| RELATED PARTY BALANCES AND TRANSACTIONS |
NOTE
16 – RELATED PARTY BALANCES AND TRANSACTIONS
The
table below sets forth the major related parties and their relationships with the Company as of March 31, 2026:
| Name
of related parties |
|
Relationship
with the Group |
| Li Hongqi |
|
Chairman of the Board |
| Li Hongliang |
|
Chief Executive Officer,
brother of Li Hongqi |
| Li Hongguang |
|
A shareholder of the Company,
brother of Li Hongqi |
| Sichuan Hongzhuo Shuya
Energy Co., Ltd. (“Sichuan Hongzhuo”) |
|
An equity investee of the
Company. On September 12, 2025, the Company sold its equity interest in Sichuan Hongzhuo to a third party. |
| Beijing Happiness Star
No.1 Enterprise Management Center (Limited Partnership) (“Beijing Happiness Star”) |
|
Li Hongqi and Li Hongliang
each holds 42.98% of the equity interest but Beijing Happiness Star is controlled by Li Hongliang. |
| Sichuan TIBO Fluid Technology
Co., Ltd. (“Sichuan TIBO”) |
|
An equity investee of the
Company. On February 8, 2025, the Company sold its equity interest in Sichuan TIBO to a third party. |
The
following related party balances are non-interest bearing as of March 31, 2026 and September 30, 2025:
SCHEDULE OF RELATED PARTY TRANSACTIONS
| | |
March 31, 2026 | | |
September 30, 2025 | |
| | |
(Unaudited) | | |
| |
| Amounts due to related parties: | |
| | | |
| | |
| Li Hongqi (1) | |
$ | 4,387,911 | | |
$ | 4,254,385 | |
| Li Hongliang (1) | |
| 1,549,617 | | |
| 1,501,432 | |
| Amount
due from related party | |
$ | 5,937,528 | | |
$ | 5,755,817 | |
| | |
| | | |
| | |
| Loan receivable - related party: | |
| | | |
| | |
| Beijing Happiness Star (2) | |
$ | 631,035 | | |
$ | - | |
| Loan
receivable from a related party | |
$ | 631,035 | | |
$ | - | |
| (1) |
The
balances are related primarily to share capital withdrawal to be paid to individual shareholders. On March 12, 2023 and March 20,
2023, China Oil Blue Ocean and ZJY Technologies’ individual shareholders withdrew their share capital from the companies. These
share capital withdrawals reduced the Company’s additional paid-in capital by approximatively $10.1 million, and they were
credited to amount due to related parties. During fiscal 2024, the Company reduced the amount owed to related parties and paid $1.3
million to Li Hongqi and $2.9 million to Li Hongliang, respectively. |
| (2) |
On October 22, 2025, China
Oil Blue Ocean lent RMB 4.3 million ($621,441) to Beijing Happiness Star with annual interest of 3.5% and a term of one year. Interest
accrued on this loan was RMB 66,385 ($9,594) as of March 31, 2026. |
The
following are related party transactions for the six months ended March 31, 2026 and 2025:
| | |
2026 | | |
2025 | |
| | |
(Unaudited) | | |
(Unaudited) | |
| Revenues: | |
| | | |
| | |
| Equipment sales to Sichuan TIBO Fluid Technology Co., Ltd. | |
$ | - | | |
$ | 843,144 | |
| LNG/CNG sales to Sichuan Hongzhuo Shuya Energy Co., Ltd. | |
| - | | |
| 2,152,526 | |
| Revenues | |
$ | - | | |
$ | 2,995,670 | |
| | |
2026 | | |
2025 | |
| | |
(Unaudited) | | |
(Unaudited) | |
| Leases | |
| | | |
| | |
| Sichuan TIBO Fluid Technology Co., Ltd. (Lessor) | |
$ | - | | |
$ | 44,930 | |
| Li Hongliang | |
| 7,697 | | |
| 8,232 | |
| Li Hongqi | |
| 22,745 | | |
| 28,940 | |
| Factory
lease | |
$ | 30,442 | | |
$ | 82,102 | |
| | |
2026 | | |
2025 | |
| | |
(Unaudited) | | |
(Unaudited) | |
| Purchase of equipment: | |
| | | |
| | |
| Sichuan TIBO Fluid Technology Co., Ltd. | |
$ | - | | |
$ | 2,243,086 | |
| Purchase
of equipment | |
$ | - | | |
$ | 2,243,086 | |
|