GARDEN SILK MILLS LTD is committed to conducting business in accordance with the highest standards of fair and transparent governance, business ethics and complying with applicable laws, rules and regulations.

Clause 49 of the Listing Agreement entered into with the Stock Exchanges requires that as part of Corporate Governance, the listed entities shall lay down a Code of Conduct for Directors on the Board and the Senior Management of the Entity.

Accordingly, the Board has laid down this Code for its Directors on the Board and the Senior Management.

This Code of Conduct is applicable to the

• Members of the Board of Directors of the Company

• Senior Management, defined as members of Core Management Team excluding Board of Directors and one level below the Executive Directors including Functional Heads. The Company Secretary shall be the Compliance Officer for this code.

The Company is committed to comply with all applicable laws, rules, regulations and guidelines in every jurisdiction where it operates. Directors / Senior Management shall ensure due compliance with all applicable laws, rules and regulations and all applicable policies and procedures adopted by the Company, for every activity undertaken under their supervision and authority. Therefore the Directors / Senior Management should possess / acquire appropriate knowledge of the legal requirements relating to their roles and duties to enable them to be in compliance thereof and to recognize potential risks.

A "conflict of interest' occurs when personal financial or other consideration(s) of any member of the Board of Directors or the Senior Management interferes or appears to interfere in any way with the interest of the Company. Every member of the Board of Directors and the Senior Management has responsibility to the Company, its stakeholders and to each other. A conflict of interest exists where the interests or benefits of Directors or Senior Management or of people or entities related to them conflicts with the interests or benefits of the Company.

Every member of the Board of Directors and the Senior Management should avoid situations where conflict of interest might occur or appear to occur. Directors / Senior Management are prohibited from engaging in any activity that interferes with the performance or discharge of responsibilities towards the Company or is otherwise in conflict with the interest or prejudicial to the Company. In addition to mandatory disclosures all Non-Executive and Independent Directors shall disclose their association with any other company which, in their judgment, may lead to conflict of interest with the Company. All other Directors (except independent directors) / Senior Management are required to obtain approval from the Company’s Chairman & Managing Director before accepting any other directorship / assignment in any company. Directors / Senior Management are free to make personal investments and enjoy social relations and normal business courtesies. They should however ensure that such interests do not directly or indirectly influence the performance of their responsibilities.

As a general rule, the Directors and the Senior Management should avoid conducting the Company’s business with a relative (as defined in the Companies Act, 1956), or any other person or a firm, Company, Association in which the relative is associated in any significant role.

If such a related party transaction is unavoidable, they must fully disclose the nature of the related party transactions to the Board, through the Chairman. Any dealings with a related party must be conducted on an arms length basis and strictly on commercial terms and no preferential treatment shall be given.

Directors / Senior Management shall as far as practicable, protect the Company’s assets from loss, damage, misuse or theft and ensure that the assets are only used for business purposes and other purposes specifically approved by Management and must never be used for unauthorized purposes.

Directors and the Senior Management are prohibited from:

• Using corporate property, information or position for personal gain.

• Soliciting, demanding, accepting, or agreeing to accept anything of value from any person while dealing with the Company’s assets and resources.

• Acting on behalf of the Company in any transaction in which they or any of their relative(s) have a significant direct or indirect interest.

“Confidential information” includes all information of the Company not authorized by the management for public dissemination. It includes all the trade related information, trade secrets, confidential and privileged information, customer information, employee related information, strategies, research in connection with the Company, non-public information about discussions and deliberations relating to business issues and decisions, between and among employees, officers and Directors in formal meetings or otherwise, and commercial, legal, scientific, technical data that are either provided to or made available to each member of the Board of Directors or the Senior Management by the Company either in paper or in electronic form to facilitate their work or that they are able to know or obtain access by virtue of their position with the Company. All confidential information must be used for Company’s business purpose only.

Directors / Senior Management has to secure, preserve, safeguard and use discreetly, confidential information in the best interest of the Company. He should not divulge or communicate such information to third parties, inadvertently or otherwise, except when authorized for the business reasons.

Except as may be approved by the Board of Directors or a Committee thereof, Directors / Senior Management are prohibited from:

• Taking for themselves personally, opportunities that belong to either the Company or are discovered through the use of Company’s property, information or position;

• Using the Company’s property, information, or position for personal gain;

• Competing with the Company

The Directors and Senior Management should abide by ‘Securities Dealing Code’ in compliance with the SEBI (Prohibition of Insider Trading) Regulations 1992, as adopted by the Board of Directors of the Company.

Directors and Senior Management shall not use or proliferate information which is not available to the investing public and which therefore constitutes insider information for making or giving advice on investment decisions on the securities of the respective company on which such insider information has been obtained.

The Company’s securities are listed on the major Stock Exchanges. The Company is committed to comply with securities laws in all jurisdictions in which its securities are listed. The Directors / Senior Management are prohibited from indulging in any fraudulent and unfair trade practices in the securities market, with regard to the securities of the Company or of any other company with whom the Company has business dealings.

The company shall provide equal opportunities to all its employees and all qualified applicants for employment without regard to their race, caste, religion, colour, marital status, sex etc., and shall treat them with dignity. Employee policies and practices would ensure that in all matters equal opportunity is provided to those eligible and that decisions are merit based.

Director / member of the Senior Management shall not take a discriminatory stance towards or give unfair advantage to the Company's, customers, suppliers, or competitors through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or any other unfair-dealing practice.

No discrimination shall be done on the basis of caste, religion, colour, sex, nationality or disability of any kind towards any employees, customers, suppliers, or any business partner.

Every employee of the company shall promptly report to the management any actual or possible violation of the code or an event he becomes aware of that could affect the business or reputation of the company.

• All Board Members and Senior Management Personnel and employees shall be subject to any internal or external investigation of possible violations of this code. The Company shall ensure confidentiality and protection to any person who has, in good faith, reported a violation or a suspected violation of law, of this code or other Company policies, or against any person who is assisting in any investigation or process with respect to such a violation.

• Penalty for breach of this code by Senior Management Personnel/employees shall be determined by the Chairman. In case of breach of this code by the Directors, the same shall be examined by the Board.

• Penalty may include serious disciplinary action, removal from office and dismissal as well as other remedies, including recommendations for any of the above penalty, to the extent permitted by law and as considered appropriate under the circumstances.

Any waiver of any provision of this code of conduct for a member of the Company's Board of Directors and the Senior Management must be approved in writing by the Board of Directors of the Company. As a general policy, the Board will not grant waivers to the Code. However, in extraordinary situations and for reasons to be recorded in writing, the Board may grant exemption from any one or more of the provisions of this Code.

This Code may be amended, modified, or waived by the Board, subject to appropriate applicable provisions of law, rules, regulations and guidelines.

All Directors and Senior Management personnel shall confirm that they have received, read and understood the Code of Conduct, and agree to comply with the Code on an annual basis within 15 days of the close of the financial year of the Company. Such certification shall be in the form provided in the Annexure to this Code.