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Accounting Policies of Kolte-Patil Developers Ltd. Company

Mar 31, 2015

A. Basis of Preparation of Financial Statements

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 ("the 2013 Act”)/ the Companies Act, 1956 ("the 1956 Act”), as applicable. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

B. Use of Estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known / materialise.

C. Inventories

Inventory comprises of stock of raw materials, completed properties for sale and properties under construction (Work in Progress). Work In Progress comprises cost of land, development rights, TDR, construction and development cost, cost of material, services and other overheads related to projects under construction. Inventory is valued at cost or net realizable value whichever is lower.

D. Cash Flow Statement

Cash flow statement is prepared under the 'Indirect Method' Prescribed under Accounting Standard 3 'Cash Flow Statements' prescribed under the Companies (Accounts) Rules, 2014. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

E. Fixed Assets

Fixed assets are carried at cost less accumulated depreciation/amortisation. The cost of fixed assets comprises its purchase price, directly attributable expenditure on making the asset ready for its intended use, other incidental expenses and interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use. Subsequent expenditure on fixed assets after its purchase / completion is capitalised only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance.

Capital work-in-progress:

Projects under which tangible fixed assets are not yet ready for their intended use are carried at cost, comprising direct cost, related incidental expenses and attributable interest.

F. Depreciation/Amortization

Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value.

Depreciation on tangible fixed assets has been provided on the straight-line method as per the useful life prescribed in Schedule II to the Companies Act, 2013.

Intangible Assets

Computer Software is amortized over a period of six years.

G. Revenue Recognition

i. Revenue from real estate projects including integrated townships is recognised on the 'Percentage of Completion Method' of accounting. Revenue is recognized, in relation to the sold areas only, on the basis of percentage of actual cost incurred thereon including land as against the total estimated cost of the project under execution subject to construction costs being 25% or more of the total estimated cost. The estimates of saleable area and costs are revised periodically by the management. The effect of such changes to estimates is recognised in the period such changes are determined.

In accordance with Revised Guidance Note issued by the Institute of Chartered Accountants of India (ICAI), on 'Accounting for Real Estate Transactions (Revised 2012)', revenue recognition for all real estate projects commencing on or after 1 April, 2012 or where the revenue is recognised for the first time on or after 1 April, 2012, revenue is recognised on percentage of completion method if (a) actual construction and development cost (excluding land cost) incurred is 25% or more of the estimated cost, (b) At least 25% of the saleable project area is secured by contracts or agreements with buyers and (c) At least 10% of the total revenue as per sales agreement or any other legally enforceable document are realised as at the reporting date.

ii. In case of joint development projects, revenue is recognised to the extent of company's percentage share of the underlying real estate development project.

iii. Revenue from sale of land is recognised when the agreement to sell is executed resulting in transfer of all significant risk and rewards of ownership and possession is handed over to the buyer.

iv. Facility charges, management charges, project management fees, rental, hire charges, sub lease and maintenance income are recognized on accrual basis as per the terms and conditions of relevant agreements.

v. Interest income is accounted on accrual basis on a time proportion basis.

vi. Dividend income is recognized when right to receive is established.

vii. Share of profit (Loss) from partnership firms/LLPs in which the Company is partner is recognized based on the financial information provided and confirmed by the respective firms.

H. Cost of Construction / Development

Cost of Construction/Development (including cost of land) incurred is charged to the statement of profit and loss proportionate to project area sold. Costs incurred for projects which have not achieved reasonable level of development is carried over as construction work-in-progress.

I. Unbilled Receivables

Unbilled receivables represent revenue recognised on 'Percentage of Completion Method' less amount due from customers as per payment plans adopted by them.

J. Foreign Currency Transactions

(i) Initial recognition

Transactions in foreign currencies entered into by the Company are accounted at the exchange rates prevailing on the date of the transaction.

(ii) Measurement at the balance sheet date

Foreign currency monetary items of the Company, outstanding at the balance sheet date are restated at the year-end rates.

(iii) Treatment of exchange differences

Exchange differences arising on settlement / restatement of short-term foreign currency monetary assets and liabilities of the Company are recognised as income or expense in the Statement of Profit and Loss.

K. Investments

Long-term investments are carried individually at cost less provision for diminution, other than temporary, in the value of such investments. Current investments are carried individually, at the lower of cost and fair value. Cost of investments include acquisition charges such as brokerage, fees and duties.

L. Employee Benefits

Employee benefits include provident fund, employee state insurance scheme, gratuity fund, compensated absences.

a) Defined contribution plans

The Company's contribution to provident fund and employee state insurance scheme are considered as defined contribution plans and are charged as an expense based on the amount of contribution required to be made and when services are rendered by the employees.

b) Defined benefit plans

For defined benefit plans in the form of gratuity fund, the cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each balance sheet date. Actuarial gains and losses are recognised in the Statement of Profit and Loss in the period in which they occur. Past service cost is recognised immediately to the extent that the benefits are already vested and otherwise is amortised on a straight-line basis over the average period until the benefits become vested. The retirement benefit obligation recognised in the Balance Sheet represents the present value of the defined benefit obligation as adjusted for unrecognised past service cost, as reduced by the fair value of scheme assets. Any asset resulting from this calculation is limited to past service cost, plus the present value of available refunds and reductions in future contributions to the scheme.

c) Short-term employee benefits

The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees are recognised during the year when the employees render the service. These benefits include performance incentive and compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related service.

The cost of short-term compensated absences is accounted as under :

(a) in case of accumulated compensated absences, when employees render the services that increase their entitlement of future compensated absences; and

(b) in case of non-accumulating compensated absences, when the absences occur.

d) Long-term employee benefits

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related service are recognised as a liability at the present value of the defined benefit obligation as at the balance sheet date less the fair value of the plan assets out of which the obligations are expected to be settled.

M. Employee Stock Option Scheme

The Company has formulated Employee Stock Option Schemes (ESOS) in accordance with the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999. The Schemes provide for grant of options to employees of the Company to acquire equity shares of the Company that vest in a graded manner and that are to be exercised within a specified period. The Company accounts the employee stock based compensation under intrinsic value method. In accordance with the SEBI Guidelines; the excess, if any, of the closing market price on the day prior to the grant of the options under ESOS over the exercise price is amortised on a straight-line basis over the vesting period.

N. Borrowing Cost

Borrowing costs that are directly attributable to the acquisition or construction of a qualifying asset are considered as part of the cost of that asset. Other borrowing costs are recognized as an expense in the year in which they are incurred.

O. Operating Leases

Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor are recognised as operating leases. Lease rentals receipts / payments under operating leases are recognised in the statement of profit and loss on a straight-line basis.

P. Earnings Per Share

Basic earnings per share is computed by dividing the net profit or loss for the year by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the net profit or loss for the year by the weighted average number of equity shares outstanding during the year as adjusted for the effects of all diluted potential equity shares except where the results are anti-dilutive.

Q. Taxes On Income

Tax expenses comprise both current and deferred tax. Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted as at the reporting date. Deferred tax liabilities are recognised for all timing differences. Deferred tax assets are recognised for timing differences of items other than unabosrbed depreciation and carry forward losses only to the extent that reasonable certainty exists that sufficient future taxable income will be available against which these can be realised. However, if there are unabsorbed depreciation and carry forward of losses, deferred tax assets are recognised only if there is virtual certainty that there will be sufficient future taxable income available to realise the assets. Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Company has a legally enforceable right for such set off. Deferred tax assets are reviewed at each balance sheet date for their readability.

R. Impairment

The carrying values of assets / cash generating units at each balance sheet date are reviewed for impairment. If any indication of impairment exists, the recoverable amount of such assets is estimated and impairment is recognized, if the carrying amount of these assets exceeds their recoverable amount. The recoverable amount is the greater of the net selling price and their value in use. Value in use is arrived at by discounting the future cash flows to their present value based on an appropriate discount factor. When there is indication that an impairment loss recognized for an asset in earlier accounting periods no longer exists or may have decreased, such reversal of impairment loss is recognized in the Statement of Profit and Loss, except in case of revalued assets.

S. Provisions, Contingent Liabilities and Contingent Assets

A provision is recognised when the Company has a present obligation as a result of past events 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 (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

Contingent liabilities are disclosed in the Notes.

Contingent assets are not recognised in the financial statements.

T. Operating Cycle

Based on the nature of products / activities of the Company and the normal time between acquisition of assets and their realisation in cash or cash equivalents, the Company has determined its operating cycle as 12 months for the purpose of classification of its assets and liabilities as current and non-current.


Mar 31, 2014

A. Basis of Preparation of Financial Statements

The financial statements are prepared under the historical cost convention, on the accrual basis of accounting and in accordance with Generally Accepted Accounting Principles (''GAAP'') in India and comply with the Accounting Standards notified under the Companies Act, 1956 ("the Act") (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs). The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

B. Use of Estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognized in the periods in which the results are known / materialize.

C. Inventories

Inventory comprises of completed properties for sale and properties under construction (Work in Progress). Work In Progress comprises cost of land, development rights, TDR, construction and development cost, cost of material, services and other overheads related to projects under construction. Inventory is valued at cost or net realizable value whichever is lower.

D. Cash Flow Statement

Cash flow statement is prepared under the ''Indirect Method'' Prescribed under Accounting Standard 3 ''Cash Flow Statements'' prescribed under the Companies (Accounting Standard) Rules, 2006. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

E. Fixed Assets

Fixed assets are carried at cost less accumulated depreciation. The cost of fixed assets comprises its purchase price, directly attributable expenditure on making the asset ready for its intended use, other incidental expenses and interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use. Subsequent expenditure on fixed assets after its purchase/completion is capitalised only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance.

F. Depreciation/Amortization

Depreciation on fixed assets is provided on straight line method at the rates specified in Schedule XIV to the Companies Act, 1956.

In respect of leasehold building, leasehold improvement plant & machinery and leasehold improvement furniture & fixtures, depreciation has been provided over the period of lease.

G. Revenue Recognition

i. Revenue from real estate projects is recognized on the ''Percentage of Completion Method'' of accounting, in accordance with Revised Guidance Note issued by the Institute of Chartered Accountants of India (ICAI), on ''Accounting for Real Estate Transactions (Revised 2012)''.

Revenue is recognized, in relation to the sold areas only, on the basis of percentage of actual cost incurred thereon including land as against the total estimated cost of the project under execution, only after the stage of completion of the project work reaches a reasonable level of development. A reasonable level of development is not achieved if the expenditure incurred on construction and development costs is less than 25 % of the total estimated construction costs (excluding cost incurred in acquisition of Land and development rights). Accordingly, cost of construction and development (including cost of Land) is charged to the statement of profit and loss in proportion to the revenue recognized during the year and balance costs are carried as part of ''Work in Progress'' under inventories.

The amount receivable against the percentage of revenue recognized is accounted as Current Assets under the head ''Trade Receivables'' and the excess amount received from customer which does not qualify for revenue recognition under the Percentage Completion Method is accounted as Other Current Liabilities under the head ''Advance from Customers''

The estimates of saleable area and costs are revised periodically by the management. The effect of such changes to estimates is recognized in the period such changes are determined.

ii. In case of joint development projects, revenue is recognised to the extent of company''s percentage share of the underlying real estate development project.

iii. Revenue from sale of land is recognised when the agreement to sell is executed resulting in transfer of all significant risk and rewards of ownership and possession is handed over to the buyer.

iv. Facility charges, management charges, project management fees, rental, hire charges, sub lease and maintenance income are recognized on accrual basis as per the terms and conditions of relevant agreements.

v. Interest income is accounted on accrual basis except for interest on delayed payments by the customers, which are accounted on receipt basis.

vi. Dividend income is recognized when right to receive is established.

vii. Share of profit (Loss) from partnership firms/LLPs in which the Company is partner is recognized based on the financial information provided and confirmed by the respective firms.

H. Cost of Construction / Development:

Cost of Construction/Development (including cost of land) incurred is charged to the statement of profit and loss proportionate to project area sold. Costs incurred for projects which have not achieved reasonable level of development is carried over as construction work-in-progress.

I. Foreign Currency transactions

All transactions in foreign currency are recorded on the basis of the exchange rate prevailing as on the date of transaction. The difference, if any, on actual payment / realization is recorded to the statement of profit & loss. Monetary assets and liabilities denominated in foreign currency are restated at rates prevailing at the year-end. The net loss or gain arising out of such conversion is dealt with in the statement of profit and loss.

J. Investments

Long-term investments are carried individually at cost less provision for diminution, other than temporary, in the value of such investments. Current investments are carried individually, at the lower of cost and fair value. Costs of investments include acquisition charges such as brokerage, fees and duties.

K. Employee Benefits:

Employee benefits include provident fund, employee state insurance scheme, gratuity and compensated absences.

a) Defined contribution plans

The Company''s contribution to provident fund and employee state insurance scheme are considered as defined contribution plans and are charged as an expense based on the amount of contribution required to be made and when services are rendered by the employees.

b) Defined benefit plans

For defined benefit plans in the form of gratuity fund, the cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each balance sheet date. Actuarial gains and losses are recognised in the statement of profit and loss in the period in which they

occur. Past service cost is recognised immediately to the extent that the benefits are already vested and otherwise is amortised on a straight-line basis over the average period until the benefits become vested. The retirement benefit obligation recognised in the Balance Sheet represents the present value of the defined benefit obligation as adjusted for unrecognised past service cost.

c) Short-term employee benefits

The undiscounted amount of short-term employee benefits expected to be paid in exchange forthe services rendered by employees are recognised during the year when the employees render the service. These benefits include performance incentive and compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related service.

The cost of short-term compensated absences is accounted as under:

(a) in case of accumulated compensated absences, when employees render the services that increase their entitlement of future compensated absences; and

(b) in case of non-accumulating compensated absences, when the absences occur.

d) Long-term employee benefits

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related service are recognised as a liability at the present value of the defined benefit obligation as at the balance sheet date.

L. Borrowing Cost

Borrowing costs that are directly attributable to the acquisition or construction of a qualifying asset are considered as part of the cost of that asset. Other borrowing costs are recognized as an expense in the year in which they are incurred.

M. Operating leases

Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor are recognised as operating leases. Lease rentals receipts / payments under operating leases are recognised in the statement of profit and loss on a straight-line basis.

N. Earnings Per Share

Basic earnings per share is computed by dividing the net profit or loss for the year by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the net profit or loss for the year by the weighted average number of equity shares outstanding during the year as adjusted for the effects of all diluted potential equity shares except where the results are anti-dilutive.

O. Taxes on income

Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted as at the reporting date. Deferred tax liabilities are recognised for all timing differences. Deferred tax assets are recognised for timing differences of items other than unabosrbed depreciation and carry forward losses only to the extent that reasonable certainty exists that sufficient future taxable income will be available against which these can be realised. However, if there are unabsorbed depreciation and carry forward of losses, deferred tax assets are recognised only if there is virtual certainty that there will be sufficient future taxable income available to realise the assets. Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Company has a legally enforceable right for such set off. Deferred tax assets are reviewed at each balance sheet date for their realisability.

P. Provisions and contingencies

A provision is recognised when the Company has a present obligation as a result of past events 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 (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes. Contingent assets are not recognised in the financial statements.

(3C) The Company has only one class of shares referred to as equity shares having a par value of Rs. 10/- per share. Each holder of equity shares is entitled to one vote per share held.

(3D) The Company declares and pays dividend in Indian Rupees. The Board of Directors had declared I nterim Dividend of Rs. 1.5 per share in their meeting held on October 26, 2013. A final dividend of Rs. 1.6 per share has been recommended by the Board of Directors in their meeting held on May 20,2014, subject to the approval of shareholders in the ensuing Annual General Meeting. If approved, thetotal dividend (Interim and Final dividend) for the financial year 2013-2014 will beRs.3.1 per equity share. Thetotal dividend appropriation for the year ended 31 st March 2014 amounted to Rs.2,697 lakhs including Corporate Dividend Distribution Tax of Rs.348 lakhs (Previous year Rs.3,078 lakhs including Corporate Dividend Distribution Tax of Rs.426 lakhs).

(3E) Pursuant to the Scheme of Amalgamation of wholly owned subsidiary i.e. Oakwoods Hospitality Private Limited (Oakwoods) with effect from 1st April 2013, authorised share capital of the Company has been increased to Rs. 11,200 lakhs.

Details of terms of repayment and securities provided in respect of secured term loans are as under: i) Term Loan from Banks :

a) IDBI Loan Against property (Sanctioned Rs. 1,000 lakhs): Outstanding Balance Rs.1,000 lakhs (PY - Rs.1,000 lakhs)

Primary Security: Office No 101-B,102,105D,106,107AB,112C,201-203-204-205-206-207-208,First & Second Floor, City Point S.no 347B, 347A, Hissa No 3C/1 A/1, 348A hissa no 1/1/, 348A hissa no 1/2A, Final Plot no 188 CST No 14(part) 14/1, 14/2 Dhole Patil Road Pune 01.

Collateral Security: Extension of Regd. Mortgage of Boat club road land, Final plot no 188, S no. 347/B, 347/A, 3C/1 A/1, 348A/1/1 and 348A/1/2A, Total area 113883 sq. ft. at Pune Rate of Interest: BBR Plus 5.25% (i.e.effective 15.50% p.a. )

Repayment Terms : In 23 Quarterly Installments commencing from 1st April 2014 (22 instalments of Rs. 44 lakhs and last 23rd installment of Rs. 32 lakhs )

b) IDBI Project Term Loan - 24 K Glitterati (Sanctioned Rs. 2,102 lakhs): Outstanding Balance Rs. 681 lakhs (PY ^2,102 lakhs)

Primary Security: Mortgage of land at survey no 14 Hissa No 14/3/1/1, 14/4/1, 14/5/12 to 4 admeasuring 34400 sq. mtr. located at Pimple Nilakh in Pune.

Collateral Security: 1) Extension of Regd. mortgage of boat club Road Land, Final Plot no 188 S.no 347B, 347/A 3C/1 A/1, 348A/1/1 and 348A/1/2A total area 113883 Sq Ft. at Pune 2)Office No.101B, 102, 105D, 106, 107AB, 112C, 201-202-203-204-205-206-207-208, First and second floors, "City PoinfS. No. 347B, 347A, Hissa No. 3C/1A/1, 348 A Hissa No. 1/1, 348A Hissa No. 1/2A, final plot no.188 CST No. 14(part) 14/1, 14/2 Dhole Patil Road Pune-01

The Company has provided personal guarantees of Mr. Rajesh Patil, Mr. Naresh Patil, Mr. Milind Kolte and Mrs. Sunita Kolte, directors of the Company.

Rate of Interest: BBR Plus 550 bps (effective 15.75% p.a.)

Repayment Terms: 12 Equal Quarterly Installment commenced from 1 st Dec 2011 and ending on September 2014

c) IDBI Project Term Loan - City Bay (Sanctioned Rs. 1,000 lakhs): Outstanding Balance Rs. 712 lakhs (PY -Rs.750 lakhs)

Primary Security: Floor No - Ground to 5th floor of Building named City Bay Situated at plot no 188, Tower 3 admeasuring 3606.55 Sq. Mtr.

Collateral Security: Extension of Regd. Mortgage of Boat Club Road Land Final Plot no 188, S.no 347-B, 347/A,3C/1 A/1,348/1/1 and348A/1/2A, Total areal 13883 Sq. Ft. at Pune and Office No 101B,102,105D,10 6,107AB,112C,201-202-203-204-206-207-208, first and second floors city Point s.no 347B,347A Hissa No 3C/1A/1,348A Hissa No 1/1, 348A hissa No 1/2A, final Plot No 188CTS No 14(part) 14/1,14/2 Dhole Patil Road Pune-01

Rate of Interest: BBR plus 300 bps (i.e. effective 13.25% p.a.)

Repayment Terms : 14 monthly installments commencing from 1st Dec 2013 (13 installment of Rs.72 Lakhs and Last 14th installment of Rs.64 lakhs)

d) Vijaya Bank Construction Finance - City Bay (Sanctioned Rs. 2,000 lakhs): Outstanding Balance Rs.1,499 lakhs (PY-Rs.850 lakhs)

Security : Exclusive Charge by way of equitable Mortgage on proposed sixth, seventh, eighth and ninth floor admeasuring 318,421 sq.ft. of proposed Building, City Bay

Rate of Interest: Base Rate 2.75% 0.25% p.a.(floating ) (i.e. 13.45% p.a. at present)

Repayment Terms : The Principal is to be repaid in 72 equal monthly installments after a moratorium period of 24months from the date of first disbursement. Interest is to be serviced as and when debited.

e) State Bank of India Projects Term Loan - Raaga - Bangalore (Sanctioned Rs. 4,300 lakhs): Outstanding Balance Rs. 2,849 lakhs (PY - Rs.1,864 lakhs)

Primary Security: Land admeasuring 6 acres 29 Guntas i.e. 292,941 sq. ft. for phase I and II and buildings to be constructed at s.no 33, Kannur Village, Bidarahalli Hobli Nr Yelakhanka, Bangalore East Taluka. Collateral Security : land admeasuring 5,400 sq. ft. and house property (basement g 2 admeasuring 9200 sq.ft. built up)at No 978 (amalgamation of 978 &979) HAL 2nd stage indiranagar Bangalore. Prime: Negative lien on unsold flats.

The Company has provided personal guarantees of Mr. Rajesh Patil, Mr. Naresh Patil, Mr. Milind Kolte and Mrs. Vandana Patil, directors of the the Company.

Rate of Interest: Base Rate 9.75% Spread 3.75% (i.e. 13.50%)

Repayment Terms : Quarter ending Dec 2014Rs. 1,000 lakhs, March 2015 Rs. 1,000 lakhs, June 2015 Rs. 1,000

lakhs and Sept 15 Rs. 1,000 lakhs

f) Axis Bank Loan Against Property (Sanctioned Rs. 500 lakhs): Outstanding - Nil (PY - Rs.146 lakhs) Security: Charge secured by registered simple mortgage of Showroom no. 3 and no. 6 on the ground floor of the building Delta II and first floor and terrace thereon of the Amenity Building of the project Giga Space constructed on S.N. 198/1B situated at Mouze Lohagaon Corporation and within district Taluka Haveli Repaid in equal 81 monthly installments commencing from January 2008 and ending on August, 2014.

ii) Term Loan from Financial Institutions / others :

a) Capital First Limited - (Sanctioned Rs. 7,500 lakhs): Outstanding Balance Rs. 5,850 lakhs (PY-Rs.Nil)

Security : Exclusive Charge on the escrow on all the receivable credited to KPDL after payment is made to the respective construction finance lender from Glitterati Project. Exclusive charge by way of Mortgage of all unsold projects assets and exclusive mortgage on land, hypotication over all the project receivable and inventory of giga residency Projects. Escrow of all projects cash flow accruing from sale of projects, including but not limited to deposits/ rentals/sale proceeds/ any other receipts of any nature in such form and manner as may be required by the lender from the projects mentioned above till our facility is fully repaid. Rate of Interest: 18% p.a. payable quarterly fixed for entire term of the facility

Repayment Terms : Repayment in quarterly installments after the moratorium period of 12 months i.e. Repayment of loan shall commence from the last day of the 12th Month from drawdown; but subject to mandatory prepayment.

b) Aditya Birla Finance Limited - (Sanctioned Rs. 1,600 lakhs): Outstanding Balance Rs. 1,600 lakhs (PY- Rs.NM)

Security: First and Exclusive charge by way of Registered MoE on the Commercial Property Alyssa (area approx. 19,600 sq.ft.) having New no 23 old No 28 Richmond Road, Richmond Town Bangalore - 560025 and hypothication of receivables from M/s Mirabilis Project

The Company has provided personal guarantees of Mr. Naresh Patil and Mrs. Vandana Patil, Directors of the the Company.

Rate of Interest: Facility 14.50% P.a. floating which is linked to ABFL long term reference Rate (i.e. ABFL LTRR /-Margin) LTRR of ABFL at Present is 16.50 % P.a. Margin offered is -2%for Facility Repayment Terms: Month -0 to Month 06 interest on the draw down amount to be serviced on monthly basis Month 07 to Month 48 installment of Rs. 48.80 lakhs iii) Vehicle Loans: Outstanding Balance Rs. 247 lakhs ( PY - Rs. 186 lakhs) Security: All the Vehicle loans are secured by the respective vehicles only. Rate of Interest: The Rate of Loans are between 10 to 18%

1. IDBI Bank Cash Credit: Rs. Nil ( PY - Rs. 2,000 lakhs)

Primary Security: Hypothecation of Construction Material, WIP, receivables and Plant and Machinery with all fixture and fittings attached embedded fastened thereon and also other plants machinery goods, articles chattels, things, stores, motor trucks, motor cars, motor vehicles, that are possessed/under process or otherwise, under control of the Company.

Collateral Security: Extension of Regd. Mortgage of Boat Club Road land, final plot no. 188, S. No. 347-B, 347/A 3C/1 A/1, 348A/1/1 and 348A/1/2A, total area 113,883 sq. ft. at Pune. Regd. Mortgage of land at C.S. No. 23/170 A & B, Aundh Land. Total Area 572,587 sq. ft. Office No. 101B, 102, 105D, 106, 107AB, 112C, 201-202-203-204- 205-206-207-208. Total Area 11,845 sq.ft. First and Second Floors, City Point, S. No. 347B, 347A, Hissa No. 3C/1 A/1, 348 A Hissa No. 1/1, 348A Hissa No. 1/2A, final plot no. 188 CST No. 14 (part) 14/1, 14/2 The Company has provided personal guarantees of Mr. Rajesh Patil, Mr. Naresh Patil, Mr. Milind Kolte and Mrs. Vandana Patil, directors of the the Company. Repayment Terms: On demand

2. Axis Bank : Rs.932 lakhs (PY -Rs. Nil)

Primary Security: Exclusive first hypothecation charge on Current assets (construction Material WIP and receivables) of all the real estate projects of the company present and future excluding the project for which the company has availed project specific funding from any other bank.

Collateral Security: Exclusive registered mortgage of land located at S.no. 171/1 and 171/2and 172 1/2 admeasuring 9460 sq mtr at Tal. Mulshi, Wakad, Pune in the name of Bouvardia Developers LLP (an entity in KPDL group).Extension of charge on the Commercial premises Showroom no 6 on the Ground floor of Building

Delta Giga Space admeasuring 5,300 sq. ft. standing in the name of the Company .

Interim additional security : Exclusive mortgage of property at unit nos 12,13, 30 at Biz Bay project in the in the name of the company admeasuring 3,750 sq. ft. of salable area.

The Company has provided personal guarantees of Mr. Rajesh Patil, Mr. Naresh Patil, Mr. Milind Kolte and Mrs. Vandana Patil, Directors of the the Company.

Repayment Terms: On demand

3. IDBI Bank - Overdraft Facility

Security - Bank Fixed Deposit Rate of Interest: Bank FD plus 1.5%


Mar 31, 2013

A. Basis of Preparation of Financial Statements

The Financial Statements are prepared on the historical cost convention in accordance with Indian Generally Accepted Accounting Principles ("GAAP") comprising the Accounting Standards issued by The Institute of Chartered Accountants of India and as notified under the Companies (Accounting Standards) Rules, 2006 and the provisions of The Companies Act, 1956 as adopted consistently by the Company.

b. Use of Estimates

The preparation of Financial Statements in conformity with generally accepted accounting principles requires the Management to make estimates and assumptions that affect the reported balances of assets and liabilities as on the date of the Financial Statements and reported amounts of income and expenses during the period. The Management believes that the estimates used in the preparation of Financial Statements are prudent and reasonable. Actual results could differ from the estimates.

c. Fixed Assets

The Gross Block of Fixed Assets are stated in the Accounts at the purchase price of acquisition of such assets including any attributable cost of bringing the assets to its working condition for its intended use. Office premises located at Jalgaon have been taken on lease for a period of 50 years and the same is reflected in Gross Block at Rs. 1.0 lakh. The leasehold premises have been amortised @ 2% per annum on the basis of period of lease.

d. Depreciation/Amortization

Depreciation is provided as per the"Straight Line Method" according to the rates prescribed in Schedule XIV of the Companies Act, 1956. The Cost of Leasehold rights is being amortized at the rate of 2% per annum considering the period of lease.

e. Revenue Recognition

i) Sale of Flats and Shops

During the year, the Company has followed the Percentage Completion Method of accounting as per the Guidance Note on Revenue Recognition by the Real Estate Developers issued by The Institute of Chartered Accountants of India. Total Sale Consideration as per the agreements of sale of constructed properties is recognized as revenue based on the percentage of actual project cost incurred thereon, including the cost of land, estimated construction and development cost of the such properties, subject to actual construction cost incurred being 25% or more of the total cost of the construction of the project.

The amount received from customers which does not qualify for revenue recognition under the Percentage Completion Method is accounted as Current Liabilities under the head "Other Current Liabilities Sub Head "Advance from Customers". The amount receivable against the percentage of revenue recognized is accounted for as Current Assets under the head "Trade Receivables" and the excess amount received from customer is accounted as current Liabilities under the head "Advance from Customers".

ii) Sale of Land

Sale of land is recognized when the agreement is executed for land transfer between the parties.

iii) Lease Rent Income

Lease Rent Income is recognized on accrual basis.

iv) Share of Profit in Partnership Firm / Joint Venture

The share of net profit after tax from the firms, in which the Company is partner or the joint venturer, is accounted for as per the Financial Statement of accounts of the firms, joint ventures.

v) Income from Investment

Interest on fixed deposit, debentures and dividend on mutual fund is accounted on accrual basis, whereas dividend from shares is accounted for on receipt basis.

vi) Project Management Fees

Revenue from Project Management fees is recognized as per the terms of contract agreed between the parties.

f. Inventories

Inventory comprises of finished property and properties under construction - (Work in Progress). Work In Progress comprises cost of land, development rights, TDR, Construction and development cost, cost of material, services and other overheads related to projects under construction. Inventory is valued at cost or net realizable value whichever is lower.

g. Investments

Long-term investments are stated at cost after providing for any diminution in value, if such diminution is of permanent nature. Current investments are carried at lower of cost or market value. The determination of carrying amount of such investments is done on the basis of specific identification. Investments in integrated joint ventures are carried at cost net off adjustments for Company''s share in profits or losses as recognized.

h. Retirement Benefits

Liability is provided for retirement benefits of Provident Fund and Gratuity in respect of eligible employees contributions under the defined contribution scheme are charged to revenue. The liability in respect of defined benefit scheme like Gratuity, Leave Encashment, etc. are provided in the accounts on the basis of actuarial valuation as on 31 st March 2013.

i. Borrowing Cost

Borrowing costs are recognized as expenses in the period in which they are incurred and debited to Profit and Loss Account. j. Taxation

Income Tax expenses for the year include Current Tax. Provision for current income tax is made on the current tax rate based on assessable income for the year worked out as per the provision of The Income tax Act 1961, as applicable for Assessment Year 2013-2014. The deferred tax assets and liabilities are recognized for the future tax consequences of timing differences, subject to the consideration of prudence. Deferred tax assets and liabilities are measured using the tax rates enacted or substantively enacted by the Balance Sheet date. k. Provisions, Contingent Liabilities and Contingent Assets

As per Accounting Standard 29, Provisions, Contingent Liabilities and Contingent Assets, issued by the Institute of Chartered Accountants of India, the Company recognizes provisions only when it has a present obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation as and when a reliable estimate of the amount of the obligation can be made. No provision is recognized for -

(a) Any possible obligation that arises from past events and the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company; or

(b) Any present obligation that arises from past events but is not recognized because-

(i) It is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or

(ii) A reliable estimate of the amount of obligation cannot be made.

Such obligations are recorded as Contingent Liabilities. These are assessed continually and only that part of the obligation for which an outflow of resources embodying economic benefits is probable, is provided for, except in the extremely rare circumstances where no reliable estimate can be made. Contingent Assets are not recognized in the financial statements since this may result in the recognition of income that may never be realized.

l. Impairment of Asset

At each Balance Sheet date, the Company reviews the carrying amounts of its fixed assets to determine whether there is any indication that those assets suffered impairment loss, if any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment loss. Recoverable amount is the higher of an asset''s net selling price and value in use. In assessing value in use, the estimated future cash flows expected from the continuing use of the asset and from its disposal are discounted to their present value using a pre-discount rate that reflect the current market assessment of time value of money and the risks specific to the asset. The impairment loss as determined above is expensed off. An impairment loss recognized in prior accounting period is reversed if there has been change in the estimate of the recoverable amount.

m. IPO Expenses

Expenses incurred for the public issue of equity shares of the Company are considered as deferred revenue expenditure to be amortized in 60 months.

n. Earnings Per Share

The Company reports basic and diluted earnings per share in accordance with Accounting Standard - 20 ''Earnings Per Share'' issued by the Institute of Chartered Accountants of India on basic earnings per share is computed by dividing the net profit or loss for the period by the weighted average number of Equity shares outstanding during the period. Diluted earnings per share is computed by dividing the net profit or loss for the period by the weighted average number of equity shares outstanding during the period as adjusted for the effects of all diluted potential equity shares except where the results are anti-dilutive.

o. Cash Flow Statement

The Cash Flow Statement is prepared by indirect method as set out in Accounting Standard 3 on Cash Flow Statement and presents cash flows by Operating, Investing and Financing activities of the Company.

p. Foreign Currency Transactions

Transactions in foreign currency and non- monetary assets are accounted on the date of the transactions. All monetary items denominated in foreign currency are converted at the year end exchange rate. Expenditure of the liaison office is translated at the yearly average rate of exchange. The exchange differences arising on such conversion and on settlement of the transactions are shown as Foreign Currency Translation Reserve under the head of Reserve and Surplus.


Mar 31, 2012

A. Basis of Preparation of Financial Statements

The Financial Statements are prepared on the historical cost convention in accordance with Indian Generally Accepted Accounting Principles ("GAAP") comprising the Accounting Standards issued by The Institute of Chartered Accountants of India and as notified under the Companies (Accounting Standards) Rules, 2006 and the provisions of The Companies Act, 1956 as adopted consistently by the Company.

b. Use of Estimates

The preparation of Financial Statements in conformity with generally accepted accounting principles requires the Management to make estimates and assumptions that affect the reported balances of assets and liabilities as on the date of the Financial Statements and reported amounts of income and expenses during the period. The Management believes that the estimates used in the preparation of Financial Statements are prudent and reasonable. Actual results could differ from the estimates.

c. Fixed Assets

The Gross Block of Fixed Assets is stated in the Accounts at the purchase price of acquisition of such assets including any attributable cost of bringing the assets to its working condition for its intended use. Office premises located at Jalgaon have been taken on lease for a period of 50 years and the same is reflected in Gross Block at Rs. 1.0 lakh. The leasehold premises have been amortized @ 2% per annum on the basis of period of lease.

d. Depreciation/Amortization

Depreciation is provided as per the "Straight Line Method" according to the rates prescribed in Schedule XIV of the Companies Act, 1956. The Cost of Leasehold rights is being amortized at the rate of 2% per annum considering the period of lease.

e. Revenue Recognition

i) Sale of Flats and Shops

During the year, the Company has followed the Percentage Completion Method of accounting as per the Guidance Note on Revenue Recognition by the Real Estate Developers issued by The Institute of Chartered Accountants of India. Total Sale Consideration as per the agreements of sale of constructed properties is recognized as revenue based on the percentage of actual project cost incurred thereon, including the cost of land, estimated construction and development cost of the such properties, subject to actual construction cost incurred being 20% or more of the total cost of the construction of the project.

The amount received from customers which does not qualify for revenue recognition under the Percentage Completion Method is accounted as Current Liabilities under the head Other Current Liabilities, Sub Head Advance from Customers". The amount receivable against the percentage of revenue recognized is accounted for as Current Assets under the head Trade Receivables and the excess amount received from customer is accounted as Current Liabilities under the head Advacne from Customers.

ii) Sale of Land

Sale of land is recognized when the agreement is executed for land transfer between the parties.

iii) Lease Rent Income

Lease Rent Income is recognized on accrual basis.

iv) Share of Profit in Partnership Firm / Joint Venture

The share of net profit after tax from the firms, in which the Company is partner or the joint venturer, is accounted for as per the Financial Statement of accounts of the Firms, Joint Ventures.

v) Income from Investment

Interest on fixed deposit, debentures and dividend on mutual fund is accounted on accrual basis, whereas dividend from shares is accounted for on receipt basis.

vi) Project Management Fees

Revenue from Project Management fees is recognized as per the terms of contract agreed between the parties.

f. Inventories

Inventory comprises of finished property and properties under construction (Work in Progress). Work In Progress comprises cost of land, development rights, TDR, Construction and development cost, cost of material, services and other overheads related to projects under construction. Inventory is valued at cost or net realizable value whichever is lower.

g. Investments

Long-term investments are stated at cost after providing for any diminution in value, if such diminution is of permanent nature. Current investments are carried at lower of cost or market value. The determination of carrying amount of such investments is done on the basis of specific identification. Investments in integrated joint ventures are carried at cost net off adjustments for Company's share in profits or losses as recognized.

h. Retirement Benefits

Liability is provided for retirement benefits of Provident Fund and Gratuity in respect of eligible employees contributions under the defined contribution scheme are charged to revenue. The liability in respect of defined benefit scheme like Gratuity, Leave Encashment, etc. are provided in the accounts on the basis of actuarial valuation as on 31st March 2012.

i. Borrowing Cost

Borrowing costs are recognized as expenses in the period in which they are incurred and debited to Profit and Loss Account.

j. Taxation

Income Tax expenses for the year include Current Tax and taxation in firm. Provision for current income tax is made on the current tax rate based on assessable income for the year worked out as per the provision of The Income tax Act 1961, as applicable for Assessment Year 2012-2013. The deferred tax assets and liabilities are recognized for the future tax consequences of timing differences, subject to the consideration of prudence. Deferred tax assets and liabilities are measured using the tax rates enacted or substantively enacted by the Balance Sheet date. k. Provisions, Contingent Liabilities and Contingent Assets

As per Accounting Standard 29, Provisions, Contingent Liabilities and Contingent Assets, issued by the Institute of Chartered Accountants of India, the Company recognizes provisions only when it has a present obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation as and when a reliable estimate of the amount of the obligation can be made.

No provision is recognized for -

(a) Any possible obligation that arises from past events and the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company; or

(b) Any present obligation that arises from past events but is not recognized because-

(i) It is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or

(ii) A reliable estimate of the amount of obligation cannot be made.

Such obligations are recorded as Contingent Liabilities. These are assessed continually and only that part of the obligation for which an outflow of resources embodying economic benefits is probable, is provided for, except in the extremely rare circumstances where no reliable estimate can be made. Contingent Assets are not recognized in the financial statements since this may result in the recognition of income that may never be realized.

l. Impairment of Asset

At each Balance Sheet date, the Company reviews the carrying amounts of its fixed assets to determine whether there is any indication that those assets suffered impairment loss, if any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of impairment loss. Recoverable amount is the higher of an asset's net selling price and value in use. In assessing value in use, the estimated future cash flows expected from the continuing use of the asset and from its disposal are discounted to their present value using a pre-discount rate that reflect the current market assessment of time value of money and the risks specific to the asset. The impairment loss as determined above is expensed off. An impairment loss recognized in prior accounting period is reversed if there has been change in the estimate of the recoverable amount. m. IPO Expenses

Expenses incurred for the public issue of equity shares of the Company are considered as deferred revenue expenditure to be amortized in 60 months.

n. Earnings Per Share

The Company reports basic and diluted earnings per share in accordance with Accounting Standard - 20 'Earnings Per Share' issued by the Institute of Chartered Accountants of India on basic earnings per share is computed by dividing the net profit or loss for the period by the weighted average number of Equity shares outstanding during the period. Diluted earnings per share is computed by dividing the net profit or loss for the period by the weighted average number of equity shares outstanding during the period as adjusted for the effects of all diluted potential equity shares except where the results are anti-dilutive.

o. Cash Flow Statement

The Cash Flow Statement is prepared by indirect method as set out in Accounting Standard 3 on Cash Flow Statement and presents cash flows by Operating, Investing and Financing activities of the Company. p. Foreign Currency Transactions

Transactions in foreign currency and non- monetary assets are accounted on the date of the transactions. All monetary items denominated in foreign currency are converted at the yearend exchange rate. Expenditure of the liaison office is translated at the yearly average rate of exchange. The exchange differences arising on such conversion and on settlement of the transactions are shown as Foreign Currency Translation Reserve under the head of Reserve and Surplus.

 
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