I did the changes mentioned.
1. Added the square brackets
2. Changed the 1 to a 0

;; Kaithi composition rules
(let ((consonant "[\x1108D-\x110AF]")
      (non-consonant "[^\x1108D-\x110AF\x110B9]")
      (vowel "[\x110B0-\x110B8\x110C2]")
      (anusvara-candrabindu "[\x11080\x11081]")
      (virama "\x110B9")
      (number-sign "\x110BD")
      (number-sign-above "\x110CD")
      (numerals "[\x966-\x96F]"))
  (set-char-table-range composition-function-table
                        '(#x110B0 . #x110B8)
                        (list (vector
                               (concat consonant vowel anusvara-candrabindu
"?")
                               1 'font-shape-gstring)))
  (set-char-table-range composition-function-table
                        '(#x110B9 . #x110B9)
                        (list (vector
                               (concat consonant "\\(?:" virama consonant
"\\)+"
                                       vowel "*\\|" consonant virama)
                               1 'font-shape-gstring)))
  (set-char-table-range composition-function-table
                        '(#x110BD . #x110BD)
                        (list (vector
                               (concat number-sign numerals)
                               0 'font-shape-gstring)))
  (set-char-table-range composition-function-table
                        '(#x110CD . #x110CD)
                        (list (vector
                               (concat number-sign-above numerals)
                               0 'font-shape-gstring))))

Now when typed alone they do not appear but when written with numbers, they
appear as NOTDEF glyphs

On Fri, Apr 29, 2022 at 12:23 PM Eli Zaretskii <eliz@gnu.org> wrote:

> > Date: Fri, 29 Apr 2022 08:52:18 +0300
> > From: Eli Zaretskii <eliz@gnu.org>
> > Cc: emacs-devel@gnu.org
> >
> > >       (numerals "\x966-\x96F"))
> >
> > I believe this should be
> >
> >        (numerals "[\x966-\x96F]")
> >
> > IOW, the "[..]" brackets are missing.  Maybe that is the cause of your
> > problem.
>
> And one more potential problem.  Since the rules for the number signs
> are:
>
>   (set-char-table-range composition-function-table
>                         '(#x110BD . #x110BD)
>                         (list (vector
>                                (concat number-sign numerals)
>                                1 'font-shape-gstring)))
>   (set-char-table-range composition-function-table
>                         '(#x110CD . #x110CD)
>                         (list (vector
>                                (concat number-sign-above numerals)
>                                1 'font-shape-gstring))))
>
> which means the number signs always come _before_ the character with
> which it should be composed, you should use 0 in the rule, not 1.
> That number means how many characters to look back for finding the
> beginning of a composable sequence, and in these two rules the
> sequence _begins_ with the character which triggers composition, so
> the look-back is zero, not 1.
>