Mar 31, 2015
(i) BASIS OF PREPARATION
The financial statements have been prepared in accordance with Indian
Generally Accepted Accounting Principles (GAAP) under the historical
cost convention on an accrual basis in compliance with all material
aspect of the applicable Accounting Standards as prescribed under
Section 133 of the Companies Act, 2013(the "Act") read with Rule 7 of
the Companies (Accounts) rules, 2014 and the "Act" (to the extend
notified and applicable). The accounting policies have been
consistently applied by the Company and are consistent with those used
in the previous year.
Vide MCA notification no. C.S.R 37 (E) dated Januaryl6, 2015, the
Company has availed exemption of not preparing & presenting
consolidated financial statement in term of section 129(3) of the Act
with its only overseas subsidiary viz. Aditya Birla Chemicals( Belgium)
BVBA which was set up we.f December 24, 2014 with an investment of Rs.
4.80 lacs. The said subsidiary has yet not commissioned its operations;
as such, the revenue and expenditure thereof are NIL as at Balance
Sheet date.
(ii) USE OF ESTIMATES
The preparation of financial statements is in conformity with Indian
Generally Accepted Accounting Principles, which require the management
to make estimates and assumptions to be made that affect the reported
amount of assets and liabilities and disclosure of contingent
liabilities on the date of the financial statements and the reported
amount of revenues and expenses during the reporting period. Actual
results could differ from those estimates and differences between
actual results and estimates are recognized in the periods in which the
results are known / materialize.
(iii) FIXED ASSETS
Fixed Assets are stated at cost, less accumulated depreciation and
impairment loss, if any. Cost comprises the purchase price and any
attributable cost of bringing the asset to its working condition for
its intended use and is net of cenvat credit.
Machinery spares which can be used only in connection with an item of
fixed assets and whose use is expected to be irregular(Insurance
Spares) are Capitalized during the year as an addition to the parent
assets and written off over the remaining estimated useful life of the
parent assets.
Capital Work in Progress is stated at cost and other relevant overheads
incurred during construction period.
Fixed Assets, individually costing less than Rs five thousand, are
fully depreciated in the year of purchase.
(iv) DEPRECIATION / AMORTISATION
Depreciation on fixed assets is provided on straight line basis,
considering the useful lives of the assets as per Schedule II to the
Act, or as per the management's assessment of useful life based on the
technical evaluation.
According to provisions of Schedule II of the Companies Act, 2013, the
carrying value of assets having nil useful life as on April 1, 2014 has
been charged to the Statement of Profit and Loss and carrying value of
assets having balance useful life (net of residual value) is being
depreciated over the revised remaining useful life.
(v) INVESTMENTS
Current Investments are stated at lower of cost and fair value. Long
term investments are stated at cost after deducting provisions made, if
any, for other than temporary diminution in the value. Investments
which are readily realisable and intended to be held for period less
than one year are current investments. Other Investments are considered
as long term investments. Long term debt securities are carried at
amortized cost.
(vi) IMPAIRMENT OF ASSETS
The carrying amounts of assets are reviewed at each Balance Sheet date
if there is any indication of impairment based on internal/external
factors. An asset is treated as impaired when the carrying cost of the
assets exceeds its recoverable value. An impairment loss, if any, is
charged to the Profit and Loss Account in the year in which an asset is
identified as impaired. Reversal of impairment losses recognised in
prior years is recorded when there is an indication that the impairment
losses recognised for the assets no longer exist or have decreased.
(vii) INVENTORIES
a) Finished Goods (including goods in transit), work-in-progress are
valued at cost or net realizable value whichever is lower.
b) Raw materials, components, stores and spares are valued at lower of
weighted Average cost or net realisable value. However, these items
are considered to be realisable at cost if the finished products in
which they will be used are expected to be sold at or above cost.
Obsolete, defective and unserviceable inventory is duly provided for.
Scrapped items of stock are valued at net realisable value.
c) Cost comprises of all costs of purchases, costs of conversions and
other costs incurred in bringing the inventory to their present
location and conditions.
d) The value of closing stock of finished goods lying at depot is
inclusive of freight charges and excise duty paid
(viii) TRANSACTION OF FOREIGN CURRENCY ITEMS
Transactions in foreign currency are recorded at the rate of exchange
prevailing on the date of transaction. Foreign currency monetary items
(except forward contract transactions) are reported using closing rate
of exchange at the end of the year. The resulting exchange gain/ loss
is reflected in the Profit and Loss Account. Other non-monetary items,
like fixed assets are carried in terms of historical cost using the
exchange rate at the date of transaction. Exchange rate difference
arising on account of conversion/ translation of liabilities for
acquisition of Fixed Assets is recognised in the Profit & Loss account.
(ix) RETIREMENT AND OTHER EMPLOYEE BENEFITS
Employee benefits of short term nature are recognized as expense as and
when accrued.
Defined Contribution Plan
The Company makes defined contribution to Provident Fund and
Superannuation schemes which are recognized in the Profit and Loss
Account on accrual basis.
Defined Benefit Plan
The Company's liabilities under Payment of Gratuity Act (funded/non
funded), and long term compensated absences (non funded) are determined
on the basis of actuarial valuation made at the end of each financial
year using the projected unit credit method except for short term
compensated absences which are provided for based on estimates.
Actuarial gains and losses are recognised immediately in the statement
of Profit and Loss as income or expense. Obligation is measured at the
present value of estimated future cash flows using a discounted rate
that is determined by reference to market yields at the Balance Sheet
date on Government bonds where the currency and tenure of the
Government bonds are consistent with the currency and estimated tenure
of the defined benefit obligation.
(x) RECOGNITION OF INCOME & EXPENDITURE
Sales are recorded net of trade discounts, Sales Tax, VAT and excise
duty. Revenue from sale of products is recognised when the significant
risks and rewards of ownership of the goods have passed to the buyer.
Income and Expenditure are recognised on accrual basis but Sales claims
under escalation clause, insurance and other claims are accounted on
acceptance basis.
(xi) BORROWING COST
Borrowing Costs, attributable to acquisition and construction of
qualifying assets, are capitalised as a part of the cost of such asset
up to the date when such assets are ready for its intended use. Long
term Finance cost ancillary to arrangement of long-term borrowings are
amortised over period of borrowings or 5 years whichever is less. Other
borrowing costs are charged to the Profit and Loss Account.
(xii) TAXATION
a) Tax expense comprises of current and deferred tax.
b) Provision for current tax is made on the basis of estimated taxable
income for the current accounting year in accordance with the
provisions of Income Tax Act, 1961.
c) The deferred tax for timing differences is accounted for, using the
tax rates and laws that have been substantively enacted as of the
Balance Sheet date. Deferred tax assets arising from timing differences
are recognised to the extent there is reasonable certainty that these
would be realised in future.
d) Deferred tax assets in case of unabsorbed losses and unabsorbed
depreciation are recognised only if there is virtual certainty that
such deferred tax asset can be realised against future taxable profits.
e) Credit for entitlement of Minimum Alternate Tax (MAT) is recognized
only if the same can be utilized within statutorily permissible time.
(xiii) INTANGIBLE ASSETS
Intangible Assets are recognized by the Company only if it is probable
that the future economic benefits that are attributable to the assets
will flow to the enterprise and the cost of the same can be measured
reliably.
Intangible Assets are amortized on a systematic basis over its useful
life and the amortization for each period will be recognized as an
expense.
(xiv) GOVERNMENT GRANTS / CAPITAL SUBSIDY
a) Capital subsidy/ Government grants are recognised when there is
reasonable assurance that the same will be received. Revenue grants are
recognised in the Profit & Loss Account.
b) Capital subsidy/ Government grants relating to specific non
depreciable fixed assets and in the nature of Promoter's Contribution
are credited to capital reserve account.
c) Capital subsidy/ Government grants related to specific depreciable
assets are credited to capital reserve account and are recognized as
income in profit and loss statement on a systematic and rational basis
over the useful life of assets.
(xv) CONTINGENT LIABILITIES AND PROVISIONS
Contingent liabilities are possible but not probable obligations as on
Balance Sheet date, based on the available evidence. Contingent
Liabilities are not provided for in the accounts. These are disclosed
by way of Notes to the Accounts.
Provisions are recognised when there is a present obligation as a
result of past event, and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are determined based on best
estimate required to settle the obligation at the Balance Sheet date.
Mar 31, 2014
(i) BASIS OF PREPARATION
The financial statements have been prepared under the historical cost
convention on an accrual basis in compliance with all material aspect
of the applicable Accounting Standards notified by Companies
(Accounting Standard) Rules, 2006 and the relevant provisions of the
Companies Act, 1956 (the Act). The accounting policies have been
consistently applied by the Company and are consistent with those used
in the previous year.
(ii) USE OF ESTIMATES
The preparation of financial statements is in conformity with Indian
Generally Accepted Accounting Principles, which require the management
to make estimates and assumptions to be made that affect the reported
amount of assets and liabilities and disclosure of contingent
liabilities on the date of the financial statements and the reported
amount of revenues and expenses during the reporting period. Actual
results could differ from those estimates and differences between
actual results and estimates are recognized in the periods in which the
results are known / materialize.
(iii) FIXED ASSETS
Fixed Assets are stated at cost, less accumulated depreciation and
impairment loss, if any. Cost comprises the purchase price and any
attributable cost of bringing the asset to its working condition for
its intended use and is net of cenvat credit.
Machinery spares which can be used only in connection with an item of
fixed assets and whose use is expected to be irregular(Insurance
Spares) are Capitalized during the year as an addition to the parent
assets and written off over the remaining estimated useful life of the
parent assets.
Capital Work in Progress is stated at cost and other relevant overheads
incurred during construction period.
Fixed Assets, individually costing less than Rs five thousand, are
fully depreciated in the year of purchase.
(iv) DEPRECIATION / AMORTISATION
a) Depreciation on Fixed Assets up to March 31, 1987 has been provided
at the then prevailing rates on Straight Line Method pursuant to
Circular No. 1/86 dated May 21, 1986 issued by the Department of
Company Affairs, Government of India.
b) For Fixed Assets added from April 1,1987 onwards, the specified
period has been recomputed according to the revised rates of
depreciation as specified in schedule XIV to the Act as amended by
Notification dated December 16,1993 and the amount of depreciation has
been calculated by allocating the unamortized value over the remaining
part of the recomputed specified period.
c) For Fixed Assets added from April 1,1993 onwards, depreciation is
provided on Straight Line Method at the rates, specified in Schedule
XIV, as amended by Notification dated December 16, 1993 of the Act
except in the case of the following assets, where depreciation is
charged over the estimated useful lives of such assets:
Assets Estimated useful life (Years)
Condensers (Plant & Machinery) 3
Heat Sealing Machine (Plant & Machinery) 1
Weighing Machine (Plant & Machinery) 1
Leasehold Land Over the primary period of
the lease
Insurance Machinery Spares Over the remaining estimated
useful life of the related
parent assets
Computer Software 3 years from the date of their
acquisition/ purchase
d) Depreciation on the Fixed Assets added/disposed off/ discarded
during the year is provided on pro- rata basis with reference to the
date of addition/ disposal/ discarding.
(v) INVESTMENTS
Current Investments are stated at lower of cost and fair value. Long
term investments are stated at cost after deducting provisions made, if
any, for other than temporary diminution in the value. Investments
which are readily realisable and intended to be held for period less
than one year are current investments. Other Investments are considered
as long term investments. Long term debt securities are carried at
amortized cost.
(vi) IMPAIRMENT OF ASSETS
The carrying amounts of assets are reviewed at each Balance Sheet date
if there is any indication of impairment based on internal/external
factors. An asset is treated as impaired when the carrying cost of the
assets exceeds its recoverable value. An impairment loss, if any, is
charged to the Profit and Loss Account in the year in which an asset is
identified as impaired. Reversal of impairment losses recognised in
prior years is recorded when there is an indication that the impairment
losses recognised for the assets no longer exist or have decreased.
(vii) INVENTORIES
a) Finished Goods (including goods in transit), work-in-progress are
valued at cost or net realizable value whichever is lower.
b) Raw materials, components, stores and spares are valued at lower of
weighted Average cost or net realisable value. However, these items
are considered to be realisable at cost if the finished products in
which they will be used are expected to be sold at or above cost.
Obsolete, defective and unserviceable inventory is duly provided for.
Scrapped items of stock are valued at net realisable value.
c) Cost comprises of all costs of purchases, costs of conversions and
other costs incurred in bringing the inventory to their present
location and conditions.
d) The value of closing stock of finished goods lying at depot is
inclusive of freight charges and excise duty paid.
(viii)TRANSACTION OF FOREIGN CURRENCY ITEMS
Transactions in foreign currency are recorded at the rate of exchange
prevailing on the date of transaction. Foreign currency monetary items
(except forward contract transactions) are reported using closing rate
of exchange at the end of the year. The resulting exchange gain/ loss
is reflected in the Profit and Loss Account. Other non-monetary items,
like fixed assets are carried in terms of historical cost using the
exchange rate at the date of transaction. Exchange rate difference
arising on account of conversion/ translation of liabilities for
acquisition of Fixed Assets is recognised in the Profit & Loss account.
(ix) RETIREMENT AND OTHER EMPLOYEE BENEFITS
Employee benefits of short term nature are recognized as expense as and
when accrued.
Defined Contribution Plan
The Company makes defined contribution to Provident Fund and
Superannuation schemes which are recognized in the Profit and Loss
Account on accrual basis.
Defined Benefit Plan
The Company''s liabilities under Payment of Gratuity Act (funded/non
funded), and long term compensated absences (non funded) are determined
on the basis of actuarial valuation made at the end of each financial
year using the projected unit credit method except for short term
compensated absences which are provided for based on estimates.
Actuarial gains and losses are recognised immediately in the statement
of Profit and Loss Account as income or expense. Obligation is
measured at the present value of estimated future cash flows using a
discounted rate that is determined by reference to market yields at the
Balance Sheet date on Government bonds where the currency and tenure of
the Government bonds are consistent with the currency and estimated
tenure of the defined benefit obligation.
(x) RECOGNITION OF INCOME & EXPENDITURE
Sales are recorded net of trade discounts, Sales Tax, VAT and excise
duty. Revenue from sale of products is recognised when the significant
risks and rewards of ownership of the goods have passed to the buyer.
Income and Expenditure are recognised on accrual basis but Sales claims
under escalation clause, insurance and other claims are accounted on
acceptance basis.
(xi) BORROWING COST
Borrowing Costs, attributable to acquisition and construction of
qualifying assets, are capitalised as a part of the cost of such asset
up to the date when such assets are ready for its intended use. Long
term Finance cost ancillary to arrangement of long-term borrowings are
amortised over period of borrowings or 5 years whichever is less.Other
borrowing costs are charged to the Profit and Loss Account.
(xii) TAXATION
a) Tax expense comprises of current and deferred tax.
b) Provision for current tax is made on the basis of estimated taxable
income for the current accounting year in accordance with the
provisions of Income Tax Act, 1961.
c) The deferred tax for timing differences is accounted for, using the
tax rates and laws that have been substantively enacted as of the
Balance Sheet date. Deferred tax assets arising from timing differences
are recognised to the extent there is reasonable certainty that these
would be realised in future.
d) Deferred tax assets in case of unabsorbed losses and unabsorbed
depreciation are recognised only if there is virtual certainty that
such deferred tax asset can be realised against future taxable profits.
e) Credit for entitlement of Minimum Alternate Tax (MAT) is recognized
only if the same can be utilized within statutorily permissible time.
(xiii)INTANGIBLE ASSETS
Intangible Assets are recognized by the Company only if it is probable
that the future economic benefits that are attributable to the assets
will flow to the enterprise and the cost of the same can be measured
reliably.
Intangible Assets are amortized on a systematic basis over its useful
life and the amortization for each period will be recognized as an
expense.
(xiv)GOVERNMENT GRANTS / CAPITAL SUBSIDY
a) Capital subsidy/ Government grants are recognised when there is
reasonable assurance that the same will be received. Revenue grants are
recognised in the Profit & Loss Account.
b) Capital subsidy/ Government grants relating to specific non
depreciable fixed assets and in the nature of Promoter''s Contribution
are credited to capital reserve account.
c) Capital subsidy/ Government grants related to specific depreciable
assets are credited to capital reserve account and are recognized as
income in profit and loss statement on a systematic and rational basis
over the useful life of assets.
(xv) CONTINGENT LIABILITIES AND PROVISIONS
Contingent Liabilities are possible but not probable obligations as on
Balance Sheet date, based on the available evidence. Contingent
Liabilities are not provided for in the accounts. These are disclosed
by way of Notes to the Accounts.
Provisions are recognised when there is a present obligation as a
result of past event, and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are determined based on best
estimate required to settle the obligation at the Balance Sheet date.
12,004,987 Equity Shares (Previous year 12,004,987) of the Company are
held by Hindalco Industries limited, the holding company, 775,000
shares (Previous year 775,000) are held by Renuka Investment & Finance
Limited (Subsidiary of Hindalco Industries Limited).
The company has only one class of share referred as equity share having
a par value of Rs. 10/-. Each holder of equity share is entitled to
same right in all respect.
(i) Security and Terms of Term loan from Banks amounting to Rs.
73318.75 Lacs (Previous Year Rs. 58,593.75 Lacs)
(a) Nature of Securities
Secured by way of first charge in favour of Security Trustee IDBI
Trusteeship Services Ltd on all the immovable properties and all
movable properties and assets other than current assets of the Company
(both present & future) and second charge on all current assets of
whatsoever nature and wherever arising both present and future.
(b) Term of Repayment
i) Outstanding Rs. 49218.75 Lacs
Repayable 25 (Previous year 29) quarterly instalment of Rs. 2,343.75
lacs each from May 31, 2014 (start dte of repayment August 31, 2012)
alongwith interest of 11.50% p.a. (Previous Year 11.10% p.a.) (also
refer Note B.8.(i))
ii) Outstanding Rs. 24100.00 Lacs
Repayable 32 (Previous year Nil) quarterly instalment of Rs. 753.13
lacs each from Sept 30, 2015 alongwith interest of 11.10% p.a.
(Previous Year Nil.) (also refer Note B.8.(i))
Security
(i) Rs. 181.43 lacs Secured against pledge of Fixed Deposits of the
Company.
(ii) Rs. 14519.81 lacs against exclusive first charge by way of
hypothecation on all stock in trade both present & future
consisting of raw materials, finished goods, goods in process and all
book debts, outstanding money receivables, claims & bills due / to
be due to the Company.
The Board of Director have recommended dividend @ 15 % i.e. Rs 1.50 per
equity share of the company for the year, under report.
-Leasehold land includes land, the lease tides whereof are in process
of being transferred in the name of the company.
Note: The above noted revenue expenditures are capitalized as a
preoperative expense relates only up to the period the concerned fixed
assets have been put to use.
Trade Receivables include dues from Holding Company, Hindalco
Industries Limited, Rs. 2379.61 lacs (Previous year Rs. 1,507.92 lacs)
maximum due at any time during the year Rs. 2379.61 lacs (Previous year
Rs. 1,966.12 lacs)
*With a view to optimise the benefits of specialisation and minimise
cost to the Company, its share of expenses towards business operations
of Rs 53.33 Lacs (Previous year Rs. 43.19 lacs) contributed to Grasim
Industries Limited and Rs.0.15 Lacs (Previous year Rs. Nil) contributed
to Indo Gulf Fertilizers the same has been accounted under ''Business
Head Office expenses in Notes B.31
Mar 31, 2013
(i) BASIS OF PREPARATION
The financial statements have been prepared under the historical cost
convention on an accrual basis in compliance with all material aspect
of the applicable Accounting Standards notified by Companies
(Accounting Standard) Rules'' 2006 and the relevant provisions of the
Companies Act'' 1956 (the Act). The accounting policies have been
consistently applied by the Company and are consistent with those used
in the previous year.
(ii) USE OF ESTIMATES
The preparation of financial statements is in conformity with Indian
Generally Accepted Accounting Principles'' which require the management
to make estimates and assumptions to be made that affect the reported
amount of assets and liabilities and disclosure of contingent
liabilities on the date of the financial statements and the reported
amount of revenues and expenses during the reporting period. Actual
results could differ from those estimates and differences between
actual results and estimates are recognized in the periods in which the
results are known / materialize.
(iii) FIXED ASSETS
Fixed Assets are stated at cost'' less accumulated depreciation and
impairment loss'' if any. Cost comprises the purchase price and any
attributable cost of bringing the asset to its working condition for
its intended use and is net of cenvat credit.
Machinery spares which can be used only in connection with an item of
fixed assets and whose use is expected to be irregular(Insurance
Spares) are Capitalized during the year as an addition to the parent
assets and written off over the remaining estimated useful life of the
parent assets.
Capital Work in Progress is stated at cost and other relevant overheads
incurred during construction period.
(iv) DEPRECIATION / AMORTISATION
a) Depreciation on Fixed Assets up to March 31'' 1987 has been provided
at the then prevailing rates on Straight Line Method pursuant to
Circular No. 1/86 dated May 21'' 1986 issued by the Department of
Company Affairs'' Government of India.
b) For Fixed Assets added from April 1'' 1987 onwards'' the specified
period has been recomputed according to the revised rates of
depreciation as specified in schedule XIV to the Act as amended by
Notification dated December 16''1993 and the amount of depreciation has
been calculated by allocating the unamortized value over the remaining
part of the recomputed specified period.
c) For Fixed Assets added from April 1''1993 onwards'' depreciation is
provided on Straight Line Method at the rates'' specified in Schedule
XIV'' as amended by Notification dated December 16'' 1993 of the Act
except in the case of the following assets'' where depreciation is
charged over the estimated useful lives of such assets:
d) Depreciation on the Fixed Assets added/disposed off/ discarded
during the year is provided on pro- rata basis with reference to the
date of addition/ disposal/ discarding.
(v) INVESTMENTS
Current Investments are stated at lower of cost and fair value. Long
term investments are stated at cost after deducting provisions made'' if
any'' for other than temporary diminution in the value. Investments
which are readily realisable and intended to be held for period less
than one year are current investments. Other Investments are considered
as long term investments. Long term debt securities are carried at
amortized cost.
(vi) IMPAIRMENT OF ASSETS
The carrying amounts of assets are reviewed at each Balance Sheet date
if there is any indication of impairment based on internal/external
factors. An asset is treated as impaired when the carrying cost of the
assets exceeds its recoverable value. An impairment loss'' if any'' is
charged to the Profit and Loss Account in the year in which an asset is
identified as impaired. Reversal of impairment losses recognised in
prior years is recorded when there is an indication that the impairment
losses recognised for the assets no longer exist or have decreased.
(vii) INVENTORIES
a) Finished Goods (including goods in transit)'' work-in-progress are
valued at cost or net realizable value whichever is lower.
b) Raw materials'' components'' stores and spares are valued at lower of
weighted Average cost or net realisable value. However'' these items
are considered to be realisable at cost if the finished products in
which they will be used are expected to be sold at or above cost.
Obsolete'' defective and unserviceable inventory is duly provided for.
Scrapped items of stock are valued at net realisable value.
c) Cost comprises of all costs of purchases'' costs of conversions and
other costs incurred in bringing the inventory to their present
location and conditions.
d) The value of closing stock of finished goods lying at depot is
inclusive of freight charges and excise duty paid.
(viii) TRANSACTION OF FOREIGN CURRENCY ITEMS
Transactions in foreign currency are recorded at the rate of exchange
prevailing on the date of transaction. Foreign currency monetary items
(except forward contract transactions) are reported using closing rate
of exchange at the end of the year. The resulting exchange gain/ loss
is reflected in the Profit and Loss Account. Other non-monetary items''
like fixed assets are carried in terms of historical cost using the
exchange rate at the date of transaction. Exchange rate difference
arising on account of conversion/ translation of liabilities for
acquisition of Fixed Assets is recognised in the Profit & Loss account.
(ix) RETIREMENT AND OTHER EMPLOYEE BENEFITS
Employee benefits of short term nature are recognized as expense as and
when accrued.
Defined Contribution Plan
The Company makes defined contribution to Provident Fund and
Superannuation schemes which are recognized in the Profit and Loss
Account on accrual basis.
Defined Benefit Plan
The Company''s liabilities under Payment of Gratuity Act (funded/non
funded)'' and long term compensated absences (non funded) are determined
on the basis of actuarial valuation made at the end of each financial
year using the projected unit credit method except for short term
compensated absences which are provided for based on estimates.
Actuarial gains and losses are recognised immediately in the statement
of Profit and Loss Account as income or expense. Obligation is
measured at the present value of estimated future cash flows using a
discounted rate that is determined by reference to market yields at the
Balance Sheet date on Government bonds where the currency and tenure of
the Government bonds are consistent with the currency and estimated
tenure of the defined benefit obligation.
(x) RECOGNITION OF INCOME & EXPENDITURE
Sales are recorded net of trade discounts'' Sales Tax'' VAT and excise
duty. Revenue from sale of products is recognised when the significant
risks and rewards of ownership of the goods have passed to the buyer.
Income and Expenditure are recognised on accrual basis but Sales claims
under escalation clause'' insurance and other claims are accounted on
acceptance basis.
(xi) BORROWING COST
Borrowing Costs'' attributable to acquisition and construction of
qualifying assets'' are capitalised as a part of the cost of such asset
up to the date when such assets are ready for its intended use. Long
term Finance cost ancillary to arrangement of long-term borrowings are
amortised over period of borrowings or5 years whichever is less.Other
borrowing costs are charged to the Profit and Loss Account.
(xii) TAXATION
a) Tax expense comprises of current and deferred tax.
b) Provision for current tax is made on the basis of estimated taxable
income for the current accounting year in accordance with the
provisions of Income Tax Act'' 1961.
c) The deferred tax for timing differences is accounted for'' using the
tax rates and laws that have been substantively enacted as of the
Balance Sheet date. Deferred tax assets arising from timing differences
are recognised to the extent there is reasonable certainty that these
would be realised in future.
d) Deferred tax assets in case of unabsorbed losses and unabsorbed
depreciation are recognised only if there is virtual certainty that
such deferred tax asset can be realised against future taxable profits.
e) Credit for entitlement of Minimum Alternate Tax (MAT) is recognized
only if the same can be utilized within statutorily permissible time.
(xiii) INTANGIBLE ASSETS
Intangible Assets are recognized by the Company only if it is probable
that the future economic benefits that are attributable to the assets
will flow to the enterprise and the cost of the same can be measured
reliably.
Intangible Assets are amortized on a systematic basis over its useful
life and the amortization for each period will be recognized as an
expense.
(xiv) GOVERNMENT GRANTS / CAPITAL SUBSIDY
a) Capital subsidy/ Government grants are recognised when there is
reasonable assurance that the same will be received. Revenue grants are
recognised in the Profit & Loss Account.
b) Capital subsidy/ Government grants relating to specific non
depreciable fixed assets and in the nature of Promoter''s Contribution
are credited to capital reserve account.
c) Capital subsidy/ Government grants related to specific depreciable
assets are credited to capital reserve account and are recognized as
income in profit and loss statement on a systematic and rational basis
over the useful life of assets.
(xv) CONTINGENT LIABILITIES AND PROVISIONS
Contingent Liabilities are possible but not probable obligations as on
Balance Sheet date'' based on the available evidence. Contingent
Liabilities are not provided for in the accounts. These are disclosed
by way of Notes to the Accounts.
Provisions are recognised when there is a present obligation as a
result of past event'' and it is probable that an outflow of resources
will be required to settle the obligation'' in respect of which a
reliable estimate can be made. Provisions are determined based on best
estimate required to settle the obligation at the Balance Sheet date.
Mar 31, 2012
(i) BASIS OF PREPARATION
The financial statements have been prepared under the historical cost
convention on an accrual basis in compliance with all material aspect
of the applicable Accounting Standards notified by Companies
(Accounting Standard) Rules, 2006 and the relevant provisions of the
Companies Act, 1956 (the Act). The accounting policies have been
consistently applied by the Company and are consistent with those used
in the previous year.
(ii) USE OF ESTIMATES
The preparation of financial statements is in conformity with Indian
Generally Accepted Accounting Principles, which require the management
to make estimates and assumptions to be made that affect the reported
amount of assets and liabilities and disclosure of contingent
liabilities on the date of the financial statements and the reported
amount of revenues and expenses during the reporting period. Actual
results could differ from those estimates and differences between
actual results and estimates are recognized in the periods in which the
results are known / materialize.
(iii) FIXED ASSETS
Fixed Assets are stated at cost, less accumulated depreciation and
impairment loss, if any. Cost comprises the purchase price and any
attributable cost of bringing the asset to its working condition for
its intended use and is net of cenvat credit.
Machinery spares which can be used only in connection with an item of
fixed assets and whose use is expected to be irregular(Insurance
Spares) are Capitalized during the year as an addition to the parent
assets and written off over the remaining estimated useful life of the
parent assets.
Capital Work in Progress is stated at cost and other relevant overheads
incurred during construction period.
(iv) DEPRECIATION/ AMORTISATION
a) Depreciation on Fixed Assets up to March 31, 1987 has been provided
at the then prevailing rates on Straight Line Method pursuant to
Circular No. 1/86 dated May 21, 1986 issued by the Department of
Company Affairs, Government of India.
b) For Fixed Assets added from April 1, 1987 onwards, the specified
period has been recomputed according to the revised rates of
depreciation as specified in schedule XIV to the Act as amended
Notification dated December 16, 1993 and the amount of depreciation has
been calculated by allocating the unamortized value over the remaining
part of the recomputed specified period.
c) For Fixed Assets added from April 1, 1993 onwards, depreciation is
provided on Straight Line Method at the rates, specified in Schedule
XIV, as amended by Notification dated December
16, 1993 of the Act except in the case of the following assets, where
depreciation is charged over the estimated useful lives of such assets:
d) Depreciation on the Fixed Assets added/disposed off / discarded
during the year is provided on pro- rata basis with reference to the
date of addition/ disposal/ discarding.
(v) INVESTMENTS
Current Investments are stated at lower of cost and fair value. Long
term investments are stated at cost after deducting provisions made, if
any, for other than temporary diminution in the value. Investments
which are readily realizable and intended to be held for period less
than one year are current investments. Other Investments are considered
as long term investments. Long term debt securities are carried at
amortized cost.
(vi) IMPAIRMENT OF ASSETS
The carrying amounts of assets are reviewed at each Balance Sheet date
if there is any indication of impairment based on internal/external
factors. An asset is treated as impaired when the carrying cost of the
assets exceeds its recoverable value. An impairment loss, if any, is
charged to the Profit and Loss Account in the year in which an asset is
identified as impaired. Reversal of impairment losses recognized in
prior years is recorded when there is an indication that the impairment
losses recognized for the assets no longer exist or have decreased.
(vii) INVENTORIES
a) Finished Goods (including goods in transit), work-in-progress are
valued at cost or net realizable value whichever is lower.
b) Raw materials, components, stores and spares are valued at lower of
weighted Average cost or net realizable value. However, these items are
considered to be realizable at cost if the finished products in which
they will be used are expected to be sold at or above cost. Obsolete,
defective and unserviceable inventory is duly provided for. Scrapped
items of stock are valued at net realizable value.
c) Cost comprises of all costs of purchases, costs of conversions and
other costs incurred in bringing the inventory to their present
location and conditions.
d) The value of closing stock of finished goods lying at depot is
inclusive of freight charges and excise duty paid.
(viii) TRANSACTION OF FOREIGN CURRENCY ITEMS
Transactions in foreign currency are recorded at the rate of exchange
prevailing on the date of transaction. Foreign currency monetary items
(except forward contract transactions) are reported using closing rate
of exchange at the end of the year. The resulting exchange gain/ loss
is reflected in the Profit and Loss Account. Other non-monetary items,
like fixed assets are carried in terms of historical cost using the
exchange rate at the date of transaction. Exchange rate difference
arising on account of conversion/ translation of liabilities for
acquisition of Fixed Assets is recognized in the Profit & Loss account.
(ix) RETIREMENT AND OTHER EMPLOYEE BENEFITS
Employee benefits of short term nature are recognized as expense as and
when accrued.
Defined Contribution Plan
The Company makes defined contribution to Provident Fund and
Superannuation schemes which are recognized in the Profit and Loss
Account on accrual basis.
Defined Benefit Plan
The Company's liabilities under Payment of Gratuity Act
(funded/non-funded), and long term compensated absences (non-funded)
are determined on the basis of actuarial valuation made at the end of
each financial year using the projected unit credit method except for
short term compensated absences which are provided for based on
estimates. Actuarial gains and losses are recognized immediately in the
statement of Profit and Loss Account as income or expense. Obligation
is measured at the present value of estimated future cash flows using a
discounted rate that is determined by reference to market yields at the
Balance Sheet date on Government bonds where the currency and tenure of
the Government bonds are consistent with the currency and estimated
tenure of the defined benefit obligation.
(x) RECOGNITION OF INCOME & EXPENDITURE
Sales are recorded net of trade discounts, Sales Tax, VAT and include
excise duty. Revenue from sale of products is recognized when the
significant risks and rewards of ownership of the goods have passed to
the buyer.
Income and Expenditure are recognized on accrual basis but Sales claims
under escalation clause, insurance and other claims are accounted on
acceptance basis.
(xi) BORROWING COST
Borrowing Costs, attributable to acquisition and construction of
qualifying assets, are capitalized as a part of the cost of such asset
up to the date when such assets are ready for its intended use. Long
term Finance cost ancillary to arrangement of long-term borrowings are
amortized over period of borrowings or 5 years whichever is less. Other
borrowing costs are charged to the Profit and Loss Account.
(xii) TAXATION
a) Tax expense comprises of current and deferred tax.
b) Provision for current tax is made on the basis of estimated taxable
income for the current accounting year in accordance with the
provisions of Income Tax Act, 1961.
c) The deferred tax for timing differences is accounted for, using the
tax rates and laws that have been substantively enacted as of the
Balance Sheet date. Deferred tax assets arising from timing differences
are recognized to the extent there is reasonable certainty that these
would be realized in future.
d) Deferred tax assets in case of unabsorbed losses and unabsorbed
depreciation are recognized only if there is virtual certainty that
such deferred tax asset can be realized against future taxable profits.
e) Credit for entitlement of Minimum Alternate Tax (MAT) is recognized
only if the same can be utilized within statutorily permissible time.
(xiii) INTANGIBLE ASSETS
Intangible Assets are recognized by the Company only if it is probable
that the future economic benefits that are attributable to the assets
will flow to the enterprise and the cost of the same can be measured
reliably.
Intangible Assets are amortized on a systematic basis over its useful
life and the amortization for each period will be recognized as an
expense.
(xiv) GOVERNMENT GRANTS/ CAPITAL SUBSIDY
a) Capital subsidy/ Government grants are recognized when there is
reasonable assurance that the same will be received. Revenue grants are
recognized in the Profit & Loss Account.
b) Capital subsidy/ Government grants relating to specific non
depreciable fixed assets and in the nature of Promoter's Contribution
are credited to capital reserve account.
c) Capital subsidy/ Government grants related to specific depreciable
assets are credited to capital reserve account and are recognized as
income in profit and loss statement on a systematic and rational basis
over the useful life of assets.
(xv) CONTINGENT LIABILITIES AND PROVISIONS
Contingent Liabilities are possible but not probable obligations as on
Balance Sheet date, based on the available evidence. Contingent
Liabilities are not provided for in the accounts. These are disclosed
by way of Notes to the Accounts.
Provisions are recognized when there is a present obligation as a
result of past event, and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are determined based on best
estimate required to settle the obligation at the Balance Sheet date.
Mar 31, 2011
(i) Basis of Preparation
The financial statements have been prepared under the historical cost
convention on an accrual basis in compliance with all material aspect
of the applicable Accounting Standards notified by Companies
(Accounting Standard) Rules, 2006 and the relevant provisions of the
Companies Act, 1956 (the Act). The accounting policies have been
consistently applied by the Company and are consistent with those used
in the previous year.
(ii) USE OF ESTIMATES
The preparation of financial statements is in conformity with Indian
Generally Accepted Accounting Principles, which require the management
to make estimates and assumptions to be made that affect the reported
amounts of assets and liabilities and disclosure of contingent
liabilities on the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates and differences between
actual results and estimates are recognized in the periods in which the
results are known / materialize.
(iii) FIXED ASSETS
Fixed Assets are stated at cost, less accumulated depreciation and
impairment loss, if any. Cost comprises the purchase price and any
attributable cost of bringing the asset to its working condition for
its intended use and is net of cenvat credit.
Machinery spares which can be used only in connection with an item of
fixed assets and whose use is expected to be irregular(Insurance
Spares) are Capitalized during the year as an addition to the parent
assets and written off over the remaining estimated useful life of the
parent assets.
Capital Work in Progress is stated at cost and other relevant overheads
incurred during construction period.
(iv) DEPRECIATION/ AMORTISATION
a) Depreciation on Fixed Assets up to March 31,1987 has been provided
at the then prevailing rates on Straight Line Method pursuant to
Circular No. 1/86 dated May 21,1986 issued by the Department of Company
Affairs, Government of India.
b) For Fixed Assets added from April 1,1987 onwards, the specified
period has been recomputed according to the revised rates of
depreciation as specified in schedule XIV to the Act as amended by
Notification dated December 16, 1993 and the amount of depreciation has
been calculated by allocating the unamortized value over the remaining
part of the recomputed specified period.
c) For Fixed Assets added from April 1,1993 onwards, depreciation is
provided on Straight Line Method at the rates, specified in Schedule
XIV, as amended by Notification dated December 16,1993 of the Act
except in the case of the following assets, where depreciation is
charged over the estimated useful lives of such assets:
Assets Estimated useful life (Years)
Condensers (Plant &
Machinery) 03
Heat Sealing Machine (Plant
& Machinery) 01
Weighing Machine (Plant &
Machinery) 01
Leasehold Land Over the primary period of the lease
Insurance Machinery Spares Over the remaining estimated useful
life of the related parent assets
Computer Software 3 years from the date of their
acquisition/ purchase
d) Depreciation on the Fixed Assets added/disposed off/ discarded
during the year is provided on pro- rata basis with reference to the
date of addition/ disposal/ discarding.
(v) INVESTMENTS
Current Investments are stated at lower of cost and fair value. Long
term investments are stated at cost after deducting provisions made, if
any, for other than temporary diminution in the value. Investments
which are readily realisable and intended to be held for period less
than one year are current investments. Other Investments are considered
as long term investments. Long term debt securities are carried at
amortized cost
(vi) IMPAIRMENT OF ASSETS
The carrying amounts of assets are reviewed at each Balance Sheet date
if there is any indication of impairment based on internal/external
factors. An asset is treated as impaired when the carrying cost of the
assets exceeds its recoverable value. An impairment loss, if any, is
charged to the Profit and Loss Account in the year in which an asset is
identified as impaired. Reversal of impairment losses recognised in
prior years is recorded when there is an indication that the impairment
losses recognised for the assets no longer exist or have decreased.
(vii) INVENTORIES
a) Finished Goods (including goods in transit), work-in-progress are
valued at cost or net realizable value whichever is lower.
b) Raw materials, components, stores and spares are valued at lower of
weighted Average cost or net realisable value. However, these items are
considered to be realisable at cost if the finished products in which
they will be used are expected to be sold at or above cost. Obsolete,
defective and unserviceable inventory is duly provided for. Scrapped
items of stock are valued at net realisable value.
c) Cost comprises of all costs of purchases, costs of conversions and
other costs incurred in bringing the inventory to their present
location and conditions.
d) The value of closing stock of finished goods lying at depot is
inclusive of freight charges and excise duty paid.
(viii) TRANSACTION OF FOREIGN CURRENCY ITEMS
Transactions in foreign currency are recorded at the rate of exchange
prevailing on the date of transaction. Foreign currency monetary items
(except forward contract transactions) are reported using closing rate
of exchange at the end of the year. The resulting exchange gain/ loss
is reflected in the Profit and Loss Account. Other non-monetary items,
like fixed assets are carried in terms of historical cost using the
exchange rate at the date of transaction. Exchange rate difference
arising on account of conversion/ translation of liabilities for
acquisition of Fixed Assets is recognised in the Profit & Loss account.
(ix) RETIREMENT AND OTHER EMPLOYEE BENEFITS
Employee benefits of short term nature are recognized as expense as and
when accrued.
Defined Contribution Plan
The Company makes defined contribution to Provident Fund and
Superannuation schemes which are recognized in the Profit and Loss
Account on accrual basis.
Defined Benefit Plan
The Company's liabilities under Payment of Gratuity Act (funded), and
long term compensated absences (non funded) are determined on the basis
of actuarial valuation made at the end of each financial year using the
projected unit credit method except for short term compensated absences
which are provided for based on estimates. Actuarial gains and losses
are recognised immediately in the statement of Profit and Loss Account
as income or expense. Obligation is measured at the present value of
estimated future cash flows using a discounted rate that is determined
by reference to market yields at the Balance Sheet date on Government
bonds where the currency and tenure of the Government bonds are
consistent with the currency and estimated tenure of the defined
benefit obligation.
(x) RECOGNITION OF INCOME & EXPENDITURE
Sales are recorded net of trade discounts, Sales Tax, VAT, and include
excise duty. Revenue from sale of products is recognised when the
significant risks and rewards of ownership of the goods have passed to
the buyer.
Income and Expenditure are recognised on accrual basis but Sales claims
under escalation clause, insurance and other claims are accounted on
acceptance basis.
(xi) BORROWING COST
Borrowing Costs, attributable to acquisition and construction of
qualifying assets, are capitalised as a part of the cost of such asset
up to the date when such assets are ready for its intended use. Other
borrowing costs are charged to the Profit and Loss Account.
(xii) TAXATION
a) Tax expense comprises of current and deferred tax.
b) Provision for current tax is made on the basis of estimated taxable
income for the current accounting year in accordance with the
provisions of Income Tax Act, 1961.
c) The deferred tax for timing differences is accounted for, using the
tax rates and laws that have been substantively enacted as of the
Balance Sheet date. Deferred tax assets arising from timing differences
are recognised to the extent there is reasonable certainty that these
would be realised in future.
d) Deferred tax assets in case of unabsorbed losses and unabsorbed
depreciation are recognised only if there is virtual certainty that
such deferred tax asset can be realised against future taxable profits.
e) Credit for entitlement of Minimum Alternate Tax (MAT) is recognized
only if the same can be utilized within statutorily permissible time.
(xiii) INTANGIBLE ASSETS
Intangible Assets are recognized by the Company only if it is probable
that the future economic benefits that are attributable to the assets
will flow to the enterprise and the cost of the same can be measured
reliably.
Intangible Assets are amortized on a systematic basis over its useful
life and the amortization for each period will be recognized as an
expense.
(xiv) GOVERNMENT GRANTS/ CAPITAL SUBSIDY
a) Capital subsidy/ Government grants are recognised when there is
reasonable assurance that the same will be received. Revenue grants are
recognised in the Profit & Loss Account.
b) Capital subsidy/ Government grants relating to specific non
depreciable fixed assets and in the nature of Promoter's Contribution
are credited to capital reserve account.
c) Capital subsidy/ Government grants related to specific depreciable
assets are credited to capital reserve account and are recognized as
income in profit and loss statement on a systematic and rational basis
over the useful life of assets.
(xv) CONTINGENT LIABILITIES AND PROVISIONS
Contingent Liabilities are possible but not probable obligations as on
Balance Sheet date, based on the available evidence. Contingent
Liabilities are not provided for in the accounts. These are disclosed
by way of Notes to the Accounts.
Provisions are recognised when there is a present obligation as a
result of past event, and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are determined based on best
estimate required to settle the obligation at the Balance Sheet date.
Mar 31, 2010
(i) Basis of Preparation
The financial statements have been prepared under the historical cost
convention on an accrual basis in compliance with all material aspect
of the applicable Accounting Standards notified by Companies
(Accounting Standard) Rules, 2006 and the relevant provisions of the
Companies Act, 1956 (the Act). The accounting policies have been
consistently applied by the Company and are consistent with those used
in the previous year.
(ii) USE OF ESTIMATES
The preparation of financial statements is in conformity with Indian
Generally Accepted Accounting Principles, which require the management
to make estimates and assumptions to be made that affect the reported
amounts of assets and liabilities and disclosure of contingent
liabilities on the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates and differences between
actual results and estimates are recognized in the periods in which the
results are known / materialize.
(iii) FIXED ASSETS
Fixed Assets are stated at cost, less accumulated depreciation and
impairment loss, if any. Cost comprises the purchase price and any
attributable cost of bringing the asset to its working condition for
its intended use and is net of cenvat credit
Machinery spares which can be used only in connection with an item of
fixed assets and whose use is expected to be irregular(Insurance
Spares) are Capitalized during the year as an addition to the parent
assets and written off over the remaining estimated useful life of the
parent assets.
Capital Work in Progress is stated at cost and other relevant overheads
incurred during construction period.
(iv) DEPRECIATION/ AMORTISATION
a) Depreciation on Fixed Assets up to March 31,1987 has been provided
at the then prevailing rates on Straight Line Method pursuant to
Circular No. 1/86 dated May 21,1986 issued by the Department of Company
Affairs, Government of India.
b) For Fixed Assets added from April 1,1987 onwards, the specified
period has been recomputed according to the revised rates of
depreciation as specified in schedule XIV to the Act as amended by
Notification dated December 16,1993 and the amount of depreciation has
been calculated by allocating the unamortized value over the remaining
part of the recomputed specified period.
c) For Fixed Assets added from April 1,1993 onwards, depreciation is
provided on Straight Line Method at the rates, specified in Schedule
XIV, as amended by Notification dated December 16,1993 of the Act
except in the case of the following assets, where depreciation is
charged over the estimated useful lives of such assets:
d) Depreciation on the Fixed Assets added/disposed off/ discarded
during the year is provided on pro- rata basis with reference to the
date of addition/ disposal/ discarding.
(v) INVESTMENTS
Current Investments are stated at lower of cost and fair value. Long
term investments are stated at cost after deducting provisions made, if
any, for other than temporary diminution in the value. Investments
which are readily realisable and intended to be held for period less
than one year are current investments. Other Investments are considered
as long term investments. Long term debt securities are carried at
amortized cost
(vi) IMPAIRMENT OF ASSETS
The carrying amounts of assets are reviewed at each Balance Sheet date
if there is any indication of impairment based on internal/external
factors. An asset is treated as impaired when the carrying cost of the
assets exceeds its recoverable value. An impairment loss, if any, is
charged to the Profit and Loss Account in the year in which an asset is
identified as impaired. Reversal of impairment losses recognised in
prior years is recorded when there is an indication that the impairment
losses recognised for the assets no longer exist or have decreased.
(vii) INVENTORIES
a) Finished Goods (including goods in transit), work-in-progress are
valued at cost or net realizable value whichever is lower.
b) Raw materials, components, stores and spares are valued at lower of
weighted Average cost or net realisable value. However, these items are
considered to be realisable at cost if the finished products in which
they will be used are expected to be sold at or above cost. Obsolete,
defective and unserviceable inventory is duly provided for. Scrapped
items of stock are valued at net realisable value.
c) Cost comprises of all costs of purchases, costs of conversions and
other costs incurred in bringing the inventory to their present
location and conditions.
d) The value of closing stock of finished goods lying at depot is
exclusive of freight charges and inclusive of excise duty paid.
(viii) TRANSACTION OF FOREIGN CURRENCY ITEMS
Transactions in foreign currency are recorded at the rate of exchange
prevailing on the date of transaction. Foreign currency monetary items
(except forward contract transactions) are reported using closing rate
of exchange at the end of the year. The resulting exchange gain/ loss
is reflected in the Profit and Loss Account. Other non-monetary items,
like fixed assets are carried in terms of historical cost using the
exchange rate at the date of transaction. Exchange rate difference
arising on account of conversion/ translation of liabilities for
acquisition of Fixed Assets is recognised in the Profit & Loss account.
(ix) RETIREMENT AND OTHER EMPLOYEE BENEFITS
Employee benefits of short term nature are recognized as expense as and
when accrued.
Defined Contribution Plan
The Company makes defined contribution to Provident Fund and
Superannuation schemes which are recognized in the Profit and Loss
Account on accrual basis.
Defined Benefit Plan
The Companys liabilities under Payment of Gratuity Act (funded), and
long term compensated absences (non funded) are determined on the basis
of actuarial valuation made at the end of each financial year using the
projected unit credit method except for short term compensated absences
which are provided for based on estimates. Actuarial gains and losses
are recognised immediately in the statement of Profit and Loss Account
as income or expense. Obligation is measured at the present value of
estimated future cash flows using a discounted rate that is determined
by reference to market yields at the Balance Sheet date on Government
bonds where the currency and tenure of the Government bonds are
consistent with the currency and estimated tenure of the defined
benefit obligation.
(x) RECOGNITION OF INCOME & EXPENDITURE
Sales are recorded net of trade discounts, Sales Tax, VAT, and include
excise duty. Revenue from sale of products is recognised when the
significant risks and rewards of ownership of the goods have passed to
the buyer.
Income and Expenditure are recognised on accrual basis but Sales claims
under escalation clause, insurance and other claims are accounted on
acceptance basis.
(xi) BORROWING COST
Borrowing Costs, attributable to acquisition and construction of
qualifying assets, are capitalised as a part of the cost of such asset
up to the date when such assets are ready for its intended use. Other
borrowing costs are charged to the Profit and Loss Account.
(xii) TAXATION
a) Tax expense comprises of current and deferred tax.
b) Provision for current tax is made on the basis of estimated taxable
income for the current accounting year in accordance with the
provisions of Income Tax Act, 1961.
c) The deferred tax for timing differences is accounted for, using the
tax rates and laws that have been substantively enacted as of the
Balance Sheet date. Deferred tax assets arising from timing differences
are recognised to the extent there is reasonable certainty that these
would be realised in future.
d) Deferred tax assets in case of unabsorbed losses and unabsorbed
depreciation are recognised only if there is virtual certainty that
such deferred tax asset can be realised against future taxable profits.
e) Credit for entitlement of Minimum Alternate Tax (MAT) is recognized
only if the same can be utilized within statutorily permissible time.
(xiii) INTANGIBLE ASSETS
Intangible Assets are recognized by the Company only if it is probable
that the future economic benefits that are attributable to the assets
will flow to the enterprise and the cost of the same can be measured
reliably.
Intangible Assets are amortized on a systematic basis over its useful
life and the amortization for each period will be recognized as an
expense.
(xiv) GOVERNMENT GRANTS/ CAPITAL SUBSIDY
a) Capital subsidy/ Government grants are recognised when there is
reasonable assurance that the same will be received. Revenue grants are
recognised in the Profit & Loss Account.
b) Capital subsidy/ Government grants relating to specific non
depreciable fixed assets and in the nature of Promoters Contribution
are credited to capital reserve account.
c) Capital subsidy/ Government grants related to specific depreciable
assets are credited to capital reserve account and are recognized as
income in profit and loss statement on a systematic and rational basis
over the useful life of assets.
(xv) CONTINGENT LIABILITIES AND PROVISIONS
Contingent Liabilities are possible but not probable obligations as on
Balance Sheet date, based on the available evidence. Contingent
Liabilities are not provided for in the accounts. These are disclosed
by way of Notes to the Accounts.
Provisions are recognised when there is a present obligation as a
result of past event, and it is probable that an outflow of resources
will be required to settle the obligation, in respect of which a
reliable estimate can be made. Provisions are determined based on best
estimate required to settle the obligation at the Balance Sheet date.