on the inputs used in the manufacture of export product is allowed to exporters. The admissible duty drawback
amount is paid to exporters by depositing it into their nominated bank account. Section 75 of the Customs Act,
1962 and Section 37 of the Central Excise Act, 1944, empower the Central Government to grant such duty
drawback. Customs, Central Excise Duties and Service Tax Drawback Rules, 2017, as amended (the “Drawback
Rules”) have been framed outlining the procedure to be followed for the purpose of grant of duty drawback (for
both kinds of duties suffered) by the customs authorities processing export documentation. Under duty drawback
scheme, an exporter can opt for either all industry rate of duty drawback scheme or brand rate of duty drawback
scheme.

The all industry rate of duty drawback scheme essentially attempts to compensate exporters of various export
commodities for average incidence of customs and central excise duties suffered on the inputs used in their
manufacture. Brand rate of duty drawback is granted in terms of rules 6 and 7 of the Drawback Rules in cases
where the export product does not have any all industry rate or duty drawback rate, or where the all industry rate
duty drawback rate notified is considered by the exporter insufficient to compensate for the customs or central
excise duties suffered on inputs used in the manufacture of export products. For goods having an all industry rate,
the brand rate facility to particular exporters is available only if it is established that the compensation by all
industry rate is less than 80% of the actual duties suffered in the manufacture of the export goods.

Merchandise Exports from India Scheme

Pursuant to the Foreign Trade Policy (2015-2020), the Merchandise Exports from India Scheme, as amended, (the
“MEI Scheme”) was introduced to provide rewards to exporters to offset infrastructure inefficiencies and
associated costs in export of goods, especially those having high export intensity, employment potential and ability
to enhance India’s export competitiveness. Export of notified goods to notified markets are rewarded under the
MEI Scheme. The basis for calculation of the reward under the MEI Scheme is on the Free on Board (“FOB”)
value of exports realized in free foreign exchange or on the FOB value of exports mentioned in the shipping bill,
whichever is less, unless otherwise specified. With effect from June 1, 2015, the MEI Scheme mandatorily
requires a declaration of intent to be endorsed on the shipping bills (except free shipping bills) to be eligible to
claim any reward under the MEI Scheme. Due to the COVID-19 pandemic, the Government of India has continued
to grant relief under various export promotion schemes by granting extension of the existing Foreign Trade Policy
(2015-2020) by one year i.e. up to March 31, 2021.

Labour law legislations
Factories Act, 1948

The Factories Act, 1948, as amended (the “Factories Act”), defines a “factory” to cover any premises which
employs 10 or more workers on any day of the preceding 12 months and in which a manufacturing process is
carried on with the aid of power or any premises where at least twenty workers are employed, and where a
manufacturing process is carried on without the aid of power. Each state government has enacted rules in respect
of the prior submission of plans and their approval for the establishment of factories and registration and licensing
of factories. The Factories Act provides that an occupier of a factory i.e. the person who has ultimate control over
the affairs of the factory and in the case of a company, any one of the directors, must ensure the health, safety and
welfare of all workers. There is a prohibition on employing children below the age of fourteen years in a factory.
The Factories Act also provides for imposition of fines and imprisonment of the manager and occupier of the
factory in case of any contravention of the provisions of the Factories Act.

In addition to the Factories Act, the employment of workers, depending on the nature of activity, is regulated by
a wide variety of generally applicable labour laws. The following in an indicative list of labour laws which may
be applicable to our Company due to the nature of the business activities:

(i) Contract Labour (Regulation and Abolition) Act, 1970.

(ii) Employees’ Provident Funds and Miscellaneous Provisions Act, 1952.
(iii) Employees’ State Insurance Act, 1948.

(iv) Minimum Wages Act, 1948.

(v) Payment of Bonus Act, 1965.

(vi) Payment of Gratuity Act, 1972.

(vii) Payment of Wages Act, 1936.

(viii) Maternity Benefit Act, 1961.

(ix) Industrial Disputes Act, 1947.

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