive Director

The Board of Directors has on the recommendation of the Nomination and Remuneration Committee adopted the Nomination and Remuneration Policy. A copy of the same has been attached to the Directors Report as Annexture C.

Role of committee shall, inter-alia, include the following:

(1) formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the board of directors a policy relating to, the remuneration of the directors, key managerial personnel and other employees;

(2 formulation of criteria for evaluation of performance of independent directors and the board of directors;

(3) devising a policy on diversity of board of directors;

(4) identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the board of directors their appointment and removal.

(5) whether to extend or continue the term of appointment of the independent director, on the basis of the report of performance evaluation of independent directors.

Remuneration Policy The remuneration of Executive Director/s is decided by the Board of Directors on the recommendation of Nomination

and Remuneration Committee and the Board of Directors as per the Company’s remuneration policy within the overall ceiling approved by shareholders.

Remuneration paid to Non-executive Directors The Independent Directors of your Company are paid sitting fees. Your Company pays sitting fees of ` 20,000/- per

meeting to the Independent Directors for attending the meetings of the Board and Audit Committee Meetings of the Board.

Details of Remuneration for the Financial Year 2016-17

Non-Executive Independent Directors

Name of the Director Commission (`) Sitting Fees (`) No of Shares Held

Mr. Nikkhil Vaidya NIL 1,60,000 NIL

Mr. Rakesh Kalra NIL 1,60,000 NIL

Mr. Rajiv Jain NIL 80,000 300

Mr. Shanti Saroop Khindria NIL 40,000 NIL

Ms. Fern Mallis NIL 60,000 NIL



Executive / Whole--Time Director

Name of Director Period of Appointment Remuneration Including Commission (`)

No. of Shares Held/Stock Options *

Mr. Rajeev Sheth, Chairman and Managing Director

Reappointed for 5 years w.e.f October 1, 2015

12,000,000 14,520,893

Mr. Vishnu Prakash Garg, Executive Director

Appointed w.e.f May 23, 2016 and Resigned w.e.f August 10, 2017

44,30,543 NIL

Mr. Ravindran M.P, Executive Director

5 years w.e.f May 25, 2015 Resigned w.e.f August 10, 2017

29,47,049 NIL

None of the Directors are entitled to any benefit upon termination of their association with your Company.

* There were no Stock Options granted during Financial Year 2016-2017.

(iii) Stakeholders Relationship Committee The Stakeholders Relationship Committee of the Board of Directors of your Company consists of the following

Members as on March 31, 2017:

1. Mr. Rajiv Jain- Chairman and Member

2. Mr. Ravindran M.P- Member upto August 10, , 2017

3. Mr. Nikkhil Vaidya- Member upto August 4, 2017


The Company Secretary of the Company acts as the Secretary of the Committee. The Company’s Stakeholders Committee met four times during 2016-17 on May 23, 2016, September 2, 2016,

December 9, 2016 and February 10, 2017

The following table presents the details of attendance at the Stakeholders Relationship Committee meetings held during 2016-17:


Mr. Rajiv Jain 4 4 Independent Director



The Company has received no complaint from the investors / shareholders during the financial year ended March 31, 2017 and the same has been resolved by the Company.

The terms of reference of the Stakeholders Relationship Committee is as follows:

Inter alia to look into redressal of shareholders and investor complaints, e.g. transfer of shares, non-receipt of balance sheet/ annual report, non-receipt of declared dividend, interest, notices etc.; formulation of procedures in line with the statutory guidelines to ensure speedy disposal of various requests received from shareholders from time to time;



The Securities and Exchange Board of India (SEBI) has commenced processing of investor complaints in a centralised web-based complaints redress system - ‘SCORES’. The salient features of this system are:

• Centralised database of all complaints

• Online movement of complaints to the concerned listed companies

• Online upload of Action Taken Reports (ATRs) by the concerned companies

• Online viewing by investors of actions taken on the complaint and its current status

Your Company has been registered on SCORES and makes every effort to resolve all investor complaints received through SCORES or otherwise within the statutory time limit from the receipt of the complaint.

(iv) Finance Committee The Company’s Board of Directors formed a Finance Committee to look after the routine financial requirements of

the Company like opening and closing of bank accounts, borrowing funds up to the limits prescribed by the Board, making investments, etc.

The Finance Committee of the Board of Directors of your Company consists of the following Members as on March 31, 2017.

1. Mr. Rajeev Sheth- Chairman;




The Company’s Finance Committee met nine times during 2016-2017 on May 23, 2016, September 2, 2016, October 6, 2016, November 18, 2016, December 6, 2016, December 9, 2016, February 10, 2017, March 2, 2017 and March 3, 2017.

The following table presents the details of attendance at the Finance Committee meetings held during 2016-17:


Mr. Rajeev Sheth 9 9 Managing Director


The terms of reference of the Finance Committee are as follows:

1. Exercise all powers to borrow moneys (otherwise than on debentures) within the limits sanctioned by the Board and do all necessary acts and deeds connected therewith.

2. Borrow monies by way of loan and / or issuing and allotting Bonds / Notes denominated in one or more foreign currencies in international markets, for the purpose of refinancing the existing debt, capital expenditure, general corporate purposes including working capital requirements and possible strategic investments within the limits approved by the Board.

3. To authorize opening, operation, changing of authorized signatories of the Company with respect to all Bank Accounts maintained by the Company, authorization for e-banking banking account/transaction and closing any bank account.

4. To open and close Demat accounts of the Company for holding securities/ investments owned by the Company. The Members of the Finance Committee will be empowered to make appropriate changes in authorized signatories of the Company for operation of demat accounts.

5. Giving of guarantees / providing corporate guarantee/ providing performance guarantee/ issuing letters of comfort / providing securities within the limits approved by the Board.



6. To authorize officers of the Company for entering into forex transactions and hedging as per approved policy of the Company;

7. Approve opening and operation of Investment Management Accounts with Foreign Banks and appoint them as Agents, establishment of representative / sales offices in or outside India etc.

8. To delegate powers, make changes, in the authorized signatories of the Company with all matters related to Central Excise Act & Rules framed there under, Customs Act & Rules framed there under, Central and State Sales Tax/Value Added Tax & Rules framed there under, Foreign Trade (Development & Regulation) Act & Rules framed there under, the Employees’ Provident Funds and Miscellaneous Provisions Act & Rules framed there under, the Payment of Gratuity Act & Rules framed there under, the Employees’ State Insurance Act & Rules framed there under, issue related to Director General Foreign Trade (DGFT), Foreign Trade Policy & Rules framed there under, Superannuation Scheme or any other authorisation of similar nature;

9. To authorize officers of the Company for entering into general contracts, agreements with relation to operations with Statutory/Regulatory Bodies viz., Electricity Boards, Ports, Railways, Pollution Control Boards, Town & Country Planning Authorities, Municipal Corporations, Panchayats, any other Local Bodies or any other similar bodies/authorities.

10. Exercise all powers to invest the funds of the Company within limits specified by the Board.

11. To delegate powers, constitute committees of authorized officials for the purposes of investing surplus funds temporarily not required for the business of the Company and any other matters incidental thereto.

12. Exercise powers to make loans on behalf on the Company within the limits sanctioned by the Board.

13. Authorize one or more employees of the Company /Group u/s 113 of the Companies Act, 2013 to attend and vote at the meetings of subsidiary, associate Company or any other Company where the Company is a shareholder/debenture-holder, meetings of creditors and meetings convened by the orders of the Court.

14. Carry out any other function as is mandated by the Board from time to time and / or enforced by any statutory notification, amendment or modification as may be applicable.

15. Other transactions or financial issues that the Board may desire to have them reviewed by the Finance Committee.

16. Delegate authorities from time to time to the Executives / Authorised persons to implement the decisions of the Committee.

17. Regularly review and make recommendations to the Board about changes to the charter of the Committee.

(v) Allotment Committee The Company’s Board of Directors formed an Allotment Committee in February, 2013 to allot shares of the

Company, especially pursuant to the ESOP Schemes of the Company.

The Allotment Committee of the Board of Directors of your Company consists of the following Members as on March 31, 2017 viz.:

1. Mr. Rajeev Sheth- Chairman;

2. Mr. Ravindran M.P- Member upto August 10 , 2017

3. Mr. Sanjay Sethi- Member from August 10, 2017 The Company Secretary of the Company acts as the Secretary of the Committee.

No Allotment Committee Meeting was held during the year.

(vi) Compensation Committee The Company’s Board of Directors formed a Compensation Committee in May 2013 to administer ESOP Scheme

2013.



The Compensation Committee of the Board of Directors of your Company consists of the following Members as on March 31, 2017 viz.:

Mr. Rajeev Sheth- Chairman

Mr. Nikkhil Vaidya- Member upto August 4, 2017

Mr. Rakesh Kalra- Member upto May 29, 2017

Mr. Pravin Patil- GM, Human Resources and Administration

Mr. Rajiv Jain- Member from May 29, 2017

Mr. Sanjay Sethi- Member from August 10, 2017


No Compensation Committee Meeting was held during the year.

(vii) Management and Administrative Committee The Company’s Board of Directors formed a Management and Administrative Committee in November, 2012 to

look into the day-to-day affairs and businesses of routine nature of the Company.

The Management and Administrative Committee of the Board of Directors of your Company consist of the following Members as on March 31, 2017 viz.:

1. Mr. Rajeev Sheth- Chairman



The Company’s Management and Administration Committee met one time during 2016-2017 on May 12, 2016.


The following table presents the details of attendance at the Management and Administrative Committee meetings held during 2016-17:


Mr. Rajeev Sheth 1 1 Managing Director


The terms of reference of the Management and Administrative Committee are as follows:

1. To attend to legal and such other administrative matters of the Company;

2. to incorporate subsidiary companies, enter into joint ventures Indian or Foreign, and also to execute Joint venture agreements, Shareholders Agreements, Memorandum of Understanding and such other documents as may be required to form Joint Venture; and to invest in, provide loan, and / or to provide corporate guarantee, security and also to provide financial and such other assistance to such subsidiary companies, joint ventures and other persons including but not limited to body corporate, units, mutual funds, individuals, trust, etc. as may be required from time to time, within the maximum ceiling of `100 crores;

3. to take on lease Land and/ or Building in relation to and for the purpose of carrying on the business of the Company, Subsidiary Companies/Joint Ventures of the Company; to purchase/take on lease Plant and Machinery to be utilized on the Company’s Subsidiary Companies/Joint Ventures;

4. to apply for registration/ license of/for the Company with/from various authorities of any state or Centre including but not limited to Provident Fund Authorities, Pollution Control Board/Authorities, Labour Department Drug and Cosmetic Department, Sales Tax authorities, Income Tax authorities, Shops and Establishment authorities, Customs and Central Excise authorities, the Director General of Foreign Trade and any other local, private or semi-government bodies and to do or perform all acts and deeds relating to such matters;



5. to apply, in the name of and for the Company for telephone, telex, internet, fax and other telecommunication and electrical/electronic connections and to do all matters relating to such applications;

6. to purchase motor vehicles and other machineries and capital items in the name of the Company for carrying out the business of the Company, either on self-finance or Hire purchase and to authorize officials of the Company to sign documents for registration of motor vehicles and to do all acts and things for the transfer of any such motor vehicles;

7. to authorise employee(s) or others to execute, for and on behalf of the Company, agreements, applications, deeds, documents and any other writings in connection with the business of the Company and, if required, to issue Power of Attorney in favour of such persons for this purpose;

8. to appoint / authorise employee(s), advocates, consultants or others to represent the Company before any Court, Tribunal, Consumer Redressal Forum or any Statutory or other Authority on any matter relating to the operations of the Company or with which the Company is in any way connected or concerned or to represent the Company generally or for any specific purpose or purposes and, if required, issue Power of Attorney in favour of such persons for the purpose;

9. to authorize persons to represent the Company at General Meetings of any Company or cooperative society of which the Company is a shareholder/member;

10. to fix the dates for Closure of the Company's Register of Members and Transfer Books of Shares and/or fixing Record Dates;

11. inform the Board about the compliance to with applicable laws, adequacy of risk management and internal controls;

12. to authorize affixation of common seal on such documents as may be required.

13. to authorize the closure of non-functioning showrooms / projects of the Company situated at various cities in India.

(viii) CORPORATE SOCIAL RESPONSIBILITY COMMITTEE: The Board has constituted a Corporate Social Responsibility (CSR) Committee consisting of the following members

as on March 31, 2017:

Mr. Rajeev Sheth Chairman

Ms. Fern Mallis Member

Mr. Ravindran M.P Member upto August 10, 2017

Mr. Sanjay Sethi Member from August 10, 2017

The CSR Policy of the Company is prepared by Committee and approved by the Board and is also placed on the website of the company www.tarajewels.in as per section 135 (5) of the Companies Act, 2013. Initiatives with respect to it have been described in the Board’s Report.

(ix) RISK MANAGEMENT COMMITTEE: The Board has constituted a Risk Management Committee consisting of following members as on March 31, 2017:

Mr. Ravindran M.P Chairman upto August 10, 2017

Mr. Nikkhil Vaidya Member upto August 4, 2017

Mr. Rakesh Kalra Member upto May 29, 2017

Mr. Rajiv Jain Member from May 29, 2017

Mr. Sanjay Sethi Chairman from August 10, 2017

The Committee Shall

• Ensure that all the current and future material risk exposures of the company are identified, assessed, quantified, appropriately mitigated, minimized and managed i.e. to ensure adequate systems for risk management.

• To establish a framework for the company’s risk management process and to ensure its implementation.



• To enable compliance with appropriate regulations, wherever applicable, through the adoption of best practices.

• To assure business growth with financial stability.

No Risk Management Committee Meeting was held during the year.

Meeting of Independent Directors The brief meeting of Independent Directors of the Company was held on February 10, 2017. Since the meeting was

Video Conference and detailed discussion was held on Meeting held on May 29, 2017 where the directors were physically present without the attendance of Non-Independent Directors and the members of the management, inter alia, to discuss the following:

1. Review the performance of Non independent Directors and the Board of Directors as a whole;

2. Review the performance of the Chairman of the Company, taking into account the views of the Executive and Non-Executive Directors.

3. Assess the quality, content and timelines of flow of information between the Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

Performance Evaluation of Directors The Nomination and Remuneration Committee lays down the criteria for performance evaluation of independent

directors and other directors, Board of Directors and Committees of the Board of Directors pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board’s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance.

A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc.

Familiarisation Programme for Independent Director

The details of familiarisation Programme conducted for Independent Director have been uploaded on website of Company which is www.tarajewels.in (weblink:www.tarajewels.in/investorrelations/corporategovernance/policies)

Interse Relationship among Directors There are no Interse Relationship among Directors.

D. GENERAL BODY MEETINGS: Details of your Company’s last three Annual General Meetings are presented in the following table:

Nature of Meeting

Date Time Venue Details of Special Resolution(s) passed

15th Annual General Meeting

September 19, 2016 03.00 pm Hotel Suncity Premiere, Gate 3, Plot No. A-1, off JVLR Road, SEEPZ, SEZ, Andheri (East), Mumbai- 400096.

1. Ratification of reappointment of Mr. Rajeev Sheth as Chairman and Managing Director

2. Ratification of appointment of Mr. Ravindran M.P as Executive Director

3. Appointment of Mr. Vishnu Prakash Garg as Executive Director



Nature of Meeting

Date Time Venue Details of Special Resolution(s) passed


September 29, 2015 03.00 pm Tribune-I, 6th Floor, Hotel Tunga International, Central Road, M.I.D.C, Andheri (East), Mumbai- 400093

Commission paid to Independent Directors


September 18, 2014 03.00 pm Tribune-I, 6th Floor, Hotel Tunga International, Central Road, M.I.D.C, Andheri (East), Mumbai- 400093

NIL

- There was no Extraordinary General Meeting held during the year. - No Special Resolution was passed last year through postal ballot. - Special Resolution is proposed to be conducted through postal ballot in 2017- 2018.

E. SUBSIDIARY COMPANY Your Company does not have any material non-listed Indian Subsidiary Company. Your Company has unlisted subsidiary

companies in USA, Hongkong.

In accordance with Section 129 (3) of the Companies Act, 2013 and Accounting Standard (AS) 21, the Company has prepared the Consolidated Financial Statements of the Company and all its subsidiaries, which forms part of this Annual Report. The Policy for determining material subsidiaries is available on your Company’s website viz. www.tarajewels.in

F. RELATED PARTY TRANSACTIONS All the transactions with related parties including material related party transaction arrangements are in the ordinary

course of business and arm’s length basis.

The policy on Related Party Transactions and on Materiality of Related Party Transactions as approved by the Board are uploaded on the Company’s website at Weblink:www.tarajewels.in/investorrelations/corporategovernance/policies)

None of the Directors has any pecuniary relationships or transactions vis-à-vis the Company except by way of remuneration paid to the Managing Director, Whole Time Director and sitting fees and Commission paid to other Non-Executive Directors.

G. DISCLOSURES (i) Materially Related Party Transactions There have been no materially significant related party transactions, pecuniary transactions or relationships between

your Company and the Directors, management, or their relatives. The other transactions with related parties are disclosed in notes to accounts of financial statement.

(ii) Details of Non-Compliance There has been no non-compliance of any legal requirements nor have there been any strictures imposed by any

Stock Exchange or SEBI or any statutory authority on any matter related to Capital Markets during the last three years.

(iii) Corporate Governance Report Your Company has complied with all the mandatory requirements of SEBI (Listing Obligations and Disclosure

Requirements) Regulations 2015 and has also complied with the non-mandatory requirements relating to having unqualified Financial Statements.



(iv) Whistle Blower Policy The Company has adopted Whistle Blower Policy and employees are encouraged to report any contravention or

suggestion for improved working of the Company. The details of the policy is also placed on the website of the company i.e.www.tarajewels.in (weblink:www.tarajewels.in/investorsrelations/corporategovernance/policies)

(v) Management Discussion and Analysis Report The Management Discussion and Analysis Report forms a part of the Annual Report and includes various matters

specified under SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

(vi) Certificate on Corporate Governance The Practicing Company Secretary’s certificate relating to Corporate Governance has been annexed to the Directors’

Report and will be sent to the Stock Exchanges at the time of filing the Company’s Annual Report.

(vii) CEO / CFO Certification A certificate from the Managing Director and the Chief Financial Officer, on the Financial Statements and other

matters of the Company for the Financial Year ended March 31, 2017, was placed before the Board. This certificate is given at the end of this report.

(viii) Risk Management The Company has laid down procedures to inform Board Members about the Risk Assessment and minimisation

procedure, which are periodically reviewed by the Board.

(ix) Reconciliation of Share Capital Audit As stipulated by SEBI, a Reconciliation of Share Capital Audit is carried out by an independent Practicing Company

Secretary on quarterly basis to confirm reconciliation of the issued and listed capital, shares held in dematerialised and physical mode and the status of the register of members.

(x) Accounting Treatment: No treatment different from that prescribed in the Indian Accounting Standards has been followed by the Company.

(xi) Commodity Price Risk or Foreign Exchange Risk and Hedging Activities: The above details have been furnished in notes to accounts of the Financials.

(xii) Proceeds from public issues, rights issues, preferential issues During the year, Company did not raise any funds by way of public issues, rights issues, preferential issues etc.

(xiii) Compliance of Non- Mandatory Requirements

1. The Company has only Chairman and Managing Directors and there is no Chief Executive Officer in the Company.

2. The Internal Auditors report to the Audit Committee

3. The Statutory Financial Statements of Company are unqualified.

(xiv) The Company has complied with corporate governance requirements specified in regulation 17 to 27 and clauses (b) to (i) of sub-regulation (2) of regulation 46.

H. MEANS OF COMMUNICATION 1. The Company’s corporate website, www.tarajewels.in, consists of Investor Relations section, which provides

comprehensive information to the Shareholders.

2. Quarterly and Annual Financial results are published in leading English and Marathi daily newspapers. The newspapers in which it is published in are:



Financial Express- All Editions Navshakti/Mumbai Lakshwadeep- Marathi

The said results are also made available on the Company’s website, www.tarajewels.in.

3. The Company’s Annual Report is e-mailed/dispatched to all the Shareholders of the Company and also made available on the Company’s website, www.tarajewels.in.

4. The Company’s Shareholding Pattern is filed on a quarterly basis with the Stock Exchanges and also displayed on the Company’s website, www.tarajewels.in.

5. Press Releases and Corporate Presentations are also displayed on the Company’s website, www.tarajewels.in.

I. GENERAL SHAREHOLDERS’ INFORMATION

1. Annual General Meeting

Date, Time and Venue September 28, 2017 at 3.00 p.m at Hotel Suncity Residency, Emerald - 1, Basement, 16th Road, Marol MIDC, Andheri (East),Mumbai-400093.

2. Financial Year

Quarterly results will be declared as per the following tentative schedule:• Financial reporting for the quarter ending

June 30, 2017• Financial reporting for the half year ending

September 30, 2017• Financial reporting for the quarter ending

December 31, 2017• Financial reporting for the year ending March

31, 2018

First Fortnight of August, 2017

First Fortnight of November, 2017

First Fortnight of February, 2018

Last Fortnight of May, 2018

3. Dates of Book Closure Friday September 22, 2017 to Thursday September 28, 2017 (both days inclusive)

4. Listing on Stock Exchanges Your Company’s shares are listed on:

• BSE Ltd. (BSE) Floor 27, P. J. Towers, Dalal Street, Mumbai – 400 001

• The National Stock Exchange of India Ltd. (NSE), Exchange Plaza, Bandra-Kurla Complex, Bandra (E) Mumbai – 400 051

Your Company has paid the annual listing fee for the financial year 2017-18 to both the Exchanges.

5. Stock Code BSE Ltd.:534756; the National Stock Exchange of India Ltd.: TARAJEWELS - EQ; ISIN: INE799L01016

6. Registrars and Transfer Agents Link Intime India Pvt. Ltd.(Unit: Tara Jewels Ltd.) C 101, 247 Park, L.B.S Marg,Vikroli (East), Mumbai- 400083

Tel:+91-22-49286000Fax:+91-22-49186060E-mail: [email protected]



7. Share Transfer System The Company has entrusted the administrative work of share transfers, transmissions, issuance of duplicate certificates, sub-division, demat and re-mat requisite etc., and all tasks related to shareholdings to Link Intime India Private Limited, the Registrars and Share Transfer Agents. If the relevant documents are complete and in order in all respects, the transfer of shares is effected within 15 days and certificates are dispatched to the transferees within 15 days from the date of receipt. The requests for dematerialization of shares are processed by the Registrar and Share Transfer Agents and if all the documents are found to be in order, the same are approved by them within a period of 15 days.

8. Address for Correspondence The Company SecretaryTARA JEWELS LIMITED Plot 29(P) & 30(P), Sub Plot ‘A’, SEEPZ, SEZ, Andheri East, Mumbai 400096 022-6677 4444 [email protected]

9. Dematerialisation of Shares and Liquidity 99.20 % shares of your Company are held in the electronic mode as on March 31, 2017.

10. Investor Complaints to be addressed to Registrars and Transfer Agents or the Company Secretary, at the addresses mentioned earlier.

11. Outstanding GDRs/ ADRs/ Warrants or any Convertible Instruments, Conversion Date and likely impact on equity

The Company has not issued any GDRs/ADRs/Warrants. There were no outstanding convertible warrants, as on March 31, 2017.

12. Commodity Price Risk or Foreign Exchange Risk and Hedging Activities

Mentioned in Financial Statements

13. Plant Locations Plot No. 29(P) & 30(P), Sub-Plot ‘A’, SEEPZ SEZ Andheri (E), Mumbai – 400096.

Unit No. GJ-7, SDF VII, SEEPZ SEZ Andheri (E), Mumbai – 400096.

Plot No.122, 15th Road, Near IDBI Bank, MIDC, Andheri (E), Mumbai – 400093.

J. MARKET PRICE DATA FOR 2016-17The market price data, i.e. monthly high and low prices of the Company’s shares on BSE & NSE are given below:

Month BSE NSE

High Price (`) Low Price (`) High Price (`) Low Price (`)

April, 2016 47.00 40.25 47.00 39.60

May, 2016 44.65 31.95 45.00 32.00

June, 2016 41.30 30.60 41.25 30.30

July, 2016 41.00 36.00 41.25 33.30

August, 2016 44.00 34.30 42.95 34.50

September, 2016 45.95 36.10 46.00 35.55

October, 2016 50.20 38.55 50.30 38.65

November, 2016 47.50 35.80 47.95 36.00

December, 2016 44.55 36.10 44.60 35.40

January, 2017 43.70 37.45 43.20 37.50

February, 2017 48.50 38.00 48.70 38.00

March, 2017 41.70 38.05 41.70 36.20



K. SHARE PRICE MOVEMENT OF SHARES ON BSE & NSE DURING FY 2016-2017

47 44.65 41.3 41 44 45.9550.2 47.5 44.55 43.7

48.541.7

40.2531.95 30.6

36 34.3 36.1 38.55 35.8 36.1 37.45 38 38.05

2300024000250002600027000280002900030000

0

10

20

30

40

50

60

Share Price Movement of Tara Jewels Limited on BSE Sensitive Index (`)

High Price (Rs.) Low Price (Rs.) BSE-30 Sensitive Index

47 45 41.25 41.25 42.95 4650.3 47.95 44.6 43.2

48.741.739.6

32 30.3 33.3 34.5 35.55 38.65 36 35.4 37.5 38 36.2

7000

7500

8000

8500

9000

9500

0102030405060

Share Price Movement of Tara Jewels Limited on NSE-50 (`)

High Price (Rs.) Low Price (Rs.) NSE-50 Index



L. GREEN INITIATIVE Your Company is concerned about the environment and utilises natural resources in a sustainable way. The Ministry of

Corporate Affairs (MCA), Government of India, through its Circular Nos. 17/2011 and 18/2011, dated April 21, 2011 and April 29, 2011, respectively, has allowed companies to send official documents to their shareholders electronically as a part of its green initiatives in corporate governance.

Recognising the spirit of the circular issued by the MCA, we henceforth propose to send documents like the Notice convening the general meetings, Financial Statements, Directors’ Report, Auditor’s Report and others to the email address provided by you with the relevant depositories.

We request you to update your email address with your depository participant to ensure that the Annual Report and other documents reach you on your preferred email.

M. SHAREHOLDING PATTERN, AS ON MARCH 31, 2017

Sr. No.

Category of Shareholders No. ofShareholders

No. of Shares Percentage (%)

1 Promoter and Promoter Group 5 14779998 60.02

2 Individuals 8437 6394305 25.97

3 Bodies Corporate 152 742867 3.02

4 Financial Institutions/Banks 2 31979 0.13

5 Clearing Members 97 206317 0.84

6 Non-resident Indians (Repat) 228 359685 1.46

7 Directors/Others 2 3300 0.01

8 Non-residents (Non repatriable) 50 54219 0.22

9 Foreign Companies 1 1800000 7.31

10 Hindu Undivided Family 291 250180 1.02

TOTAL 9265 24622850 100.00

N. DISTRIBUTION OF SHAREHOLDING, AS ON MARCH 31, 2017

Sr. No.

Category (Share) No. ofShareholders

TotalShareholders (%)

No. of Shares Percentage (%)

1 1 – 500 6877 74.23 1199639 4.87

2 501 – 1000 1100 11.87 909196 3.69

3 1001 – 2000 660 7.12 1011087 4.11

4 2001 – 3000 241 2.60 616219 2.50

5 3001 – 4000 73 0.79 259054 1.05

6 4001 – 5000 98 1.06 465869 1.89

7 5001 – 10000 131 1.41 954873 3.88

8 10001 & Above 85 0.92 19206913 78.00

Total 9265 100.00 24622850 100.00


DECLARATION PURSUANT TO SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

In accordance with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with the Stock Exchanges, I hereby declare that Directors and Senior Management of the Company have affirmed compliance with the Code of Conduct as applicable to them for the year ended March 31, 2017.

For TARA JEWELS LIMITED

sd/-RAJEEV SHETH

Chairman and Managing DierctorMumbai, August 10, 2017 DIN:00266460


CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER (CEO) AND CHIEF FINANCIAL OFFICER (CFO) ON FINANCIAL STATEMENTS OF THE COMPANY:

(Pursuant to SEBI (Listing Obligations and Disclosure Requirements, 2015)

We, Rajeev Sheth, Chairman & Managing Director and Sanjay Sethi, Chief Financial Officer, of Tara Jewels Limited, certify that:

1. We have reviewed the financial statements and the cash flow statement for the year ended 31st March, 2017 and that to the best of our knowledge and belief:

a) These statements do not contain any materially untrue statement nor omit any material fact nor contain statements that might be misleading and

b) These statements together present a true and fair view of the Company’s affairs and are in compliance with the existing accounting standards, applicable laws and regulations.

2. There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year, which are fraudulent, illegal or in violation of the Company’s code of conduct;

3. We accept responsibility for establishing and maintaining internal controls, we have evaluated the effectiveness of the internal control systems of the Company and we have disclosed to the auditors and the Audit Committee, deficiencies in the design or operation of internal controls, if any, of which we are aware and the steps that we have taken or propose to take to rectify the identified deficiencies; and

4. We have indicated to the auditors and the Audit Committee that:

a) there were no significant changes in internal control over financial reporting during the year;

b) there were no significant changes in the accounting policies during the year; and

c) there were no instances of fraud of which we have become aware and the involvement therein, if any, of the management or an employee having a significant role in the company's internal control system over financial reporting.

Rajeev Sheth Sanjay Sethi Chairman and Managing Director Chief Financial OfficerMumbai, August 10, 2017 DIN: 00266460


To the Members of Tara Jewels Limited

REPORT ON THE STANDALONE IND AS FINANCIAL STATEMENTS We have audited the accompanying standalone Ind AS financial statements of Tara Jewels Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss (including other comprehensive income), the Statement of Cash Flow and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information (herein after referred to as “standalone Ind AS financial statements”)

MANAGEMENT’S RESPONSIBILITY FOR THE STANDALONE IND AS FINANCIAL STATEMENTS“The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“”the Act””) with respect to the preparation and presentation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act. This responsibility also includes 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 frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.”

AUDITOR’S RESPONSIBILITY Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit of standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.

OPINION In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Ind AS, of the financial position of the Company as at March 31, 2017, and its financial performance including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.

INDEPENDENT AUDITORS REPORT


REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the Central Government of India in

terms of section 143 (11) of the Act, we give in the Annexure “I”, a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by section 143(3) of the Act, we report that:

a we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c the Balance Sheet, the Statement of Profit and Loss, the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;

d in our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards prescribed under Section 133 of the Act,

e on the basis of written representations received from the directors as on March 31, 2017, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017, from being appointed as a director in terms of section 164 (2) of the Act.

f With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure II”.

g With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. the Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements – Refer Note 35 to the standalone Ind AS financial statements;

ii. the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii. there were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

iv. the Company has provided requisite disclosures in its standalone Ind AS financial statements as to holdings as well as dealings in Specified Bank Notes during the period from November 8, 2016 to December 30, 2016 and these are in accordance with the books of accounts maintained by the Company. Refer Note No.43 to the standalone Ind AS financial statements.

For C. B. Chhajed & Co. Chartered Accountants (Firm Regn. No : 101796W)

Place : Mumbai C. B. ChhajedDated : 29.05.2017 (Partner) Membership No : 009447



ANNEXURE “I” TO THE INDEPENDENT AUDITORS’ REPORT

[Referred to in paragraph 1 of ”Report on other legal and regulatory requirements” of our report of even date]

TO THE MEMBERS OF TARA JEWELS LIMITED (‘the Company’)

1 a The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

b. The fixed assets of the Company have been physically verified by the management during the year and no material discrepancies have been noticed on such verification. In our opinion, the frequency of verification is reasonable.

c. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

2 The inventory has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable. The discrepancies noticed on physical verification of inventory as compared to book records were not material and the same were properly dealt with in the books of accounts.

3 In our opinion and according to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, to companies, firms, limited liability partnerships or other parties covered in the register maintained under Section 189 of the Act. Accordingly, clauses (iii)(a) to (iii)(c) of paragraph 3 of the Order are not applicable to the Company for the year.

4 In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 185 and 186 in respect of loans, investments, guarantees and securities, wherever applicable.

5 According to the information and explanations given to us, the Company has not accepted any deposits from the public. Accordingly clause (v) of paragraph 3 of the order is not applicable to the company.

6 The Central Government of India has not prescribed the maintenance of cost records under sub-section (1) of Section 148 of the Act for any of the products of the Company. Accordingly, clause (vi) of paragraph 3 of the Order is not applicable to the Company for the year.

7 a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, undisputed statutory dues including provident fund, employees’ state insurance, income-tax, sales-tax, service tax, duty of custom, duty of excise, value added tax, cess have not been regularly deposited with the appropriate authorities and there have been delays in a large number of cases.

The Statutory dues outstanding as on Balance Sheet date for a period of more than six months from the date they became payable, are listed below:

Name of the Statute Nature of Dues Amount (Rs.)

Period to which the amount relates

Due Date Date of Payment

Income Tax Act, 1961 Income tax 133,607,523 F.Y. 2014-15 15.03.2015 Not Paid

Income tax 76,921,826 F.Y. 2015-16 15.03.2016 Not Paid

Tax Deducted at Source

1,102,248 August 2016 07.09.2016 25.05.17

The Employees’ Provident Fund And Miscellaneous Provisions Act, 1952

Provident fund 2,609,936 August 2016 15.09.2016 Not Paid



Name of the Statute Nature of Dues Amount (Rs.)


Due Date Date of Payment

The Employees’ State Insurance Act, 1948

ESIC on Salaries and Wages

529,125 July 2016 21.08.2016 18.04.2017

476,471 August 2016 21.09.2016 18.04.2017

ESIC on Contracts 1,218 April 2016 21.05.2016 22.05.2017

881 June 2016 21.07.2016 22.05.2017

2,470 July 2016 21.08.2016 22.05.2017

309 August 2016 21.09.2016 22.05.2017

b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of sales-tax, wealth tax, excise duty and cess which have not been deposited on account of any dispute. The income-tax, customs duty and service tax dues which have not been deposited on account of disputed matters pending before appropriate authority are as under :

The Statutory dues outstanding as on Balance Sheet date for a period of more than six months from the date they became payable, are listed below:

Name of the Statute Nature of Dues Amount (`)


Forum where the dispute is pending

Customs Act, 1962 Custom Duty 1,418,430 1995-1996 Commissioner of Customs (Appeals), Mumbai

Customs Act, 1962 Custom Duty 377,133 1996-1997 Assistant Commissioner of Customs, Mumbai

Customs Act, 1962 Custom Duty 105,000 2004-2005 Customs, Excise and Gold (Control) Appellate Tribunal

Income Tax Act, 1961 Income Tax 56,500,000 2001-2014 CIT Appeals, IT Tribunal and High court

Finance Act, 1994 Service Tax 6,723,389 2006-2008 Joint Commissioner of Service Tax

8. In our opinion and according to the information and explanation given to us, the Company has defaulted in repayment of loans or borrowings to a financial institution and banks during the year. The Company does not have any loans or borrowings from Government or has not issued any debentures. The period and amount of defaults are as under :

Name of Lender Type of Facility Amount of Default Period of Default

1. Canara Bank Bills Discounted 95,935,829 Upto 90 Days

2. Central Bank of India Bills Discounted 20,885,179 Upto 90 Days

3. Corporation Bank Bills Discounted 48,402,395 30 - 45 Days

4. Punjab National Bank Bills Discounted 30,669,320 Upto 15 Days

5. State Bank of India Bills Discounted 117,353,000 Upto 90 Days

6. Union Bank of India Bills Discounted 72,305,033 Upto 60 Days

7. Vijaya Bank Bills Discounted 83,625,343 Upto 30 Days

8. Daimler Financial Services India Pvt Ltd Vehicle Loan 445,237 Upto 60 Days



9 The Company has not raised money by way of initial public offer or further public offer or debt instruments during the year. In our opinion, and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

10 According to the information and explanations given to us, no material fraud by the Company or on the Company by its

officers or employees has been noticed or reported during the course of our audit

11 According to the information and explanations given to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.

12 In our opinion and according to the information and explanations given to us, the company is not a nidhi company.

Accordingly, clause (xii) of paragraph 3 of the order is not applicable to the company. 13 According to the information and explanations given to us and based on our examination of the records of the Company,

transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

14 According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, clause (xiv) of paragraph 3 of the order is not applicable to the Company.

15 According to the information and explanations given to us, the Company has not entered into any non-cash transactions

during the year with the directors or persons connected with him. Accordingly, clause (xv) of paragraph 3 of the order is not applicable to the company.

16 In our opinion and according to the information and explanations given to us, the Company is not required to register

under section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, clause (xvi) of paragraph 3 of the order is not applicable to the company.





ANNEXURE “II” TO THE INDEPENDENT AUDITOR’S REPORT OF EVEN DATE ON THE STANDALONE IND AS FINANCIAL STATE-MENTS OF TARA JEWELS LIMITED

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”) We have audited the internal financial controls over financial reporting of Tara Jewels Limited (“the Company”) as of March 31, 2017 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors’ Responsibility Our responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the “Guidance Note”) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting A company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are



being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.





(Amount in `)

Particulars Notes As at March 31, 2017

As at March 31, 2016

ASSETS Non-Current Assets Property, Plant and Equipment 4 1,049,608,759 1,147,865,585 Capital Work-in-Progress - 28,293,589 Intangible Assets 5 22,433,090 16,575,092 Financial Assets

Investments 6 172,947,995 204,106,247 Other Financial Assets 8 5,128,722 16,405,333

Deferred Tax Asset (Net) 14 90,950,566 67,534,872 Other Non-Current Assets 13 23,469,276 24,335,471

1,364,538,408 1,505,116,189 Current assets Inventories 9 4,663,044,143 5,298,972,788 Financial Assets

Trade Receivables 10 7,945,347,225 7,144,810,421 Cash and Cash Equivalents 11 6,937,180 20,275,608 Other Bank Balances 12 686,917,573 694,259,301 Loans 7 3,755,939 2,720,393 Other Financial Assets 8 9,651,427 10,771,524

Other Current Assets 13 143,937,442 134,447,323 13,459,590,929 13,306,257,358

TOTAL 14,824,129,337 14,811,373,547 EQUITY AND LIABILITIES Equity Equity Share capital 15 246,228,500 246,228,500 Other Equity 16 5,170,572,201 5,291,991,938

5,416,800,701 5,538,220,438 Liabilities Non Current Liabilities Financial Liabilities

Borrowings 17 7,968,080 12,158,836 Provisions 21 43,534,714 30,443,904

51,502,794 42,602,740 Current Liabilities Financial Liabilities

Borrowings 17 5,586,932,601 5,739,200,295 Trade Payables 19

Micro, Small and Medium Enterprises - 77,787 Others 3,207,190,597 3,014,658,652

Other Financial Liabilities 18 65,514,142 31,406,621 Other Current Liabilities 20 200,246,237 166,110,284 Provisions 21 2,228,622 6,162,410 Current Tax Liabilities (Net) 22 293,713,643 272,934,320

9,355,825,842 9,230,550,369 TOTAL 14,824,129,337 14,811,373,547

Significant Accounting Policies and Notes on Accounts form an integral part of the financial statements.

As Per Our Attached Report of Even Date

For C. B. Chhajed & Co. For and on Behalf of Board of Directors Chartered Accountants


Place : Mumbai Dated : 29.05.2017

BALANCE SHEET AS AT MARCH 31, 2017


(Amount in `)

Particulars Notes Year ended March 31, 2017


REVENUE

Revenue from operations (net) 23 11,906,360,620 13,568,611,216

Other income 24 63,662,043 66,823,068

Total Revenue 11,970,022,663 13,635,434,284

EXPENSES

Cost of materials consumed 25 9,697,997,342 9,576,285,173

Purchases of stock-in-trade 26 257,120,224 2,324,708,368

Changes in inventories of finished goods, work-in-process and Stock-in-Trade

27 417,216,901 (323,502,785)

Excise duty 11,560,930 3,265,750

Employee benefits expense 28 282,952,855 343,114,241

Finance costs 29 758,399,759 658,250,475

Depreciation and amortization expense 30 221,722,364 213,614,892

Other expenses 31 462,612,835 681,386,467

Total Expenses 12,109,583,210 13,477,122,581

Profit/(loss) before tax (139,560,547) 158,311,703

Tax expense:

Current tax - 81,000,000

Deferred tax (21,353,283) (15,199,381)

(21,353,283) 65,800,619

Profit/(loss) for the year (118,207,264) 92,511,084

OTHER COMPREHENSIVE INCOME

A. Other Comprehensive income not to be reclassified to profit and loss in subsequent periods:

Remeasurement of gains (losses) on defined benefit plans (6,237,824) 6,210,526

Income tax effect 2,062,411 (2,149,339)

Equity Instruments through Other Comprehensive Income 515,480 (556,220)

Income tax effect - -

Other Comprehensive income for the year, net of tax (3,659,933) 3,504,967

Total Comprehensive Income for the year, net of tax (121,867,197) 96,016,051

Earnings / (Loss) per Equity Share 32

Basic (4.80) 3.76

Dilluted (4.80) 3.76






STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED MARCH 31, 2017


(Amount in `)

Particulars Year ended March 31, 2017


CASH FLOWS FROM OPERATING ACTIVITIES:

Profit/(Loss) before income tax from: (139,560,547) 158,311,703

Adjustments for:

Depreciation and amortisation expense 221,722,364 213,614,892

Employee share-based payment expense 447,460 895,107

Loss on disposal of property, plant and equipment 6,175,932 6,759,433

Fixed Assets written off 4,347,902 7,881,649

Financial guarantees income (17,807,480) (17,977,510)

Financial guarantees expense 14,760,000 14,860,000

Gain(Loss)on sale of investments (1,370,671) 69,574

Bad debts written off 98,157,644 55,573,718

Rent Income (5,170,454) (2,331,000)

Allowance for doubtful debts (23,172,104) 50,466,745

Changes in fair value of financial assets at fair value through profit or loss 18,143,004 925,729

Dividend and interest income classified as investing cash flows (39,270,116) (46,398,785)

Finance costs 675,810,116 575,389,904

Operating profit before working capital adjustment 813,213,050 1,018,041,159

Change in operating assets and liabilities:

(Increase)/Decrease in trade receivables (875,522,344) (967,693,709)

(Increase)/Decrease in inventories 635,928,645 (288,396,273)

Increase/(Decrease) in trade payables 192,454,158 841,820,787

(Increase)/Decrease in loans (1,035,546) 1,152,628

(Increase)/Decrease in other financial assets 14,057,687 9,853,432

(Increase)/Decrease in other assets (9,490,119) 48,542,436

(Increase)/Decrease in other bank balances 7,341,728 9,811,336

Increase/(Decrease) in other financial liabilities 5,470,779 7,574,962

Increase/(Decrease) in provisions and other liabilities 37,007,548 21,512,131

Cash generated from operations 819,425,586 702,218,889

Less: Income taxes paid (34,220,677) (31,792,393)

Net cash inflow from operating activities (A) 785,204,909 670,426,496

CASH FLOWS FROM INVESTING ACTIVITIES:

Payments for property, plant and equipment (including intangible assets) (113,400,115) (334,542,869)

Payments for purchase of investments (8,150,320) (17,840,057)

Proceeds from sale of investments 45,620,956 4,884,885

Proceeds from sale of property, plant and equipment 2,760,132 7,305,190

Dividends received 8,185 259,972

Interest received 37,600,952 46,798,049

Rent Received 5,170,454 2,331,000

Net cash outflow from investing activities (B) (30,389,756) (290,803,830)

STATEMENT OF CASH FLOWS FOR THE YEAR ENDED MARCH 31, 2017


(Amount in `)



CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from borrowings (156,358,815) 131,923,413

Interest paid (611,794,766) (551,549,324)

Net cash inflow (outflow) from financing activities (C) (768,153,581) (419,625,910)

Net increase (decrease) in cash and cash equivalents (A + B + C) (13,338,428) (40,003,244)

Cash and Cash Equivalents at the beginning of the financial year 20,275,608 60,278,852

Cash and Cash Equivalents at end of the year 6,937,180 20,275,608

Reconciliation of cash and cash equivalents as per the cash flow statement:

Cash and cash equivalents as per above comprise of the following:

Balances with banks 6,578,722 17,971,638

Cash on hand 358,458 2,303,970

Balances per statement of cash flows 6,937,180 20,275,608

Figures under bracket represent outflows.





A Equity Share Capital

(Amount in `)

Particulars Balance at the Beginning of

the year

Changes in Equity share capital

during the year

Balance at the end of the

year

March 31, 2016

Numbers 24,622,850 - 24,622,850

Amount 246,228,500 - 246,228,500

March 31, 2017

Numbers 24,622,850 - 24,622,850

Amount 246,228,500 - 246,228,500

B Other Equity(Amount in `)

Particulars Reserves and Surplus Money Received

against share warrants

Total

SEZ Reinvestment

Allowance Reserve

Securities Premium Reserve

General Reserve

Share Based Payment Reserve

Retained Earnings

Equity Instruments through OCI

As at April 1, 2015 264,650,684 1,679,062,852 114,400,049 2,577,905 3,121,010,700 1,178,590 12,200,000 5,195,080,780

Profit for thhe year 92,511,084 92,511,084

Other comprehensive income

4,061,187 (556,220) 3,504,967

Total comprehensive income for the year

- - - - 96,572,271 (556,220) - 96,016,051

Transfer to General Reserve

12,200,000 (12,200,000) -

Utilisation of SEZ Reinvestment allowance reserve

(264,650,684) 264,650,684 -

Share based payments 895,107 895,107

As at March 31, 2016 - 1,679,062,852 126,600,049 3,473,012 3,482,233,655 622,370 - 5,291,991,938

Loss for the year (118,207,264) (118,207,264)


(4,175,413) 515,480 (3,659,933)


- - - - (122,382,677) 515,480 - (121,867,197)

Lapse of share options 189,392 (189,392) -


As at March 31, 2017 - 1,679,062,852 126,789,441 3,731,080 3,359,850,978 1,137,850 - 5,170,572,201





STATEMENT OF CHANGES IN EQUITY AS AT MARCH 31, 2017


1 CORPORATE INFORMATION

Tara Jewels Limited ('the Company') is a public Company domiciled in India and is incorporated under the provisions of the Companies Act applicable in India. Its shares are listed on two recognised stock exchanges in India. The registered office of the Company is located at Plot 122, 15th Road , Near IDBI Bank, MIDC, Andheri (E), Mumbai 400093.

The Company is in the business of exports and domestic sales of fine jewellery. The Company has been in the jewellery

exports business since inception and has started the retail jewellery business in 2010. The Company is an integrated player in the jewellery industry with experience ranging from designing to retailing of jewellery. The Company’s business can be divided into three operations namely, manufacturing, exporting and retailing. The portfolio of products includes gold, platinum and silver jewellery with or without studded precious and semi-precious stones. The Company's products have presence across different price points and cater to customers across high-end, mid-market and value market segments. The financial statements for the year ended March 31, 2017 were approved by the Board of Directors and authorised for issue on May 29, 2017.

2 SIGNIFICANT ACCOUNTING POLICIES

2.1 Basis of preparation The financial statements of the Company have been prepared in accordance with Indian Accounting Standards

(Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015, as amended by the Companies (Indian Accounting Standards) (Amendment) Rules, 2016, under the historical cost convention on the accrual basis except for derivative financial instruments and certain financial assets and liabilities which are measured at fair value.

For all periods upto and including the year ended March 31, 2016, the Company prepared its financial statements

in accordance accounting standards notified under the section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP). These financial statements for the year ended March 31, 2017 has been prepared in accordance with Ind AS and the adoption was carried out in accordance with Ind AS 101 - 'First time adoption of India Accounting Standard'. Reconciliation and description of the effect of the transition has been summarised in Note 46.

2.2 Summary of significant accounting policies

(a) Revenue recognition

(i) Sale of goods Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the

goods have passed to the buyer. Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of returns, trade discounts and volume rebates.

(ii) Rendering of services Service income is recognised as per terms of contract with customers when the related services are

performed.

(iii) Interest income Income from Interest on fixed deposits is recognised using effective interest rate method.

(iv) Dividend income Revenue is recognised when the Company’s right to receive the payment is established, which is generally

when shareholders approve the dividend.

(v) Rental income Rental income arising from operating leases is accounted for on a straight-line basis over the lease terms

unless the payments are structured to increase in line with expected general inflation to compensate for the Company's expected inflationary cost increases and is included in other income in the statement of profit or loss.

(b) Foreign currency translation

(i) Functional and presentation currency Items included in the financial statements of the entity are measured using the currency of the primary

economic environment in which the entity operates (‘the functional currency’). The financial statements are presented in Indian rupee (`), which is entity’s functional and presentation currency.

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2017



(ii) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates at

the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognised in profit or loss.

Non-monetary assets and non-monetary liabilities denominated in a foreign currency and measured at

fair value are translated at the exchange rate prevalent at the date when the fair value was determined. Non-monetary assets and non-monetary liabilities denominated in a foreign currency and measured at historical cost are translated at the exchange rate prevalent at the date of the transaction.

(c) Taxes

(i) Current income tax Income tax expense is recognized in net profit in the statement of profit and loss except to the extent that it

relates to items recognized directly in equity, in which case it is recognized in other comprehensive income. Current income tax for current and prior periods is recognized at the amount expected to be paid to or recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

(ii) Deferred tax Deferred tax assets and liabilities are recognized using the liability method for all temporary differences

arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

Deferred income tax assets and liabilities are measured using tax rates and tax laws that have been

enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of changes in tax rates on deferred income tax assets and liabilities is recognized as income or expense in the period that includes the enactment or the substantive enactment date.

A deferred tax asset is recognized to the extent that it is probable that future taxable profit will be

available against which the deductible temporary differences and tax losses can be utilized. The company offsets current tax assets and current tax liabilities, where it has a legally enforceable right

to set off the recognized amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

(d) Leases The determination of whether an arrangement is (or contains) a lease is based on the substance of the arrangement

at the inception of the lease. The arrangement is, or contains, a lease if fulfillment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use the asset or assets, even if that right is not explicitly specified in an arrangement.

(i) As a lessee Leases in which a significant portion of the risks and rewards of ownership are not transferred to the Company

as lessee are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease unless the payments are structured to increase in line with expected general inflation to compensate for the lessor’s expected inflationary cost increases.

(ii) As a lessor Lease income from operating leases where the Company is a lessor is recognised in income on a straight-line

basis over the lease term unless the receipts are structured to increase in line with expected general inflation to compensate for the expected inflationary cost increases.



(e) Impairment of non financial assets Intangible assets and property, plant and equipment are evaluated for recoverability whenever events or changes in

circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the CGU to which the asset belongs.

If such assets are considered to be impaired, the impairment to be recognized in the Statement of Profit and Loss is

measured by the amount by which the carrying value of the assets exceeds the estimated recoverable amount of the asset. An impairment loss is reversed in the statement of profit and loss if there has been a change in the estimates used to determine the recoverable amount. The carrying amount of the asset is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of any accumulated amortization or depreciation) had no impairment loss been recognized for the asset in prior years.

(f) Cash and cash equivalents Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with

an original maturity of three months or less, which are subject to an insignificant risk of changes in value. (g) Inventories Inventories are valued at the lower of cost and net realisable value. Costs incurred in bringing each product to its present location and condition are accounted for as follows: Raw materials: cost includes cost of purchase and other costs incurred in bringing the inventories to their present

location and condition. Cost is determined on weighted average basis. Finished goods and work in progress: cost includes cost of direct materials and labour and a proportion of

manufacturing overheads based on the normal operating capacity, but excluding borrowing costs. Cost is determined on weighted average basis.

Traded goods: cost includes cost of purchase and other costs incurred in bringing the inventories to their present

location and condition. Cost is determined on first in, first out basis. Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion

and the estimated costs necessary to make the sale. (h) Financial instruments

(i) Initial recognition The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual

provisions of the instrument. All financial assets and liabilities are recognized at fair value on initial recognition. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities, that are not at fair value through profit or loss, are added to the fair value on initial recognition. Regular way purchase and sale of financial assets are accounted for at trade date.

(ii) Subsequent measurement

a. Non-derivative financial instruments (i) Financial assets carried at amortised cost A financial asset is subsequently measured at amortised cost if it is held within a business model whose

objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding."

After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance income in the profit or loss. The losses arising from impairment are recognised in the profit or loss. This category generally applies to trade and other receivables.



(ii) Financial assets at fair value through other comprehensive income A financial asset is subsequently measured at fair value through other comprehensive income if it is held

within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

The Company has made an irrevocable election for its investments which are classified as equity instruments to present the subsequent changes in fair value in other comprehensive income based on its business model. Further, in cases where the Company has made an irrevocable election based on its business model, for its investments which are classified as equity instruments, the subsequent changes in fair value are recognized in other comprehensive income.

(iii) Financial assets at fair value through profit or loss A financial asset which is not classified in any of the above categories are subsequently fair valued

through profit or loss. (iv) Financial liabilities Financial liabilities at fair value through profit or loss Financial liabilities at fair value through profit or loss include financial liabilities held for trading and

financial liabilities designated upon initial recognition as at fair value through profit or loss. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. This category also includes derivative financial instruments entered into by the company that are not designated as hedging instruments in hedge relationships as defined by Ind AS 109.

Gains or losses on liabilities held for trading are recognised in the profit or loss. Financial liabilities designated upon initial recognition at fair value through profit or loss are designated

as such at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied. Financial liabilities at amortised cost Financial liabilities are subsequently carried at amortized cost using the effective interest rate method. For

trade and other payables maturing within one year from the Balance Sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.

Financial guarantee contracts Financial guarantee contracts issued by the company are those contracts that require a payment

to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance with the terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognised less cumulative amortisation.

(v) Investment in subsidiaries

Investment in subsidiaries is carried at cost in the financial statements. b. Derivative financial instruments The Company uses derivative financial instruments, such as forward currency contracts to hedge its foreign currency

risks. Such derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently re-measured at fair value. Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative. Any gains or losses arising from changes in the fair value of derivatives are taken directly to profit or loss.

(iii) Derecognition of financial instruments The company derecognizes a financial asset when the contractual rights to the cash flows from the financial

asset expire or it transfers the financial asset and the transfer qualifies for derecognition under Ind AS 109. A financial liability (or a part of a financial liability) is derecognized from the Company's Balance Sheet when the obligation specified in the contract is discharged or cancelled or expires.



(iv) Impairment of financial assets The company assesses on a forward looking basis the expected credit losses associated with its assets carried

at amortised cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk. Note 39 details how the Company determines whether there has been a significant increase in credit risk.

For trade receivables only, the company applies the simplified approach permitted by Ind AS 109 Financial

Instruments, which requires expected lifetime losses to be recognised from initial recognition of the receivables. (v) Offsetting of financial instruments Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there

is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.

(i) Property, plant and equipment Property, plant and equipment are stated at cost, less accumulated depreciation. Cost directly attributable

to the acquisition are capitalised until the property, plant and equipment are ready for use, as intended by management. The Company depreciates property, plant and equipment over their estimated useful lives as specified in Schedule II of the Companies Act, 2013 using the written down value method. The estimated useful lives of assets are as follows:

Buildings 30 Years Plant and Equipments* 8-15 Years Furniture and Fixtures 10 Years Vehicles 8 - 10 Years Air- Conditioners 5 - 15 Years Office Equipments 5 Years Computer Hardwares 3 - 6 Years Factory Equipments 15 Years Flats 60 Years Electric Installations 10 Years

Building on leasehold land and leasehold improvements are amortised on straight line basis over the primary period of lease.

*Based on technical evaluation, the management believes that the useful lives for few plant and

machinery best represent the period over which management expects to use these assets. Hence, the useful lives for these assets is different from the useful lives as prescribed under Part C of Schedule II of the Companies Act 2013.

The residual values are not more than 5% of the original cost of the asset. The Useful lives and residual

values are reviewed periodically, including at each financial year end. Subsequent expenditures relating to property, plant and equipment is capitalized only

when it is probable that future economic benefits associated with these will flow to the Company and the cost of the item can be measured reliably. Repairs and maintenance costs are recognized in net profit in the Statement of Profit and Loss when incurred. The cost and related accumulated depreciation are eliminated from the financial statements upon sale or retirement of the asset and the resultant gains or losses are recognized in the Statement of Profit and Loss. Assets to be disposed off are reported at the lower of the carrying value or the fair value less cost to sell.

(j) Intangible assets Intangible assets includes computer software, are stated at cost less accumulated amortization. Computer software

are amortized over estimated useful lives of five years on a straight-line basis, from the date that they are available for use. Amortization methods and useful lives are reviewed periodically including at each financial year end.



(k) Borrowing costs General and specific borrowing costs that are directly attributable to the acquisition, construction or production of

a qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

(l) Provisions, Contingent Liabilities and Commitments A provision is recognized if, as a result of a past event, the company has a present legal or constructive obligation

that is reasonably estimable, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.

Contingent liability is disclosed in the case of:

- a present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle the obligation;

- a present obligation arising from past events, when no reliable estimate is possible;

- a present obligation arising from past events, unless the probability of outflow of resources is remote.

Commitments include the amount of purchase order(net of advances) issued to parties for completion of assets. Provisions, contingent liabilities, contingent assets and commitments are reviewed at each balance sheet date.

(m) Employee benefits

(i) Short-term obligations Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly

within 12 months after the end of the period in which the employees render the related service are recognised in respect of employees’ services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the balance sheet.

(ii) Post-employment obligations The company operates the following post-employment schemes: (a) defined benefit plans such as gratuity and (b) defined contribution plans such as provident fund.

(a) Gratuity The company provides for gratuity, a defined benefit retirement plan ('the Gratuity Plan') covering eligible

employees. The Gratuity Plan provides a lump-sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee's salary and the tenure of employment with the Company.

Liabilities with regard to the Gratuity Plan are determined by actuarial valuation, performed by an

independent actuary, at each balance sheet date using the projected unit credit method. The Company has taken a Group Gratuity Policy with Life Insurance Corporation of India.

The Company recognizes the net obligation of a defined benefit plan in its balance sheet as an liability.

Gains and losses through re-measurements of the net defined benefit liability are recognized in other comprehensive income. The actual return of the portfolio of plan assets, in excess of the yields computed by applying the discount rate used to measure the defined benefit obligation is recognized in other comprehensive income. The effect of any plan amendments are recognized in net profit in the Statement of Profit and Loss.

(b) Provident Fund The Company pays provident fund contributions to publicly administered provident funds as per local

regulations. The Company has no further payment obligations once the contributions have been paid. The contributions are accounted for as defined contribution plans and the contributions are recognised as employee benefit expense when they are due.



(iii) Other long-term employee benefit obligations Compensated absences The expected cost of accumulating compensated absences is determined by actuarial valuation performed

by an independent actuary at each balance sheet date using projected unit credit method on the additional amount expected to be paid/availed as a result of the unused entitlement that has accumulated at the balance sheet date.

The obligations are presented as current liabilities in the balance sheet if the entity does not have an

unconditional right to defer settlement for at least twelve months after the reporting period, regardless of when the actual settlement is expected to occur.

(iv) Share-based payments Share-based compensation benefits are provided to employees via the Employee Stock Option Plan. The

Company recognizes compensation expense relating to share-based payments in net profit using fair-value in accordance with Ind AS 102, Share-Based Payment. The estimated fair value of options is charged to expense on a straight-line basis over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied.

(v) Bonus Plans The company recognises a liability and an expense for bonuses. The company recognises a provision where

contractually obliged or where there is a past practice that has created a constructive obligation. (n) Segment Reporting Operating segments are reported in a manner consistent with the internal reporting provided the Chief Operating

Decision Maker (CODM). The chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been notified as the Board of Directors that makes strategic decisions.

(o) Cash Flow Statement Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of

transactions of non cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the group are segregated based on available information.

(p) Current/non current classification The Company presents assets and liabilities in the balance sheet based on current/ non-current classification. An

asset is treated as current when it is:

- Expected to be realised or intended to be sold or consumed in normal operating cycle

- Held primarily for the purpose of trading

- Expected to be realised within twelve months after the reporting period, or

- Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period

All other assets are classified as non-current. A liability is current when:

- It is expected to be settled in normal operating cycle

- It is held primarily for the purpose of trading

- It is due to be settled within twelve months after the reporting period, or

- There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period

The company classifies all other liabilities as non-current.

Deferred tax assets and liabilities are classified as non-current assets and liabilities.

The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents. The company has identified twelve months as its operating cycle.



(q) Earnings per share Basic earnings per equity share is computed by dividing the net profit attributable to the equity holders

of the company by the weighted average number of equity shares outstanding during the year. Diluted earnings per equity share is computed by dividing the net profit attributable to the equity holders, after income tax effect of interest and other financing costs associated with dilutive potential equity, by the weighted average number of equity shares considered for deriving basic earnings per equity share and also the weighted average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares.

3 SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS

The preparation of the financial statements in conformity with Ind AS requires management to make estimates, judgments and assumptions. These estimates, judgments and assumptions affect the application of accounting policies and the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the period. Application of accounting policies that require critical accounting estimates involving complex and subjective judgments and the use of assumptions in these financial statements have been disclosed below. Accounting estimates could change from period to period. Actual results could differ from those estimates. Appropriate changes in estimates are made as management becomes aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.

The areas involving critical accounting estimates or judgments are:

- Estimation of current tax expense and payable – Note 14

- Estimated fair value of unlisted securities – Note 38

- Estimated useful life of intangible asset – Note 5

- Estimated useful life of tangible asset – Note 4

- Estimation of defined benefit obligation – Note 33

- Recognition of deferred tax assets for carried forward tax losses – Note 14

- Impairment of trade receivables and other financial assets – Note 39

- Impairment of non-financial assets – Note 39



4.

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5. INTANGIBLE ASSETS

(Amount in `)

Particulars Computer Software

Total

GROSS CARRYING VALUE

As at April 1, 2015 23,442,870 23,442,870

Additions 1,772,427 1,772,427

Deletions 231,490 231,490

As at March 31, 2016 24,983,807 24,983,807

Additions 14,344,549 14,344,549

Deletions 186,124 186,124

As at March 31, 2017 39,142,232 39,142,232

ACCUMULATED AMORTISATION AND IMPAIRMENT

As at April 1, 2015 - -

Amortisation for the year 8,640,205 8,640,205

Deductions/Adjustments during the year 231,490 231,490

As at March 31, 2016 8,408,715 8,408,715

Amortisation for the year 8,486,547 8,486,547

Deductions/Adjustments during the year 186,120 186,120

As at March 31, 2017 16,709,142 16,709,142

Net Carrying value as at March 31, 2017 22,433,090 22,433,090

Net Carrying value as at March 31, 2016 16,575,092 16,575,092

Net Carrying value as at April 1, 2015 23,442,870 23,442,870

6. INVESTMENTS

(Amount in `)

Particulars As at March 31, 2017


As at April 1, 2015

Non Current Investments

Equity Instruments of Subsidiaries 146,648,124 143,600,644 140,483,134

Other Equity Instruments 1,419,250 903,770 1,459,990

Mutual Funds 24,880,621 59,601,833 47,641,964

Total 172,947,995 204,106,247 189,585,088

Details of Non Current Investments (Amount in `)



(1) Investments carried at Cost

Investments in Equity Instruments of Subsidiaries

Unquoted

Tara (Hong Kong) Limited655,590 Equity shares of face value HK$ 10 each

28,161,724 27,059,444

Tara Jewels Holding Inc. 2,000 Equity Shares of Face Value US$ 0.01 each

118,486,400 116,541,200

146,648,124 143,600,644



(Amount in `)



(2) Investments carried at fair value through Other Comprehensive Income

Investments in Equity Instruments

Unquoted

Divya Jewels International Pvt. Ltd. 5,000 Equity Shares of Face Value ` 10 each

175,000 175,000

Quoted

Punjab National Bank 7,000 Equity Shares of Face Value ` 2 each

1,049,300 592,900

Bank of India 1,400 Equity Shares of Face Value ` 10 each

194,950 135,870

1,419,250 903,770

(3) Investments carried at fair value through Profit and Loss

Investments in Mutual Funds

Quoted

SBI MF Magnum Balanced Fund - Regular Plan Growth 7,367.763 (Previous Year: 228,036.84) Units of face value of ` 10 each

804,230 21,595,476

SBI Premier Liquid Fund - Regular Fund Daily Dividend 32.254 (Previous Year: 30.791) Units of Face Value of ` 10 each

32,359 30,891

Principal Emerging Bluechip Fund-Direct Plan Growth NIL (Previous Year: 7,210.845) Units of face value of ` 10 each

- 480,026

Axis Liquid Fund - Daily Dividend 146.40 (Previous Year: 139.675) Units of Face Value of ` 1000 each

146,528 139,780

CP4G-Union KBC Capital Protection Oriented Fund-Series 4-Reg Plan-Growth NIL (Previous Year: 150,000) Units of Face Value of ` 10 each

- 1,733,085

CP5G-Union KBC Captial Protection Oriented Fund-Series 5-Reg Plan-Growth NIL (Previous Year: 150,000) Units of Face Value of ` 10 each

- 1,765,455

DBDP- union KBC Dynamic Bonds Fund- Div Payout NIL (Previous Year: 227,250.347) Units of face value of ` 10 each

- 2,713,824

Principle Large Cap Fund - Regular Plan growth NIL (Previous Year: 47,327.581) Units of Face Value of ` 10 each

- 2,049,284

TF2GR-Union KBC Trigger Fund Series 2 - Regular Plan Growth 299,990 (Previous Year: 299,990) Units of Face Value of ` 10 each

3,377,887 2,759,908

Principal Asset Allocation Fund - Aggressive Plan NIL (Previous Year: 895,309.07) Units of face value of ` 10 each

- 8,834,104

Principal Tax Savings Fund - Regular Plan Growth 6,768.429 (Previous Year: NIL) Units of face value of ` 10 each

1,189,754 -

CP7G-Union Capital Protection Oriented Fund - Series 7 - Regular Plan Growth 1,82,172 (Previous Year: NIL) Units of face value of ` 10 each

1,829,863 -

Unquoted

1,750 units of face value ` 10,000 each of IIMCL-Emerging India Opportunities Fund

17,500,000 17,500,000

24,880,621 59,601,833

Total 172,947,995 204,106,247



Details of Quoted and Unquoted Investments(Amount in `)



Aggregate amount of quoted investments(Market Value `86,24,871 (Previous Year : `4,28,30,603))

8,624,871 42,830,603

Aggregate amount of unquoted investments 164,323,124 161,275,644

Total 172,947,995 204,106,247

Carrying value of Investments (Amount in `)



Investments carried at fair value through other comprehensive income 1,419,250 903,770

Investments carried at fair value through profit and loss 24,880,621 59,601,833

Investments carried at cost 146,648,124 143,600,644

Total 172,947,995 204,106,247

7. LOANS

(Amount in `)



As at April 1, 2015

Current

Unsecured, considered good

Loans to Employees 3,755,939 2,720,393 3,873,021

Total 3,755,939 2,720,393 3,873,021

8. OTHER FINANCIAL ASSETS

(Amount in `)



As at April 1, 2015

Non Current

Financial assets carried at amortised cost

Security Deposits 5,128,722 16,405,333 25,274,105

Total 5,128,722 16,405,333 25,274,105

Current


Interest Accrued but not due 7,572,598 5,911,619 6,570,855

Other financial assets* 2,078,829 4,859,905 5,849,630

Total 9,651,427 10,771,524 12,420,485

* Includes claims Receivable.



9. INVENTORIES

(Amount in `)



As at April 1, 2015

(Valued at lower of Cost and Net Realisable value)

Raw materials [including goods-in-transit: ` 2,716,182 (March 31, 2016: ` 41,261,070, April 1, 2015: ` 120,176)]

673,486,062 891,580,715 891,112,591

Work-in-process 3,237,608,537 3,530,932,266 2,830,979,597

Finished goods 740,831,241 864,724,413 1,236,423,451

Stock-in-trade 26,208 26,208 4,777,054

Stores, consumables and packing material 11,092,095 11,709,186 47,283,822

Total 4,663,044,143 5,298,972,788 5,010,576,515

10. TRADE RECEIVABLES

(Amount in `)



As at April 1, 2015

Current

Unsecured

Considered good 7,945,347,225 7,144,810,421 6,283,157,175

Considered doubtful 86,669,843 109,841,947 59,375,202

8,032,017,068 7,254,652,368 6,342,532,377

Less: Allowances for doubtful debts 86,669,843 109,841,947 59,375,202

7,945,347,225 7,144,810,421 6,283,157,175

Includes Receivables from related parties (Refer Note 36)

11. CASH AND CASH EQUIVALENTS

(Amount in `)



As at April 1, 2015

Balances with banks:

- in current accounts 6,578,722 17,971,638 44,836,960

Cash on hand 358,458 2,303,970 15,441,892

Total 6,937,180 20,275,608 60,278,852

12. OTHER BANK BALANCES

(Amount in `)



As at April 1, 2015

Deposits with banks to the extent held as margin money 359,331,656 403,362,647 419,755,094

Deposits with banks as security against borrowings 327,585,917 290,896,654 284,315,543

Total 686,917,573 694,259,301 704,070,637



13. OTHER ASSETS

(Amount in `)



As at April 1, 2015

Non Current

Capital Advances 23,469,276 24,335,471 13,255,081

Others

- Prepaid expenses - - 1,504,422

Total 23,469,276 24,335,471 14,759,503

Current

Advances other than Capital advances

- Other Advances * 24,434,183 10,427,656 7,069,222

Others

- Prepaid expenses 41,302,738 44,283,509 57,619,078

- Balances with Statutory, Government Authorities 78,174,116 79,731,093 116,508,972

- Other current assets 26,405 5,065 283,000

Total 143,937,442 134,447,323 181,480,272

* includes advances paid to creditors

14. INCOME TAX

(Amount in `)



As at April 1, 2015

Deferred tax relates to the following:

Accelerated Depreciation for tax purposes 19,017,055 12,147,017 5,251,480

Gratuity 10,595,492 8,908,141 11,545,464

Leave Encashment 4,535,240 3,760,572 5,027,482

Unamortised share issue expenses u/s 35D - 5,259,956 10,519,911

Disallowance under Section 40(a)(ia) - 674,856 2,055,082

Investment in Subsidiaries (1,956,695) (1,253,580) (534,308)

Losses available for offsetting against future taxable income 23,649,345 23,809 71,149

Provision for doubtful debts 28,655,650 38,014,101 20,548,570

Derivative Liability 6,454,479 - -

Net Deferred Tax Assets / (Liabilities) 90,950,566 67,534,872 54,484,830

Movement in deferred tax liabilities/assets(Amount in `)



Opening balance as at beginning of the year 67,534,872 54,484,830

Tax income/(expense) during the period recognised in profit or loss 21,353,283 15,199,381

Tax income/(expense) during the period recognised in OCI 2,062,411 (2,149,339)

Closing balance as at end of the year 90,950,566 67,534,872



The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liablities relate to income taxes levied by the same tax authority.

Tax losses which arose in India of ` 71528130 that are available for offsetting for eight years against future taxable profits of the Company. Major Components of income tax expense for the years ended March 31, 2017 and March 31, 2016 are as follows: i. Income tax recognised in profit or loss

(Amount in `)



Current income tax charge - 81,000,000

Adjustment in respect of current income tax of previous year - -

Deferred tax

Relating to origination and reversal of temporary differences (21,353,283) (15,199,381)

Income tax expense recognised in profit or loss (21,353,283) 65,800,619

ii. Income tax recognised in OCI(Amount in `)



Net loss/(gain) on remeasurements of defined benefit plans 2,062,411 (2,149,339)

Income tax expense recognised in OCI 2,062,411 (2,149,339)

Reconciliation of current tax expense and accounting profit multiplied by income tax rate for March 31, 2017 and March 31, 2016

(Amount in `)



Profit / (Loss) before tax (139,560,547) 158,311,703

Accounting profit before income tax (139,560,547) 158,311,703

Enacted tax rate in India 33.063% 34.608%

Income tax on accounting profits (46,142,904) 54,788,514

Effects of Incomes exempt from tax (911,748) (374,883)

Non-deductible expenses for tax purposes 23,887,691 11,337,253

Tax on income at different rate 3,876,089 (410,461)

Others (2,062,411) 460,196

Tax at effective income tax rate (21,353,283) 65,800,619



15. SHARE CAPITAL

(Amount in `)



As at April 1, 2015

Authorised

30,000,000 Equity Shares of ` 10 each 300,000,000 300,000,000 300,000,000

Issued, subscribed and paid-up

24,622,850 Equity Shares of ` 10 each fully paid up 246,228,500 246,228,500 246,228,500

TOTAL 246,228,500 246,228,500 246,228,500

i. Terms/rights attached to equity shares The Company has only one class of equity shares having a par value of ` 10 per share. Each holder of equity shares is

entitled to one vote per share and dividend in indian rupees, as proposed by the Board of Directors, which is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the

Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

ii. Shares held by holding/ ultimate holding company and / or their subsidiaries / associates The company does not have holding company or ultimate holding company iii. Details of shareholders holding more than 5% shares in the company

Name of the shareholder As at March 31, 2017 As at March 31, 2016

Number % holding Number % holding

Equity shares of ` 10 each fully paid

Rajeev Sheth 14,502,893 58.90 14,522,893 58.98

Crystalon Finanz AG 1,800,000 7.31 1,800,000 7.31

iv. Shares reserved for issue under options For details of shares reserved for issue under the Share based payment plan of the company, please refer note 34

v. Shares issued for consideration other than Cash / Bonus Shares The company has not issued shares for consideration other than cash or Bonus shares during the preceding 5 financial years.

16. OTHER EQUITY

i. Reserves and Surplus(Amount in `)



As at April 1, 2015

Securities Premium Reserve 1,679,062,852 1,679,062,852 1,679,062,852

General Reserve 126,789,441 126,600,049 114,400,049

Share Based Payment Reserve 3,731,080 3,473,012 2,577,905

Retained Earnings 3,359,850,978 3,482,233,655 3,121,010,700

SEZ Reinvestment Allowance Reserve - - 264,650,684

5,169,434,351 5,291,369,568 5,181,702,190



(a) Securities Premium Reserve(Amount in `)



Opening balance 1,679,062,852 1,679,062,852

Add/(Less):

changes during the period - -

Closing balance 1,679,062,852 1,679,062,852

(b) General Reserve(Amount in `)



Opening balance 126,600,049 114,400,049

Add/(Less):

Shares warrants forfeited - 12,200,000

Share based payment reserve transferred on lapse of option 189,392

Closing balance 126,789,441 126,600,049

(c) Share Based Payment Reserve(Amount in `)



Opening balance 3,473,012 2,577,905

Add/(Less):

Option Compensation expense charged during the period 447,460 895,107

Transfer to General Reserve on exercise/lapse of option (189,392) -

Closing balance 3,731,080 3,473,012

The Company has one share option scheme under which options to subscribe for the company’s shares have been granted to certain executives and senior employees. The Share based payment reserve is used to recognise the value of equity settled share based payments provided to employees, including key management personnel, as part of their remuneration. Refer to Note 34 for further details of these plans. (d) Retained Earnings

(Amount in `)



Opening balance 3,482,233,655 3,121,010,700

Net Profit/(Loss) for the year (118,207,264) 92,511,084

Add/(Less):

Untilisation of SEZ Reinvestment allowance reserve - 264,650,684

Items of Other Comprehensive Income directly recognised in Retained Earnings

Remeasurement of post employment benefit obligation, net of tax (4,175,413) 4,061,187

Closing balance 3,359,850,978 3,482,233,655



(e) SEZ Reinvestment Allowance Reserve(Amount in `)



Opening balance - 264,650,684

Add/(Less):

Utilisation of SEZ Reinvestment allowance reserve - (264,650,684)

Closing balance - -

A ‘Unit’ in Special Economic Zone (“SEZ Unit”) claiming tax holiday benefit under section 10AA enjoys the tax incentive for a period of 10 years. The incentive is a staggered one, spread over a period of 10 years. An SEZ Unit does not have to pay income tax on entire export profits for the first 5 years. In the next block of 2 years, a SEZ unit is not required to pay tax on half of its export profits. In the last block of 3 years (Year 8 to Year 10), a SEZ unit can claim deduction of the amount not exceeding fifty per cent of the profit as debited to the profit and loss account of the previous year in respect of which the deduction is to be allowed and credited to a reserve account (to be called the “Special Economic Zone Re-investment Reserve Account”) to be created and utilized for the purposes of the business of the company for the purposes of acquiring machinery or plant before the expiry of a period of three years following the previous year in which the reserve was created. ii. Components of Other Comprehensive Income

(Amount in `)



As at April 1, 2015

Equity Instruments through OCI 1,137,850 622,370 1,178,590

1,137,850 622,370 1,178,590 The disaggregation of changes to OCI by each type of reserve in equity is shown below:

(Amount in `)

Particulars Equity Investments Through OCI

Total

As at April 1, 2015 1,178,590 1,178,590

Gain/(Loss) on FVTOCI financial assets (556,220) (556,220)

As at March 31, 2016 622,370 622,370

Gain/(Loss) on FVTOCI financial assets 515,480 515,480

As at March 31, 2017 1,137,850 1,137,850

iii. Other Components of Equity(Amount in `)



As at April 1, 2015

Money Received against share warrants - - 12,200,000

Total - - 12,200,000.00

Share Warrants The Company had allotted 3,05,000 (Three Lac Five Thousand) Convertible Warrants (“Warrants”), on April 02, 2014 to Bennett, Coleman & Company Limited (‘BCCL’) on a preferential allotment basis, with each warrant convertible into one equity share at a conversion price of ` 160 per share, not later than 18 months from the date of allotment in accordance with the SEBI (ICDR) Regulations, 2009. In accordance with ICDR regulations, BCCL had paid ` 12,200,000 towards 25% value of total consideration



payable for the Warrants. The aforesaid share warrants were due for conversion in equity shares on or before October 2, 2015, however BCCL has not exercised the option and hence the warrants have lapsed on October 2, 2015. The amount paid against the aforesaid warrants has been forfeited by the Company and transferred to General Reserve. 17. BORROWINGS

i. Non Current Borrowings(Amount in `)



As at April 1, 2015

Secured

Term Loans

From Banks 150,824 598,804 1,575,367

From Others 12,382,456 16,025,597 10,140,861

Long term maturity of Finance Lease Obligations - - 614,157

(A) 12,533,280 16,624,401 12,330,385

Current Maturity of Non Current Borrowings

Term Loans

From Banks 150,824 377,190 924,635

From Others 4,414,376 4,088,375 7,480,909


(B) 4,565,200 4,465,565 9,019,701

Total (A)-(B) 7,968,080 12,158,836 3,310,684

a) Term Loan from Banks includes vehicle loan which is secured by hypothecation of vehicle and carries interest @ 10.22% p.a. The loans is repayable in 60 monthly installments inclusive of interest from the date of loan.

b) Term Loans from others include

i) Loan secured by hypothecation of Plant and Machinery and carries interest @ 13.00% p.a. The loan is repayable in 45 monthly installments of `148,642/- each including interest starting from March 2014.

ii) Loan secured by hypothecation of vehicle and carries interest @ 10.22%. The loans is repayable in 60 monthly installments inclusive of interest from the date of loan.

ii. Current Borrowings(Amount in `)



As at April 1, 2015

Secured

Loans repayable on demand

From Banks 3,029,954,842 3,085,069,038 3,040,769,879

From Other Parties 30,000,000 15,000,000 15,000,000

Bills Discounted 2,518,913,751 2,639,131,257 2,555,801,018

Unsecured

Loan from Related Party 8,064,008 - -

Total 5,586,932,601 5,739,200,295 5,611,570,897

(a) Working capital loans from banks are secured by hypothecation of inventories, book debts, plant and machinery, fixed deposits, other current assets and equitable mortgage of the Company’s factories at Seepz and MIDC, one office at Bandra Kurla Complex, seven flats in Mumbai, and Two Flats at Prabhadevi belonging to Divya Real Estate Pvt. Ltd.



(b) The above facilities are further secured by(i) personal guarantee of managing director, Mr. Rajeev Sheth,(ii) corporate guarantee of Divya Real Estate Pvt. Ltd., Fabrikant Tara International LLC and

Tara (Hong kong) Limited(iii) fixed deposits of ` 8.79 Crores of managing director, Mr. Rajeev Sheth

(iv) pledge of 9,581,300 equity shares of the Company held by managing director, Mr. Rajeev Sheth”

(c) Working capital loans from others are secured by pledge of 23,75,000 equity shares of the Company held by managing director, Mr. Rajeev Sheth and personal guarantee of managing director

(d) Loan from related party is interest free and repayable on demand. iii. Other Disclosures

(a) The carrying amounts of financial and non-financial assets pledged as security for current and non current borrowings are disclosed in Note 41

(b) Amount and period of default in repayment of borrowings (Amount in `)


Particulars Amount Period of Default

Term Loans from Others

Principal 445,237 1-60 Days

Interest 170,696 1-60 Days

Loans repayable on demand from Banks

Principal 469,176,099 1-90 Days

Interest 5,804,928 1-90 Days

18. OTHER FINANCIAL LIABILITIES

(Amount in `)



As at April 1, 2015

Current

(i) Financial Liabilities at amortised cost

Current maturities of long term debts 4,565,200 4,465,565 8,405,544

Current maturities of finance lease obligations - - 614,157

Interest accrued and due on borrowings 6,960,484 - -

Interest accrued but not due on borrowings 2,249,480 194,614 354,034

Unpaid dividends 5,065 5,065 5,065

Others

Bank Overdraft 24,372,532 19,383,813 12,479,458

Other Payables 7,839,624 7,357,564 7,947,116

45,992,385 31,406,621 29,805,374

(ii) Financial Liabilities carried at fair value through profit and loss

Derivatives not designated as hedge

- Foreign Exchange forward contracts 19,521,757 - -

19,521,757 - -

Total 65,514,142 31,406,621 29,805,374



19. TRADE PAYABLES

(Amount in `)



As at April 1, 2015

Current

Trade Payables to Micro, Small and Medium Enterprises - 77,787 77,000

Trade Payables to Others 3,207,190,597 3,014,658,652 2,172,838,652

Total 3,207,190,597 3,014,736,439 2,172,915,652

Includes dues to related parties (refer note 36)

20. OTHER LIABILITIES

(Amount in `)



As at April 1, 2015

Current

Statutory Liabilities 59,462,634 34,724,886 28,326,577

Others* 140,783,603 131,385,398 110,646,501

Total 200,246,237 166,110,284 138,973,078

*Others includes expenses payable, advance received from customer and deposits.

21. PROVISIONS

(Amount in `)



As at April 1, 2015

Non Current

Provision for employee benefits

Gratuity (Refer Note 33) 30,609,587 20,546,146 32,166,555

Leave encashment 12,925,127 9,897,758 13,839,101

Total 43,534,714 30,443,904 46,005,656

Current



Leave encashment 791,838 968,436 687,834

Total 2,228,622 6,162,410 1,881,958

22. CURRENT TAX LIABILITY(NET)

(Amount in `)



As at April 1, 2015

Opening balance 272,934,320 199,726,713 199,726,713

Add: Current tax payable for the year - 81,000,000 -

Add: Provision for interest payable on current tax 55,000,000 24,000,000 -

Less: Taxes paid 34,220,677 31,792,393 -

Closing Balance 293,713,643 272,934,320 199,726,713



23. REVENUE FROM OPERATIONS

(Amount in `)



Sale of products

Gems and Jewellery 11,901,368,218 13,563,434,564

Others - 199,608

Sale of services

Labour charges 4,992,402 4,839,955

Other Operating Revenues

Sale of gold dust - 137,089

11,906,360,620 13,568,611,216

24. OTHER INCOME

(Amount in `)



Interest income on

Bank fixed deposits 39,261,931 46,119,223

Loans to others - 19,590

Dividend income 8,185 259,972

Other Non Operating Income

Financial Guarantee Income 17,807,480 17,977,510

Net gain on sale of Investments 1,370,671 (69,574)

Others

Rent received 5,170,454 2,331,000

Commission received 43,322 185,347

63,662,043 66,823,068

25. COST OF MATERIALS CONSUMED

(Amount in `)



As at beginning of the year 891,580,715 891,112,591

Add: Purchases 9,479,902,689 9,576,753,297

Less : As at end of the year 673,486,062 891,580,715

9,697,997,342 9,576,285,173

Details of raw materials and components consumed (Amount in `)



Precious metals and diamonds 9,624,108,819 9,456,718,100

Others 73,888,523 119,567,073

9,697,997,342 9,576,285,173



26. PURCHASES OF STOCK-IN-TRADE

(Amount in `)



Gems and Jewellery 257,120,224 2,324,708,368

257,120,224 2,324,708,368

27. CHANGES IN INVENTORIES OF FINISHED GOODS, WORK-IN-PROGRESS AND STOCK-IN-TRADE

(Amount in `)



Inventories as at the beginning of the year

Work - in - process 3,530,932,266 2,830,979,597

Finished goods 864,724,413 1,236,423,451

Stock-in-trade 26,208 4,777,054

4,395,682,887 4,072,180,102

Less : Inventories as at the end of the year

Work - in - process 3,237,608,537 3,530,932,266

Finished goods 740,831,241 864,724,413

Stock-in-trade 26,208 26,208

3,978,465,986 4,395,682,887

Net decrease / (increase) in inventories 417,216,901 (323,502,785)

28. EMPLOYEE BENEFITS EXPENSE

(Amount in `)



Salaries, wages and bonus 251,233,199 304,861,311

Contribution to provident and other funds 21,317,223 23,515,563

Share based payments to employees 447,460 895,107

Staff welfare expenses 6,120,158 11,829,162

Gratuity Expense 3,834,815 2,013,098

282,952,855 343,114,241

29. FINANCE COST

(Amount in `)



Interest expense on debts and borrowings 620,810,116 551,389,904

Interest on Income tax 55,000,000 24,000,000

Other borrowing costs

Guarantee Commission Expense 14,760,000 14,860,000

Others 67,829,643 68,000,571

758,399,759 658,250,475



30. DEPRECIATION AND AMORTISATION EXPENSE

(Amount in `)



Depreciation on tangible assets 213,235,817 204,974,687

Amortisation on intangible assets 8,486,547 8,640,205

221,722,364 213,614,892

31. OTHER EXPENSES

(Amount in `)



Manufacturing Expenses

Wages, allowances and bonus 98,622,620 124,752,628

Import clearing charges 8,466,250 12,288,323

Labour charges 43,239,632 90,736,867

Electric power, fuel and water 32,386,699 40,349,097

Repairs and maintenance

Factory Building 1,063,096 2,668,451

Plant and Machinery 2,775,897 6,812,170

Foreign Exchange fluctuation loss (47,771,137) (126,496,470)

Stores, consumables and packing material 38,132,298 114,664,171

176,915,355 265,775,237

Selling, Administration and Other Expenses

Advertisement 394,242 8,266,732

Payments to auditors (Refer note below) 6,915,000 7,668,500

Bad Debts written off 98,157,644 55,573,718

Credit insurance 21,862,549 28,651,495

Electricity charges 1,500,157 3,093,399

Export clearing charges 11,142,932 14,085,955

Fixed assets written off 4,347,902 7,881,649

House Keeping Expenses 2,775,265 3,948,817

Insurance 4,963,799 9,976,046

Legal and professional fees 24,917,550 35,467,085

Net loss on disposal of property, plant and equipment 6,175,932 6,759,433

Rates and taxes 4,702,533 7,688,811

Rent 14,381,226 44,751,602

Repairs & maintenance - other 8,498,385 8,721,894

Sales promotion expenses 7,891,260 7,292,267

Security charges 8,232,505 13,437,456

Telephone and internet expenses 3,220,931 4,241,530

Travelling & conveyance expenses 15,185,668 17,048,668



(Amount in `)




Bank charges 30,821,927 48,547,964

Fair value loss on financial instrument at Fair value through profit and loss 18,143,004 925,729

Miscellaneous expenses 14,639,173 31,115,735

285,697,480 415,611,230

Total 462,612,835 681,386,467

a. Details of Payments to auditors (Amount in `)



Audit Fee 1,500,000 2,000,000

Tax audit fee 1,500,000 1,500,000

Limited review fee 1,000,000 1,000,000

Services for tax matters 1,500,000 1,500,000

Certification and consultation 1,100,000 1,308,000

Service Tax 315,000 360,500

6,915,000 7,668,500

b. Value of imports calculated on CIF Basis(Amount in `)



Raw materials 5,838,516,471 5,832,763,015

Trading goods - -

Packing Material 16,306,328 25,693,357

Components and spares 1,502,512 12,797,459

Capital goods 82,104,303 298,847,852

Total 5,938,429,614 6,170,101,683

c. Expenditure in foreign currency(Amount in `)



Salary 7,954,514 15,158,010

Interest 163,273,625 159,833,971

Labour charges 8,135,284 7,514,763

Payment on other accounts 9,498,152 13,153,155

Total 188,861,575 195,659,899



d. Earnings in foreign currency(Amount in `)



F.O.B value of exports 8,813,354,363 9,870,087,143

Labour charges 4,729,138 4,611,767

Freight 9,905,166 11,293,564

Total 8,827,988,667 9,885,992,474

32. EARNINGS PER SHARE

(Amount in `)



Profit / (Loss) after tax (`) (118,207,264) 92,511,084

Weighted average number of equity shares 24,622,850 24,622,850

Nominal value per share (`) 10.00 10.00

Basic and Diluted Earning / (Loss) per Equity Share (`) (4.80) 3.76

33. EMPLOYEE BENEFIT OBLIGATIONS

(Amount in `)

As at March 31, 2017 As at March 31, 2016

Current Non Current Total Current Non Current Total

Leave obligations 791,838 12,925,127 13,716,965 968,436 9,897,758 10,866,194

Gratuity 1,436,784 30,609,587 32,046,371 5,193,974 20,546,146 25,740,120

Total Employee Benefit Obligation

2,228,622 43,534,714 45,763,336 6,162,410 30,443,904 36,606,314

(i) Leave Obligations The leave obligations cover the company’s liability for sick and earned leave. The amount of the provision of ` 791,838 (Previous Year : ` 968,436) is presented as current, since the company does

not have an unconditional right to defer settlement for any of these obligations.

(ii) Post Employment obligations Gratuity The company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are

in continuous service for a period of five years are eligible for gratuity. The amount of gratuity payable on retirement/ termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied by number of years of service.

The gratuity plan is a funded plan and the company makes contributions to recognised funds in India. The company

does not fully fund the liability and maintains a target level of funding to be maintained over a period of time based on estimations of expected gratuity payments.



The amount recognised in the balance sheet and the movement in the net defined benefit obligation over the period are as follows

(Amount in `)

Particulars Present value of obligation

Fair value of plan assets

Net amount

As at April 1, 2015 33,513,587 (152,908) 33,360,679

Current service cost 3,006,728 - 3,006,728

Interest expense/(income) 2,681,087 - 2,681,087

Total amount recognised in profit or loss 5,687,815 - 5,687,815

Remeasurements

Return of plan assets, excluding amount included in interest (income)

- (12,233) (12,233)

(Gain)/Loss from change in demographic assumptions - - -

(Gain)/Loss from change in financial assumptions 551,601 (535) 551,066

Experience (gains)/losses (6,749,359) - (6,749,359)

Total amount recognised in other comprehensive income (6,197,758) (12,768) (6,210,526)

Employer contributions -

Benefit payments (7,097,848) - (7,097,848)

As at March 31, 2016 25,905,796 (165,676) 25,740,120

Current service cost 3,861,587 - 3,861,587

Interest expense/(income) 1,878,170 (12,012) 1,866,158

Total amount recognised in profit or loss 5,739,757 (12,012) 5,727,745

Remeasurements


- - -

(Gain)/Loss from change in demographic assumptions 153,631 - 153,631

(Gain)/Loss from change in financial assumptions 5,460,489 - 5,460,489

Experience (gains)/losses 625,360 (1,656) 623,704

Total amount recognised in other comprehensive income 6,239,480 (1,656) 6,237,824


Benefit payments (5,659,318) - (5,659,318)

As at March 31, 2017 32,225,715 (179,344) 32,046,371

The net liability disclosed above relates to funded and unfunded plans are as follows:(Amount in `)



As at April 1, 2015

Present value of funded obligations 32,225,715 25,905,796 33,513,587

Fair value of plan assets (179,344) (165,676) (152,908)

Deficit of funded plan 32,046,371 25,740,120 33,360,679

Unfunded plans - - -

Deficit of gratuity plan 32,046,371 25,740,120 33,360,679



The significant actuarial assumptions were as follows:(Amount in `)



Discount rate 7.25% 8.00%

Expected return on plan assets 7.25% 7.99%

Salary growth rate 3.50% 2.50%

Attrition rate 1% to 4% 1% to 3%

Life expectation for

Male 60 Years 60 years

Female 60 Years 60 years

A quantitative sensitivity analysis for significant assumption as at March 31, 2017 is shown below:

Assumptions Discount rate Salary growth rate

Sensitivity Level 0.5% increase 0.5% decrease 0.5% increase 0.5% decrease

March 31, 2016

Impact on defined benefit obligation (129,400) 130,735 34,462 (34,052)

March 31, 2017

Impact on defined benefit obligation (1,735,769) 1,897,725 1,959,837 (1,804,161)

Sensivities due to mortality, attrition and withdrawals are insignificant and therefore ignored. Sensitivities as to rate of inflation, rate of increase of pensions in payment, rate of increase of pensions before retirement and life expectancy are not applicable being a lump sum benefit on retirement. The sensitivity analysis above have been determined based on a method that extrapolates the impact on defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period. The following payments are expected contributions to the defined benefit plan in future years:

(Amount in `)



Within the next 12 months 1,616,128 6,398,609

Between 2 and 5 years 9,211,898 8,536,487

Between 5 and 10 years 7,285,680 -

Beyond 10 years - -

Total expected payments 18,113,706 14,935,096

(iii) Defined contribution plans The company also has defined contribution plans. Contributions are made to provident fund in India for employees at the

rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the government. The company has also contributed towards employee’s state insurance scheme and Maharashtra labour welfare fund. The obligation of the company is limited to the amount contributed and it has no further contractual nor any constructive obligation.



During the year, the Company has recognised the following amounts in the Statement of Profit and Loss: (Amount in `)



Employer's contribution to provident fund 16,320,666 18,243,875

Employer's contribution to employee's state insurance 4,918,041 5,179,455

Employer's contribution to Maharashtra labour welfare fund 78,516 92,233

21,317,223 23,515,563

34. SHARE BASED PAYMENTS

(a) Employee stock option plan The Employee Stock Option Plan (ESOP) is designed to provide incentives to employees above the designation of

managers to deliver long term returns. Participation in the plan is at the board’s discretion and no individual has a contractual right to participate in the plan or to receive any guaranteed benefits.

Once vested, the options remain exercisable for a period of 4 years. When exercisable, each option is convertible

into one equity share of ` 10 each. The exercise price of the share options is ` 230.

Movement during the period The number and weighted average exercise prices (WAEP) of the options and movement during the period is as

follows

Particulars Year ended March 31, 2017 Year ended March 31, 2016

No. of options WAEP No. of options WAEP

Opening balance 111,678 230 111,678 230

Granted during the period - - - -


Forfeited / lapsed during the period (5,395) - - -


Closing balance 106,283 230 111,678 230



Particulars Grant date Expiry date Exercise price (Rs.)

Share options

Share options

Share options

March 31, 2017

March 31, 2016

April 1, 2015

ESOP 2013 - Grant C 25-Jul-13 25-Jul-17 230 106,283 111,678 111,678

Total 106,283 111,678 111,678





(b) Expense arising from share based payment transactions Total expenses arising from share based payment transactions recognised in profit or loss as part of employee

benefit expense were as follows:(Amount in `)





35. COMMITMENTS AND CONTINGENCIES A. Commitments

i. Capital Commitments Capital expenditure contracted for at the end of the reporting period but not recognised as liabilities is as

follows:(Amount in `)



As at April 1, 2015

Property, plant and equipment 10,400,445 11,515,601 43,687,095

ii. Leases Operating lease commitments - Company as lessee The Company’s significant leasing arrangements are in respect of residential flats and commercial premises

taken on lease. The arrangements range between 11 months and 9 years generally and are usually renewable by mutual consent or mutually agreeable terms. Under these arrangements, generally refundable interest free deposits have been given. In respect of above arrangements, lease rentals payable are recognised in the Statement of Profit and Loss for the year and included under Rent (disclosed under Other Expenses).

(Amount in `)



As at April 1, 2015

Commitments for minimum lease payments in relation to non cancellable operating leases are as follows

Within one year 320,000 543,513 5,155,782

Later than one year but not later than five years - - 993,835

later than five years - - -

320,000 543,513 6,149,617

Rents recognised as expense in the period 14,381,226 44,751,602 -

Operating lease commitments - Company as lessor The Company has entered into operating leases for its commercial property. These leases have terms of between

11 months and 3 years. All leases include a clause to enable upward revision of the rental charge on an annual basis according to prevailing market conditions. The total rents recognised as income during the year is ̀ 51,70,454 (Previous Year : ` 23,31,000).

(Amount in `)



As at April 1, 2015

Minimum lease rentals receivables in relation to non cancellable operating leases are as follows

Within one year 4,800,000 - -

Later than one year but not later than five years 7,880,000 - -


12,680,000 - -



B. Contingent Liabilities(Amount in `)



As at April 1, 2015

Claim against the company not acknowledged as debt

(a) Custom duty matters 1,900,563 1,900,563 1,900,563

(b) Property tax - 2,481,489 2,481,489

(c) Service tax matter 6,723,389 6,723,389 6,723,389

(d) Other matter 1,004,921 2,085,723 2,085,723

Brief description of the nature of each contingent liability (a) Custom duty matters Two show cause notices have been issued against our Company by Assistant Commissioner of Customs, Mumbai,

regarding shortage of gold and misuse of wastage norms. Also Additional Assistant Commissioner of Customs, Mumbai has imposed fine for import without a license that could not be cleared as prototype samples. Company has filed appeals before the Commissioner of Customs / Additional Commissioner of Customs and matters are pending.

(b) Property tax Bill of Property Tax issued by MCGM mentioned an old outstanding amount to be paid by company, which as per

company were not payable and the same has been settled during the year. (c) Service tax matter Joint Commissioner, Service Tax- I, Mumbai has issued a show cause notice to Company for service tax demand for

the Taxation of Services (Provided from Outside India and Received in India). Company has filed an appeal before the Commissioner of Central Excise against the order and the matter is currently pending.

(d) Other matter American Express Bank on his credit card bill to the Company is showing an outstanding amount for interest payable on

account of delay in payment of regular credit card outstanding in past. This amount has been disputed by the company and matter is not yet settled.

C. Financial Guarantees

(Amount in `)



As at April 1, 2015

Corporate Guarantee given by the Company to the bankers of a subsidiary company

1,847,940,000 1,558,755,000 1,157,915,000

Income Tax Assessment The Income- Tax assessments of the Company have been completed up to Assessment Year 2014-15. The disputed

demand outstanding up to the said assessment year is approximately ` 56,500,000 Based on the decisions of the appellate authorities and the interpretations of other relevant provisions, the Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

36. RELATED PARTY TRANSACTIONS

i. List of related parties as per the requirements of Ind-AS 24 - Related Party Disclosures Subsidiary Companies

1. Fabrikant Tara International LLC.2. Tara Jewels Holding Inc.3. Tara (Hong Kong) Ltd.4. Tara China Jewelery Ltd.



Key Management Personnel1. Mr. Rajeev Sheth2. Mr.Ravindran M. P.3. Mr. Sanjay Sethi (Upto 11-02-2016)4. Mr. Vishnu Prakash Garg (From 23-05-2016)5. Ms. Fern Mallis6. Mr. Nikkhil Vaidya7. Mr. Rakesh Kalra8. Mr. Shanti Saroop Khindria9. Mr. Rajiv Jain10. Mr. Francois Arpels (Upto 11-02-2016)11. Mr. Mariano De La Torre (Upto 09-12-2016)12. Mr. Jeffery Shlakman (From 02-09-2016)13. Mr. Stuart Marcus (From 02-09-2016)14. Ms. Alison Lazerwitz (From 09-12-2016)15. Mr. Bimal Desai (Upto 13-05-2016)16. Mrs. Nivedita Nayak

Relatives of Directors 1. Mrs. Aarti Sheth2. Mrs. Divya Sheth3. Mrs. Purnima Sheth4. Mrs. Rama Ravindran Menon

Entities in which Key Managerial Personnel/ their relatives are able to exercise significant influence or control 1. F. T. Diamonds2. Divya Jewels International Pvt. Ltd.3. Divya Real Estate Pvt. Ltd.4. Aarti Jewellers Pvt Ltd. 5. Karan Arjun Jewellery Pvt. Ltd.6. Tara Duniya Corporation

ii. Transactions during the year ended Mar 31, 2017

(Amount in `)

Particulars Subsidiaries Companies

Key Management Personnel/ Relatives

Entities in which Key Managerial Personnel/ their

relatives have significant influence or control

Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Sale of Goods

Fabrikant Tara International LLC. 1,649,874,842 2,065,262,615 - - - -

Tara (Hong Kong) Ltd. 3,145,372,848 2,554,223,829 - - - -

F. T. Diamonds - - - - 164,497,155 39,887,037

Purchase of Goods

Fabrikant Tara International LLC. 956,514,721 769,887,182 - - - -

Tara (Hong Kong) Ltd. 2,235,421,221 1,110,764,555 - - - -

Aarti Jewellers Pvt Ltd. - - - - 108,000 78,023

F. T. Diamonds - - - - 145,552,019 -

Labour Charges Paid

Tara (Hong Kong) Ltd. 154,524 437,489 - - - -

F. T. Diamonds - - - - 1,159,269 -



(Amount in `)





Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year




Aarti Jewellers Pvt Ltd. - - - - - 71,342

F. T. Diamonds - - - - 27,988 22,324

Purchase of Fixed Assets


Directors' Remuneration and Commission

Mr Rajeev V. Sheth - - 12,000,000 12,000,000 - -

Mr Sanjay Sethi - - - 5,136,207 - -

Mr Vishnu Prakash Garg - - 4,430,543 - - -

Mr Ravindran M. P. - - 2,947,049 2,767,264

Commission and other benefits to Independent Directors

- - 500,000 3,560,000 - -

Salary paid

Mr. Bimal Desai - - 652,759 1,867,370 - -

Ms Aarti Sheth - - 3,246,335 3,720,000 - -

Ms Divya Sheth - - 2,299,067 2,187,165 - -

Other Key Managerial Personnel - - 629,039 611,175 - -

Professional Fees paid

Mrs. Rama Ravindran Menon - - 1,901,880 1,654,992 - -

Sales Promotion Expenses

Aarti Jewellers Pvt Ltd. - - - - 146,744 -

Unsecured Loan Taken

Mr. Rajeev Sheth - - 10,664,008 - - -

Repayment of Unsecured Loans

Mr. Rajeev Sheth - - 2,600,000 - - -

Commission Income on Corporate Guarantee issued


Tara (Hong Kong) Ltd. 1,116,645 1,127,610 - - - -



(Amount in `)





Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Guarantee Commission Expense on Corporate Guarantee received


Tara (Hong Kong) Ltd. 7,380,000 - - - - -

Guarantee Commission Income on Corporate Guarantee received


Tara (Hong Kong) Ltd. 7,380,000 - - - - -

iii. Key management personnel compensation

(Amount in `)



Salaries and other employee benefits to whole time directors and Key Management Personnel

26,204,792 28,289,181

Provision for Post employment benefits to whole time directors and Key Management Personnel *

1,349,977 -

Commission and other benefits to non-executive / independent directors 500,000 3,560,000

Share based payments - -

28,054,769 31,849,181

* The amount for year ended March 31, 2016 excludes post employment benefit viz. gratuity which can not be separately identified from the composite amount advised by the Actuary. iv. Closing Balances as on March 31, 2017

(Amount in `)

Subsidiaries Companies




Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Trade Receivables

Fabrikant Tara International LLC. - 44,308,468

Tara (Hong Kong) Ltd. 1,100,692,796 285,605,138 - - - -

F. T. Diamonds - - - - - 41,229,519

Aarti Jewellers Pvt Ltd. - - - - 52,903 71,794

Trade Payables

Fabrikant Tara International LLC. 67,879,027 - - - - -

F. T. Diamonds - - - - 35,396,027 -

Investments

Tara Jewels Holding Inc. 118,849,850 116,541,200 - - - -



(Amount in `)

Subsidiaries Companies




Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous Year

Tara (Hong Kong) Ltd. 28,176,089 27,059,444 - - - -

Divya Jewels International Pvt. Ltd. - - - - 175,000 175,000

Short-term borrowings

Mr. Rajeev Sheth - - 8,064,008 - - -

Director Remuneration payable

Mr. Rajeev Sheth - - 984,912 5,567,343 - -

Mr Vishnu Prakash Garg - - 577,133 - - -

Mr Ravindran M. P. - - 352,156 165,439 - -

Commission and other benefits Payable to Independent Directors

- - 2,866,100 5,444,420 - -

Salary Payable

Ms Aarti Sheth - - 1,359,935 647,707 - -

Ms Divya Sheth - - 117,507 71,983 - -

Mr. Bimal Desai - - - 297,634 - -

Other Key Managerial Personnel - - 108,269 45,364 - -

Professional Fees Payable

Mrs. Rama Ravindran Menon - - 470,448 137,916 - -

v. Terms and conditions of transactions with related parties The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm’s length

transactions. Outstanding balances at the year end are unsecured and interest free. For the year ended March 31, 2017, the Company has not recorded any impairment of receivables relating to amount owed by related parties. This assessment is undertaken each financial year through examining the financial position of the related party and market in which the related party operates.

37. SEGMENT REPORTING

A. Information about Primary Business Segment The Company is exclusively engaged in the “Diamond and Gold Jewellery” Business Segment.

B. Information about Secondary Geographical Segment.(Amount in `)

April 1, 2016 to March 31, 2017

Particulars India Outside India* Total

External Revenue 3,081,244,909 8,825,115,711 11,906,360,620

(3,741,809,572) (9,826,801,644) (13,568,611,216)


Carrying Amount of Segment Assets 6,880,024,150 7,944,105,187 14,824,129,337

(7,499,469,964) (7,311,903,583) (14,811,373,547)

April 1, 2016 to March 31, 2017

Capital Expenditure 114,313,913 - 114,313,913

(322,756,621) - (322,756,621)

* Includes mainly United States of America, Australia, China (including Hong kong), United Arab Emirates,



Europe, South- Africa, Canada, Singapore and United kingdom

Note: The figures in brackets are in respect of the previous year ended March 31, 2016

Notes:

(a) Segment Revenue in the geographical segment considered for disclosure are as follows:

- Revenue within India includes sales to customers located within India and earnings in India

- Revenue outside India includes sales to customers located outside India and earnings outside India.

(b) Segment revenue, results, assets and liabilities includes the respective amounts identified to each the segment and amounts allocated on a reasonable basis.

(c) Revenue from two subsidiaries amounted to `4,79,99,45,528 (March 31, 2016 : ` 4,62,42,27,666)

38. FAIR VALUE MEASUREMENTS

i. Financial Instruments by Category(Amount in `)

Particulars Carrying Amount Fair Value

As at March 31,

2017


As at April 1, 2015

As at March 31,

2017


As at April 1, 2015

FINANCIAL ASSETS

Amortised cost

Trade Receivables 7,945,347,225 7,144,810,421 6,283,157,175 7,945,347,225 7,144,810,421 6,283,157,175

Loans 3,755,939 2,720,393 3,873,021 3,755,939 2,720,393 3,873,021

Cash and Cash Equivalents 6,937,180 20,275,608 60,278,852 6,937,180 20,275,608 60,278,852

Other Bank Balances 686,917,573 694,259,301 704,070,637 686,917,573 694,259,301 704,070,637

Other Financial Assets 14,780,149 27,176,857 37,694,590 14,780,149 27,176,857 37,694,590

FVTOCI

Investment in Equity Instruments 1,419,250 903,770 1,459,990 1,419,250 903,770 1,459,990

FVTPL

Investments in Mutual Funds 24,880,621 59,601,833 47,641,964 24,880,621 59,601,833 47,641,964

Total 8,684,037,937 7,949,748,183 7,138,176,229 8,684,037,937 7,949,748,183 7,138,176,229

FINANCIAL LIABILITIES

Amortised cost

Borrowings 5,594,900,681 5,751,359,131 5,614,881,581 5,594,900,681 5,751,359,131 5,614,881,581

Trade Payables 3,207,190,597 3,014,736,439 2,172,915,652 3,207,190,597 3,014,736,439 2,172,915,652

Other financial liabilities 45,992,385 31,406,621 29,805,374 45,992,385 31,406,621 29,805,374

FVTPL

Derivative instruments 19,521,757 - - 19,521,757 - -

Total 8,867,605,420 8,797,502,191 7,817,602,607 8,867,605,420 8,797,502,191 7,817,602,607

The management assessed that the fair value of cash and cash equivalent, other bank balances, trade receivables, trade payables, and other current financial assets and liabilities approximate their carrying amounts largely due to the short term maturities of these instruments.

The fair values for security deposits were calculated based on cash flows discounted using a current lending rate. They are

classified as level 3 fair values in the fair value hierarchy and their fair values are assessed as approximate to their carrying amounts.



The fair values of non current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk. The own non performance risk as at reporting date was assessed to be insignificant and therefore fair values approximate their carrying amounts.

ii. Fair Value Hierarchy This section explains the judgments and estimates made in determining the fair values of the financial instruments

that are recognised and measure at fair value. To provide an indication about the reliability of the inputs used in determining fair value, the company has classified its financial instruments into three levels prescribed under the accounting standard. An explanation of each level follows underneath the table:

Assets and liabilities measured at fair value - recurring fair value measurement:

Particulars Fair value measurement using Total

Quoted prices in active markets (Level 1)

Significant Observable

Inputs (Level 2)

Significant Unobservable

Inputs (Level 3)


Financial Assets

Financial Investments at FVTPL

Quoted Mutual Funds 7,380,621 7,380,621

Unquoted Mutual Funds 17,500,000 17,500,000

Financial Investments at FVTOCI

Quoted equity shares 1,244,250 1,244,250

Unquoted equity shares 175,000 175,000

Total Financial Assets 8,624,871 17,500,000 175,000 26,299,871

Financial Liabilities at FVTPL

Derivative instruments 19,521,757 19,521,757

Total Financial Liabilities - 19,521,757 - 19,521,757


Financial Assets





Quoted equity shares 728,770 728,770




Derivative instruments - -

Total Financial Liabilities - - - -

As at April 1, 2015

Financial Assets








Inputs (Level 2)


Inputs (Level 3)



Quoted equity shares 1,284,990 1,284,990



There have been no transfers among Level 1, Level 2 and Level 3 during the period

Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments, traded bonds and mutual funds that have quoted price. The fair value of all equity instruments (including bonds) which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the closing NAV.

Level 2 - The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over the counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3 - If one or more of the significant inputs are not based on observable market data, the instrument is included in level

3. This is the case for unlisted equity shares, contingent consideration and indemnification assets included in level 3.

iii. Valuation technique used to determine fair value Specific Valuation techniques used to value financial instruments include:

- the use of quoted market prices or dealer quotes for similar instruments - the fair value of the remaining financial instruments is determined using discounted cash flow analysis

iv. Valuation inputs and relationships to fair value The fair values of the unquoted equity shares have been estimated using a discounted cash flow model. The

valuation requires management to make certain assumptions about the model inputs, including forecast cash flows, discount rate, credit risk and volatility, the probabilities of the various estimates within the range can be reasonably assessed and are used in management’s estimate of fair value for these unquoted equity investments.

v. Valuation processes The finance department of the Company performs the valuations of financial assets and liabilities required for

financial reporting purposes, including level 3 fair values. The department reports directly to the chief financial officer (CFO) and the audit committee. Discussions of valuation processes and results are held between the CFO, Audit Committee and the valuation team periodically.

vi. Reconciliation of fair value measurement of financial assets carried at fair value (Level 3): There is no change in fair value of unquoted equity shares.

39. FINANCIAL RISK MANAGEMENT

The company’s activity expose it to market risk, liquidity risk and credit risk. In order to minimise any adverse effects on the financial performance of the company, derivative financial instruments, such as foreign exchange forward contracts are entered to hedge certain foreign currency risk exposures. Derivatives are used exclusively for hedging purposes and not as trading or speculative instruments. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk.



(A) Credit risk Credit risk is the risk that the counterparty will not meet its obligations leading to a financial loss. Credit risk arises

from cash and cash equivalents, investments carried at amortised cost and deposits with banks and financial institutions, as well as credit exposures to customers including outstanding receivables.

i. Credit risk management Credit risk has always been managed by the company through credit approvals, obtaining credit reports,

establishing credit limits, taking credit limits and continuously monitoring the creditworthiness of customers to which the company grants credit terms in the normal course of business.

The company considers the probability of default upon initial recognition of asset and whether there has been

a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk the group compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers available reasonable and supportive forwarding-looking information.

A default on a financial asset is when the counterparty fails to make contractual payments of when they fall

due. This definition of default is determined by considering the business environment in which entity operates and other macro-economic factors.

ii. Provision for expected credit losses The company follows ‘simplified approach’ for recognition of impairment loss allowance on Trade

receivables As a practical expedient, the Company uses a provision matrix to determine impairment loss allowance on

portfolio of its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analyzed.

iii. Reconciliation of loss allowance provision - Trade receivables

(Amount in `)

Particulars

Loss allowance on April 1, 2015 59,375,202

Changes in loss allowance 50,466,745

Loss allowance on March 31, 2016 109,841,947

Changes in loss allowance (23,172,104)


(B) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, company maintains flexibility in funding by maintaining availability under committed credit lines. Management monitors rolling forecasts of the company’s liquidity position (comprising the undrawn borrowing facilities) and cash and cash equivalents on the basis of expected cash flows. In addition, the company’s liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.



Maturities of financial liabilities The tables below analyse the company’s financial liabilities into relevant maturity groupings based on their

contractual maturities for: - all non-derivative financial liabilities, and - net and gross settled derivative financial instruments for which the contractual maturities are essential for an

understanding of the timing of the cash flows. The table have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest

date on which the Company can be required to pay. In the table below, borrowings include both interest and principal cash flows. To the extent that the interest rates are floating rate, the undiscounted amount is derived from interest rate curves at the end of the reporting period.

Contractual maturities of financial liabilities

Particulars Carrying Amount

Contractual Cash Flows

Total Less than 1 year

Between 1 and 3 years

More than 3 years

March 31, 2017

Non-derivatives

Borrowings 5,599,465,881 5,941,419,994 5,932,497,894 8,231,500 690,600

Trade payables 3,207,190,597 3,207,190,597 3,207,190,597 - -

Other financial liabilities 45,992,385 45,992,385 45,992,385 - -

Total non derivative liabilities 8,852,648,863 9,194,602,976 9,185,680,876 8,231,500 690,600

Derivatives (net settled)

Foreign exchange forward contracts 19,521,757 19,521,757 19,521,757 - -

Total derivative liabilities 19,521,757 19,521,757 19,521,757 - -

March 31, 2016

Non-derivatives

Borrowings 5,755,824,696 6,378,618,229 6,364,546,769 9,237,260 4,834,200

Trade payables 3,014,736,439 3,014,736,439 3,014,736,439 - -


Total non derivative liabilities 8,801,967,756 9,424,761,289 9,410,689,829 9,237,260 4,834,200

April 1, 2015

Non-derivatives

Borrowings 5,623,901,282 6,169,464,736 6,165,893,092 3,571,644 -

Trade payables 2,172,915,652 2,172,915,652 2,172,915,652 - -


Total non derivative liabilities 7,826,622,308 8,372,185,762 8,368,614,118 3,571,644 -

(C) Market risk Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of

change in market prices. Market risk comprises three types of risk: foreign currency risk, interest rate risk and other price risk such as equity price risk and commodity price risk.

(i) Foreign currency risk The fluctuation in foreign currency exchange rates may have potential impact on the statement of profit and

loss and other comprehensive income and equity, where any transaction references more than one currency or where assets/liabilities are denominated in a currency other than functional currency of the Company.



Considering the countries and economic environment in which the Company operates, its operations are subject to risks arising from fluctuation in exchange rates in those countries. The risk primarily relate to fluctuations in US Dollars(USD). Other Currencies in which risk of fluctuation is not significant are Great Britain Pound(GBP) and Euro(EUR) against the functional currency of the Company.

The Company, as per its risk management policy uses derivative instruments primarily to hedge foreign

exchange. Further, any movement in the foreign currencies of the various operations of the Company against the functional currency of the Company may impact the Company’s revenue from international business.

The Company evaluates the impact of foreign exchange rate fluctuations by assessing its exposure to exchange rate risk. It hedges a part of this risk by using derivative financial instruments in line with risk management policies.

(a) Foreign currency risk exposure The Company’s exposure to foreign currency risk at the end of the reporting period expressed in Indian

Rupees are as follows (Amount in `)

Particulars USD Others Total

March 31, 2017

Trade Receivables 7,717,609,967 79,718 7,717,689,685

Bank balance in EEFC accounts 70,297 70,297

Foreign Currency loans (2,336,314,096) (2,336,314,096)

Trade Payables (2,962,026,090) (14,033,572) (2,976,059,662)

Derivative Instruments (19,521,757) (19,521,757)

Net exposure to foreign currency risk 2,399,818,321 (13,953,854) 2,385,864,467

March 31, 2016




Trade Payables (2,451,339,299) (52,377,569) (2,503,716,868)


April 1, 2015




Trade Payables (1,861,152,257) (52,116,987) (1,913,269,244)


(b) Foreign currency sensitivity 1% increase or decrease in foreign exchange rates will have the following impact on profit before tax:


1% Increase 1% Decrease 1% Increase 1% Decrease

USD 23,998,183 (23,998,183) 20,029,398 (20,029,398)

Others (139,539) 139,539 (522,911) 522,911

Net Increase/(decrease) in profit or loss 23,858,645 (23,858,645) 19,506,487 (19,506,487)



(ii) Interest rate risk The company’s main interest rate risk arises from borrowings with variable rates, which expose the company to cash

flow interest rate risk. During March 31, 2017, March 31, 2016 and April 1, 2015, the company’s borrowings at variable rate were mainly denominated in Rupees and USD.

The company’s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate

risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market.

(a) Interest rate risk exposure The exposure of the company’s borrowing to interest rate changes at the end of the reporting period are as follows:

(Amount in `)



As at April 1, 2015

Variable rate borrowings 5,548,868,593 5,724,200,295 5,596,570,897

Fixed rate borrowings 50,597,288 31,624,401 27,330,385

Total borrowings 5,599,465,881 5,755,824,696 5,623,901,282

% of borrowings at variable rate 99.10 99.45 99.51

(b) Sensitivity Profit or loss is sensitive to higher/lower interest expense from borrowings as a result of changes in interest rates.

Particulars Impact on profit before tax



Interest rates - increase by 50 basis points (50 bps)* (27,744,343) (28,621,001)

Interest rates - decrease by 50 basis points (50 bps)* 27,744,343 28,621,001

* holding all other variables constant

(iii) Price risk Commodity price risk - The company is affected by the price volatility of certain commodities. Its operating activities

require the ongoing purchase and manufacture of Jewellery and therefore require a continuous supply of mainly Gold and Diamond. Due to the volatility in the price of Gold and Diamond, the company is exposed to commodity price risk. Historically, the company has been able to increase prices to reflect changes in commodity cost.

Equity / Units price risk - The company’s exposure to listed and unlisted equity / debt securities price risk arises from investments held by the company and classified in the balance sheet either as fair value through OCI or at fair value through profit or loss.

To manage its price risk arising from investments in equity securities, the company diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the company. Reports on the equity / debt portfolio are submitted to the company’s senior management on a regular basis. The majority of the company’s equity / debt investments are publicly traded.

Equity / debt price sensitivity The analysis is based on the assumption that the stock market index had increased by 1% or decreased by 1% with

all other variables held constant, and that all the company’s equity / debt instruments moved in line with the index.

Particulars Impact on profit before tax Impact on other component of equity

Year ended March 31,

2017


2016


2017


2016

Stock Market Index - increase 1% (2016 - 1%) 73,806 421,018 12,443 7,288

Stock Market Index - decrease 1% (2016 - 1%) (73,806) (421,018) (12,443) (7,288)



Profit for the period would increase/decrease as a result of gains/losses on equity securities classified as at fair value through profit or loss. Other components of equity would increase/decrease as a result of gains/losses on equity securities classified as fair value though other comprehensive income.

40. CAPITAL MANAGEMENT

For the purpose of the company’s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Company’s capital management is to maximise the shareholder value.

The company manages its capital structure and makes adjustments in light of changes in economic conditions and the

requirements of the financial covenants. To maintain or adjust the capital structure, the company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The company monitors capital using a gearing ratio, which is Total outside liabilities (TOL) divided by Total net worth (TNW). TOL includes interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents.

(Amount in `)



As at April 1, 2015

Borrowings 5,594,900,681 5,751,359,131 5,614,881,581

Trade payables 3,207,190,597 3,014,736,439 2,172,915,652

Other payables 65,514,142 31,406,621 29,805,374

Less: cash and cash equivalents 6,937,180 20,275,608 60,278,852

Less: Other bank balances 686,917,573 694,259,301 704,070,637

TOL 8,173,750,667 8,082,967,282 7,053,253,118

Total Equity 5,416,800,701 5,538,220,438 5,441,309,280

TNW 5,416,800,701 5,538,220,438 5,441,309,280

Gearing ratio (TOL / TNW) 1.51 1.46 1.30

In order to achieve this overall objective, the Company’s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the borrowings that define capital structure requirements as follows:

- the ratio of total outside liabilities to adjusted Net Worth must be not more than 5 times, - the ratio of long term debt to EBITDA must not be more than 4.5 times, and - the ratio of EBITDA to net finance cost must not be less than 1.62 times The company has complied with these covenants throughout the reporting period except ratio of EBITDA to net finance cost.

41. ASSETS PLEDGED AS SECURITY

The carrying amount of assets pledged as security for current and non current borrowings are:(Amount in `)



As at April 1, 2015

CURRENT ASSETS

i. Financial Assets

Trade Receivables 7,945,347,225 7,144,810,421 6,283,157,175

Cash and Cash Equivalents 6,937,180 20,275,608 60,278,852

Other Bank Balances 686,917,573 694,259,301 704,070,637

Loans 3,755,939 2,720,393 3,873,021

Other Financial Assets 9,651,427 10,771,524 12,420,485



ii. Non Financial Assets

Inventories 4,663,044,143 5,298,972,788 5,010,576,515

Other Current Assets 102,634,704 90,163,814 123,861,194

Total current assets pledge as security 13,418,288,191 13,261,973,849 12,198,237,879

NON CURRENT ASSETS

Property, Plants and equipments 724,767,552 765,128,252 612,758,369

Total non current assets pledge as security 724,767,552 765,128,252 612,758,369

42. DETAILS OF DUES TO MICRO AND SMALL ENTERPRISES AS DEFINED UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006 (MSMED ACT, 2006)

(Amount in `)



As at April 1, 2015

a) Principal amount due and remaining unpaid - 55,624 77,000

b) Interest due on above - 3,498 271

c) Payment made beyond the appointed day during the year 245,905 489,630 583,788

d) Interest Paid on above - - -

e) Interest due and payable for the period of delay 7,439 12,821 18,276

f) Interest accrued and remaining unpaid 7,439 16,319 18,547

g) Amount of further interest remaining due and payable in succeeding years

115,189 107,750 91,431

43. DISCLSOURE ON SPECIFIED BANK NOTES (SBNS)

During the year, the Company had specified bank notes or other denomination note as defined in the MCA notification G.S.R. 308(E) dated March 31, 2017 on the details of Specified Bank Notes (SBN) held and transacted during the period from November 8, 2016 to December, 30 2016, the denomination wise SBNs and other notes as per the notification is given below:

Particulars SBNs* Other Denomination

Notes

Total

Closing cash in hand as on 08-11-2016 53,612,000 318,808 53,930,808

Add : Permitted receipts # - 2,438,551 2,438,551

Less : Permitted payments - 499,527 499,527

Less : Amount deposited in Banks 53,612,000 130,591 53,742,591

Closing cash in hand as on 30-12-2016 - 2,127,241 2,127,241

* For the purposes of this clause, the term ‘Specified Bank Notes’ shall have the same meaning as provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407 (E), dated the November 8, 2016.

# Includes withdrawals from Banks `5,23,000

44. DISCLOSURES REQUIRED UNDER SECTION 186(4) OF THE COMPANIES ACT, 2013

Corporate guarantees given by the Company in respect of Loans as at March 31, 2017(Amount in `)

Name of the Party As at March 31, 2017


As at April 1, 2015

Fabrikant Tara International LLC. 1,296,800,000 994,950,000 625,900,000

Tara (Hong Kong) Ltd. 551,140,000 563,805,000 532,015,000

All the above corporate guarantees have been given for the purpose of business.



45. CORPORATE SOCIAL RESPONSIBILITY (CSR)

During the previous financial year, the company has constituted the Corporate Social Responsibility Committee in terms of Section 135 of the Companies Act, 2013 and the board had adopted a CSR Policy as recommended by the Committee. However during the financial year under review, the Company has not made any expenditure on CSR as the Company is still in the process of identifying the eligible project, by which the public can be benefited appropriately. The Company intends to contribute to the money for CSR activities as soon as the project is identified.

46. FIRST TIME ADOPTION OF IND AS

These are the company’s first financial statements prepared in accordance with Ind AS. The accounting policies set out in note 2 have been applied in preparing the financial statements for the year ended March 31, 2017, the comparative information presented in these financial statements for the year ended March 31, 2016 and in the preparation of an opening Ind AS balance sheet at April 1, 2015 (the Company’s date of transition). In preparing its opening Ind AS balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under under the section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP) and other relevant provisions of the Act (previous GAAP or Indian GAAP). An explanation of how the transition from previous GAAP to Ind AS has affected the company’s financial position, financial performance and cash flows is set out in the following tables and notes.

A. Exemptions and exceptions availed Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition

from previous GAAP to Ind AS.

1. Ind AS optional exemptions i. Business combinations Ind AS 101 provides the option to apply Ind AS 103 prospectively from the transition date or from a

specific date prior to the transition date. This provides relief from full retrospective application that would require restatement of all business combinations prior to the transition date. The company elected to apply Ind AS 103 prospectively to business combinations occurring after its transition date. Business combinations occurring prior to the transition date have not been restated.

ii. Deemed cost Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property,

plant and equipment and intangible assets covered by Ind AS 38 - Intangible Assets as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition. This exemption can also be used for investment property covered by Ind AS 40 Investment Properties since there is no change in the functional currency. Accordingly, the company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value.

iii. Designation of previously recognised financial instruments Ind AS 101 allows an entity to designate investments in equity instruments at FVOCI on the basis of

the facts and circumstances at the date of transition to Ind AS. The company has elected to apply this exemption for its investment in quoted and unquoted equity investments.

iv. Estimates The estimates at April 1, 2015 and at March 31, 2016 are consistent with those made for the same dates

in accordance with Indian GAAP (after adjustments to reflect any differences in accounting policies) apart from the following items where application of Indian GAAP did not require estimation:

- FVTOCI – unquoted equity shares

- FVTPL – unquoted mutual funds

- Impairment of financial assets based on expected credit loss model The estimates used by the company to present these amounts in accordance with Ind AS reflect conditions at April 1, 2015, the date of transition to Ind AS and as of March 31, 2016.



v. Investments in subsidiaries In separate financial statements, a first-time adopter that subsequently measures an investment in a

subsidiary at cost , may measure such investment at cost (determined in accordance with Ind AS 27) or deemed cost (fair value or previous GAAP carrying amount) in its separate opening Ind AS balance sheet. Selection of fair value or previous GAAP carrying amount for determining deemed cost can be done for each subsidiary. The company elects to carry all its investments in subsidiaries at previous GAAP carrying amount as deemed cost.

vi. Share based payment transactions A first-time adopter is encouraged, but not required, to apply Ind AS 102 Share-based Payment to

equity instruments that were vested on or before the date of transition to Ind AS. However, if a first-time adopter elects to apply Ind AS 102 to such equity instruments, it may do so only if the entity has disclosed publicly the fair value of those equity instruments determined at the measurement date as defined in Ind AS 102.

Therefore, Ind AS 102 Share-based Payment has been applied to equity instruments in share-based payment transactions that vested before April 1, 2015.

2. Ind AS mandatory exceptions i. De-recognition of financial assets and liabilities Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively

for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the de-recognition requirements in Ind AS 109 retrospectively from a date of the entity’s choosing, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognised as a result of past transactions was obtained at the time of initially accounting for those transactions. The Company has elected to apply the de-recognition provisions of Ind AS 109 retrospectively from the date of transition to Ind AS.

ii. Classification and measurement of financial assets Ind AS 101 requires an entity to assess classification and measurement of financial assets (investment in

debt instruments) on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

B. Reconciliations between previous GAAP and Ind AS Ind AS 101 requires an entity to reconcile equity and total comprehensive income for prior periods. The following

tables represent the reconciliations from previous GAAP to Ind AS.

i. Reconciliation of equity as at date of transition (April 1, 2015) (Amount in `)

Particulars Notes IGAAP Ind-AS Adjustments

Ind-AS

ASSETS

Non-Current Assets

Property, Plant and Equipment 1,082,095,939 1,082,095,939

Other Intangible Assets 23,442,870 23,442,870

Investments 1 175,356,506 14,228,582 189,585,088

Other Financial Assets 25,274,105 25,274,105

Deferred Tax Asset (Net) 2 34,470,568 20,014,262 54,484,830

Other Non-Current Assets 14,759,503 14,759,503

1,355,399,491 34,242,844 1,389,642,335

Current assets

Inventories 5,010,576,515 5,010,576,515



(Amount in `)


Ind-AS

Financial Assets -

Trade Receivables 3 6,342,532,377 (59,375,202) 6,283,157,175

Cash and Cash Equivalents 60,278,852 60,278,852

Other Bank Balances 704,070,637 704,070,637

Loans 3,873,021 3,873,021

Other Financial Assets 12,420,485 12,420,485

Other Current Assets 181,480,272 181,480,272

12,315,232,159 (59,375,202) 12,255,856,957

TOTAL 13,670,631,650 (25,132,358) 13,645,499,292

EQUITY AND LIABILITIES

Equity

Equity Share capital 246,228,500 246,228,500

Other Equity 7, 8 5,220,213,138 (25,132,358) 5,195,080,780

5,466,441,638 (25,132,358) 5,441,309,280

Liabilities

Non Current Liabilities

Financial Liabilities

Borrowings 3,310,684 3,310,684

Provisions 46,005,656 46,005,656

49,316,340 49,316,340

Current Liabilities


Borrowings 4 5,611,570,897 5,611,570,897

Trade Payables

Micro, Small and Medium Enterprises 77,000 77,000

Others 2,172,838,652 2,172,838,652

Other Financial Liabilities 29,805,374 29,805,374

Other Current Liabilities 138,973,078 138,973,078

Provisions 1,881,958 1,881,958

Current Tax Liabilities (Net) 199,726,713 199,726,713

8,154,873,672 - 8,154,873,672

TOTAL 13,670,631,650 (25,132,358) 13,645,499,292



ii. Reconciliation of equity as at March 31, 2016(Amount in `)


Ind-AS

ASSETS

Non-Current Assets

Property, Plant and Equipment 1,147,865,585 - 1,147,865,585

Capital Work-in-Progress 28,293,589 - 28,293,589

Other Intangible Assets 16,575,092 - 16,575,092

Financial Assets

Investments 1 188,619,351 15,486,896 204,106,247

Other Financial Assets 16,405,333 - 16,405,333


Other Non-Current Assets 24,335,471 - 24,335,471

1,452,868,772 52,247,417 1,505,116,189

Current assets

Inventories 5,298,972,788 - 5,298,972,788

Financial Assets


Cash and Cash Equivalents 20,275,608 - 20,275,608

Bank Balances Other than (iii) above 694,259,301 - 694,259,301

Loans 2,720,393 - 2,720,393


Other Current Assets 134,447,323 - 134,447,323

13,416,099,305 (109,841,947) 13,306,257,358

TOTAL 14,868,968,077 (57,594,530) 14,811,373,547


Equity

Equity Share capital 246,228,500 246,228,500

Other Equity 7, 8 5,349,586,468 (57,594,530) 5,291,991,938

5,595,814,968 (57,594,530) 5,538,220,438

Liabilities



Borrowings 12,158,836 - 12,158,836

Provisions 30,443,904 - 30,443,904

42,602,740 - 42,602,740

Current Liabilities


Borrowings 4 5,739,200,295 - 5,739,200,295

Trade Payables



(Amount in `)


Ind-AS

Micro, Small and Medium Enterprises 77,787 - 77,787

Others 3,014,658,652 - 3,014,658,652

Other Financial Liabilities 31,406,621 - 31,406,621

Other Current Liabilities 166,110,284 - 166,110,284

Provisions 6,162,410 - 6,162,410

Current Tax Liabilities (Net) 272,934,320 - 272,934,320

9,230,550,369 - 9,230,550,369

TOTAL 14,868,968,077 (57,594,530) 14,811,373,547

iii. Reconciliation of total comprehensive income for the year ended March 31, 2016(Amount in `)

Particulars Notes IGAAP Adjustments IND AS Balance

REVENUE

Revenue from operations (net) 13,568,611,216 - 13,568,611,216

Other income 1, 9 49,222,805 17,600,263 66,823,068

Total Revenue (I) 13,617,834,021 17,600,263 13,635,434,284

EXPENSES

Cost of materials consumed 9,576,285,173 - 9,576,285,173

Purchases of stock-in-trade 2,324,708,368 - 2,324,708,368


(323,502,785) - (323,502,785)

Excise duty 3,265,750 - 3,265,750

Employee benefits expense 5, 6 340,021,032 3,093,209 343,114,241

Finance costs 9 643,390,475 14,860,000 658,250,475

Depreciation and amortization expense 213,614,892 213,614,892

Other expenses 1, 3, 5 625,981,569 55,404,898 681,386,467

Total Expenses (II) 13,403,764,474 73,358,107 13,477,122,581

Profit/(loss) before tax (I-II) 214,069,547 (55,757,844) 158,311,703

Tax expense: - -

Current tax 81,000,000 81,000,000

Adjustment of tax relating to earlier periods -

Deferred tax 2 3,696,217 (18,895,598) (15,199,381)

84,696,217 (18,895,598) 65,800,619

Profit/(loss) for the year 129,373,330 (36,862,246) 92,511,084



(Amount in `)


Ind-AS



Remeasurement of gains (losses) on defined benefit plans

5 - 6,210,526 6,210,526

Income tax effect 2 - (2,149,339) (2,149,339)

Equity Instruments through Other Comprehensive Income

1 - (556,220) (556,220)

Income tax effect - - -

Other Comprehensive income for the year, net of tax

- 3,504,967 3,504,967

TOTAL COMPREHENSIVE INCOME FOR THE PERIOD, NET OF TAX

129,373,330 (33,357,279) 96,016,051

* The previous GAAP figures have been reclassified to conform to Ind AS presentation requirements for the purpose of this note

iv. Reconciliation of total equity as at March 31, 2016 and April 1, 2015(Amount in `)

Particulars Notes March 31, 2016 April 1, 2015

Total equity (shareholder’s funds) as per previous GAAP 5,595,814,968 5,466,441,638

Adjustments:

Fair valuation of investments 1 10,053,556 11,912,752

Provision for expected credit losses on trade receivables 3 (109,841,947) (59,375,202)

Fair valuation of financial guarantees 9 5,433,340 2,315,830

Tax effects of adjustments 2 36,760,521 20,014,262

Total adjustments (57,594,530) (25,132,358)

Total equity as per Ind AS 5,538,220,438 5,441,309,280

v. Reconciliation of total comprehensive income for the year ended March 31, 2016(Amount in `)


Profit after tax as per previous GAAP 129,373,330

Adjustments:

Fair valuation of investments 1 (1,302,976)

Provision for expected credit losses on trade receivables 3 (50,466,745)

Fair valuation of financial guarantees 9 3,117,510

Share based payment transaction 6 (895,107)

Remeasurements of post-employment benefit obligations 5 (6,210,526)



(Amount in `)


Tax effects of adjustments 2 18,895,598

Total adjustments (36,862,246)

Profit after tax as per Ind AS 92,511,084

Other comprehensive income 8 3,504,967

Total comprehensive income as per Ind AS 96,016,051

C. Notes to first-time adoption: Note 1: Fair valuation of investments Under the previous GAAP, investments in equity instruments and mutual funds were classified as long-term investments or current investments based on the intended holding period and realisability. Long-term investments were carried at cost less provision for other than temporary decline in the value of such investments. Current investments were carried at lower of cost and fair value. Under Ind AS, these investments are required to be measured at fair value. The resulting fair value changes of these investments (other than equity instruments designated as at FVOCI) have been recognised in retained earnings as at the date of transition and subsequently in the profit or loss for the year ended March 31, 2016. This increased the retained earnings by ` 9,431,186 as at March 31, 2016 (April 1, 2015 - ` 10,734,162). Fair value changes with respect to investments in equity instruments designated as at FVOCI have been recognised in FVOCI – Equity instruments through OCI reserve as at the date of transition and subsequently in the other comprehensive income for the year ended March 31, 2016. This increased Equity instruments through OCI reserve by ` 622,370 as at March 31, 2016 (April 1, 2015 - ` 1,178,590). Consequent to the above, the total equity as at March 31, 2016 increased by ` 10,053,556 (April 1, 2015 - ` 11,912,752) and profit and other comprehensive income for the year ended March 31, 2016 decreased by ` 1,302,976 and ` 556,220 respectively. Note 2: Deferred tax Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required under Indian GAAP. In addition, the various transitional adjustments lead to temporary differences. According to the accounting policies, the company has to account for such differences. Deferred tax adjustments are recognised in correlation to the underlying transaction either in retained earnings or a separate component of equity. On the date of transition, the net impact on deferred tax liabilities is of ` 2,00,14,262 (March 31, 2016: ` 3,67,60,521) Note 3: Trade and Other Receivables Under Indian GAAP, the company has created provision for impairment of receivables consists only in respect of specific amount for incurred losses. Under Ind AS, impairment allowance has been determined based on Expected Loss model (ECL). Due to ECL model, the company impaired its trade receivable by ` 5,93,75,202 on April 1, 2015 which has been eliminated against retained earnings. The impact of ` 5,04,66,745 for year ended on March 31, 2016 has been recognized in the statement of profit and loss. Under Indian GAAP, the Company had derecognised the trade receivables against which the bills discounting facility has been availed; and had disclosed such bills discounted which are outstanding as at the balance sheet date under contingent liabilities. Under Ind AS, the risk of default associated with certain trade receivables against which the bill discounting facility has been availed remains with the Company and hence, the Company cannot derecognise the related trade receivable.







Note 4: Borrowings Under Indian GAAP, the Company had not recognised the borrowings in the nature of bills discounted as the same had been set off against the related trade receivables and had been disclosed under contingent liabilities. Under Ind AS, as the trade receivables cannot be derecognised till the risk of default does not get transferred, the bills discounting facility availed against such trade receivables has to be recognised separately as short term borrowings. Note 5: Remeasurements of post-employment benefit obligations Under Ind AS, remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognised in other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurements were forming part of the profit or loss for the year. As a result of this change, the profit for the year ended March 31, 2016 decreased by ` 6,210,526. There is no impact on the total equity as at March 31, 2016. Note 6: Employee stock option expense Under the previous GAAP, the cost of equity-settled employee share-based plan were recognised using the intrinsic value method. Under Ind AS, the cost of equity settled share-based plan is recognised based on the fair value of the options as at the grant date. Consequently, the amount recognised in share option outstanding account increased by ̀ 3,473,102 as at March 31, 2016 (April 1, 2015: ` 2,577,509). The profit for the year ended March 31, 2016 decreased by ` 895,107. There is no impact on total equity. Note 7: Retained earnings Retained earnings as at April 1, 2015 has been adjusted consequent to the above Ind AS transition adjustments. Note 8: Other comprehensive income Under Ind AS, all items of income and expense recognised in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognised in profit or loss but are shown in the statement of profit and loss as ‘other comprehensive income’ includes remeasurements of defined benefit plans and fair value gains or (losses) on FVOCI equity instruments. The concept of other comprehensive income did not exist under previous GAAP. Note 9: Financial Guarantees Under Indian GAAP, the bank guarantees issued to banks in relation to loans availed by subsidiaries is only disclosed by way of a note in Contingent Liabilities disclosure. Under Ind AS, liability from such financial guarantees is to be recorded initially at fair value. The adjustment represents the fair value of the guarantee given by the Company on behalf of others and issued by others on Company’s behalf.


To the Members of Tara Jewels Limited

REPORT ON THE CONSOLIDATED IND AS FINANCIAL STATEMENTSWe have audited the accompanying consolidated Ind AS financial statements of TARA JEWELS LIMITED (“the Holding Company”) and its subsidiaries (collectively referred to as “the Group”), comprising of the Consolidated Balance Sheet as at March 31, 2017, the Consolidated Statement of Profit and Loss (including other comprehensive income), the Consolidated Cash Flow Statement and the Consolidated Changes in Equity for the year then ended and a summary of the significant accounting policies and other explanatory information (hereinafter referred to as “consolidated Ind AS financial statements”).

MANAGEMENT’S RESPONSIBILITY FOR THE CONSOLIDATED IND AS FINANCIAL STATEMENTSThe Holding Company’s Board of Directors is responsible for the preparation of the consolidated Ind AS financial statements in terms of the requirements of the Companies Act, 2013 (“the Act”) that give a true and fair view of the consolidated financial position, consolidated financial performance including other comprehensive income, consolidated cash flows and consolidated changes in equity of the Group in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Act, read with relevant rules issued thereunder. The respective Board of Directors of the companies included in the Group are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Group and for preventing and detecting frauds and other irregularities; the selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the consolidated Ind AS financial statements by the Directors of the Holding Company, as aforesaid.

AUDITOR’S RESPONSIBILITYOur responsibility is to express an opinion on these consolidated Ind AS financial statements based on our audit. While conducting the audit, we have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143 (10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the consolidated Ind AS financial statements are free frommaterial misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the consolidated Ind AS financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Holding Company’s preparation of the consolidated Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Holding Company’s Board of Directors, as well as evaluating the overall presentation of the consolidated Ind AS financial statements.

We believe that the audit evidence obtained by us and the audit evidence obtained by the other auditors in terms of their reports referred to in Other Matters below, is sufficient and appropriate to provide a basis for our audit opinion on the consolidated Ind AS financial statements.

OPINIONIn our opinion and to the best of our information and according to the explanations given to us and based on consideration of reports of the other auditors on separate financial statements of the subsidiary companies referred to in “Other Matters” below, the aforesaid consolidated Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the consolidated financial position of the Group as at March 31, 2017, and their consolidated financial performance including other comprehensive income, their consolidated cash flows and consolidated statement of changes in equity for the year ended on that date.



OTHER MATTERSWe did not audit the financial statements of subsidiaries, whose financial statements reflect total assets of `2,54,36,15,197 as at March 31, 2017, total revenues of `8,49,53,40,957 and net cash outflows amounting to `35,41,508 for the year ended on that date, as considered in the consolidated Ind AS financial statements. These financial statements have been audited by other auditors whose reports have been furnished to us by the Management and our opinion on the consolidated Ind AS financial statements, in so far as it relates to the amounts and disclosures included in respect of these subsidiaries and our report in terms of Section 143 (3) of the Act, insofar as it relates to the aforesaid subsidiaries is based solely on the reports of the other auditors.

The Company’s Management has converted the financial statements of such subsidiaries located outside India from accounting principles generally accepted in their respective countries to accounting principles generally accepted in India. We have audited these conversion adjustments made of the Company’s Management. Our opinion is so far as it relates to the balances and affairs of such subsidiaries located outside India is based on the report of other auditors and the conversion adjustments prepared by the management of the Company and audited by us.

We did not audit the financial statements of subsidiaries, whose financial statements reflect total assets of ` 2,40,72,54,658 as at March 31, 2017, total revenues of `4,95,69,62,113 and net cash outflows amounting to `8,36,888 for the year ended on that date, as considered in the consolidated Ind AS financial statements. These financial statements of subsidiaries are unaudited and have been furnished to us by the Management and our opinion on the consolidated In AS financial statements, in so far as it related to the amounts and disclosures included in respect of these subsidiaries and our report in terms of sub section (3) of Section 143 of the Actin so far as it relates to the aforesaid subsidiaries is based solely on such unaudited financial statements.

Our opinion on the consolidated Ind AS financial statements above, and our report on Other Legal and Regulatory Requirements below, is not modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTSAs required bySection143(3) of the Act, we report, to the extent applicable, that:

a. We have sought and obtained all the information and explanations which to the best ofour knowledge and belief were necessary for the purposesof our audit of the aforesaid consolidated Ind AS financial statements.

b. In our opinion, proper books of account as required by law relating to preparation of the aforesaid consolidated Ind AS financial statements have been kept so far as it appears from our examination of those books and the reports of the other auditors.

c. The Consolidated Balance Sheet, the Consolidated Statement of Profit and Loss, the Consolidated Cash Flow Statement and Consolidated Statement of Changes in Equity dealt with by this Report are in agreement with the relevant books of account maintained for the purpose of preparation of the consolidated Ind AS financial statements.

d. In our opinion, the aforesaid consolidated Ind AS financial statements comply with the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act as applicable.

e. The subsidiaries companies are incorporated outside India and hence provision of section 164 (2) of the Act is not applicable to directors of subsidiary companies. On the basis of the written representations received from the directors of the Holding Company as on

March 31, 2017 and taken on record by the Board of Directors of the Holding Company, none of the directors of the Holding company incorporated in India is disqualified as on March 31, 2017 from being appointed as a director in terms of Section 164 (2) of the Act.

f. In case of subsidiary companies incorporated outside India, the provisions of the Act relating to internal financial controls are not applicable. With respect to the adequacy of the internal financial controls over financial reporting of the Holding Company and the operating effectiveness of such controls, refer to our separate report in the ‘Annexure II’ to Independent Auditor’s Report of Holding Company.

g. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditor’s) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:



i. The consolidated Ind AS financial statements disclose the impact of pending litigations on the consolidated financial position of the Group Refer Note 33 to the consolidated Ind AS financial statements.

ii. The Group did not have any material foreseeable losses on long-term contracts including derivative contracts.

iii. In case of subsidiary companies incorporated outside India, the provision of the Act relating to Investor Education and Protection Fund are not applicable. There were no amounts which were required to be transferred to the Investor Education andProtection Fund by the Holding Company.

iv. the Holding Company has provided requisite disclosures in its consolidated Ind AS financial statements as to holdings as well as dealings in Specified Bank Notes during the period from November 8, 2016 to December 30, 2016 and these are in accordance with the books of accounts maintained by the Holding Company. Refer Note No.42 to the Consolidated Ind AS financial statements.





(Amount in `)



As at April 1, 2015

ASSETS Non-Current Assets Property, Plant and Equipment 4 1,051,756,778 1,150,474,277 1,090,478,429 Capital Work-in-Progress - 28,293,589 - Intangible Assets 5 24,316,757 18,233,342 25,007,620 Financial Assets

Investments 6 26,299,871 60,505,603 49,101,954 Other Financial Assets 8 5,128,722 16,405,333 25,274,105

Deferred Tax Asset (Net) 14 99,938,928 75,177,786 73,482,498 Other Non-Current Assets 13 42,743,170 38,406,386 14,759,503

1,250,184,226 1,387,496,316 1,278,104,109 Current assets Inventories 9 5,221,909,537 5,810,279,063 5,764,453,826 Financial Assets

Trade Receivables 10 10,525,268,953 10,557,797,700 7,833,174,486 Cash and Cash Equivalents 11 16,862,384 34,579,208 73,851,243 Other Bank Balances 12 739,041,995 746,958,353 773,622,148 Loans 7 3,753,527 2,720,393 3,873,021 Other Financial Assets 8 10,356,886 11,494,455 12,445,771

Other Current Assets 13 169,095,941 231,539,585 247,952,855 16,686,289,223 17,395,368,757 14,709,373,350

TOTAL 17,936,473,449 18,782,865,073 15,987,477,459

EQUITY AND LIABILITIES Equity

Equity Share capital 15 246,228,500 246,228,500 246,228,500 Other Equity 16 5,723,454,725 5,790,211,701 5,573,181,409

5,969,683,225 6,036,440,201 5,819,409,909 Liabilities Non Current Liabilities Financial Liabilities

Borrowings 17 14,671,115 18,322,352 4,846,830 Provisions 21 43,534,714 30,443,904 46,005,656

58,205,829 48,766,256 50,852,486 Current Liabilities Financial Liabilities

Borrowings 17 7,405,426,375 7,370,567,476 6,652,463,439 Trade Payables 19

Micro, Small and Medium Enterprises - 77,787 77,000 Others 3,879,902,428 4,819,755,988 3,016,916,810

Other Financial Liabilities 18 69,484,861 47,243,439 29,805,374 Other Current Liabilities 20 239,040,039 177,502,595 217,518,584 Provisions 21 2,228,622 6,162,410 1,881,958 Current Tax Liabilities (Net) 22 312,502,070 276,348,921 198,551,899

11,908,584,395 12,697,658,616 10,117,215,064 TOTAL 17,936,473,449 18,782,865,073 15,987,477,459






CONSOLIDATED BALANCE SHEET AS AT MARCH 31, 2017


(Amount in `)

Particulars Notes Year ended March 31, 2017


REVENUE

Revenue from operations (net) 23 15,527,552,427 17,953,924,075

Other income 24 50,945,621 119,040,606

Total Revenue 15,578,498,048 18,072,964,681

EXPENSES

Cost of materials consumed 25 11,771,301,081 12,584,573,603

Purchases of stock-in-trade 1,084,482,557 2,997,569,090


26 282,277,687 (150,991,099)

Excise duty 11,560,930 3,265,750

Employee benefits expense 27 388,238,928 455,558,681

Finance costs 28 844,582,957 708,091,794

Depreciation and amortization expense 29 223,200,490 217,111,437

Other expenses 30 1,017,670,971 983,049,887

Total Expenses 15,623,315,601 17,798,229,143

Profit/(loss) before tax (44,817,553) 274,735,538

Tax expense:

Current tax 26,587,767 99,303,009

Adjustment of tax relating to earlier periods (2,497,492) -

Deferred tax (22,698,731) (3,640,857)

1,391,544 95,662,152

Profit/(loss) for the year (46,209,097) 179,073,386



Foreign Currency Translation Reserve (17,335,406) 33,556,832

Remeasurement of gains (losses) on defined benefit plans (6,237,824) 6,210,526

Income tax effect 2,062,411 (2,149,339)

Equity Instruments through Other Comprehensive Income 515,480 (556,220)

Income tax effect - -

Other Comprehensive income for the year, net of tax (20,995,339) 37,061,799

Total Comprehensive Income for the year, net of tax (67,204,436) 216,135,185

Earnings / (Loss) per Equity Share 36

Basic (1.88) 7.27

Dilluted (1.88) 7.27






CONSOLIDATED STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED MARCH 31, 2017


(Amount in `)



CASH FLOWS FROM OPERATING ACTIVITIES:

Profit/(Loss) before income tax from: (44,817,553) 274,735,538

Adjustments for:

Depreciation and amortisation expense 223,200,490 217,111,437

Employee share-based payment expense 447,460 895,107

Loss on disposal of property, plant and equipment 6,175,932 6,759,433

Fixed Assets written off 4,347,902 11,323,405

(Gain) / loss on sale of investments (1,370,671) 69,574

Changes in fair value of financial assets at fair value through profit or loss 18,143,004 925,729


Rent Income (5,170,454) (2,331,000)

Loss Allowance on Doubtful Debts (14,785,854) 50,466,745

Dividend and interest income classified as investing cash flows (39,767,119) (46,858,575)

Finance costs 766,662,889 640,091,223

Sundry Balances written back (4,594,055) (66,965,580)

Foreign Currency Translation Reserve (17,948,256) 33,343,910

Operating profit before working capital adjustment 989,816,119 1,184,376,808

Change in operating assets and liabilities:

(Increase)/Decrease in trade receivables (51,977,803) (2,839,899,821)

(Increase) in inventories 588,369,526 (45,825,237)

Increase / (Decrease) in trade payables (935,337,292) 1,869,805,545

(Increase) /Decrease in loans (1,033,134) 1,152,628

(Increase) / Decrease in other financial assets 14,075,159 9,160,852

(Increase)/decrease in other assets 57,240,665 3,846,777

(Increase)/decrease in other bank balances 7,916,358 26,663,795

Increase/(decrease) in other financial liabilities 872,730 17,873,336

Increase/(decrease) in provisions and other liabilities 65,382,039 (47,643,425)

Cash generated from operations 735,324,367 179,511,258

Less: Income taxes paid (42,324,276) (45,496,901)

Net cash inflow from operating activities 693,000,091 134,014,357

CASH FLOWS FROM INVESTING ACTIVITIES:

Payments for property, plant and equipment (115,615,985) (332,538,286)

Payments for purchase of investments (8,150,320) (17,840,057)

Proceeds from sale of investments 45,620,956 4,884,885

Proceeds from sale of property, plant and equipment 2,760,132 7,305,190

Dividends received 8,185 259,972

Interest received 38,097,955 47,257,839

Rent Received 5,170,454 2,331,000

Net cash outflow from investing activities (32,108,623) (288,339,457)

STATEMENT OF CASH FLOWS FOR THE YEAR ENDED MARCH 31, 2017


(Amount in `)



CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from borrowings 31,307,297 727,025,423

Interest paid (709,915,589) (611,972,358)

Net cash inflow (outflow) from financing activities (678,608,292) 115,053,065

Net increase (decrease) in cash and cash equivalents (17,716,824) (39,272,035)

Cash and Cash Equivalents at the beginning of the financial year 34,579,208 73,851,243

Cash and Cash Equivalents at end of the year 16,862,384 34,579,208

Reconciliation of cash and cash equivalents as per the cash flow statement:

Cash and cash equivalents as per above comprise of the following:

Balances with banks 16,129,190 31,300,320

Cash on hand 733,194 3,278,888

Balances per statement of cash flows 16,862,384 34,579,208






A Equity Share Capital

(Amount in `)

Particulars Balance at the Beginning of

the year

Changes in Equity share capital

during the year

Balance at the end of the

year

March 31, 2016

Numbers 24,622,850 - 24,622,850

Amount 246,228,500 - 246,228,500

March 31, 2017

Numbers 24,622,850 - 24,622,850

Amount 246,228,500 - 246,228,500

B Other Equity(Amount in `)

Particulars Reserves and Surplus Exchange differences

on translating the financial

statements of foreign operations

Money Received against share

warrants

Equity Instruments through OCI

Total other equity *

Capital Reserve

SEZ Reinvestment

Allowance Reserve

Securities Premium Reserve

General Reserve

Share Based

Payment Reserve

Retained Earnings

As at April 1, 2015 26,848,865 264,650,684 1,679,062,852 114,400,049 2,577,905 3,411,877,405 60,385,059 12,200,000 1,178,590 5,573,181,409

Profit for the period 179,073,386 179,073,386


4,061,187 33,556,832 (556,220) 37,061,799


- - - - - 183,134,573 33,556,832 - (556,220) 216,135,185

Transfer to General Reserve

12,200,000 (12,200,000) -

Utilisation of SEZ Reinvestment allowance reserve

(264,650,684) 264,650,684 -


As at March 31, 2016 26,848,865 - 1,679,062,852 126,600,049 3,473,012 3,859,662,662 93,941,891 - 622,370 5,790,211,701

Profit for the period (46,209,097) (46,209,097)


(4,175,413) (17,335,406) 515,480 (20,995,339)


- - - - - (50,384,510) (17,335,406) - 515,480 (67,204,436)

Lapse of share options 189,392 (189,392) -


As at March 31, 2017 26,848,865 - 1,679,062,852 126,789,441 3,731,080 3,809,278,152 76,606,485 - 1,137,850 5,723,454,725 * Attributable to equity holders of the Parent as there is no non-controlling interest.




STATEMENT OF CHANGES IN EQUITY AS AT MARCH 31, 2017


1 CORPORATE INFORMATION

The consolidated financial statements comprise financial statements of Tara Jewels limited (‘the Company’) and its subidiaries (collectively, ‘the Group’)for the year ended March 31, 2017. The Company is a public Company domiciled in India and is incorporated under the provisions of the Companies Act applicable in India. Its shares are listed on two recognised stock exchanges in India. The registered office of the Company is located at Plot 122, 15th Road , Near IDBI Bank, MIDC, Andheri (E), Mumbai 400093.

The Group is in the business of exports and domestic sales of fine jewellery. The Group has been in the jewellery exports

business since inception and has started the retail jewellery business in 2010. The Group is an integrated player in the jewellery industry with experience ranging from designing to retailing of jewellery. The portfolio of products includes gold, platinum and silver jewellery with or without studded precious and semi-precious stones. The Group’s products have presence across different price points and cater to customers across high-end, mid-market and value market segments.

The consolidated financial statements for the year ended March 31, 2017 were approved by the Board of Directors and authorised for issue on May 29, 2017.

2 SIGNIFICANT ACCOUNTING POLICIES

2.1 Basis of preparation The consolidated financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS)

notified under the Companies (Indian Accounting Standards) Rules, 2015 (as amended) by the Companies (Indian Accounting Standards) (Amendment) Rules, 2016, under the historical cost convention on the accrual basis except for derivative financial instruments and certain financial assets and liabilities which are measured at fair value.

For all periods up to and including the year ended March 31, 2016, the group prepared its financial statements in

accordance with accounting standards notified under the section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP).These financial statements for the year ended March 31, 2017 has been prepared in accordance with Ind AS and the adoption was carried out in accordance with Ind AS 101 - ‘First time adoption of India Accounting Standard’. Reconciliation and description of the effect of the transition has been summarised in Note 46.

2.2 Principles of consolidation

The consolidated financial statements have been prepared on the following basis

(a) Subsidiaries

Subsidiaries are all entities over which the group has control. The group controls an entity when the group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the relevant activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the group. They are deconsolidated from the date that control ceases.

The acquisition method of accounting is used to account for business combinations by the group.

The group combines the financial statements of the parent and its subsidiaries line by line adding together like

items of assets, liabilities, equity, income and expenses. Intercompany transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group.

The financial statements of all entities used for the purpose of consolidation are drawn up to same reporting date as that of the parent company, i.e., year ended on March 31 2017. When the end of the reporting period of the parent is different from that of a subsidiary, the subsidiary prepares, for consolidation purposes, additional financial information as of the same date as the financial statements of the parent to enable the parent to consolidate the financial information of the subsidiary.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEAR ENDED MARCH 31, 2017



Non-controlling interests, if any, in the results and equity of subsidiaries are shown separately in the consolidated statement of profit and loss, consolidated statement of changes in equity and balance sheet respectively.

(b) Changes in ownership interests

The group treats transactions with non-controlling interests that do not result in a loss of control as transactions with equity owners of the group. A change in ownership interest results in an adjustment between the carrying amounts of the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the amount of the adjustment to non-controlling interests and any consideration paid or received is recognised within equity.

(c) Business combinations and goodwill

Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate of the consideration transferred measured at acquisition date fair value and the amount of any non controlling interests in the acquiree. For each business combination, the Group elects whether to measure the non controlling interests in the acquiree at fair value or at the proportionate share of the acquiree’s identifiable net assets. Acquisition-related costs are expensed as incurred.

Goodwill is initially measured at cost, being the excess of the aggregate of the consideration transferred and the amount recognised for non-controlling interests, and any previous interest held, over the net identifiable assets acquired and liabilities assumed. If the fair value of the net assets acquired is in excess of the aggregate consideration transferred, the Company re-assesses whether it has correctly identified all of the assets acquired and all of the liabilities assumed and reviews the procedures used to measure the amounts to be recognised at the acquisition date. If the reassessment still results in an excess of the fair value of net assets acquired over the aggregate consideration transferred, then the gain is recognised in OCI and accumulated in equity as capital reserve. However, if there is no clear evidence of bargain purchase, the entity recognises the gain directly in equity as capital reserve, without routing the same through OCI.

After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Company’s cash-generating units that are expected to benefit from the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units.

A cash generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro rata based on the carrying amount of each asset in the unit. Any impairment loss for goodwill is recognised in profit or loss. An impairment loss recognised for goodwill is not reversed in subsequent periods.

(d) Foreign currency translation

(i) Functional and presentation currency Items included in the financial statements of the entity are measured using the currency of the primary

economic environment in which the entity operates (‘the functional currency’). The financial statements are presented in Indian rupee (INR), which is entity’s functional and presentation currency.

(ii) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates at the dates

of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognised in profit or loss.



Non-monetary assets and non-monetary liabilities denominated in a foreign currency and measured at fair value are translated at the exchange rate prevalent at the date when the fair value was determined. Non-monetary assets and non-monetary liabilities denominated in a foreign currency and measured at historical cost are translated at the exchange rate prevalent at the date of the transaction.

iii) Group companies The results and financial position of foreign operations that have a functional currency different from the

presentation currency are translated into the presentation currency as follows: - assets and liabilities are translated at the closing rate at the date of that balance sheet

- income and expenses are translated at average exchange rates , and

- All resulting exchange differences are recognised in other comprehensive income. 2.3 Other Significant Accounting Policies

These are set out under “Significant Accounting Policies” as given in the Company’s standalone financial statements. 3 SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS

These are same as given in the Company’s standalone financial statements.



4.

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ipm

ent.



5. INTANGIBLE ASSETS

(Amount in `)

Particulars Computer Software

Patent and Trademark

Total

GROSS CARRYING VALUE

As at April 1, 2015 23,442,870 1,564,750 25,007,620

Additions during 2015-16 1,772,427 - 1,772,427

Disposals during 2015-16 231,490 - 231,490

WDV Translation Difference 2015-16 - 93,500 93,500

As at March 31, 2016 24,983,807 1,658,250 26,642,057

Additions during 2016-17 14,747,760 - 14,747,760

Disposals during 2016-17 186,124 - 186,124

WDV Translation Difference 2016-17 (13,523) (37,250) (50,773)

As at March 31, 2017 39,531,920 1,621,000 41,152,920

ACCUMULATED DEPRECIATION / IMPAIRMENT

As at April 1, 2015 - - -

Depreciation for the year 2015-16 8,640,205 - 8,640,205

Deductions/Adjustments during 2015-16 231,490 - 231,490

Accumulated Depreciation Translation Difference 2015-16 - - -

As at March 31, 2016 8,408,715 - 8,408,715

Depreciation for the year 2016-17 8,617,976 - 8,617,976

Deductions/Adjustments during 2016-17 186,120 - 186,120

Accumulated Depreciation Translation Difference 2016-17 (4,408) - (4,408)

As at March 31, 2017 16,836,163 - 16,836,163

Net Carrying value as at March 31, 2017 22,695,757 1,621,000 24,316,757

Net Carrying value as at March 31, 2016 16,575,092 1,658,250 18,233,342

Net Carrying value as at April 1, 2015 23,442,870 1,564,750 25,007,620

6. INVESTMENTS

(Amount in `)



As at April 1, 2015

Non Current Investments

Other Equity Instruments 1,419,250 903,770 1,459,990

Mutual Funds 24,880,621 59,601,833 47,641,964

Total 26,299,871 60,505,603 49,101,954



Details of Non Current Investments (Amount in `)



(1) Investments carried at fair value through Other Comprehensive Income

Investments in Equity Instruments

Unquoted

Divya Jewels International Pvt. Ltd.5,000 Equity Shares of Face Value ` 10 each

175,000 175,000

Quoted

Punjab National Bank 7,000 Equity Shares of Face Value ` 2 each

1,049,300 592,900

Bank of India 1,400 Equity Shares of Face Value ` 10 each

194,950 135,870

1,419,250 903,770

(2) Investments carried at fair value through Profit and Loss

Investments in Mutual Funds

Quoted

SBI MF Magnum Balanced Fund - Regular Plan Growth 7,367.763 (Previous Year: 228,036.84) Units of face value of ` 10 each

804,230 21,595,476

SBI Premier Liquid Fund - Regular Fund Daily Dividend 32.254 (Previous Year: 30.791) Units of Face Value of ` 10 each

32,359 30,891

Principal Emerging Bluechip Fund-Direct Plan Growth NIL (Previous Year: 7,210.845) Units of face value of ` 10 each

- 480,026

Axis Liquid Fund - Daily Dividend 146.40 (Previous Year: 139.675) Units of Face Value of ` 1000 each

146,528 139,780

CP4G-Union KBC Capital Protection Oriented Fund-Series 4-Reg Plan-Growth NIL (Previous Year: 150,000) Units of Face Value of ` 10 each

- 1,733,085

CP5G-Union KBC Captial Protection Oriented Fund-Series 5-Reg Plan-Growth NIL (Previous Year: 150,000) Units of Face Value of ` 10 each

- 1,765,455

DBDP- union KBC Dynamic Bonds Fund- Div Payout NIL (Previous Year: 227,250.347) Units of face value of ` 10 each

- 2,713,824

Principle Large Cap Fund - Regular Plan growth NIL (Previous Year: 47,327.581) Units of Face Value of ` 10 each

- 2,049,284

TF2GR-Union KBC Trigger Fund Series 2 - Regular Plan Growth 299,990 (Previous Year: 299,990) Units of Face Value of ` 10 each

3,377,887 2,759,908

Principal Asset Allocation Fund - Aggressive Plan NIL (Previous Year: 895,309.07) Units of face value of ` 10 each

- 8,834,104

Principal Tax Savings Fund - Regular Plan Growth 6,768.429 (Previous Year: NIL) Units of face value of ` 10 each

1,189,754 -

CP7G-Union Capital Protection Oriented Fund - Series 7 - Regular Plan Growth 1,82,172 (Previous Year: NIL) Units of face value of ` 10 each

1,829,863 -



(Amount in `)



Unquoted

1,750 units of face value ` 10,000 each of IIMCL-Emerging India Opportunities Fund

17,500,000 17,500,000

24,880,621 59,601,833

Total 26,299,871 60,505,603

Details of Quoted and Unquoted Investments(Amount in `)



Aggregate amount of quoted investments (Market Value `86,24,871 (Previous Year : `4,28,30,603))

8,624,871 42,830,603

Aggregate amount of unquoted investments 17,675,000 17,675,000

Total 26,299,871 60,505,603

Carrying value of Investments (Amount in `)



Investments carried at fair value through other comprehensive income 1,419,250 903,770

Investments carried at fair value through profit and loss 24,880,621 59,601,833

Total 26,299,871 60,505,603

7. LOANS

(Amount in `)



As at April 1, 2015

Current

Unsecured, considered good

Loans to Employees 3,753,527 2,720,393 3,873,021

Total 3,753,527 2,720,393 3,873,021



8. OTHER FINANCIAL ASSETS

(Amount in `)



As at April 1, 2015

Non Current


Security Deposits 5,128,722 16,405,333 25,274,105

Total 5,128,722 16,405,333 25,274,105

Current


Interest Accrued but not due 7,572,598 5,911,619 6,570,855

Security Deposits 705,459 722,931 25,286

Other financial assets* 2,078,829 4,859,905 5,849,630

Total 10,356,886 11,494,455 12,445,771

* Includes advances paid to creditors and claims Receivable.

9. INVENTORIES

(Amount in `)



As at April 1, 2015

(Valued at lower of Cost and Net Realisable value)

Raw materials [including goods-in-transit: ` 2,716,182 (March 31, 2016: ` 41,261,070, April 1, 2015: ` 120,176)]

682,109,423 972,925,085 1,076,294,849

Work-in-process 3,239,898,159 3,545,356,247 2,855,679,544

Finished goods 1,288,783,652 1,280,262,337 1,780,418,557

Stock-in-trade 26,208 26,208 4,777,054

Stores, consumables and packing material 11,092,095 11,709,186 47,283,822

Total 5,221,909,537 5,810,279,063 5,764,453,826

10. TRADE RECEIVABLES

(Amount in `)



As at April 1, 2015

Current

Unsecured

Considered good 10,525,268,953 10,557,797,700 7,811,708,244

Considered doubtful 96,395,843 111,500,197 82,406,194

10,621,664,796 10,669,297,897 7,894,114,438

Less: Allowances for credit losses 96,395,843 111,500,197 60,939,952

10,525,268,953 10,557,797,700 7,833,174,486

Includes Receivables from other related parties (Refer Note 34)



11. CASH AND CASH EQUIVALENTS

(Amount in `)



As at April 1, 2015

Balances with banks:

- in current accounts 16,129,190 31,300,320 57,976,667

Cash on hand 733,194 3,278,888 15,874,576

Total 16,862,384 34,579,208 73,851,243

12. OTHER BANK BALANCES

(Amount in `)



As at April 1, 2015

Deposits with banks to the extent held as margin money 359,331,656 403,362,647 419,755,094

Deposits with banks as security against borrowings 379,710,339 343,595,706 353,867,054

Total 739,041,995 746,958,353 773,622,148

13. OTHER ASSETS

(Amount in `)



As at April 1, 2015

Non Current

Capital Advances 23,469,276 24,335,471 13,255,081

Others


Total 42,743,170 38,406,386 14,759,503

Current

Advances other than Capital advances

- Other Advances 39,541,903 10,427,656 7,069,222

Others


- Balances with Statutory, Government Authorities 78,174,116 79,731,093 116,508,972

- Other current assets 26,405 38,199,206 37,540,699

Total 169,095,941 231,539,585 247,952,855



14. INCOME TAX

Deferred Tax(Amount in `)



As at April 1, 2015

Deferred tax relates to the following:

Accelerated Depreciation for tax purposes 19,017,055 12,147,017 2,893,339

Gratuity and Leave encashment 15,130,732 12,668,713 16,572,946

Unamortised share issue expenses u/s 35D - 5,259,956 10,519,911

Disallowance under Section 40(a)(ia) - 674,856 2,055,082

Losses available for offsetting against future taxable income 23,649,345 23,809 71,149

Provision for doubtful debts 28,655,650 38,014,101 20,548,570

Derivative Liability 6,454,479 - -

Others - - 6,802,031

Inventories 7,031,667 6,389,334 14,019,470

Net Deferred Tax Assets / (Liabilities) 99,938,928 75,177,786 73,482,498

Movement in deferred tax liabilities/assets(Amount in `)



Opening balance as of April 1 75,177,786 73,482,498

Tax income/(expense) during the period recognised in profit or loss 22,698,731 3,640,857

Tax income/(expense) during the period recognised in OCI 2,062,411 (2,149,339)

Translation difference 203,770

Closing balance as at March 31 99,938,928 75,177,786

The Group offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liablities relate to income taxes levied by the same tax authority.

Tax losses which arose in India of ̀ 7,15,28,130 (Previous year ̀ NIL) that are available for offsetting for eight years against future taxable profits of the Holding company. Major Components of income tax expense for the years ended March 31, 2017 and March 31, 2016 are as follows:

i. Income tax recognised in profit or loss(Amount in `)



Current income tax charge 26,587,767 99,303,009

Adjustment in respect of current income tax of previous year (2,497,492) -

Deferred tax

Relating to origination and reversal of temporary differences (22,698,731) (3,640,857)

Income tax expense recognised in profit or loss 1,391,544 95,662,152



ii. Income tax recognised in OCI(Amount in `)



Net loss/(gain) on remeasurements of defined benefit plans 2,062,411 (2,149,339)

Income tax expense recognised in OCI 2,062,411 (2,149,339)

Reconciliation of tax expense and accounting profit multiplied by income tax rate for March 31, 2017 and March 31, 2016(Amount in `)



Profit / (Loss) before tax (44,817,553) 274,735,538

Accounting profit before income tax (44,817,553) 274,735,538

Enacted tax rate in India 33.06% 33.06%

Income tax on accounting profits (14,818,028) 90,835,811

Effects of

Incomes exempt from tax (911,748) (374,883)

Non-deductible expenses for tax purposes 23,887,691 11,337,253

Tax on income at different rate 3,876,089 (410,461)

Differential overseas tax rates (8,580,049) (6,185,764)

Others (2,062,411) 460,196

Tax at effective income tax rate 1,391,544 95,662,152

15. SHARE CAPITAL

(Amount in `)



As at April 1, 2015

Authorised

30,000,000 Equity Shares of ` 10 each 300,000,000 300,000,000 300,000,000

Issued, subscribed and paid-up

24,622,850 Equity Shares of ` 10 each fully paid up 246,228,500 246,228,500 246,228,500

TOTAL 246,228,500 246,228,500 246,228,500

i. Terms/rights attached to equity shares The Holding Company has only one class of equity shares having a par value of ` 10 per share. Each holder of equity

shares is entitled to one vote per share and dividend in indian rupees, as proposed by the Board of Directors, which is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Holding Company, the holders of equity shares will be entitled to receive remaining

assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.



ii. Details of shareholders holding more than 5% shares in the Holding company

Name of the shareholder As at March 31, 2017 As at March 31, 2016

Number % holding Number % holding

Equity shares of ` 10 each fully paid

Rajeev Sheth 14,502,893 58.90 14,522,893 58.98

Crystalon Finanz AG 1,800,000 7.31 1,800,000 7.31 iii. Shares reserved for issue under options

For details of shares reserved for issue under the Share based payment plan of the Holding company, please refer note 32

iv. Shares issued for consideration other than Cash / Bonus Shares The Holding company has not issued shares for consideration other than cash or Bonus shares during the preceding 5

financial years.

16. OTHER EQUITY

i. Reserves and Surplus(Amount in `)



As at April 1, 2015

Securities Premium Reserve 1,679,062,852 1,679,062,852 1,679,062,852

General Reserve 126,789,441 126,600,049 114,400,049

Share Based Payment Reserve 3,731,080 3,473,012 2,577,905

Retained Earnings 3,809,278,152 3,859,662,662 3,411,877,405

Capital Reserve 26,848,865 26,848,865 26,848,865

Foreign Currency Translation Reserve 76,606,485 93,941,891 60,385,059

SEZ Reinvestment Allowance Reserve - - 264,650,684

5,722,316,875 5,789,589,331 5,559,802,819

(a) Securities Premium Reserve(Amount in `)



Opening balance 1,679,062,852 1,679,062,852

Add/(Less):


Closing balance 1,679,062,852 1,679,062,852

(b) General Reserve(Amount in `)



Opening balance 126,600,049 114,400,049

Add/(Less):

Shares warrants forfeited - 12,200,000

Share based payment reserve transferred on lapse of option 189,392

Closing balance 126,789,441 126,600,049



(c) Share Based Payment Reserve(Amount in `)



Opening balance 3,473,012 2,577,905

Add/(Less):

Option Compensation expense charged during the period 447,460 895,107

Transfer to General Reserve on exercise/lapse of option (189,392) -

Closing balance 3,731,080 3,473,012

The Holding Company has one share option scheme under which options to subscribe for the company’s shares have been granted to certain executives and senior employees.

The Share based payment reserve is used to recognise the value of equity settled share based payments provided to employees, including key management personnel, as part of their remuneration. Refer to Note 32 for further details of these plans. (d) Retained Earnings

(Amount in `)



Opening balance 3,859,662,662 3,411,877,405

Net Profit/(Loss) for the year (46,209,097) 179,073,386

Add/(Less):

Untilisation of SEZ Reinvestment allowance reserve - 264,650,684

Items of Other Comprehensive Income directly recognised in Retained Earnings

Remeasurement of post employment benefit obligation, net of tax (4,175,413) 4,061,187

Closing balance 3,809,278,152 3,859,662,662

(e) Capital Reserve(Amount in `)



Opening balance 26,848,865 26,848,865

Add/(Less):


Closing balance 26,848,865 26,848,865

(f) Foreign Currency Translation Reserve(Amount in `)



Opening balance 93,941,891 60,385,059

Add/(Less):

changes during the period (17,335,406) 33,556,832

Closing balance 76,606,485 93,941,891



(g) SEZ Reinvestment Allowance Reserve(Amount in `)



Opening balance - 264,650,684

Add/(Less):

Untilisation of SEZ Reinvestment allowance reserve - (264,650,684)

Closing balance - -

A ‘Unit’ in Special Economic Zone (“SEZ Unit”) claiming tax holiday benefit under section 10AA enjoys the tax incentive for a period of 10 years. The incentive is a staggered one, spread over a period of 10 years. An SEZ Unit does not have to pay income tax on entire export profits for the first 5 years. In the next block of 2 years, a SEZ unit is not required to pay tax on half of its export profits. In the last block of 3 years (Year 8 to Year 10), a SEZ unit can claim deduction of the amount not exceeding fifty per cent of the profit as debited to the profit and loss account of the previous year in respect of which the deduction is to be allowed and credited to a reserve account (to be called the “Special Economic Zone Re-investment Reserve Account”) to be created and utilized for the purposes of the business of the company for the purposes of acquiring machinery or plant before the expiry of a period of three years following the previous year in which the reserve was created. ii. Components of Other Comprehensive Income

(Amount in `)



As at April 1, 2015

Equity Instruments through OCI 1,137,850 622,370 1,178,590

1,137,850 622,370 1,178,590 The disaggregation of changes to OCI by each type of reserve in equity is shown below:

(Amount in `)

Particulars Equity Instruments through OCI

Total

As at April 1, 2015 1,178,590 1,178,590

Gain/(Loss) on FVTOCI financial assets (556,220) (556,220)

As at March 31, 2016 622,370 622,370

Gain/(Loss) on FVTOCI financial assets 515,480 515,480

As at March 31, 2017 1,137,850 1,137,850

iii. Other Components of Equity(Amount in `)



As at April 1, 2015

Money Received against share warrants - - 12,200,000

Total - - 12,200,000

Share Warrants The Holding Company had allotted 3,05,000 (Three Lac Five Thousand) Convertible Warrants (“Warrants”), on April 02, 2014 to Bennett, Coleman & Company Limited (‘BCCL’) on a preferential allotment basis, with each warrant convertible into one equity share at a conversion price of ` 160 per share, not later than 18 months from the date of allotment in accordance with the SEBI (ICDR) Regulations, 2009. In accordance with ICDR regulations, BCCL had paid ` 12,200,000 towards 25% value of



total consideration payable for the Warrants. The aforesaid share warrants were due for conversion in equity shares on or before October 2, 2015, However BCCL has not exercised the option and hence the warrants have lapsed on October 2, 2015. The amount paid against the aforesaid warrants has been forfeited by the Holding Company and transferred to General Reserve. 17. BORROWINGS

i. Non Current Borrowings(Amount in `)



As at April 1, 2015

Secured

Term Loans

From Banks 150,824 598,804 1,575,367

From Others 12,382,456 16,025,597 10,140,861

Long term maturity of Finance Lease Obligations 6,703,035 6,163,516 2,150,303

(A) 19,236,315 22,787,917 13,866,531

Current Maturity of Non Current Borrowings

Term Loans

From Banks 150,824 377,190 924,635

From Others 4,414,376 4,088,375 7,480,909


(B) 4,565,200 4,465,565 9,019,701

Total (A)-(B) 14,671,115 18,322,352 4,846,830

a) Term Loan from Banks includes vehicle loan which is secured by hypothecation of vehicle and carries interest @ 10.22% p.a. The loans is repayable in 60 monthly installments inclusive of interest from the date of loan.

b) Term Loans from others include

i) Loan secured by hypothecation of Plant and Machinery and carries interest @ 13.00% p.a. The loan is repayable in 45 monthly installments of `148,642/- each including interest starting from March 2014.

ii) Loan secured by hypothecation of vehicle and carries interest @ 10.22%. The loans is repayable in 60 monthly installments inclusive of interest from the date of loan.

c) Long term maturity of Finance Lease Obligations represents fair value of Finance lease obligations amortised over the lease term on a straight line basis in accordance with Ind AS 109.

ii. Current Borrowings(Amount in `)



As at April 1, 2015

Secured

Loans repayable on demand

From Banks 4,808,224,033 4,668,930,938 4,031,747,835

From Other Parties 30,000,000 15,000,000 15,000,000

Bills Discounted 2,518,913,751 2,639,131,257 2,555,801,018

Unsecured

Loan from Related Party 48,288,591 47,505,281 49,914,586

Total 7,405,426,375 7,370,567,476 6,652,463,439



(a) Working capital loans from banks are secured by hypothecation of inventories, book debts, plant and machinery, fixed deposits, other current assets and equitable mortgage of the Holding Company’s factories at Seepz and MIDC, one office at Bandra Kurla Complex, seven flats in Mumbai, and Two Flats at Prabhadevi belonging to Divya Real Estate Pvt. Ltd.

(b) The above facilities are further secured by

(i) personal guarantee of managing director, Mr. Rajeev Sheth,(ii) corporate guarantee of Divya Real Estate Pvt. Ltd., Fabrikant Tara International LLC and Tara (Hong kong)

Limited(iii) fixed deposits of ` 8.79 Crores of managing director, Mr. Rajeev Sheth(iv) pledge of 9,581,300 equity shares of the Holding Company held by managing director, Mr. Rajeev Sheth

(c) Working capital loans from others are secured by pledge of 23,75,000 equity shares of the Holding Company held

by managing director, Mr. Rajeev Sheth and personal guarantee of managing director

(d) Working capital loans taken by USA Subsidiary Company are secured by hypothecation of substantially all assets of the subsidiary company, subordinations and corporate guarantee of Tara Jewels Limited.

(e) Working capital loans taken by Hongkong Subsidiary Company are secured by hypothecation of inventory, receivables and fixed deposits. The loans are further secured by corporate guarantee of Tara Jewels Limited and personal guarantee of Managing Director, Mr. Rajeev Sheth.

(f) Loan from related party is interest free and repayable on demand. iii. Other Disclosures

(a) The carrying amounts of financial and non-financial assets pledged as security for current and non current borrowings are disclosed in Note 40.

(b) Amount and period of default in repayment of borrowings

(Amount in `)


Amount Period of Default

Term Loans from Others

Principal 445,237 1 - 60 days

Interest 170,696 1 - 60 days

Loans repayable on demand from Banks

Principal 469,176,099 1 - 90 days

Interest 5,804,928 1 - 90 days



18. OTHER FINANCIAL LIABILITIES

(Amount in `)



As at April 1, 2015

Current

(i) Financial Liabilities at amortised cost

Current maturities of long term debts 4,565,200 4,465,565 8,405,544

Current maturities of finance lease obligations - - 614,157

Interest accrued and due on borrowings 6,960,484 - -

Interest accrued but not due on borrowings 6,220,199 4,472,899 354,034

Unpaid dividends 5,065 5,065 5,065

Others

Bank Overdraft 24,372,532 19,383,813 12,479,458

Other Payables 7,839,624 18,916,097 7,947,116

49,963,104 47,243,439 29,805,374

(ii) Financial Liabilities carried at fair value through profit and loss

Derivatives not designated as hedge

- Foreign Exchange forward contracts 19,521,757 - -

19,521,757 - -

Total 69,484,861 47,243,439 29,805,374

19. TRADE PAYABLES

(Amount in `)



As at April 1, 2015

Current

Trade Payables to Micro, Small and Medium Enterprises - 77,787 77,000

Trade Payables to Others 3,879,902,428 4,819,755,988 3,016,916,810

Total 3,879,902,428 4,819,833,775 3,016,993,810

Includes dues to related parties (refer note 34)

20. OTHER LIABILITIES

(Amount in `)



As at April 1, 2015

Current

Statutory Liabilities 59,462,634 34,724,886 28,326,577

Others* 179,577,405 142,777,709 189,192,007

Total 239,040,039 177,502,595 217,518,584

*Others includes expenses payable, advance received from customer and deposits.



21. PROVISIONS

(Amount in `)



As at April 1, 2015

Non Current



Leave encashment 12,925,127 9,897,758 13,839,101

Total 43,534,714 30,443,904 46,005,656

Current



Leave encashment 791,838 968,436 687,834

Total 2,228,622 6,162,410 1,881,958

22. CURRENT TAX LIABILITY(NET)

(Amount in `)



As at April 1, 2015

Opening balance 276,348,921 198,551,899 198,551,899

Add: Current tax and earlier tax payable 24,090,275 99,303,009 -

Add: Provision for interest payable on current tax 55,000,000 24,000,000 -

Less: Taxes paid (42,324,276) (45,496,901) -

Translation Difference (612,850) (9,086) -

Closing Balance 312,502,070 276,348,921 198,551,899

23. REVENUE FROM OPERATIONS

(Amount in `)



Sale of products 15,527,257,864 17,953,688,253

Sale of services 294,563 98,733

Labour charges

Other Operating Revenues - 137,089

15,527,552,427 17,953,924,075



24. OTHER INCOME

(Amount in `)



Interest income on

Bank fixed deposits 39,758,934 46,542,552

Loans to others - 56,051

Dividend income 8,185 259,972

Other Non Operating Income

Net gain on sale of Investments 1,370,671 (69,574)

Others

Rent received 5,170,454 2,331,000

Commission received 43,322 185,347

Sundry balances written back 4,594,055 66,965,580

Miscellaneous income - 2,769,678

50,945,621 119,040,606

25. COST OF MATERIALS CONSUMED

(Amount in `)



As at beginning of the year 972,925,085 1,076,294,849

Add: Purchases 11,479,850,811 12,471,611,691

Less : As at end of the year 682,109,423 972,925,085

Translation Difference 634,608 9,592,148

11,771,301,081 12,584,573,603

26. CHANGES IN INVENTORIES OF FINISHED GOODS, WORK-IN-PROGRESS AND STOCK-IN-TRADE

(Amount in `)



Inventories as at the beginning of the year

Work - in - process 3,545,356,247 2,855,679,544

Finished goods 1,280,262,337 1,780,418,557

Stock-in-trade 26,208 4,777,054

4,825,644,792 4,640,875,155

Less : Inventories as at the end of the year

Work - in - process 3,239,898,159 3,545,356,247

Finished goods 1,288,783,652 1,280,262,337

Stock-in-trade 26,208 26,208

4,528,708,019 4,825,644,792

Translation Difference (14,659,086) 33,778,538

Net decrease / (increase) in inventories 282,277,687 (150,991,099)



27. EMPLOYEE BENEFITS EXPENSE

(Amount in `)



Salaries, wages and bonus 354,112,214 408,829,400

Contribution to provident and other funds 21,856,090 23,994,927

Share based payments to employees 447,460 895,107

Staff welfare expenses 7,988,349 19,826,149

Gratuity Expense 3,834,815 2,013,098

388,238,928 455,558,681

28. FINANCE COST

(Amount in `)



Interest expense on debts and borrowings 711,662,889 616,091,223

Interest on income tax 55,000,000 24,000,000

Other borrowing costs 77,920,068 68,000,571

844,582,957 708,091,794

29. DEPRECIATION AND AMORTISATION EXPENSE

(Amount in `)



Depreciation on tangible assets 214,582,514 208,471,232

Amortisation on intangible assets 8,617,976 8,640,205

223,200,490 217,111,437

30. OTHER EXPENSES

(Amount in `)



Manufacturing Expenses

Wages, allowances and bonus 98,622,620 124,752,628

Import clearing charges 33,546,077 17,741,599

Labour charges 312,580,812 161,198,515

Electric power, fuel and water 32,386,699 40,486,367

Repairs and maintenance

Factory Building 1,063,096 2,668,451

Plant and Machinery 2,775,897 6,812,170

Foreign Exchange fluctuation loss (47,779,419) (126,495,554)

Stores, consumables and packing material 39,415,416 116,112,081

472,611,198 343,276,257



(Amount in `)



Selling, Administration and Other Expenses

Advertisement 394,242 8,266,732

Payments to auditors (Refer note below) 6,915,000 7,668,500


Credit insurance 21,862,549 28,651,495

Electricity charges 1,668,486 3,093,399

Export clearing charges 13,842,899 14,752,272

Fixed assets written off 4,347,902 11,323,405

House Keeping Expenses 4,601,934 5,446,607

Insurance 26,349,380 21,812,654

Legal and professional fees 124,152,503 113,531,343

Net loss on disposal of property, plant and equipment 6,175,932 6,759,433

Rates and taxes 4,711,993 8,231,998

Rent 41,011,976 75,346,362

Repairs & maintenance - other 12,191,961 11,856,446

Sales promotion expenses 66,988,837 52,064,616

Security charges 8,232,505 13,437,456

Telephone and internet expenses 4,946,364 6,762,394

Travelling & conveyance expenses 24,539,928 22,808,689


Bank charges 44,754,201 72,158,339

Fair value loss on financial instrument at Fair value through profit and loss 18,143,004 925,729

Miscellaneous expenses 24,721,627 39,599,154

545,059,773 639,773,630

Total 1,017,670,971 983,049,887

Details of Payments to auditors (Amount in `)



Audit Fee 1,500,000 2,000,000

Tax audit fee 1,500,000 1,500,000

Limited review fees 1,000,000 1,000,000

Services for tax matters 1,500,000 1,500,000

Certification and consultation 1,100,000 1,308,000

Service Tax 315,000 360,500

6,915,000 7,668,500



31. EMPLOYEE BENEFIT OBLIGATIONS

(Amount in `)

As at March 31, 2017 As at March 31, 2016

Current Non Current Total Current Non Current Total

Leave obligations 791,838 12,925,127 13,716,965 968,436 9,897,758 10,866,194

Gratuity 1,436,784 30,609,587 32,046,371 5,193,974 20,546,146 25,740,120

Total Employee Benefit Obligation

2,228,622 43,534,714 45,763,336 6,162,410 30,443,904 36,606,314

(i) Leave Obligations The leave obligations cover the Holding company’s liability for sick and earned leave. The amount of the provision of ` 791,838 (Previous Year : ` 968,436) is presented as current, since the Holding company

does not have an unconditional right to defer settlement for any of these obligations.

(ii) Post Employment obligations a) Gratuity The Holding company provides for gratuity for employees in india as per the Payment of Gratuity Act, 1972.

Employees who are in continuous service for a period of five years are eligible for gratuity. The amount of gratuity payable on retirement/ termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied by number of years of service.

The gratuity plan is a funded plan and the Holding company makes contributions to recognised funds in India. The

Holding company does not fully fund the liability and maintains a target level of funding to be maintained over a period of time based on estimations of expected gratuity payments.

The amount recognised in the balance sheet and the movement in the net defined benefit obligation over the period are as follows

(Amount in `)



Net amount

As at April 1, 2015 33,513,587 (152,908) 33,360,679

Current service cost 3,006,728 3,006,728

Interest expense/(income) 2,681,087 2,681,087

Total amount recognised in profit or loss 5,687,815 - 5,687,815

Remeasurements


(12,233) (12,233)

(Gain)/Loss from change in demographic assumptions -

(Gain)/Loss from change in financial assumptions 551,601 (535) 551,066

Experience (gains)/losses (6,749,359) (6,749,359)

Total amount recognised in other comprehensive income (6,197,758) (12,768) (6,210,526)


Benefit payments (7,097,848) (7,097,848)

As at March 31, 2016 25,905,796 (165,676) 25,740,120

Current service cost 3,861,587 3,861,587

Interest expense/(income) 1,878,170 (12,012) 1,866,158

Total amount recognised in profit or loss 5,739,757 (12,012) 5,727,745



(Amount in `)



Net amount

Remeasurements


- - -

(Gain)/Loss from change in demographic assumptions 153,631 153,631

(Gain)/Loss from change in financial assumptions 5,460,489 5,460,489

Experience (gains)/losses 625,360 (1,656) 623,704

Total amount recognised in other comprehensive income 6,239,480 (1,656) 6,237,824


Benefit payments (5,659,318) (5,659,318)

As at March 31, 2017 32,225,715 (179,344) 32,046,371

The net liability disclosed above relates to funded and unfunded plans are as follows:(Amount in `)



As at April 1, 2015

Present value of funded obligations 32,225,715 25,905,796 33,513,587

Fair value of plan assets (179,344) (165,676) (152,908)

Deficit of funded plan 32,046,371 25,740,120 33,360,679

Unfunded plans - - -

Deficit of gratuity plan 32,046,371 25,740,120 33,360,679

The significant actuarial assumptions were as follows:(Amount in `)



Discount rate 7.25% 8.00%

Expected return on plan assets 7.25% 7.99%

Salary growth rate 3.50% 2.50%

Attrition rate 1% to 4% 1% to 3%

Life expectation for

Male 60 Years 60 years

Female 60 Years 60 years

A quantitative sensitivity analysis for significant assumption as at March 31, 2017 is shown below:

Assumptions Discount rate Salary growth rate

Sensitivity Level 0.5% increase 0.5% decrease 0.5% increase 0.5% decrease

March 31, 2016

Impact on defined benefit obligation (129,400) 130,735 34,462 (34,052)

March 31, 2017

Impact on defined benefit obligation (1,735,769) 1,897,725 1,959,837 (1,804,161)

Sensivities due to mortality, attrition and withdrawals are insignificant and therefore ignored. Sensitivities as to rate of inflation, rate of increase of pensions in payment, rate of increase of pensions before retirement and life expectancy are not applicable being a lump sum benefit on retirement.



The sensitivity analysis above have been determined based on a method that extrapolates the impact on defined beenfit obligation as a result of reasonable changes in key assumptions occuring at the end of the reporting period. The following payments are expected contributions to the defined benefit plan in future years:

(Amount in `)



Within the next 12 months 1,616,128 6,398,609

Between 2 and 5 years 9,211,898 8,536,487

Between 5 and 10 years 7,285,680 -

Beyond 10 years - -

Total expected payments 18,113,706 14,935,096

(iii) Defined contribution plans The Holding company also has defined contribution plans. Contributions are made to provident fund in India for

employees at the rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the government. The Holding company has also contributed towards employee’s state insurance scheme and maharsahtra labour welfare fund. The obligation of the Holding company is limited to the amount contributed and it has no further contractual nor any contructive obligation.

During the year, the Holding Company has recognised the folllowing amounts in the Statement of Profit and Loss:

(Amount in `)



Employer's contribution to provident fund 16,320,666 18,243,875

Employer's contribution to employee's state insurance 4,918,041 5,179,455

Employer's contribution to maharashtra labour welfare fund 78,516 92,233

21,317,223 23,515,563

32. SHARE BASED PAYMENTS

(a) Employee stock option plan The Employee Stock Option Plan (ESOP) is designed to provide incentives to employees above the designation of

managers to deliver long term returns. Participation in the plan is at the board’s discretion and no individual has a contractual right to participate in the plan or to receive any guaranteed benefits.

Once vested, the options remain exercisable for a period of 4 years. When exercisable, each option is convertible

into one equity share of ` 10 each. The exercise price of the share options is ` 230.

Movement during the period The number and weighted average exercise prices (WAEP) of the options and movement during the period is as

follows:

Particulars Year ended March 31, 2017 Year ended March 31, 2016

No. of options WAEP No. of options WAEP

Opening balance 111,678 230 111,678 230

Granted duing the period - - - -


Forfeited /lapsed during the period (5,395) - - -


Closing balance 106,283 230 111,678 230





(Amount in `)

Particulars Grant date Expiry date Exercise price (`.)

Share options

Share options

Share options

As at March 31,

2017

As at March 31,

2016

As at April 1,

2015

ESOP 2013 - Grant C 25-Jul-13 25-Jul-17 230 106,283 111,678 111,678

Total 106,283 111,678 111,678



(b) Expense arising from share based payment transactions Total expenses arising from share based payment transactions recognised in profit or loss as part of employee

benefit expense were as follows:(Amount in `)





33. COMMITMENTS AND CONTINGENCIES

A. Commitmentsi. Capital Commitments Capital expenditure contracted for at the end of the reporting period but not recognised as liabilities is as

follows:(Amount in `)



As at April 1, 2015

Property, plant and equipment 10,400,445 11,515,601 43,687,095

ii. Other Commitments(Amount in `)



As at April 1, 2015

Future Minimum Royalty payable 16,047,900 30,919,460 51,949,700

iii. Leases Operating lease commitments - as lessee The Group’s significant leasing arrangements are in respect of residential flats and commercial premises taken

on lease. The arrangements range between 11 months and 9 years generally and are usually renewable by mutual consent or mutually agreeable terms. Under these arrangements, generally refundable interest free deposits have been given. In respect of above arrangements, lease rentals payable are recognised in the Statement of Profit and Loss for the year and included under Rent (disclosed under Other Expenses).



(Amount in `)



As at April 1, 2015

Commitments for minimum lease payments in relation to non cancellable operating leases are as follows

Within one year 19,332,125 18,879,248 20,490,586

Later than one year but not later than five years 98,971,582 69,416,003 10,819,943

later than five years - 28,240,594 -

118,303,707 116,535,845 31,310,529

Rents recognised as expense in the period 41,011,976 75,346,362

Operating lease commitments - as lessor

The Holding Company has entered into operating leases for its commercial property. These leases have terms of between 11 months and 3 years. All leases include a clause to enable upward revision of the rental charge on an annual basis according to prevailing market conditions. The total rents recognised as income during the year is ` 51,70,454 (Previous Year : ` 23,31,000).

(Amount in `)



As at April 1, 2015

Minimum lease rentals receivables in relation to non cancellable operating leases are as follows

Within one year 4,800,000 - -

Later than one year but not later than five years 7,880,000 - -


12,680,000 - -

B. Contingent Liabilities(Amount in `)



As at April 1, 2015

Claim against the group not acknowledged as debt

(a) Custom duty matters 1,900,563 1,900,563 1,900,563

(b) Property tax - 2,481,489 2,481,489

(c) Service tax matter 6,723,389 6,723,389 6,723,389

(d) Other matter 1,004,921 2,085,723 2,085,723

Breif description of the nature of each contingent liability (a) Custom duty matters Two show cause notices have been issued against holding Company by Assistant Commissioner of Customs, Mumbai,

regarding shortage of gold and misuse of wastage norms. Also Additional Assistant Commissioner of Customs, Mumbai has imposed fine for import without a license that could not be cleared as prototype samples. Holding Company has filed appeals before the Commissioner of Customs / Additional Commissioner of Customs and matters are pending.



(b) Property tax Bill of Property Tax issued by MCGM mentioned an old outstanding amount to be paid by Holding company, which as

per Holding company were not payable and the same has been settled during the year. (c) Service tax matter Joint Commissioner, Service Tax- I, Mumbai has issued a show cause notice to Holding Company for service tax demand

for the Taxation of Services (Provided from Outside India and Received in India). The Holding Company has filed an appeal before the Commissioner of Central Excise against the order and the matter is currently pending.

(d) Other matter American Express Bank on his credit card bill to the Holding Company is showing an outstanding amount for interest

payable on account of delay in payment of regular credit card outstanding in past. This amount has been disputed by the Holding company and matter is not yet settled.

Income Tax Assessment The Income- Tax assessments of the Holding Company have been completed up to Assessment Year 2014-15. The disputed

demand outstanding up to the said assessment year is approximately `56,500,000 Based on the decisions of the appellate authorities and the interpretations of other relevant provisions, the Holding Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

34. RELATED PARTY TRANSACTIONS

i. List of related parties as per the requirements of Ind-AS 24 - Related Party DisclosuresKey Management Personnel1. Mr. Rajeev Sheth2. Mr.Ravindran M. P.3. Mr. Sanjay Sethi (Upto 11-02-2016)4. Mr. Vishnu Prakash Garg (From 23-05-2016)5. Ms. Fern Mallis6. Mr. Nikkhil Vaidya7. Mr. Rakesh Kalra8. Mr. Shanti Saroop Khindria9. Mr. Rajiv Jain10. Mr. Francois Arpels (Upto 11-02-2016)11. Mr. Mariano De La Torre (Upto 09-12-2016)12. Mr. Jeffery Shlakman (From 02-09-2016)13. Mr. Stuart Marcus (From 02-09-2016)14. Ms. Alison Lazerwitz (From 09-12-2016)15. Mr. Bimal Desai (Upto 13-05-2016)16. Mrs. Nivedita Nayak

Relatives of Directors 1. Mrs. Aarti Sheth2. Mrs. Divya Sheth3. Mrs. Purnima Sheth4. Mrs. Rama Ravindran Menon

Entities in which Key Managerial Personnel/ their relatives are able to exercise significant influence or control 1. F. T. Diamonds2. Divya Jewels International Pvt. Ltd.3. Divya Real Estate Pvt. Ltd.4. Aarti Jewellers Pvt Ltd. 5. Karan Arjun Jewellery Pvt. Ltd.6. Tara Duniya Corporation7. Brahma Designs Inc. (From 02-09-2016)8. Direct Partners Inc. (From 02-09-2016)



ii. Transactions during the year ended Mar 31, 2017

(Amount in `)

Particulars Key Management Personnel/ Relatives



Current Year

Previous Year

Current Year

Previous Year

Sale of Goods

F. T. Diamonds - - 164,497,155 39,943,220

Purchase of Goods

Aarti Jewellers Pvt Ltd. - - 108,000 78,023

F. T. Diamonds - - 145,552,019 -

Labour Charges Paid

F. T. Diamonds - - 1,159,269 -


Aarti Jewellers Pvt Ltd. - - - 71,342

F. T. Diamonds - - 27,988 22,324

Directors' Remuneration and Commission

Mr. Rajeev Sheth 12,000,000 12,000,000 - -

Mr. Sanjay Sethi - 5,136,207 - -

Mr. Vishnu Prakash Garg 4,430,543 - - -

Mr. Ravindran M. P. 2,947,049 2,767,264

Commission and other benefits to Independent Directors 500,000 3,560,000 - -

Salary and Professional Fees paid

Mr. Bimal Desai 652,759 1,867,370

Ms. Aarti Sheth 3,246,335 3,720,000 - -

Ms. Divya Sheth 2,299,067 2,187,165 - -

Other Key Managerial Personnel 629,039 611,175 - -

Professional Fees paid

Mrs. Rama Ravindran Menon 1,901,880 1,654,992 - -

Brahma Designs Inc. - - 531,311 -

Direct Partners Inc. - - 307,472 -

Sales Promotion Expenses

Aarti Jewellers Pvt Ltd. - - 146,744 -

Unsecured Loan Taken

Mr.Rajeev Sheth 10,664,008 - - -

F.T. Diamonds - - 617,765 -

Repayment of Unsecured Loan Taken


Tara Duniya Corporation - - 7,044,450 -



iii. Key management personnel compensation

(Amount in `)



Salaries and other employee benefits to whole time directors and Key Management Personnel

26,204,791 28,289,181

Provision for Post employment benefits to whole time directors and Key Management Personnel*

1,349,977 -

Commission and other benefits to non-executive / independent directors 500,000 3,560,000

Share based payments - -

28,054,768 31,849,181

* The amount for year ended March 31, 2016 excludes post employment benefit viz. gratuity which can not be separately identified from the composite amount advised by the Actuary. iv. Closing Balances as on March 31, 2017

(Amount in `)

Particulars Key Management Personnel/ Relatives



Current Year

Previous Year

Current Year

Previous Year

Trade Receivables

F. T. Diamonds Inc. - - - 41,322,872

Aarti Jewellers Pvt Ltd. - - 52,903 71,794

Trade Payables

F. T. Diamonds Inc. - - 35,396,027 628,639

Investments

Divya Jewels International Pvt. Ltd. - - 175,000 175,000

Short Term Borrowings


F.T. Diamonds - - 15,319,228 15,060,492

Tara Duniya Corporation - - 24,905,355 32,444,789

Director Remunaration payable

Mr.Rajeev Sheth 984,912 5,567,343 - -

Mr.Vishnu Prakash Garg 577,133 - - -

Mr.Ravindra P. Menon 352,156 165,439 - -

Commission and other benefits to Independent Directors 2,866,100 5,444,420 - -

Salary and Professional Fees payable

Mr. Bimal Desai - 297,634 - -

Ms. Aarti Sheth 1,359,935 647,707 - -

Ms. Divya Sheth 117,507 71,983 - -

Mrs. Rama Ravindran Menon 470,448 - - -

Other Key Managerial Personnel 108,269 45,364 - -



v. Terms and conditions of transactions with related parties The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm’s length

transactions. Outstanding balances at the year end are unsecured and interest free. For the year ended March 31, 2017, the Group has not recorded any impairment of receivables relating to amount owed by related parties. This assessment is undertaken each financial year through examining the financial position of the related party and market in which the related party operates.

35. SEGMENT REPORTING

A. Information about Primary Business Segment The Group is exclusively engaged in the “Diamond and Gold Jewellery” Business Segment.

B. Information about Secondary Geographical Segment.(Amount in `)

April 1, 2016 to March 31, 2017

Particulars India Outside India* Total

External Revenue 3,081,244,909 12,446,307,518 15,527,552,427

(3,741,809,572) (14,212,114,503) (17,953,924,075)


Carrying Amount of Segment Assets 6,880,024,150 11,056,449,299 17,936,473,449

(7,499,469,964) (11,283,395,109) (18,782,865,073)

April 1, 2016 to March 31, 2017

Capital Expenditure 114,313,913 1,333,816 115,647,729

(322,756,621) (744,672) (323,501,293)

* Includes mainly United States of America, Australia, China (including Hong kong), United Arab Emirates, Europe, South- Africa, Canada, Singapore and United kingdom

Note: The figures in brackets are in respect of the previous year ended March 31, 2016

Notes:

(a) Segment Revenue in the geographical segment considered for disclosure are as follows:

- Revenue within India includes sales to customers located within India and earnings in India

- Revenue outside India includes sales to customers located outside India and earnings outside India.

(b) Segment revenue, results, assets and liabilities includes the respective amounts identified to each the segment and amounts allocated on a reasonable basis.

36. EARNINGS PER SHARE

(Amount in `)



Profit / (Loss) after tax (`) (46,209,097) 179,073,386

Weighted average number of equity shares 24,622,850 24,622,850

Nominal value per share (`) 10.00 10.00

Basic and Diluted Earning / (Loss) per Equity Share (`) (1.88) 7.27



37. FAIR VALUE MEASUREMENTS

i. Financial Instruments by Category(Amount in `)

Particulars Carrying Amount Fair Value

As at March 31,

2017


As at April 1, 2015

As at March 31,

2017


As at April 1, 2015

FINANCIAL ASSETS

Amortised cost

Trade Receivables 10,525,268,953 10,557,797,700 7,833,174,486 10,525,268,953 10,557,797,700 7,833,174,486

Loans 3,753,527 2,720,393 3,873,021 3,753,527 2,720,393 3,873,021

Cash and Cash Equivalents 16,862,384 34,579,208 73,851,243 16,862,384 34,579,208 73,851,243

Other Bank Balances 739,041,995 746,958,353 773,622,148 739,041,995 746,958,353 773,622,148

Other Financial Assets 15,485,608 27,899,788 37,719,876 15,485,608 27,899,788 37,719,876

FVTOCI

Investment in Equity Instruments 1,419,250 903,770 1,459,990 1,419,250 903,770 1,459,990

FVTPL

Investments in Mutual Funds 24,880,621 59,601,833 47,641,964 24,880,621 59,601,833 47,641,964

Total 11,326,712,338 11,430,461,045 8,771,342,728 11,326,712,338 11,430,461,045 8,771,342,728

FINANCIAL LIABILITIES

Amortised cost

Borrowings 7,420,097,490 7,388,889,828 6,657,310,269 7,420,097,490 7,388,889,828 6,657,310,269

Trade Payables 3,879,902,428 4,819,833,775 3,016,993,810 3,879,902,428 4,819,833,775 3,016,993,810

Other financial liabilities 49,963,104 47,243,439 29,805,374 49,963,104 47,243,439 29,805,374

FVTPL

Derivative instruments 19,521,757 - - 19,521,757 - -

Total 11,369,484,779 12,255,967,042 9,704,109,453 11,369,484,779 12,255,967,042 9,704,109,453

The management assessed that the fair value of cash and cash equivalent, other bank balances, trade receivables, trade payables, and other current financial assets and liabilities approximate their carrying amounts largely due to the short term maturities of these instruments.

The fair values for security deposits were calculated based on cash flows discounted using a current lending rate. They are

classified as level 3 fair values in the fair value hierarchy and their fair values are assessed as approximate to their carrying amounts.

The fair values of non current borrowings are based on discounted cash flows using a current borrowing rate. They are

classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk. The own non performance risk as at reporting date was assessed to be insignificant and therefore fair values approximate their carrying amounts.

ii. Fair Value Hierarchy This section explains the judgments and estimates made in determining the fair values of the financial instruments

that are recognised and measure at fair value. To provide an indication about the reliability of the inputs used in determining fair value, the Group has classified its financial instruments into three levels prescribed under the accounting standard. An explanation of each level follows underneath the table:



Assets and liabilities measured at fair value - recurring fair value measurement:




Inputs (Level 2)


Inputs (Level 3)


Financial Assets


Quoted Mutual Funds 7,380,621 - - 7,380,621

Unquoted Mutual Funds - 17,500,000 - 17,500,000


Quoted equity shares 1,244,250 - - 1,244,250

Unquoted equity shares - - 175,000 175,000



Derivative instruments - 19,521,757 - 19,521,757

Total Financial Liabilities - 19,521,757 - 19,521,757


Financial Assets





Quoted equity shares 728,770 - - 728,770




Derivative instruments - - - -

Total Financial Liabilities - - - -

As at April 1, 2015

Financial Assets





Quoted equity shares 1,284,990 - - 1,284,990





There have been no transfers among Level 1, Level 2 and Level 3 during the period Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity

instruments, traded bonds and mutual funds that have quoted price. The fair value of all equity instruments (including bonds) which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the closing NAV.

Level 2 - The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over the counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3 - If one or more of the significant inputs are not based on observable market data, the instrument is included in level

3. This is the case for unlisted equity shares, contingent consideration and indemnification assets included in level 3.

iii. Valuation technique used to determine fair value Specific Valuation techniques used to value financial instruments include:

- the use of quoted market prices or dealer quotes for similar instruments - the fair value of the remaining financial instruments is determined using discounted cash flow analysis

iv. Valuation inputs and relationships to fair value The fair values of the unquoted equity shares have been estimated using a discounted cash flow model. The

valuation requires management to make certain assumptions about the model inputs, including forecast cash flows, discount rate, credit risk and volatility, the probabilities of the various estimates within the range can be reasonably assessed and are used in management’s estimate of fair value for these unquoted equity investments.

v. Valuation processes The finance department performs the valuations of financial assets and liabilities required for financial reporting

purposes, including level 3 fair values. The department reports directly to the chief financial officer (CFO) and the audit committee. Discussions of valuation processes and results are held between the CFO, Audit Committee and the valuation team periodically

vi. Reconciliation of fair value measurement of financial assets carried at fair value (Level 3): There is no change in fair value of unquoted equity shares.

38. FINANCIAL RISK MANAGEMENT

The group’s activity expose it to market risk, liquidity risk and credit risk. In order to minimise any adverse effects on the financial performance of the group, derivative financial instruments, such as foreign exchange forward contracts are entered to hedge certain foreign currency risk exposures. Derivatives are used exclusively for hedging purposes and not as trading or speculative instruments. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk.

(A) Credit risk Credit risk is the risk that the counterparty will not meet its obligations leading to a financial loss. Credit risk arises

from cash and cash equivalents, investments carried at amortised cost and deposits with banks and financial institutions, as well as credit exposures to customers including outstanding receivables.

i. Credit risk management Credit risk has always been managed by the group through credit approvals, obtaining credit reports,

establishing credit limits, taking credit limits and continuously monitoring the creditworthiness of customers to which the group grants credit terms in the normal course of business.

The group considers the probability of default upon initial recognition of asset and whether there has been

a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk the group compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers available reasonable and supportive forwarding-looking information.



A default on a financial asset is when the counterparty fails to make contractual payments of when they fall due. This definition of default is determined by considering the business environment in which entity operates and other macro-economic factors.

ii. Provision for expected credit losses The group follows ‘simplified approach’ for recognition of impairment loss allowance on Trade receivables

As a practical expedient, the group uses a provision matrix to determine impairment loss allowance on

portfolio of its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analyzed.

iii. Reconciliation of loss allowance provision - Trade receivables

Particulars (Amount in `)

Loss allowance on April 1, 2015 60,939,952

Changes in loss allowance 50,466,745

Translation difference 93,500


Changes in loss allowance (14,785,854)

Translation difference (318,500)


(B) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, group maintains flexibility in funding by maintaining availability under committed credit lines.

Management monitors rolling forecasts of the group’s liquidity position (comprising the undrawn borrowing facilities) and cash and cash equivalents on the basis of expected cash flows. In addition, the group’s liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.

Maturities of financial liabilities The tables below analyse the group’s financial liabilities into relevant maturity groupings based on their contractual

maturities for:- all non-derivative financial liabilities, and- net and gross settled derivative financial instruments for which the contractual maturities are essential for an

understanding of the timing of the cash flows. The table have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest

date on which the Group can be required to pay. In the table below, borrowings include both interest and principal cash flows. To the extent that the interest rates are floating rate, the undiscounted amount is derived from interest rate curves at the end of the reporting period.



Contractual maturities of financial liabilities

Particulars Carrying Amount

Contractual Cash Flows

Total Less than 1 year

Between 1 and 3 years

More than 3 years

March 31, 2017

Non-derivatives

Borrowings 7,420,097,490 7,871,908,906 7,856,283,771 8,651,302 6,973,833

Trade payables 3,879,902,428 3,879,902,428 3,879,902,428 - -



Derivatives (net settled)

Foreign exchange forward contracts 19,521,757 19,521,757 19,521,757 - -

Total derivative liabilities 19,521,757 19,521,757 19,521,757 - -

March 31, 2016

Non-derivatives

Borrowings 7,375,033,041 8,107,001,699 8,086,766,723 9,237,260 10,997,716

Trade payables 4,819,833,775 4,819,833,775 4,819,833,775 - -



April 1, 2015

Non-derivatives

Borrowings 6,661,483,140 7,276,594,743 7,271,486,953 3,571,644 1,536,146

Trade payables 3,016,993,810 3,016,993,810 3,016,993,810 - -



(C) Market risk Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of

change in market prices. Market risk comprises three types of risk: foreign currency risk, interest rate risk and other price risk such as equity price risk and commodity price risk.

(i) Foreign currency risk The fluctuation in foreign currency exchange rates may have potential impact on the statement of profit and

loss and other comprehensive income and equity, where any transaction references more than one currency or where assets/liabilities are denominated in a currency other than functional currency of the Holding Company.

Considering the countries and economic environment in which the Holding Company operates, its operations are subject to risks arising from fluctuation in exchange rates in those countries. The risk primarily relate to fluctuations in US Dollars(USD). Other Currencies in which risk of fluctuation is not significant are Great Britain Pound(GBP) and Euro(EUR) against the functional currency of the Holding Company.

The Group, as per its risk management policy uses derivative instruments primarily to hedge foreign exchange.

The Group evaluates the impact of foreign exchange rate fluctuations by assessing its exposure to exchange rate risk. It hedges a part of this risk by using derivative financial instruments in line with risk management policies.



(a) Foreign currency risk exposure The Group’s exposure to foreign currency risk at the end of the reporting period expressed in Indian

Rupees are as follows(Amount in `)

Particulars USD Others Total

March 31, 2017


Cash and Bank balances 62,119,923 - 62,119,923

Other Financial Assets 705,459 - 705,459

Foreign Currency loans (4,161,510,905) - (4,161,510,905)

Trade Payables (3,634,737,921) (14,033,572) (3,648,771,493)

Derivative Instruments (19,521,757) - (19,521,757)

Other Financial Liabilities (3,970,719) - (3,970,719)


March 31, 2016



Other Financial Assets 722,931 722,931


Trade Payables (4,256,436,635) (52,377,569) (4,308,814,204)

Other Financial Liabilities (15,836,818) - (15,836,818)


April 1, 2015



Other Financial Assets 25,286


Trade Payables (2,705,230,415) (52,116,987) (2,757,347,402)


(b) Foreign currency sensitivity 1% increase or decrease in foreign exchange rates will have the following impact on profit before tax and OCI:


1% Increase 1% Decrease 1% Increase 1% Decrease

Impact in Profit or Loss

USD 23,998,183 (23,998,183) 20,029,398 (20,029,398)

Others (139,539) 139,539 (522,911) 522,911

Net Increase/(decrease) in profit or loss Impact in OCI

23,858,645 (23,858,645) 19,506,487 (19,506,487)

USD 1,407,975 (1,407,975) 222,480 (222,480)

Net Increase/(decrease) in profit or loss 1,407,975 (1,407,975) 222,480 (222,480)

(ii) Interest rate risk The company’s main interest rate risk arises from borrowings with variable rates, which expose the company to

cash flow interest rate risk. During March 31, 2017, March 31, 2016 and April 1, 2015, the group’s borrowings at variable rate were mainly denominated in Rupees and USD.



The group’s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market.

(a) Interest rate risk exposure The exposure of the group’s borrowing to interest rate changes at the end of the reporting period are as follows:

(Amount in `)



As at April 1, 2015

Variable rate borrowings 7,327,137,784 7,308,062,195 6,587,548,853

Fixed rate borrowings 97,524,906 85,293,198 78,781,117

Total borrowings 7,424,662,690 7,393,355,393 6,666,329,970

% of borrowings at variable rate 98.69 98.85 98.82

(b) Sensitivity Profit or loss is sensitive to higher/lower interest expense from borrowings as a result of changes in interest rates.

Particulars Impact on profit before tax



Interest rates - increase by 50 basis points (50 bps)* (36,635,689) (36,540,311)

Interest rates - decrease by 50 basis points (50 bps)* 36,635,689 36,540,311

* holding all other variables constant

(iii) Price risk Commodity price risk - The group is affected by the price volatility of certain commodities. Its operating activities

require the ongoing purchase and manufacture of Jewellery and therefore require a continuous supply of mainly Gold and Diamond. Due to the volatility in the price of Gold and Diamond, the company is exposed to commodity price risk. Historically, the group has been able to increase prices to reflect changes in commodity cost.

Equity / Units price risk - The group’s exposure to listed and unlisted equity / debt securities price risk arises from investments held by the group and classified in the balance sheet either as fair value through OCI or at fair value through profit or loss.

To manage its price risk arising from investments in equity securities, the group diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the group. Reports on the equity / debt portfolio are submitted to the senior management on a regular basis. The majority of the group’s equity / debt investments are publicly traded.

Equity / debt price sensitivity The analysis is based on the assumption that the stock market index had increased by 1% or decreased by 1% with

all other variables held constant, and that all the group’s equity / debt instruments moved in line with the index.

Particulars Impact on profit before tax Impact on other component of equity


2017


2016


2017


2016

Stock Market Index - increase 1% (2016 - 1%) 73,806 421,018 12,443 7,288

Stock Market Index - decrease 1% (2016 - 1%) (73,806) (421,018) (12,443) (7,288)

Profit for the period would increase/decrease as a result of gains/losses on equity securities classified as at fair value through profit or loss. Other components of equity would increase/decrease as a result of gains/losses on equity securities classified as fair value though other comprehensive income.



39. CAPITAL MANAGEMENT

For the purpose of the group’s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the Holding Company. The primary objective of the group’s capital management is to maximise the shareholder value.

The group manages its capital structure and makes adjustments in light of changes in economic conditions and the

requirements of the financial covenants. To maintain or adjust the capital structure, the group may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The group monitors capital using a gearing ratio, which is Total outside liabilities (TOL) divided by Total net worth (TNW). TOL includes interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents.

(Amount in `)



As at April 1, 2015

Borrowings 7,420,097,490 7,388,889,828 6,657,310,269

Trade payables 3,879,902,428 4,819,833,775 3,016,993,810

Other payables 69,484,861 47,243,439 29,805,374

Less: cash and cash equivalents 16,862,384 34,579,208 73,851,243

Less: Other bank balances 739,041,995 746,958,353 773,622,148

TOL 10,613,580,400 11,474,429,481 8,856,636,062

Total Equity 5,969,683,225 6,036,440,201 5,819,409,909

TNW 5,969,683,225 6,036,440,201 5,819,409,909

Gearing ratio (TOL / TNW) 1.78 1.90 1.52

40. ASSETS PLEDGED AS SECURITY

The carrying amount of assets pledged as security for current and non current borrowings are:(Amount in `)



As at April 1, 2015

CURRENT ASSETS

i. Financial Assets

Trade Receivables 10,525,268,953 10,557,797,700 7,833,174,486

Cash and Cash Equivalents 15,903,336 30,078,652 71,409,983

Other Bank Balances 739,041,995 746,958,353 744,270,386

Loans 3,755,939 2,720,393 3,873,021

Other Financial Assets 9,651,427 10,771,524 12,420,485

ii. Non Financial Assets

Inventories 5,212,479,078 5,801,102,772 5,744,388,911

Other Current Assets 125,810,136 181,736,227 188,739,985

Total current assets pledge as security 16,631,910,864 17,331,165,621 14,598,277,257

NON CURRENT ASSETS

Property, Plants and equipments 727,828,130 767,661,130 619,526,789

Total non current assets pledge as security 727,828,130 767,661,130 619,526,789



41. DETAILS OF DUES TO MICRO AND SMALL ENTERPRISES AS DEFINED UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELO MENT ACT, 2006 (MSMED ACT, 2006)

(Amount in `)



As at April 1, 2015

a) Principal amount due and remaining unpaid - 55,624 77,000

b) Interest due on above - 3,498 271

c) Payment made beyond the appointed day during the year 245,905 489,630 583,788

d) Interest Paid on above - - -

e) Interest due and payable for the period of delay 7,439 12,821 18,276

f) Interest accrued and remaining unpaid 7,439 16,319 18,547

g) Amount of further interest remaining due and payable in succeeding years

115,189 107,750 91,431

The information has been given in respect of such vendors to the extent they could be identified as “Micro and Small” enterprises on the basis of information available with the Holding Company. 42. DISCLSOURE ON SPECIFIED BANK NOTES (SBNS)

During the year, the Holding Company had specified bank notes or other denomination note as defined in the MCA notification G.S.R. 308(E) dated March 31, 2017 on the details of Specified Bank Notes (SBN) held and transacted during the period from November 8, 2016 to December, 30 2016, the denomination wise SBNs and other notes as per the notification is given below:

Particulars SBNs* Other Denomination

Notes

Total

Closing cash in hand as on 08-11-2016 53,612,000 318,808 53,930,808

Add : Permitted receipts # - 2,438,551 2,438,551

Less : Permitted payments - 499,527 499,527

Less : Amount deposited in Banks 53,612,000 130,591 53,742,591

Closing cash in hand as on 30-12-2016 - 2,127,241 2,127,241 * For the purposes of this clause, the term ‘Specified Bank Notes’ shall have the same meaning as provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407 (E), dated the November 8, 2016.

# Includes withdrawals from Banks `5,23,000

43. CORPORATE SOCIAL RESPONSIBILITY (CSR)

During the previous financial year, the Holding company has constituted the Corporate Social Responsibility Committee in terms of Section 135 of the Companies Act, 2013 and the board had adopted a CSR Policy as recommended by the Committee. However during the financial year under review, the Holding Company has not made any expenditure on CSR as the Holding Company is still in the process of identifying the eligible project, by which the public can be benefited appropriately. The Holding Company intends to contribute to the money for CSR activities as soon as the project is identified.



44. ADDITIONAL INFORMATION

Additional Information, as required under Schedule III to the Companies Act, 2013, of enterprises consolidated as Subsidiary / Associates / Joint-Ventures is as under:

(Amount in `)

Name of the Enterprise Net Assets i.e. total assetsminus total liabilities

Share inprofit or loss

Share in Total Comprehensive Income

As % of consolidated

net assets

Amount As % of consolidated profit or loss

Amount As % of consolidated

Comprehensive Income

Amount

Parent

Tara Jewels Limited 88.34 5,416,800,701 276.61 (118,207,264) 191.23 (121,867,197)

Subsidiaries

Indian - - - - - -

Foreign

1. Tara Jewels Holdings, Inc. * 4.92 301,462,700 (38.11) 16,283,965 (14.39) 9,172,056

2. Tara (Hong Kong) Limited 6.68 409,343,963 (136.37) 58,275,180 (75.79) 48,303,479

3. Tara China Jewelry Limited 0.07 4,073,119 (2.14) 913,763 (1.04) 661,967

Minority interest in all subsidiaries - - - - - -

Associates (Investments as per the equity method)

Indian - - - - - -

Foreign - - - - - -

Joint Ventures (as per proportionate consolidation / Investment as per the equity method)

Indian - - - - - -

Foreign - - - - - -

100 6,131,680,483 100 (42,734,356) 100 (63,729,695)

Less : Adjustments arising out of consolidation

161,997,258 3,474,741 3,474,741

Total 5,969,683,225 (46,209,097) (67,204,436)

45. SALIENT FEATURES

Salient Features of Financial Statements of Subsidiary / Associates / Joint Ventures as per Companies Act , 2013

Part “A”: Subsidiaries

(Amount in `)

1. Sl. No. I II III

2. Name of the subsidiary Tara Jewels Holdings, Inc. *



3. Reporting period for the subsidiary concerned, if different from the holding company’s reporting period

N.A. N.A. N.A.

4. Reporting currency and Exchange rate as on the last date of the relevant Financial year in the case of foreign subsidiaries.

USD*** USD*** USD***



(Amount in `)

Sl. No. I II III

Name of the subsidiary Tara Jewels Holdings, Inc. *



5. Share capital 113,299,500 464,117 4,134,035

6. Reserves & surplus (including foreign currency translation reserve)

188,163,200 408,879,846 (60,916)

7. Total assets 2,407,254,658 2,533,203,903 10,411,294

8. Total Liabilities 2,105,791,958 2,123,859,940 6,338,175

9. Investments - 4,135,007 -

10. Turnover 4,956,962,113 8,485,767,683 4,482,216

11. Profit before taxation 31,770,014 66,879,406 913,763

12. Provision for taxation 15,486,049 8,604,226 -

13. Profit after taxation 16,283,965 58,275,180 913,763

14. Other Comprehensive Income (7,111,909) (9,971,701) (251,796)

15. Total Comprehensive Income 9,172,056 48,303,479 661,967

16. Proposed Dividend - - -

17. % of shareholding 100 100 100

* Based on Consolidated figures with Fabricant-Tara International LLC** Wholly owned subsidiary of Tara (Hong Kong) Limited.*** Exchange rate as at end of the year USD 1 = `64.84

Part “B”: Associates and Joint VenturesStatement pursuant to Section 129 (3) of the Companies Act, 2013 related to Associate Companies and Joint Ventures is not applicable to the company since, there are no associates or joint ventures of the Company.

46. FIRST TIME ADOPTION OF IND AS

These are the group’s first financial statements prepared in accordance with Ind AS. The accounting policies set out in note 2 have been applied in preparing the financial statements for the year ended March 31, 2017, the comparative information presented in these financial statements for the year ended March 31, 2016 and in the preparation of an opening Ind AS balance sheet at April 1, 2015 (the group’s date of transition). In preparing its opening Ind AS balance sheet, the group has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under under the section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP) and other relevant provisions of the Act (previous GAAP or Indian GAAP). An explanation of how the transition from previous GAAP to Ind AS has affected the group’s financial position, financial performance and cash flows is set out in the following tables and notes.

A. Exemptions and exceptions availed Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition

from previous GAAP to Ind AS.

1. Ind AS optional exemptions i. Business combinations Ind AS 101 provides the option to apply Ind AS 103 prospectively from the transition date or from a

specific date prior to the transition date. This provides relief from full retrospective application that would require restatement of all business combinations prior to the transition date. The group elected to apply Ind AS 103 prospectively to business combinations occurring after its transition date. Business combinations occurring prior to the transition date have not been restated.



ii. Deemed cost Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property,

plant and equipment and intangible assets covered by Ind AS 38 - Intangible Assets as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition. This exemption can also be used for investment property covered by Ind AS 40 Investment Properties since there is no change in the functional currency. Accordingly, the group has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value.

iii. Designation of previously recognised financial instruments Ind AS 101 allows an entity to designate investments in equity instruments at FVOCI on the basis of the

facts and circumstances at the date of transition to Ind AS. The group has elected to apply this exemption for its investment in quoted and unquoted equity investments.

iv. Estimates The estimates at April 1, 2015 and at March 31, 2016 are consistent with those made for the same dates

in accordance with Indian GAAP (after adjustments to reflect any differences in accounting policies) apart from the following items where application of Indian GAAP did not require estimation:

- FVTOCI – unquoted equity shares

- FVTPL – unquoted mutual funds

- Impairment of financial assets based on expected credit loss model

The estimates used by the group to present these amounts in accordance with Ind AS reflect conditions at April 1, 2015, the date of transition to Ind AS and as of March 31, 2016.

v. Share based payment transactions A first-time adopter is encouraged, but not required, to apply Ind AS 102 Share-based Payment to

equity instruments that were vested on or before the date of transition to Ind AS. However, if a first-time adopter elects to apply Ind AS 102 to such equity instruments, it may do so only if the entity has disclosed publicly the fair value of those equity instruments determined at the measurement date as defined in Ind AS 102.

Therefore, Ind AS 102 Share-based Payment has been applied to equity instruments in share-based payment transactions that vested before April 1, 2015.

2. Ind AS mandatory exceptions i. De-recognition of financial assets and liabilities Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively

for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the de-recognition requirements in Ind AS 109 retrospectively from a date of the group’s choosing, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognised as a result of past transactions was obtained at the time of initially accounting for those transactions. The group has elected to apply the de-recognition provisions of Ind AS 109 retrospectively from the date of transition to Ind AS.

ii. Classification and measurement of financial assets Ind AS 101 requires an entity to assess classification and measurement of financial assets (investment in

debt instruments) on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

B. Reconciliations between previous GAAP and Ind AS Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The

following tables represent the reconciliations from previous GAAP to Ind AS.



i. Reconciliation of equity as at date of transition (April 1, 2015) (Amount in `)


Ind-AS

ASSETS

Non-Current Assets

Property, Plant and Equipment 9 1,105,275,398 (14,796,969) 1,090,478,429

Capital Work-in-Progress - - -

Intangible Assets 9 23,961,473 1,046,147 25,007,620

Financial Assets

Investments 1 37,189,202 11,912,752 49,101,954




1,245,197,349 32,906,760 1,278,104,109

Current assets

Inventories 5,764,453,826 - 5,764,453,826

Financial Assets



Other Bank Balances 773,622,148 - 773,622,148

Loans 3,873,021 - 3,873,021


Current Tax Assets (Net) - - -


14,768,748,552 (59,375,202) 14,709,373,350

TOTAL 16,013,945,901 (26,468,442) 15,987,477,459


Equity

Equity Share capital 246,228,500 - 246,228,500

Other Equity 7, 8 5,599,649,851 (26,468,442) 5,573,181,409

5,845,878,351 (26,468,442) 5,819,409,909

Liabilities



Borrowings 4,846,830 - 4,846,830

Provisions 46,005,656 - 46,005,656

50,852,486 - 50,852,486

Current Liabilities


Borrowings 4 6,652,463,439 - 6,652,463,439



(Amount in `)


Ind-AS

Trade Payables


Others 3,016,916,810 - 3,016,916,810



Provisions 1,881,958 - 1,881,958


10,117,215,064 - 10,117,215,064

TOTAL 16,013,945,901 (26,468,442) 15,987,477,459

ii. Reconciliation of equity as at March 31, 2016(Amount in `)


Ind-AS

ASSETS

Non-Current Assets

Property, Plant and Equipment 9 1,160,250,145 (9,775,868) 1,150,474,277

Capital Work-in-Progress 28,293,589 - 28,293,589

Intangible Assets 9 16,927,542 1,305,800 18,233,342

Financial Assets

Investments 1 50,452,047 10,053,556 60,505,603




1,341,509,393 45,986,923 1,387,496,316

Current assets

Inventories 5,810,279,063 - 5,810,279,063

Financial Assets



Other Bank Balances 746,958,353 - 746,958,353

Loans 2,720,393 - 2,720,393


Current Tax Assets (Net) - - -




(Amount in `)


Ind-AS

17,505,210,704 (109,841,947) 17,395,368,757

TOTAL 18,846,720,097 (63,855,024) 18,782,865,073


Equity

Equity Share capital 246,228,500 - 246,228,500

Other Equity 7, 8 5,854,066,725 (63,855,024) 5,790,211,701

6,100,295,225 (63,855,024) 6,036,440,201

Liabilities



Borrowings 18,322,352 - 18,322,352

Provisions 30,443,904 - 30,443,904

48,766,256 - 48,766,256

Current Liabilities - -


Borrowings 4 7,370,567,476 - 7,370,567,476

Trade Payables


Others 4,819,755,988 - 4,819,755,988



Provisions 6,162,410 - 6,162,410


12,697,658,616 - 12,697,658,616

TOTAL 18,846,720,097 (63,855,024) 18,782,865,073

iii. Reconciliation of total comprehensive income for the year ended March 31, 2016(Amount in `)

Particulars Notes IGAAP Adjustments IND AS Balance

REVENUE

Revenue from operations (net) 17,953,924,075 - 17,953,924,075

Other income 1 119,417,853 (377,247) 119,040,606

Total Revenue 18,073,341,928 (377,247) 18,072,964,681

EXPENSES

Cost of materials consumed 9 12,618,352,141 (33,778,538) 12,584,573,603

Purchases of stock-in-trade 2,997,569,090 - 2,997,569,090


9 (184,769,637) 33,778,538 (150,991,099)

Excise duty 3,265,750 - 3,265,750



(Amount in `)


Ind-AS

Employee benefits expense 5, 6 452,465,472 3,093,209 455,558,681

Finance costs 708,091,794 - 708,091,794

Depreciation and amortization expense 9 220,897,711 (3,786,274) 217,111,437

Other expenses 1, 3, 5, 9

895,543,150 87,506,737 983,049,887

Total Expenses 17,711,415,471 86,813,672 17,798,229,143

Profit/(loss) before tax 361,926,457 (87,190,919) 274,735,538

Tax expense:

Current tax 9 99,546,266 (243,257) 99,303,009

Adjustment of tax relating to earlier periods - - -

Deferred tax 2 7,963,317 (11,604,174) (3,640,857)

107,509,583 (11,847,431) 95,662,152

Profit/(loss) for the year 254,416,874 (75,343,488) 179,073,386



Foreign Currency Translation Reserve 9 - 33,556,832 33,556,832

Remeasurement of gains (losses) on defined benefit plans

5 - 6,210,526 6,210,526

Income tax effect 2 - (2,149,339) (2,149,339)

Equity Instruments through Other Comprehensive Income

1 - (556,220) (556,220)

Income tax effect - - -

Other Comprehensive income for the year, net of tax

- 37,061,799 37,061,799

Total Comprehensive Income for the year, net of tax

254,416,874 (38,281,689) 216,135,185

* The previous GAAP figures have been reclassified to confirm to Ind AS presentation requirements for the purpose of this note

iv. Reconciliation of total equity as at March 31, 2016 and April 1, 2015(Amount in `)

Particulars Notes March 31, 2016 April 1, 2015

Total equity (shareholder’s funds) as per previous GAAP 6,100,295,225 5,845,878,351

Adjustments:

Fair valuation of investments 1 10,053,556 11,912,752

Provision for expected credit losses on trade receivables 3 (109,841,947) (59,375,202)

Effect of translating foreign operations from functional currency to presentation currency

9 (8,470,068) (13,574,032)

Recognisiton of Deferred tax asset on unrealised profits of group companies

2 6,389,334 14,019,470

Tax effects of adjustments 2 38,014,101 20,548,570

Total adjustments (63,855,024) (26,468,442)

Total equity as per Ind AS 6,036,440,201 5,819,409,909



v. Reconciliation of total comprehensive income for the year ended March 31, 2016(Amount in `)


Profit after tax as per previous GAAP 254,416,874

Adjustments:

Fair valuation of investments 1 (1,302,976)

Share based payment transaction 6 (895,107)

Provision for expected credit losses on trade receivables 3 (50,466,745)

Effect of translating foreign operations from functional currency to presentation currency 9 (28,452,868)

Remeasurements of post-employment benefit obligations 5 (6,210,526)

Effect of recognisiton of Deferred tax asset on unrealised profits of group companies 2 (7,630,136)

Tax effects of adjustments 2 19,614,870

Total adjustments (75,343,488)

Profit after tax as per Ind AS 179,073,386

Other comprehensive income 8 37,061,799

Total comprehensive income as per Ind AS 216,135,185

C. Notes to first-time adoption: Note 1: Fair valuation of investmentsUnder the previous GAAP, investments in equity instruments and mutual funds were classified as long-term investments or current investments based on the intended holding period and realisability. Long-term investments were carried at cost less provision for other than temporary decline in the value of such investments. Current investments were carried at lower of cost and fair value. Under Ind AS, these investments are required to be measured at fair value. The resulting fair value changes of these investments (other than equity instruments designated as at FVOCI) have been recognised in retained earnings as at the date of transition and subsequently in the profit or loss for the year ended March 31, 2016. This increased the retained earnings by `9,431,186 as at March 31, 2016 (April 1, 2015 - `10,734,162). Fair value changes with respect to investments in equity instruments designated as at FVOCI have been recognised in FVOCI – FVTOCI reserve as at the date of transition and subsequently in the other comprehensive income for the year ended March 31, 2016. This increased other reserves by `622,370 as at March 31, 2016 (April 1, 2015 - `1,178,590).

Consequent to the above, the total equity as at March 31, 2016 increased by `10,053,556 (April 1, 2015 - `11,912,752) and profit and other comprehensive income for the year ended March 31, 2016 decreased by ̀ 1,302,976 and ̀ 556,220 respectively. Note 2: Deferred tax Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required under Indian GAAP. Also Under previous GAAP, tax expense in the consolidated financial statements was computed by performing line by line addition of tax expense of the parent and its subsidiaries. No adjustments to tax expense was made on consolidation. Under Ind AS, deferred taxes are also recognised on unrealised profits on transactions with subsidiaries and undistributed profits of subsidiaries.

On the date of transition, the net impact on deferred tax assets is of `34,744,830 (March 31, 2016: `44,403,435)



Note 3: Trade and Other Receivables Under Indian GAAP, the group has created provision for impairment of receivables consists only in respect of specific amount for incurred losses. Under Ind AS, impairment allowance has been determined based on Expected Loss model (ECL). Due to ECL model, the group impaired its trade receivable by `5,93,75,202 on April 1, 2015 which has been eliminated against retained earnings. The impact of `5,04,66,745 for year ended on March 31, 2016 has been recognized in the statement of profit and loss. Under Indian GAAP, the group had de-recognised the borrowings in the nature of bills discounted as the same had been set off against the related trade receivables and had been disclosed under contingent liabilities. Under Ind AS, as the trade receivables cannot be de-recognised till the risk of default does not get transferred, the bills discounting facility availed against such trade receivables has to be recognised separately as short term borrowings.

Note 4: Borrowings Under Indian GAAP, the group had not recognised the borrowings in the nature of bills discounted as the same had been set off against the related trade receivables and had been disclosed under contingent liabilities. Under Ind AS, as the trade receivables cannot be de-recognised till the risk of default does not get transferred, the bills discounting facility availed against such trade receivables has to be recognised separately as short term borrowings. Note 5: Remeasurements of post-employment benefit obligations Under Ind AS, remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognised in other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurements were forming part of the profit or loss for the year. As a result of this change, the profit for the year ended March 31, 2016 decreased by `6,210,526. There is no impact on the total equity as at March 31, 2016. Note 6: Employee stock option expense Under the previous GAAP, the cost of equity-settled employee share-based plan were recognised using the intrinsic value method. Under Ind AS, the cost of equity settled share-based plan is recognised based on the fair value of the options as at the grant date. Consequently, the amount recognised in share option outstanding account increased by `3,473,102 as at March 31, 2016 (April 1, 2015: `2,577,509). The profit for the year ended March 31, 2016 decreased by `895,107. There is no impact on total equity. Note 7: Retained earnings Retained earnings as at April 1, 2015 has been adjusted consequent to the above Ind AS transition adjustments. Note 8: Other comprehensive income Under Ind AS, all items of income and expense recognised in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognised in profit or loss but are shown in the statement of profit and loss as ‘other comprehensive income’ includes remeasurements of defined benefit plans, foreign exchange differences arising on translation of foreign operations, effective portion of gains and losses on cash flow hedging instruments and fair value gains or (losses) on FVOCI equity instruments. The concept of other comprehensive income did not exist under previous GAAP. Note 9: Translation of foreign operations Under Indian GAAP, foreign subsidiaries were classified as integral operations and accordingly translated for the purpose of consolidation. Under Ind AS, the functional currency of these operations was assessed as currency other than the functional currency of parent and therefore, these operations were translated from their functional currency to presentation currency of the parent as prescribed under para 38 to 41 of Ind AS 21.






Notice is hereby given that the SIXTEENTH (16th) Annual General Meeting (AGM) of the Members of Tara Jewels Limited will be held on Thursday, September 28, 2017 at 03.00 p.m. at Hotel Suncity Residency, Emerald - 1, Basement, 16th Road, Marol MIDC, Andheri (East), Mumbai-400093., to transact the following business:

ORDINARY BUSINESS:1. To receive, consider and adopt the Standalone and the Consolidated Audited financial statements as at March 31, 2017

together with the Report of the Directors’ and the Auditors’ thereon.

2. To appoint a Director in place of Mr. Rajeev Sheth (DIN: 00266460 ), who retires by rotation and, being eligible, seeks re-appointment and to pass the following resolution as an Ordinary Resolution:

“RESOLVED THAT Mr. Mr. Rajeev Sheth (DIN: 00266460), who retires by rotation and being eligible, offers himself for re-appointment be and is hereby re-appointed as a Director, liable to retire by rotation.”

“RESOLVED FURTHER THAT the above-mentioned re-appointment of Mr. Rajeev Sheth as a Director liable to retire by rotation shall not in any way constitute a break in his existing office as a Managing Director of the Company.”

3. To appoint the auditors of the Company, and to fix their remuneration and for that purpose to pass the following resolution as an Ordinary Resolution:

“RESOLVED THAT pursuant to the provisions of Section 139 and other applicable provisions, if any, of the Companies Act, 2013 (“Act”) and the Companies (Audit and Auditors) Rules, 2014, as amended from time to time, M/s GMJ & Co, Chartered Accountants (Firm Registration No. 103429W), be and are hereby appointed as Auditors of the Company in place of the retiring auditors M/S C.B. Chhajed & Co., Chartered Accountants (Firm Registration No. 101796W), to hold office from the conclusion of this Annual General Meeting (“AGM”) till the conclusion of the twenty-first AGM to be held in the year 2022 (subject to ratification of their appointment at every AGM), at such remuneration, as may be mutually agreed between the Board of Directors of the Company and the Auditors.”

SPECIAL BUSINESS:4. To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution: "RESOLVED THAT Mr. Sanjay Sethi (DIN 01152580) who was appointed by the Board of Directors as an Additional

Director of the Company with effect from August 10, 2017 and who holds office up to the date of this Annual General Meeting of the Company in terms of Section 161(1) of the Companies Act, 2013 (“Act”), but who is eligible for appointment and in respect of whom the Company has received a notice in writing from a Member under Section 160(1) of the Act proposing his candidature for the office of Director of the Company, be and is hereby appointed as a Director of the Company, liable to retire by rotation.”

5. To consider and, if thought fit, to pass the following resolution as a Special Resolution: “RESOLVED THAT pursuant to the provisions of Sections 196, 197,198 and other applicable provisions, if any, of the

Companies Act, 2013 (Act) read with Schedule V to the Act and the applicable Rules made thereunder, the approval of the Members of the Company be and is hereby accorded for the appointment of Mr. Sanjay Sethi (DIN: 01152580) as a Whole-Time Director for a period of three years, with effect from August 10, 2017 on the following terms and conditions including remuneration:

Particulars Amount Per Month (in Rs.)

Basic Salary 2,16,700/-

Allowances 2,96,113/-

Bonus 753/-

Provident Fund 1800/-

Other benefits 26,301

Total Monthly Gross Salary 5,41,667

NOTICE


“RESOLVED FURTHER THAT in pursuance of the provisions of Section 197(3) and other applicable provisions, if any, of the Companies Act, 2013, and the Rules framed thereunder, Mr. Sanjay Sethi, Whole-Time Director, shall be paid the above mentioned remuneration with authority to the Board to grant increments and vary terms of his appointment from time to time so however that the aggregate remuneration at any time will not exceed a sum of Rs. 8 lacs p.m. during his tenure. However in the event of absence or inadequacy of profits in any financial year during the term of his office as a Whole-Time Director, remuneration will not exceed the limits specified under Section II of Part II of Schedule V to the Companies Act, 2013, or such other limits as may be prescribed by the Central Government from time to time as minimum remuneration under the Companies Act, 2013.”

“RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorized to do all such acts, deeds, matters and things as it may in its absolute discretion consider necessary and also to file necessary e-forms with the Ministry of Corporate Affairs to give effect to the above resolution under the Act.”

Registered Office: By Order of the Board of DirectorsPlot No. 122, 15th Road For Tara Jewels LimitedNear IDBI Bank, M.I.D.C Andheri (East)Mumbai – 400 093. Sd/-

Nivedita NayakMumbai, August 10, 2017 Company Secretary CIN: L52393MH2001PLC131252Tel.:022 66774444Website:www.tarajewels.inE-mail:[email protected]

NOTICE


NOTES:1. A member entitled to attend and vote at the Annual General Meeting is entitled to appoint a proxy to attend

and vote, instead of himself/herself and the proxy need not be a member of the Company and Pursuant to Section 105(1) of the Companies Act, 2013, read with Rule 19 of the Companies (Management and Administration) Rules, 2014, a person can act as proxy on behalf of Members not exceeding 50 (fifty) in number and holding in aggregate not more than 10 (ten) per cent of the total share capital of the Company carrying voting rights. In the case of a Member holding more than 10 (ten) per cent of the total share capital of the Company carrying voting rights, such a Member may appoint a single person as proxy, who however shall not act as proxy for any other person or shareholder.

2. Proxy form duly stamped and executed in order to be effective, must reach the registered office of the company not less than 48 hours before the time of commencement of the Annual General Meeting. Proxy form for the AGM is enclosed.

3. Corporate Members are requested to send to the Registered Office of the Company a duly certified copy of the Board Resolution, pursuant to Section 113 of the Companies Act, 2013, authorizing their representative to attend and vote at the Annual General Meeting.

4. The Explanatory Statement pursuant to Section 102 (1) of the Companies Act, 2013, with respect to Item No. 3 being Ordinary Business and 4 to 5, the Special Business as set out in the Notice is attached and forms part of this Notice.

5. Brief resume of Directors proposed to be re-appointed / appointed, nature of their expertise in specific functional areas, names of companies in which they hold directorships (excluding Directorships in Private Limited Companies, Foreign Companies and Government bodies) and memberships/ chairmanships of Board Committees (includes only Audit & Shareholders’/ Investors’ Grievance Committee), shareholding and relationships between Directors inter-se as stipulated under Regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, are provided in the “Annexure A” to the Notice.

6. The Registers required to be maintained under the Companies Act, 2013 i.e. the Register of Directors and Key Managerial Personnel and their Shareholding in the Company under Section 170 of the Companies Act, 2013 and Register of Contracts in which Directors are intrested under Section 189 of the Companies Act, 2013 will be available for inspection by the Members at the AGM.

7. The Register of Members and Share Transfer Books will remain closed from September 22, 2017 to September 28, 2017 (both days inclusive).

8. Section 72 of the Companies Act, 2013 read with Rule 19(1) of the Rules made thereunder, permits Nomination by the members of the Company in the prescribed Form SH-13. Members are requested to avail this facility.

9. Members/Proxy holders are requested to bring their attendance slip duly signed and copy of the Annual Report to attend the meeting.

10. Members are requested to send to the Company their queries, if any, on accounts and operations of the Company at least 10 days before the Meeting to enable the Company to provide the required information.

11. Relevant documents referred to in the accompanying Notice are open for inspection by the members at the Registered Office of the Company on all working days, except Saturdays, between 11.00 a.m. to 1.00 p.m. up to the date of the Meeting.

12. Members are requested to notify immediately any change in their address / Bank mandate to their respective Depository Participants (DPs) in respect of their electronic share accounts and in respect of their physical shares, Folios to the Registrars and Share Transfer Agent of the Company, Link Intime India Private Limited,C 101, 247 Park, L.B.S Marg, Vikroli West, Mumbai- 400083.

13. Members are requested to quote their Ledger Folio Number / Client ID Number in all their future correspondence.

14. In case of joint holders attending the Meeting, only such joint holder who is higher in the order of names will be entitled to vote.

15. Electronic copy of the Notice along with the Annual Report is being sent to all the members whose email IDs are registered with the Company/Depository Participants(s) for communication purposes unless any member has requested

NOTICE


for a hard copy of the same. For members who have not registered their email address, physical copies of the Annual Report are being sent in the permitted mode.

16. Non-Resident Indian Members are requested to inform M/s. Link Intime India Private Limited immediately of:

(a) Change in their residential status on return to India for permanent settlement.

(b) Particulars of their bank account maintained in India with complete name, branch, account type, account No. and address of the Bank with PIN Code No, if not furnished earlier.

17. In compliance with the provisions of Section 108 of the Act and the Rules framed thereunder, the Members are provided with the facility to cast their vote electronically, through the e-voting services provided by Central Depository Services (India) Limited (CDSL), on all resolutions set forth in this Notice.

The facility for voting through ballot paper,will also be made available at the AGM and the members attending the AGM who have not already cast their votes by remote e-voting shall be able to exercise their voting right at the AGM, through ballot paper. Members who have cast their vote by remote e-voting prior to the AGM may attend the AGM but shall not be entitled to cast their votes again.

18. Since the securities of the Company are compulsorily tradable in electronic form, to ensure better investor service and elimination of risk of holding securities in physical form, it is requested that the members holding shares in physical form to get their shares dematerialized art the earliest.

The instructions for shareholders voting electronically are as under:

(i) The voting period begins on September 25, 2017 at 9.30 A.M and ends on September 27, 2017 at 5.00 P.M. During this period shareholders of the Company, holding shares either in physical form or in dematerialized form, as on the cut-off date September 21, 2017, may cast their vote electronically. The e-voting module shall be disabled by CDSL for voting thereafter.

(ii) Any person, who acquires shares of the Company and become member of the Company after the dispatch of the notice and holding shares as of the cut-off date i.e. September 21, 2017 may obtain login id and password by sending a request to Company Secretary.

(iii) The shareholders should log on to the e-voting website www.evotingindia.com.

(iv) Click on Shareholders.

(v) Now Enter your User ID

a. For CDSL: 16 digits beneficiary ID,

b. For NSDL: 8 Character DP ID followed by 8 Digits Client ID,

c. Members holding shares in Physical Form should enter Folio Number registered with the Company.

(vi) Next enter the Image Verification as displayed and Click on Login.

(vii) If you are holding shares in demat form and had logged on to www.evotingindia.com and voted on an earlier voting of any company, then your existing password is to be used.

(viii) If you are a first time user follow the steps given below:

For Members holding shares in Demat Form and Physical Form

PAN Enter your 10 digit alpha-numeric *PAN issued by Income Tax Department (Applicable for both demat shareholders as well as physical shareholders)• Members who have not updated their PAN with the Company/Depository Participant are requested

to use the sequence number which is printed on stiker of the annual report envelope.

DOB Enter the Date of Birth as recorded in your demat account or in the company records for the said demat account or folio in dd/mm/yyyy format.

Dividend Bank Details

Enter the Dividend Bank Details as recorded in your demat account or in the company records for the said demat account or folio.

NOTICE


• Please enter the DOB or Dividend Bank Details in order to login. If the details are not recorded with the depository or company please enter the member id / folio number in the Dividend Bank details field as mentioned in instruction (iv).

(ix) After entering these details appropriately, click on “SUBMIT” tab.

(x) Members holding shares in physical form will then directly reach the Company selection screen. However, members holding shares in demat form will now reach ‘Password Creation’ menu wherein they are required to mandatorily enter their login password in the new password field. Kindly note that this password is to be also used by the demat holders for voting for resolutions of any other company on which they are eligible to vote, provided that company opts for e-voting through CDSL platform. It is strongly recommended not to share your password with any other person and take utmost care to keep your password confidential.

(xi) For Members holding shares in physical form, the details can be used only for e-voting on the resolutions contained in this Notice.

(xii) Click on the EVSN of Tara Jewels Ltd.

(xiii) On the voting page, you will see “RESOLUTION DESCRIPTION” and against the same the option “YES/NO” for voting. Select the option YES or NO as desired. The option YES implies that you assent to the Resolution and option NO implies that you dissent to the Resolution.

(xiv) Click on the “RESOLUTIONS FILE LINK” if you wish to view the entire Resolution details.

(xv) After selecting the resolution you have decided to vote on, click on “SUBMIT”. A confirmation box will be displayed. If you wish to confirm your vote, click on “OK”, else to change your vote, click on “CANCEL” and accordingly modify your vote.

(xvi) Once you “CONFIRM” your vote on the resolution, you will not be allowed to modify your vote.

(xvii) You can also take out print of the voting done by you by clicking on “Click here to print” option on the Voting page.

(xviii) If Demat account holder has forgotten the same password then Enter the User ID and the image verification code and click on Forgot Password & enter the details as prompted by the system.

(xix) Note for Non – Individual Shareholders and Custodians

• Non-Individual shareholders (i.e. other than Individuals, HUF, NRI etc.) and Custodian are required to log on to www.evotingindia.com and register themselves as Corporates.

• A scanned copy of the Registration Form bearing the stamp and sign of the entity should be emailed to [email protected].

• After receiving the login details a compliance user should be created using the admin login and password. The Compliance user would be able to link the account(s) for which they wish to vote on.

• The list of accounts should be mailed to [email protected] and on approval of the accounts they would be able to cast their vote.

• A scanned copy of the Board Resolution and Power of Attorney (POA) which they have issued in favour of the Custodian, if any, should be uploaded in PDF format in the system for the scrutinizer to verify the same.

(xx) In case you have any queries or issues regarding e-voting, you may refer the Frequently Asked Questions (“FAQs”) and e-voting manual available at www.evotingindia.com, under help section or write an email to [email protected].

19. a) Mr. K.C Nevatia, FCS, Practicing Company Secretary (CP No.2348) has been appointed as Scrutinizer to scrutinize voting process in a fair and transparent manner.

b) The Scrutinizer shall after the conclusion of voting at the general meeting, will first count the votes cast at the meeting and thereafter unblock the votes cast through remote e-voting in the presence of at least two (2) witnesses who are not in the employment of the Company and shall make not later than three (3) days of the conclusion of the Annual General Meeting a consolidated Scrutinizer’s Report of the votes cast in favour or against, if any, forthwith to the Chairman of the Company or in his absence any other director so authorized by the Board, who shall countersign the same and declare the result of the voting forthwith.

NOTICE


c) The Results declared along with the Scrutinizer’s Report shall be available for inspection and also placed on the website of the Company and on the website of CDSL immediately after the declaration. The results shall also be immediately forwarded to BSE Limited and NSE.

IMPORTANT COMMUNICATION TO MEMBERS:

The Ministry of Corporate Affairs has taken a “Green Initiative in the Corporate Governance” by allowing paperless compliances by the companies and has issued circulars stating that service of notice / documents including Annual Report can be sent by e-mail to its members. To support this green initiative of the Government in full measure, members who have not registered their e-mail addresses, so far, are requested to register their e-mail addresses, in respect of electronic holdings with the Depository through their concerned Depository Participants. Members who hold shares in physical form are requested to register the same with the Company’s Share Transfer Agent, M/s. Link Intime India Private Limited Email: [email protected]

EXPLANATORY STATEMENT UNDER SECTION 102 (1) OF THE COMPANIES ACT, 2013

ITEM NO. 3This explanatory Statement is provided though strictly not required as per section 102 of the Act.Section 139(2) of the Companies Act, 2013 provides that no listed Company shall appoint a firm of Auditors for more than two terms of five consecutive years. However under the third proviso to said sub-section (2) in case of an exisiting Company i.e. as on 1st April, 2014 if an Auditor has already completed the abovementioned term, then the said firm can continue for a period of another three years commencing from the date of the 1st Annual General Meeting of the Company held from the commencement of the Companies Act, 2013. The exisiting Auditors of the Company M/s. C.B. Chajjed and Co., Chartered Accountants (Firm Registration No. 101796W) shall be completing their term of extended three years at the conclusion of the ensuing Annual General Meeting and therefore the Company has to appoint another firm of Auditors at the ensuing Annual General Meeting.

The Board of Directors has, based on the recommendation of the Audit Committee, at its meeting held on August 10, 2017, proposed the appointment of M/s GMJ & Co, Chartered Accountants (Firm Registration No. 103429W) as the Statutory Auditors of the Company for a period of 5 years, to hold office from the conclusion of this AGM till the conclusion of the twenty-first AGM to be held in the year 2022 (subject to ratification of their appointment at every AGM).

M/s GMJ & Co, Chartered Accountants have consented to their appointment as Statutory Auditors and have confirmed that if appointed, their appointment will be in accordance with the conditions as prescribed under section 139 and also that they meet the criteria provided in section 141 of the Act.

The Board commends the Ordinary Resolution set out at Item No. 3 of the Notice for approval by the Members. None of the Directors or Key Managerial Personnel of the Company or their relatives is, in any way, concerned or interested in the Resolution set out at Item No. 3 of the Notice.

ITEM NO. 4 & 5The Board of Directors of the Company at their meeting held on August 10, 2017, had appointed Mr.Sanjay Sethi as an Additional Director of the Company on the recommendation of the Nomination and Remuneration Committee. As per Section 161 (1) of the Companies Act, 2013, Mr. Sanjay Sethi holds office up to the date of this Annual General Meeting. The Company has received a notice under Section 160 of the Companies Act, 2013 in writing from a member of the Company alongwith the required deposit, proposing the candidature of Mr. Sanjay Sethi for being elected as a Director liable to retire by rotation. He does not hold any equity shares of the Company.

Mr. Sanjay Sethi satisfies the conditions as given under Section 196 (3) and Part I of Schedule V of the Companies Act, 2013 and is not disqualified from being appointed as a Director under Section 164 of the Act.

The Board recommends his appointment as a Director and also as a Whole-Time Director of the Company for the approval of members of the Company by passing the resolutions as set out at item Nos. 4 and 5 of the notice as Ordinary and Special Resolutions respectively.

NOTICE


Except Mr. Sanjay Sethi, none of the other Directors and Key Managerial Personnel of the Company and their relatives is/are in any manner, concerned or interested, financially or otherwise, in passing the resolutions set out at item Nos. 4 and 5.

The information of Mr. Sanjay Sethi to be provided under Regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is provided in the Annexure A to this Notice.

INFORMATION AS REQUIRED IN SECTION II OF PART II OF SCHEDULE V:I. General Information:

(1) Nature of Industry- Manufacturing of Jewellery

(2) Date or expected date of commencement of commercial production-N.A.

(3) In case of new companies, expected date of commencement of activities as per project approved by financial institutions appearing in the prospectus-N.A.

(4) Financial performance based on given indicators- Given in Financial Statement

(5) Foreign investments or collaborations, if any- The Company has not entered into any foreign collaboration and no direct capital investment has been made in the Company. As regards foreign investors mainly, foreign bodies corporate and foreign nationals are investors in the Company on account of past public issue of securities and secondary market purchases.

II. Information about the appointee:

(1) Background details- He is Chartered Accountant by Profession and has around 27 years of experience in respective field.

(2) Past remuneration- N.A.

(3) Recognition or awards- NIL

(4) Job profile and his suitability- Included in Annexure “A” to the Notice.

(5) Remuneration proposed- as mentioned in resolution.

(6) Comparative remuneration profile with respect to industry, size of the company, profile of the position and person (in case of expatriates the relevant details would be with respect to the country of his origin)-Not Comparable.

(7) Pecuniary relationship directly or indirectly with the company, or relationship with the managerial personnel, if any- None

III. Other Information:

(1) Reasons of loss or inadequate profits- Adverse Market Conditions and increase in cost of input.

(2) Steps taken or proposed to be taken for improvement- Efforts to create new market and reduction in cost.

(3) Expected increase in productivity and profits in measurable terms- Cannot be ascertained in measurable terms.

Registered Office: By Order of the Board of DirectorsPlot No. 122, 15th Road For Tara Jewels LimitedNear IDBI Bank, M.I.D.C Andheri (East)Mumbai – 400 093. Sd/-

Nivedita NayakMumbai, August 10, 2017 Company Secretary CIN: L52393MH2001PLC131252Tel.:022 66774444Website:www.tarajewels.inE-mail:[email protected]

NOTICE


ANNEXURE ADetails of the Directors seeking re-appointment/ appointment in the Sixteenth Annual General Meeting pursuant to Regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

Particulars Mr. Rajeev Sheth Mr. Sanjay Sethi

Date of Birth 16/11/1958 07/05/1965

Age 59 years 52 years

DIN 00266460 01152580

Date of appointment/reappointment October 1 2015 August 10, 2017

Date of first appointment on Board March 16, 2001 August 10, 2017

Terms and Conditions of appointment As mentioned in resolution and the explanatory statement annexed to the Notice

As mentioned in resolution and the explanatory statement annexed to the Notice

Relationship with other Directors, Manager and other Key Managerial Personnel of the company NIL NIL

Remuneration sought to be paidAs mentioned in resolution and the explanatory statement annexed to the Notice

As mentioned in resolution and the explanatory statement annexed to the Notice

Remuneration Last Drawn Gross Rs. 10,00,000/- p.m N.A

Qualification& Experience in specific functional area

He holds a graduate degree in commerce from Mumbai University. He also holds a diploma in gemology from Gemological Institute of America. Mr. Sheth has approximately 35 years of experience in jewellery business.

He is a Chartered Accountant and all-India ranker with 10th rank in the merit list. He is also a Cost Accountant by profession and Post Graduate from Delhi School of Economics, University of Delhi in First Division. He has been the recipient of the University Merit Scholarship for Post-Graduation Studies. He is responsible for overall planning and control of finance function. He has more than 27 years of experience with various organizations.

No. of Meetings of the Board attended during the year

4 NIL #

Directorships held in other companies* NIL NIL

Memberships/ Chairmanships of Committee in other public limited companies (includes only Audit & Shareholders’/ Investors’ Grievance Committee)

NIL NIL

No of shares held in Company 14,502,893 NIL

*excludes Directorships in Private Limited Companies, Foreign Companies and Government bodies.# Appointed as Additional and Executive Director w.e.f August 10, 2017.

ANNEXURE BThe Shareholding of Mr. Rajeev Sheth, his Relatives and the Promoter Group Company in Tara Jewels Limited is as given below:

Name Shareholding in Tara Jewels

Limited

Percentage (%)

Mr. Rajeev Sheth 14,502,893 58.90

Ms. Purnima Rajeev Sheth 14,625 0.06

Ms. Aarti Sheth 1,14,440 0.46

Ms. Divya Sheth 1,14,440 0.46

Divya Jewels International Private Limited 33,600 0.14

Total 14,779,998 60.02

NOTICE


NOTES


NOTES

TARA JEWELS LIMITED

REGISTERED OFFICEPlot No. 122, 15th Road, Near IDBI Bank, M.I.D.C, Andheri (East), Mumbai- 400093, India.

CORPORATE OFFICEPlot No. 29(P), & 30(P), Sub Plot A, SEEPZ SEZ, Andheri (East), Mumbai- 400096,

India.

www.tarajewels.in