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Accounting Policies of P G Foils Ltd. Company

Mar 31, 2015

1. Basis of Preparation of financial statements : The Financial Statements have been prepared In accordance with generally accepted accounting principles in India ('Indian GAAP1} under the historical cost convention on an accrual basis, except interest on debtors and other claims receivable, which are accounted for on receipt/payment basis, in compliance with all material aspects of the Accounting Standards CAS1) notified under section 133 of The Companies Act, 2013 (The Act") read with Rule 7 of the Companies (Accounts) Rules, 2014. The accounting policies have been consistently applied by the company and are consistent with those used in the previous year, unless otherwise mentioned in the notes.

2. Use of Estimates: The presentation of financial statements requires estimates and assumptions to be made that affect the repotted amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and the estimate sari recognized in the period in which the results are known /materialized.

3. Fixed Assets, Intangible Assets and Depreciation:

(i) (a) fixed assets are stated at cost of acquisition or construction less depreciation. AH cost relating to the acquisition & installation are capitalized.

(bi Addition in fixed assets is stated at cost net of VAT and Cenvat credit, Custom duty (where applicable). Atl cost relating to acquisition and installation of fixed asset are capitalized.

(c) Agricultural land is shown at cost price.

(ii- Till the year ended 31 March 2014, Schedule XIV to the Companies Act, 1956, prescribed requirements concerning depreciation of fixed assets. From the current year, Schedule XIV has been replaced by Schedule El to the Companies Act, 2013. The applicability of Schedule II has resulted in the following changes related to depreciation of fixed assets. Unless stated otherwise, the impact mentioned for the current year is likely to hold good for future years also.

(a) Useful lives/ depreciation rates

Till the year ended 31 March 2014, depreciation rates prescribed under Schedule XIV were treated as minimum rates and the company was not allowed to charge depreciation at lower rates even if such lower rates were justified by the estimated useful life of the asset Schedule If to the Companies Act 2013 prescribes useful lives for fixed assets which, in many cases, are different from fives prescribed under the erstwhile Schedule XIV. However, Schedule II allows companies to use higher/ lower useful lives and residual values if such useful lives and residual values can be technically supported and justification for difference is disclosed in the financial statements.

Considering the applicability of Schedule II, the management has re-estimated useful lives and residual values of all its fixed assets. The management believes that depreciation rates currently used fairy reflect its estimate of these full versa residual values of fixed assets, though these rates in certain cases are different from lives prescribed under Schedule II. Hence, this change in accounting policy did not have any material impact on financial statements of the company.

(b) Accounting for additional depreciation on account of revaluation of assets On 31 March 1993, the company revalued all its land and buildings «ustingasontrBtdate.TiByearended31 March2014,rheCuidance Note on Treatment of Reserve Created on Revaluation of fixed Assets issued by the 1CAI allowed companies to transfer an amount equivalent to the additional depreciation arising due to upward revaluation of fixed assets from revaluation reserve to the statement of profit and loss. Accordingly, the company was transferring an amount equivalent to additional depreciation arising due to upward revaluation of building from revaluation reserve to the statement of profit and loss. In contrast, Schedule II to the Companies Act, 2013 applicable from the current year, states that depreciable amount of an asset is the cost of an asset or other amount substituted for cost. Hence, in case of revalued assets, depreciation computed on the revalued amount needs to be charged to the statement of profit and loss, without any recoupment from revaluation reserve. Consequently, to comply with die Schedule II requirement, the company has discontinued the practice of recouping the impact of additional depreciation from revaluation reserve. The management has decided to apph/there vied counter policy prospectively from Apri12014.

Had the company continued its earlier policy of recouping die additional depreciation arising due to upward revaluation of fixed assets from revaluation assets, profits for the current year would have been on higher side. However, the change in accounting policy did not have any impact tin reserves and surplus as at 31 March 2015.

(c) Depreciation on assets cooing less than 5,000/-

Tilt year ended 31 March 2014, to comply with the requirements of Schedule XIV to the Companies Act, 1956, the company was charging 100% depreciation on assets costing less than S,000/- in the year of purchase. However, Schedule II to the Companies Act 2013, applicable from the current year, does not recognize such practice. Hence, to comply with the requirement of Schedule II to the Companies Act, 2013, the company has changed its accounting policy for depreciations of assets costing less than 5,000/-. As per the revised policy, the company is depreciating such assets over their useful life as assessed by die management. The management has decided to apply the revised accounting policy prospectively from accounting periods commencing on or after 1 April 2014.

The change in accounting for depreciation of assets costing less than 5,000/- did not have any material impact on financial statements of tile company for the current year.

(iii) Fixed assets acquired in exchange or in part exchange for another asset are recorded at the net book value of the assets given up, adjusted for any balancing payment or recap of cash or on snider a on.

(iv) Capital Assets under erection,1nstallation/construction are reflected in the Balance sheet as "Capital Work in Progress'.

4. Purchases: Purchase of all Raw materials, Aluminum wire Rods, glassine paper, packing material, Oil & Lubricants, Cash Cylinder, production, mechanical & Electrical stores, Polythene and polyester film & paper are accounted for on basic price & CST. Convert and VAT paid on purchase of above items are shown as Convert recoverable & VAT recoverable and the same is to be adjusted against the Exose/Sa les Tax liabilities.

5. Investments: Short term investments are stated at cost or market price, whichever is lower.

Long term Investments are stated at oost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary in the opinion of the management.

6. Inventories & Other Current Assets:

Inventories as taken and certified by the management are valued as under:

(a) Raw materials, dyes & Chemicals At cost excluding convert credit and VAT.

Packing material, Polyester Him, paper and Polythene

(b) Production, Electrical, and Mechanical and : At Cost excluding Convert, Service Tax & VAT

consumable store & spares

(c) Oil & lubricants : At cost excluding excise duty except HSD.

(d) Write process: At estimated cost value deserter feed by the management.

(e) Aluminum wire rods : At cost or market price which ever is lower.

(f) Scrap & rejected goods : At net realizable value determined by management.

(g) Finished goods : Valuation of finished goods manufactured but not cleared from excise bonded warehouse up to the end of the year is at cost or market price, whichever is lower inclusive of Excise Duty. (Cost price estimated by deducting approx 9.44% from the selling price)

(h) Stock at port& in transit At Selling price

(i) Stock in transit/ware house{Purchase) : At purchase price including clearing expenses, custom duty paid and incidental expenses thereto.

(j) DEPB licenses Purchased : At cost.

(W Gas Cylinder : At cost

(I) Returned Material outside factory At Estimated Net Realizable Value (certified by management).

(m) Export Goods in Transit ; At sale invoice value Including regret there of.

Note:

The cost of raw materials, dyes, chemicals, packing material, oil & lubricant and consumable stores are arrived at on first in first out method and in the case of basic raw material, freight inward expenses have also been considered.

7. Expenditure:

(a) All other expenses are accounted for on accrual basis and consumption of stores has been taken on actual consumption.

(b) Power unit generated from £ neuron wind power plant which has been wheeled for captive consumption after adjusting wheeling charges® 10% of the energy fed into grid to RVPNL Disco(s) is accounted on effective tariff rate in power bill and simultaneously such figure was also reflected in other income.

8. Employee Benefits:

(a) Defined contribution plans : The Company's contribution to provident fund and employee state insurance are considered as defined contribution plans and are charged as an expense as they fall due based on the amount of contribution required to be made.

(b) Defined benefit plans : (a) Gratuity payable to employees is provided on the basis of premium paid under group gratuity scheme with Life Insurance Corporation of India.

(b) Provision for Leave encashment has been made on accrual basis on leave un-availed son 31.03.2015.

(c- Service awards have been adjusted/accounted on the basis of completed months of service provided by employees.

(c) Short-term employee benefits : Short term employee benefits are recognized as an expense at the undiscounted amount in the statement of profit and loss for the year in which the related service is rendered.

9. Borrowing Cowls: Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one mat resserch lacks. charged to revenue.

10. Revenue Recognition:

(a) Sales are inclusive of Convert but are net of Sales returns, Shortages and other discounts & rebates but excluding value of recoveries made for insurance, freight and package for warding expenses, which have been shown in die invoice value and are adjusted in die respective heads,

(b) Discount and rebate son sales is accounted for as and when settled.

let Export sales are accounted for, on the basis of exchange rate of LEO Date (Let Export Order) of transactions and recognized as and when Risk & Rewards are transferred.

(d) Revenue from investment is accounted on sale/disposal of such investments.

(e) Export Incentive: (i) Revenue from DEPB Licenses is recognized when the licenses are sold / utilized and are shown as other incomes,

(ii) Revenue of duty drawback has been accounted on accrual basis.

(f) Units generated on wind power plant has been accounted at contract price on accrual basis.

(g) Interest receivable from Trade Receivables and dividend from investments area counted on receipt basis.

(h) The Company has purchased DEPB Licenses from market at discounts and the same has been shown as Discounts received on purchase of DEPB in other income.

11. Transaction in Foreign Currencies (Other than for fixed assets):a) Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction. Gain/Loss arising out of fluctuation in between transaction date and realization date are recognized in profit & loss account

(b) All foreign currency Monetary items at the year-end which not covered by foreign exchange contracts are translated at year-end rates.

(c) Foreign Exchange Gain/Loss of buyer's credit taken from foreign bank has been recognized at the date of transaction and recognized in profit & loss account

12. Impairment of Assets: AS assets other than inventory, investment or deferred tax assets are reviewed to impaired - circumstances indicate that the carrying amount may not be recoverable. Assets whose carrying amount exceeds their recoverable amount will be written down to recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset Is identified as impaired.

13. Convert, Service Tax & VAT or The value of Convert, Service Tax and VAT credit benefits eligible on raw materials, other eligible inputs, production stores and capital goods is considered for die clearances of finished goods

14. Accounting of Taxes on Income: Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961.

Deferred tax resulting from 'Timing Differences between and taxable profits accounted for using the tax rates and laws that the been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable certainty that the asset will be realized in future.

15. Contingent liabilities : The company is not providing for contingent liabilities in the account since the ultimate outcome thereof cannot be determined the date of balance sheet Flowered, notes on every cons gem Sanities exist on me due of balance sheet are given in notes to ¦ accounts. Contingent assets are neither recognized Nordic dosed in the balance sheet.

16. Earnings Per Share : Basic and diluted earning per share are computed by dividing the net profit after tax attributable to equity shareholders for the year, with the weighted number of equity shares outstanding during the year.

17. Lease: Lease rentals under an operating lease, are receded as an expend the lease term. Lease Income from Operating lease is recognized in Profit & Loss Account on a Straight line basis over the Lease Term.

18. Accounting of Financial Instruments: The Premium or Discount arose due to difference between spot and forward rate on Forward Exchange Contracts, which are taken to hedge foreign currency risk of an existing asset/liability, is recognized over the period of contract. Premium/ discount on the above FEC forth expired period is booked as income/ expenditure in die statement of profit & loss and for unexpired period as on balance sheet date are shown as Financial Asset & Liability & Amount receivable and payable under the Forward Exchange Contract is booked as liabilities and assets accordance with Accounting Standard-31 and the same has also been subsequently recognized as per Accounting Standard-11


Mar 31, 2014

1. Basis of Preparation of Financial statements : The Financial Statements have been prepared in accordance with Indian Generally Accepted accounting principles (GAAP) , generally under the historical cost convention on accrual basis except insurance, Interest on debtors and other claims receivable, which are accounted for on receipt/payment basis. GAAP comprises of mandatory Accounting Standards notified by companies (Accounting Standards) Rules 2006 and relevant provisions of the companies Act 1956, the Guidelines issued by ICAI and Securities and Exchange Board of India (SEBI). Accounting Policies have been consistently adopted except where a change in existing GAAP requires a change in accounting policy hitherto in use.

2. Use of Estimates : The presentation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and the estimates are recognized in the period in which the results are known /materialised.

3. Fixed Assets, Intangible Assets and Depreciation :

(i) (a) Fixed assets are stated at cost of acquisition or construction less depreciation. All cost relating to the acquisition & installation are capitalized.

(b) Addition in Fixed assets is stated at cost net of VAT and Cenvat credit, Custom duty (where applicable). All cost relating to acquisition and installation of fixed asset are capitalized.

(c) Agricultural land is shown at cost price.

(ii) Revalued assets are recorded at revalued amount less depreciation on revalued amount.

(iii) (a) Depreciation on fixed assets is provided on written down value basis at the rates and in the manner prescribed in Schedule XIV of Companies

Act, 1956. Depreciation in respect of revalued amount, the additional depreciation attributable to revaluation is withdrawn from revaluation reserve. Depreciation on addition in fixed assets has been adjusted after deducting the amount of excise duty & VAT availed as Cenvat and VAT set off.

(b) Depreciation on assets added / disposed off during the year has been provided on prorata basis with reference to date of addition / disposed except for items on which 100% depreciation rate are applicable.

(iv) Fixed assets acquired in exchange or in part exchange for another asset are recorded at the Net book value of the assets given up, adjusted for any balancing payment or receipt of cash Or other consideration.

(v) Capital Assets under erection/installation/construction are reflected in the Balance sheet as "Capital Work in Progress".

4. Purchases : Purchase of all Raw materials, Aluminium wire Rods, glassine paper, packing material, Oil & Lubricants, Gas Cylinder, production , mechanical & Electrical stores, Polythene and polyester film & paper are accounted for on basic price & CST. Cenvat and VAT paid on purchase of above items are shown as Cenvat recoverable & VAT recoverable and the same is to be adjusted against the Excise/Sales Tax liabilities.

5. Investments : Short term investments are stated at cost or market price, whichever is lower.

Long term Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary in the opinion of the management.

Dividends reinvested are added to the cost of investments on the NAV of the date of distribution of dividend by mutual funds

6. Inventories & Other Current Assets :

Inventories as taken and certified by the management are valued as under:

(a) Raw materials, dyes & Chemicals : At cost excluding Packing material, Polyester Film, cenvat credit and VAT. Paper and Polythene

(b) Production, Electrical, and Mechanical and consumable store & spares : At cost excluding Cenvat, Service Tax & VAT

(c) Oil & lubricants : At cost excluding excise duty except HSD.

(d) Work in process : At estimated cost (valued as certified by the management.)

e)Aluminium wire rods : At cost or market price whichever is lower.

(f) Scrap & rejected : At net realizable value determined by goods management.

(g) Finished goods : Valuation of finished goods manufactured but not cleared from excise bonded

warehouse up to the end of the year is at cost or market price, whichever is lower inclusive of Excise Duty. (Cost price estimated by deducting approx 7.00% from the selling price).

(h) Stock at port & in transit : At Selling price

(i) Stock in transit/ware house(Purchase) : At purchase price including clearing expenses and custom duty paid.

Custom duty paid.

(j) DEPB licences Purchased : At cost.

(k) Gas Cylinder : At cost

(l) Returned Material outside factory : At Estimated Net Realizable Value (certified by management).

(m) Export Goods in Transit : At sale invoice value including freight thereof.

Note: The cost of raw materials, dyes, chemicals, packing material, oil & lubricant and consumable stores are arrived at on first in first out method and in the case of basic raw material, freight inward expenses have also been considered.

7. Expenditure :

(a) All other expenses are accounted for on accrual basis and consumption of stores has been taken on actual consumption.

(b) Power unit generated from Enercon wind power plant which has been wheeled for captive consumption after adjusting wheeling charges @ 10% of the energy fed into grid to RVPNL Discom(s) is accounted on effective tariff rate in power bill and simultaneously such figure was also reflected in other income.

8. Employee Benefits :

(a) Defined contribution plans :

The Company''s contribution to provident fund and employee state insurance are considered as defined contribution plans and are charged as an expense as they fall due based on the amount of contribution required to be made.

(b) Defined benefit plans :

Gratuity payable to employees is provided on the basis of premium paid under group gratuity scheme with Life Insurance Corporation of India .Provision for Leave encashment has been made on accrual basis on leave un- availed as on 31.03.2014.Service awards have been adjusted/accounted on the basis of completed months of service provided by employees.

(c) Short-term employee benefits : Short term employee benefits are recognized as an expense at the undiscounted amount in the statement of profit and loss for the year in which the related service is rendered.

9. Borrowing Costs : Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue

10. Revenue Recognition :

(a) Sales are inclusive of Cenvat but are net of Sales returns, Shortages and other discounts & rebates but excluding value of recoveries made for insurance, freight and packing forwarding expenses, which have been shown in the invoice value and are adjusted in the respective heads.

(b) Discount and rebates on sales is accounted for as and when settled.

(c) Export sales are accounted for, on the basis of exchange rate of LEO Date (Let Export Order) of transactions and recognized as and when Risk & Rewards are transferred.

(d) Revenue from investment is accounted on sale/disposal of such investments.

(e) Export Incentive: (i) Revenue from DEPB Licenses is recognized when the licenses are sold / utilized and are shown as other incomes. (ii) Revenue of duty drawback has been accounted on accrual basis.

(f) Units generated on Enercon wind power plant has been accounted on the basis of effective tariff rate in respective month. Units generated on Suzlon wind power plant has been accounted at contract price on accrual basis.

(g) Interest receivable from Trade Receivables and dividend from investments are accounted on receipt basis.

(h) The Company has purchased DEPB Licenses from market at discounts and the same has been shown as Discounts received on purchase of DEPB in other income.

11. Transaction in Foreign Currencies (Other than for fixed assets) : Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction. Gain/Loss arising out of fluctuation in between transaction date and realization date are recognized in profit & loss account.

All foreign currency Monetary items at the year-end which not covered by foreign exchange contracts are translated at year-end rates.

Foreign Exchange Gain/Loss of buyer''s credit taken from foreign bank has been recognized at the date of transaction and recognized in profit & loss account.

12. Impairment of Assets : All assets other than inventory, investment or deferred tax assets are reviewed for impairment where event or changes in circumstances indicate that the carrying amount may not be recoverable. Assets whose carrying amount exceeds their recoverable amount will be written down to recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired.

13. Cenvat, Service Tax & VAT : The value of Cenvat, Service Tax and VAT credit benefits eligible on raw materials, other eligible inputs, production stores and capital goods is considered for the clearances of finished goods.

14. Accounting of Taxes on Income : Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961.

Deferred tax resulting from "Timing Differences" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable certainty that the asset will be realized in future..

15. Contingent Liabilities : The company is not providing for contingent liabilities in the account since the ultimate outcome thereof cannot be determined on the date of balance sheet. However, notes on every contingent liabilities exist on the date of balance sheet are given in notes to accounts. Contingent assets are neither recognized nor disclosed in the balance sheet.

16. Earnings Per Share : Basic and diluted earning per share are computed by dividing the net profit after tax attributable to equity shareholders for the year, with the weighted number of equity shares outstanding during the year.

17. Lease: Lease rentals under an operating lease, are recognized as an expenses in the statement of Profit & Loss Account on a straight line basis over the lease term. Lease Income from Operating lease is recognized in Profit & Loss Account on a Straight line basis over the Lease Term.

18. Accounting of Financial Instruments: The Premium or Discount arose due to difference between spot and forward rate on Forward Exchange Contracts, which are taken to hedge foreign currency risk of an existing asset/liability, is recognized over the period of contract. Premium/ discount on the above FEC for the expired period is booked as income/ expenditure in the statement of profit & loss and for unexpired period as on balance sheet date are shown as Financial Asset & Liability & Amount receivable and payable under the Forward Exchange Contract is booked as liabilities and assets accordance with Accounting Standard-31 and the same has also been subsequently recognized as per Accounting Standard-11.

(i) The Company has only one class of equity shares having a par value of Rs. 10 per share. Each Shareholder is eligible for one vote per share.

(ii) In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company, after distribution of all preferential amounts, in proportion of their shareholding.

Note: (i) Unpaid dividend of Rs.15,00,000.00/- has not been deposited with the Scheduled Bank in Unpaid Dividend Account,since the ownership of the shares is sub-judise in city civil court at Ahemdabad. And Rs. 8,500/- of others has also not been deposited. (ii) Statutory Remittances includes Rs.7,88,101/- of Entry Tax payable 2006-07. Interest liability of the same has not been provided for, as the appeal is pending before DC (Appeal)

Note:- (i) Unclaimed dividend includes Rs.445384.00/- for F.Y. 2007-08 and Rs345462.00/- for F.Y. 2010-11.

(ii) Statutory remittance includes Rs. 1,03,73,210/- of demand for C-Form Raised for the Year 2011-12 by Sales Tax Authorities.

Note:- Balances with government includes a sum of Rs.6,00,000/- was deposited by the company as pre-deposit of penalty as per directions given by the Custom Excice & Gold (control) Appellate New Delhi by order dated 03.02.2003 against total amount of penalty of Rs.25 lacs to be deposited by Shri Pankaj P Shah(Managing Director) and Shri Ashok P. Shah(Ex-Director) of the company,the appeal has been dismissed by the tribunal.The company has filed an appeal before High Court. Matter is still pending.

Note (i) Balances with Covt.Authorities includes Rs.38,00,000/- deposited against demand of Rs.1,16,51,284/- for safeguard duty, redemtion fine and penalty. Liability for the balance amount has not been provided for, as the same stayed by the Commisioner of Central Excise (Appeal). Note (ii) Balances with Govt.Authorities includes Rs.38,98,883/- deposited against demand of Rs.88,58,238/- for safeguard duty, and valuation. Liability for the balance amount has not been provided for, as the same demanded by the CESTAT.


Mar 31, 2013

1. Basis of Preparation of Financial statements : The Financial Statements have been prepared in accordance with Indian Generally Accepted accounting principles (GAAP), generally under the historical cost convention on accrual basis except insurance, Interest on debtors and other claims receivable, which are accounted for on receipt/payment basis. GAAP comprises of mandatory Accounting Standards notified by companies (Accounting Standards) Rules 2006 and relevant provisions of the companies Act 1956, the Guidelines issued by ICAI and Securities and Exchange Board of India (SEBI). Accounting Policies have been consistently adopted except where a change in existing GAAP requires a change in accounting policy hitherto in use.

2. Use of Estimates: The presentation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and the estimates are recognized in the period in which the results are known/materialised.

3. Fixed Assets, Intangible Assets and Depreciation:

(i) (a) Fixed assets are stated at cost of acquisition or construction less depreciation. All cost relating to the acquisition & installation of fixed assets are capitalized.

(b) Addition in Fixed assets is stated at cost net of VAT and Cenvat credit, Custom duty (where applicable). All cost relating to acquisition and installation of fixed assetare capitalized.

(c) Agricultural land is shown at cost price.

(ii) Revalued assets are recorded at revalued amount less depreciation on revalued amount.

(iii) (a) Depreciation on fixed assets is provided on written down value basis at the rates and in the manner prescribed in Schedule XIV of Companies Act, 1956. Depreciation in respect of revalued amount, the additional depreciation attributable to revaluation is withdrawn from revaluation reserve. Depreciation on addition in fixed assets has been adjusted after deducting the amount of excise duty & VAT availed as Cenvat and VAT setoff.

(b) Depreciation on assets added / disposed off during the year has been provided on prorata basis with reference to date of addition / disposed except for items on which 100% depreciation rate are applicable.

(iv) Fixed assets acquired in exchange or in part exchange for another asset are recorded at the net book value of the assets given up, adjusted for any balancing payment or receipt of cash or other consideration. (v) Capital Assets under erection/installation/construction are reflected in the Balance sheet as"Capital Work in Progress".

4. Purchases : Purchase of all Raw materials, Aluminium wire Rods, glassine paper, packing material, Oil & Lubricants, Gas Cylinder, production , mechanical & Electrical stores, Polythene and polyester film & paper are accounted for on basic price & CST. Cenvat and VAT on purchase of these items is shown as Cenvat recoverable & VAT recoverable is adjusted against the Excise/Sales Tax liabilities.

5. Investments: Short term investments are stated at cost or market price, whichever is lower.

Long term Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary in the opinion of the management.

Dividends reinvested are added to the cost of investments on the NAV of the date of distribution of dividend by mutual funds

6. Inventories & Other Current Assets:

Inventories as taken and certified by the management are valued as under:

(a) Raw materials, dyes & Chemicals : At cost excluding cenvat credit and VAT. packing material, Polyester Film, Paper and Polythene

(b) Production, Electrical, Mechanical and : At cost excluding cenvat credit & VAT consumable store & spares

(c) Oil & lubricants : At cost excluding excise duty except HSD.

(d) Work in process Atestimated cost (valued asoertified by the management.)

(e) Aluminium wire rods : At cost or market price whichever is lower.

(0 Scrap & rejected goods : At net realizable value determined by management.

(g) Finished goods : Valuation of finished goods Manufactured but not cleared from excise bonded warehouse up to the end of the year is at cost or market price, whichever is lower inclusive of Excise Duty. (Cost price estimated by deducting approx 3% & 8.75% from the selling price).

(h) Stock at port & in transit : At Selling price

(i) Stock in transit/ware house (Purchase) : Atpurchasepriceincludingclearingexpensesandcustomdutypaid.

(j) DEPB licences Purchased : At cost.

(k) Gas Cylinder : At cost

(I) Returned Material outside factory : At Net Realisable Value on the basic sale price soldor at price certified by management.

(m) ExportGoods in Transit : Atsaleinvoicevalueincludingfreighttheirof.

Note: The cost of raw materials, dyes, chemicals, packing material, oil & lubricant and consumable stores are arrived at on first in first out method and in the case of basic raw material, freight inward expenses have also been considered.

7. Expenditure:

(a) All other expenses are accounted for on accrual basis and consumption of stores has been taken on actual consumption.

(b) Power unit generated from Enercon wind power plant which has been wheeled for captive consumption after adjusting wheeling charges @ 10% of the energy fed into grid to RVPNL Discom(s) is accounted on effective tariff rate in power bill and simultaneously such figure was also reflected in other income.

8. Employee Benefits:

(a) Defined contribution plans : The Company''s contribution to provident fund and employee state insurance are considered as defined contribution plans and are charged as an expense as they fall due based on the amount of contribution required to be made.

(b) Defined benefit plans : Gratuity payable to employees is provided on the basis of premium paid under group gratuity scheme with Life Insurance Corporation of India. Provision for Leave encashment has been made on accrual basis on leave un- availed as on 31.03.2013.Service awards have been adjusted/accounted on the basis of completedmonths of service provided by employees..

(c) Short-term employee benefits : Short term employee benefits are recognized as an expense at the undiscounted amount in the statement of profit and loss for the year in which the related service is rendered.

9. Borrowing Costs : Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

10. Revenue Recognition:

(a) Sales are inclusive of Cenvat but are net of Sales returns, Shortages and other discounts & rebates but excluding value of recoveries made for insurance, freight and packing forwarding expenses, which have been shown in the invoice value and are adjusted in the respective heads.

(b) Discount and rebates on sales is accounted for as and when settled.

(c) Export sales are accounted for on the basis of exchange rate on date of transactions and recognized only when export goods leaves the territory of India.

(d) Revenue from investment is accounted on sale/disposal of such investments.

(e) Export Incentive: (i) Revenue from DEPB Licences is recognised when the licences are sold / utilized and are shown as other incomes,

(ii) Revenue of duty drawback has been accounted on accrual basis.

(f) Units generated on Enercon wind power plant has been accounted on the basis of effective tariff rate in respective month. Units generated on Suzlon wind power plant has been accounted at contract price

(g) Interest receivable from debtor and dividend from investment are considered on receipt basis.

(h) The Company has purchased DEPB Licenses from market at discounts and the same has been shown as Discounts received on purchase of DEPB in other income.

11. Transaction in Foreign Currencies (Other than for fixed assets) : Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction. Cain/Loss arising out of fluctuation in between transaction date and realization date are recognized in profit & loss account.

All foreign currency Monetary items at the year-end which not covered by foreign exchange contracts are translated atyear-end rates.

The difference between the foreign exchange contract rate and the exchange rate on the date of transaction is recognized as income or expenditure over the life of the contract.

Foreign Exchange Cain/Loss of buyer''s credit taken from foreign bank has been recognized at the date of transaction and recognized in profit & loss account

12. Impairment of Assets:

All assets other than inventory, investment or deferred tax assets are reviewed for impairment where event or changes in circumstances indicate that the carrying amount may not be recoverable. Assets whose carrying amount exceeds their recoverable amount will be written down to recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired.

13. Cenvat and VAT:

The value of Cenvat and VAT benefits eligible on raw materials, other eligible inputs, production stores and capital goods is considered for the clearances of finished goods.

14. Accountingof Taxes on Income.-

Provision for currenttax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961.

Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable certainty that the asset will be realized in future.

15. Contingent Liabilities:

The company is not providing for contingent liabilities in the account since the ultimate outcome thereof cannot be determined on the date of balance sheet. However, notes on every contingent liabilities exist on the date of balance sheet are given in notes on account. Contingent assets are neither recognized nor disclosed in the balance sheet.

16. Earnings Per Share:

Basic and diluted earning per share are computed by dividing the net profit after tax attributable to equity shareholders for the year, with the weighted numberof equitysharesoutstandingduringtheyear.

17. Lease:

Lease rentals under an operating lease, are recognized as an expenses in the statement of Profit & Loss Account on a straight line basis over the lease term. Lease Income from Operating lease is recognized in Profit & Loss Account on a Straight line basis over the Lease Term.


Mar 31, 2012

1. Basis of Preparation of Financial statements : The Financial Statements have been prepared in accordance with Indian Generally Accepted accounting principles (GAAP), generally under the historical cost convention on accrual basis except insurance, Interest on debtors and other claims receivable, which are accounted for on receipt/payment basis. GAAP comprises of mandatory Accounting Standards notified by companies (Accounting Standards) Rules 2006 and relevant provisions of the companies Act 1956, the Guidelines issued by ICAI and Securities and Exchange Board of India (SEBI). Accounting Policies have been consistently adopted except where a change in existing GAAP requires a change in accounting policy hitherto in use.

2. Use of Estimates : The presentation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and the estimates are recognized in the period in which the results are known/materialised.

3. Fixed Assets, Intangible Assets and Depreciation :

(i) (a) Fixed assets are stated at cost of acquisition or construction less depreciation. All cost relating to the acquisition & installation of fixed assets are capitalized.

(b) Addition in Fixed assets is stated at cost net of VAT and Cenvat credit, Custom duty (where applicable). All cost relating to acquisition and installation of fixed asset are capitalized.

(c) Agricultural land is shown at cost price.

(ii) Revalued assets are recorded at revalued amount less depreciation on revalued amount.

(iii) (a) Depreciation on fixed assets is provided on written down value basis at the rates and in the manner prescribed in Schedule XIV of Companies Act, 1956. Depreciation in respect of revalued amount, the additional depreciation attributable to revaluation is withdrawn from revaluation reserve. Depreciation on addition in fixed assets has been adjusted after deducting the amount of excise duty & VAT availed as Cenvat and VAT set off.

(b) Depreciation on assets added/disposed off during the year has been provided on prorata basis with reference to date of addition/disposed except for items on which 100% depreciation rate are applicable.

(iv) Fixed assets acquired in exchange or in part exchange for another asset are recorded at the net book value of the assets given up, adjusted for any balancing payment or receipt of cash or other consideration.

(v) Capital Assets under erection/installation/construction are reflected in the Balance sheet as "Capital Work in Progress".

4. Purchases : Purchase of all Raw materials, Aluminium wire Rods, glassine paper, packing material, Oil & Lubricants, Gas Cylinder, production, mechanical & Electrical stores, Polythene and polyester film & paper are accounted for on basic price & CST. Cenvat and VAT on purchase of these items are shown as Cenvat recoverable & VAT recoverable is adjusted against the Excise/Sales Tax liabilities.

5. Investments : Short term investments are stated at cost or market price, whichever is lower.

Long term Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary in the opinion of the management.

Dividends reinvested are added to the cost of investments on the NAV of the date of distribution of dividend by mutual funds.

6. Inventories & Other Current Assets :

Inventories as taken and certified by the management are valued as under:

(a) Raw materials, dyes & Chemicals : At cost excluding cenvat credit and VAT. packing material, Polyester Film, Paper and Polythene

(b) Production, Electrical, Mechanical and : At cost excluding cenvat credit & VAT consumable store & spares

(c) Oil & lubricants : At cost excluding excise duty except HSD.

(d) Work in process : At estimated cost (valued as certified by the management.)

(e) Aluminium wire rods : At cost or market price whichever is lower.

(f) Scrap & rejected goods : At net realizable value determined by management.

(g) Finished goods : Valuation of finished goods Manufactured but not cleared from excise bonded warehouse up to the end of the year is at cost or market price, whichever is lower inclusive of Excise Duty. (Cost price estimated by deducting approx 8.75% from the selling price).

(h) Stock at port & in transit : At Selling price

(i) Stock in transit/ware house (Purchase) : At purchase price including clearing expenses and custom duty paid.

(j) DEPB licences Purchased : At cost.

(k) Gas Cylinder : At cost

(l) Returned Material outside factory : At Net Realisable Value on the basic sale price solder at price certified by management.

(m) Stock with Consignment Agent : At cost (estimated by deducting 8.75% from the selling price) plus excise and expenses as per Invoice.

Note: The cost of raw materials, dyes, chemicals, packing material, oil & lubricant and consumable stores are arrived at on first in first out method and in the case of basic raw material, freight inward expenses have also been considered.

7. Expenditure :

(a) All other expenses are accounted for on accrual basis and consumption of stores has been taken on actual consumption.

(b) Power unit generated from Enercon wind power plant which has been wheeled for captive consumption after adjusting wheeling charges @ 10% of the energy fed into grid to RVPNL Discom(s) is accounted on effective tariff rate in power bill and simultaneously such figure was also reflected in other operating revenue.

8. Employee Benefits :

(a) Defined contribution plans : The Company's contribution to provident fund is considered as defined contribution plans and are charged as an expense as they fall due based on the amount of contribution required to be made.

(b) Defined benefit plans : Gratuity payable to employees is provided for on the basis of premium paid under group gratuity Scheme with Life Insurance Corporation of India.

Provision of Leave encashment has been made on accrual basis on leave un-availed balance available as on 31.03.2012.

Service Awards have been adjusted/accounted on the basis of completed months.

(c) Short-term employee benefits : Short term employee benefits are recognised as an expense at the undiscounted amount in the statement of profit and loss for the year in which the related service is rendered.

9. Borrowing Costs : Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

10. Revenue Recognition :

(a) Sales are inclusive of Cenvat but are net of Sales returns, Shortages and other discounts & rebates but excluding value of recoveries made for insurance, freight and packing forwarding expenses, which have been shown in the invoice value and are adjusted in the respective heads.

(b) Discount and rebates on sales is accounted for as and when settled.

(c) Export sales are accounted for on the basis of exchange rate on date of transactions and recognized only when export goods leaves the territory of India.

(d) Revenue from investment is accounted on sale/disposal of such investments.

(e) Export Incentive: (i) Revenue from DEPB Licences is recognised when the licences are sold/utilized and are shown as other operating revalue. (ii) Revenue of duty drawback has been accounted on accrual basis.

(f) Units generated on Enercon wind power plant has been accounted on the basis of effective tariff rate in respective month. Units generated on Suzlon wind power plant has been accounted at contract price

(g) Interest receivable from debtor and dividend from investment are considered on receipt basis.

(h) The Company has purchased DEPB Licenses from market at discounts and the same has been shown as Discounts received on purchase of DEPB in other income.

11. Transaction in Foreign Currencies (Other than for fixed assets) : Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction. Gain/Loss arising out of fluctuation in between transaction date and realization date are recognized in statement of profit & loss.

All foreign currency Monetary items at the year-end which not covered by foreign exchange contracts are translated at year-end rates.

The difference between the foreign exchange contract rate and the exchange rate on the date of transaction is recognized as income or expenditure over the life of the contract.

Foreign Exchange Gain/Loss of buyer's credit taken from foreign bank has been recognized at the date of transaction and recognized in statement of profit & loss.

12. Impairment of Assets :

All assets other than inventory, investment or deferred tax assets are reviewed for impairment where event or changes in circumstances indicate that the carrying amount may not be recoverable. Assets whose carrying amount exceeds their recoverable amount will be written down to recoverable amount. An impairment loss is charged to the statement of Profit and Loss in the year in which an asset is identified as impaired.

13. Cenvat and VAT :

The value of Cenvat and VAT benefits eligible on raw materials, other eligible inputs, production stores and capital goods is considered for the clearances of finished goods

14. Accounting of Taxes on Income :

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961.

Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable certainty that the asset will be realized in future.

15. Contingent Liabilities :

The company is not providing for contingent liabilities in the account since the ultimate outcome thereof cannot be determined on the date of balance sheet. However, notes on every contingent liabilities exist on the date of balance sheet are given in notes on account. Contingent assets are neither recognized nor disclosed in the balance sheet.

16. Earnings Per Share :

Basic and diluted earning per share are computed by dividing the net profit after tax attributable to equity shareholders for the year, with the weighted number of equity shares outstanding during the year.

17. Lease:

Lease rentals under an operating lease, are recognized as an expenses in the statement of Profit & Loss on a straight line basis over the lease term. Lease Income from Operating lease is recognized in statement of Profit & Loss on a Straight line basis over the Lease Term.


Mar 31, 2011

1.Basis of Accounting: The Financial Statements have been prepared in accordance with Indian Cenerally Accepted accounting principles (GAAP), generally under the historical cost convention on accrual basis except insurance, Interest on debtors and other claims receivable, exports benefits and expenditure on account of fuel escalation charges of the Jodhpur Vidyut Vitrah Nigam Limited, which are accounted for on receipt/payment basis. GAAP comprises of mandatory Accounting Standards issued by The Institute of Chartered Accountants of India (ICAI), the provisions of Indian Companies Act, 1956 and the Guidelines issued by ICAI and Securities and Exchange Board of India {SEBf). Accounting Policies have been consistently adopted except where a change in existing GAAP requires a change in accounting policy hitherto in use.

2.Use of Estimates: - The presentation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and the estimates are recognized in the period in which the results are known / materialised.

3.Fixed assets and Depreciation:

(i) (a) Fixed assets are stated at cost of acquisition or construction loss depreciation. All cost relatingto the acquisition & installation of fixed assets are capitalized.

(b) Addition in Fixed assets is stated at cost net of VAT and Cenvat credit, Custom duty (where applicable). All cost relatingto acquisition and installation of fixed asset are capitalized.

(c)Agricultural land is shown at cost price.

(ii)Revalued assets are recorded at revalued amount less depreciation on revalued amount.

(iii)(a) Depreciation on fixed assets is provided on written down value basis at the rates and in the manner prescribed in Schedule XIV of Companies Act, 1956. Depreciation in respect of revalued amount, the additional depreciation attributable to revaluation is withdrawn from revaluation reserve. Depreciation on addition in fixed assets has been adjusted after deductingthe amount of excise duty & VAT availed as Cenvat and VAT set off.

(b) Depreciation on assets added / disposed off during the year has been provided on prorate basis with reference to date of addition / disposed except for items on which 100% depreciation rate are applicable.

(iv) Fixed assets acquired in exchange or in part exchange for another asset are recorded at the net book value of the assets given up, adjusted for any balancing payment or receipt of cash or other consideration.

(v) Capital Assets under erection/installation are reflected in the Balance sheet as "Capital Work-In Progress''

4.Purchases: Purchase of all Raw materials. Raw Cotton, Aluminium wire Rods, glassine paper, packing material, Oil & Lubricants, Gas Cylinder, production , mechanical & Electrical stores, Polythene and polyester film & paper are accounted for on basic price &CST. Cenvat and VAT on purchase of these items is shown as Cenvat recoverable & VAT recoverable is adjusted against the Excise/Sales Tax liabilities.

5.Investment: Long term Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary in the opinion of the management. Dividends reinvested are added to the cost of investments.

6.Current Assets: Inventories as taken and certified by the management are valued as under:

(a) Raw materials, dyes : At cost excludingcenvat & Chemicals packing credit and VAT. material, Polyester Film Paper and Polythene

(b) Production, Electrical, : At cost excludingcenvat Mechanical and credit & VAT consumable store & spares

(c) Oil & lubricants : At cost excluding excise duty except HSD.

(d) Work in process : At esti mated cost valued as certified by the management.

(e) Aluminium wire rods : At cost or market price whichever is lower.

(f) Scrap & rejected goods : At net realizable value determined by management

(g) Finished goods : 1.Received after conversion Valued at cost or market Price, whichever is lower inclusive of Excise duty : 2.Manufactured goods: Valuation of finished goods manufactured but not cleared from excise bonded warehouse up to the end of the year is at cost or market price, whichever is lower inclusive of Excise Duty (Cost price estimated by deducting approx 16.30% from the selling price),

(h) Stock at port & in : At Selling price transit

(i) Stock in transit/ware : At cost house (Purchase)

(j) DEPB licenses Purchased : At cost.

(k) Gas Cylinder : At cost

(I) Returned Material : At Net Realisable Value outside factory on the basic sale price sold or at price certified by management.

(m) Stock with : At cost (estimated by Consignment Agent deducting 16.30% from the selling price) plus excise and expenses as per Invoice.

Note: The cost of raw materials, dyes, chemicals, packing material, oil & lubricant and consumable stores are arrived at on first in first out method and in the case of basic raw material, freight inward expenses have also been considered.

7.Expenditure:

(a)Benefit to employees:

(i)Contribution to statutory funds is accounted for on accrual basis.

(ii)Provision of Leave encashment has been made on accrual basis on leave un-availed balance available as on 31,03.2011.

(iii)Service Awards have been adjusted / accounted on the basis of completed months.

(iv)Gratuity payable to employees is provided for on the basis of premium paid under group gratuity Scheme with Life Insurance Corporation of India

(b)Lease rent in respect of leasehold land for factory building and township are accounted for on accrual basis. The unexpired periods of said leasehold land are 54 and 55 years respectively.

(c)All other expenses are accounted for on accrual basis and consumption of stores has been taken on actual consumption,

(d)Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets.Aqualifyingassetisone that necessarily takes substantial period of time to get ready for intended use. All other borrowingcosts are charged to revenue.

(e)Power unit generated from Enercon wind power plant which has been wheeled for captive consumption after adjusting wheeling charges @ 10% of the energy fed into grid to RVPNL Discom(s) is accounted on effective tariff rate in power bill and simultaneously such figure was also reflected in other income.

8.Income:

(a) Sales are inclusive of Cenvat but are net of Sales returns, Shortages and other discounts & rebates but excluding value of recoveries made for insurance, freight and packing forwarding expenses, which have been shown in the invoice value and are adjusted in the respective heads.

(b)Export sales are accounted for on the basis of exchange rate on date of transactions and recognized only when export goods leaves the territory of India.

(c)Discount and rebates on sales is accounted for as and when settled.

(d) Revenue from investment is accounted on sale/disposal of such investments.

(e)Export Incentive: Revenue from DEPB Licenses is recognised when the licenses are sold / utilized and are shown as other incomes.

(f)Units generated on Enercon wind power plant has been accounted on the basis of effective tariff rate in respective month. Units generated on Suzlon wind power plant has been accounted at contract price

(g)Interest receivable from debtor is considered on receipt basis.

(h) The Company has purchased DEPB Licenses from market at discounts and the same has been shown as Discounts received on purchase of DEPB in other income.

9.Transaction in Foreign Currencies: (Other than for fixed assets): Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of the transaction. Cain/Loss arising out of fluctuation in between transaction date and realization date are recognized in profit & loss account. Gain/loss arises on account of fluctuation in between transaction date and realization date on sales settled in same year has been accounted for in the same head. Current assets are restated at the exchange rate prevailing at the end and the overall net gain/toss has been adjusted in the profit & loss account. Monetary items denominated in foreign currencies at the year-end and not covered by foreign exchange contracts are translated at year-end rates. The difference between the foreign exchange contract rate and the exchange rate on the date of transaction is recognized as income or expenditure over the life of the contract. Foreign Exchange Gain/Loss of buyer's credit taken from foreign bank has been recognized at the date of transaction and recognized in profit & loss account.

10.Impairment of Assets: All assets other than inventory, investment or deferred tax assets are reviewed for impairment where event or changes in circumstances indicate that the carrying amount may not be recoverable. Assets whose carrying amount exceeds their recoverable amount will be written down to recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. During the year Ink, dyes & Chemicals not usable having no recoverable value have been written off.

11.Cenvat and VAT: The value of Cenvat and VAT benefits eligible on raw materials, other eligible inputs, production stores and capital goods is considered for the clearances of finished goods.

12.Accounting of Taxes on Income: Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable certainty that the asset will be realized in future.

13.Contingent Liabilities: The company is not providing for contingent liabilities in the account since the ultimate outcome thereof cannot be determined on the date of balance sheet. However, notes on every contingent liabilities exist on the date of balance sheet are given in notes on account. Contingent assets are neither recognized nor disclosed in the balance sheet.

14.Earning Per Share : Basic and diluted earnings per share are computed by dividing the net profit after tax attributable to equity shareholders for the year, with the weighted number of equity shares outstanding during the year.

15.Lease: Lease rentals under an operating lease, are recognized as an expenses in the statement of Profit & Loss Account on a straight line basis over the lease term. Lease Income from Operating lease is recognized in Profit & Loss Account on a Straight line basis over the Lease Term.


Mar 31, 2010

1. Basis of Accounting: -

The accounts of the company are prepared under historical cost convention and in accordance with the applicable Accounting Standards and provisions of the Companies Act, 1956 as adopted consistently by the company except where otherwise stated. Mercantile system of accounting is followed except insurance, Interest on debtors and other claims receivable, exports benefits and expenditure on account of fuel escalation charges of the Jodhpur Vidyut Vitran Nigam Limited, which are accounted for on receipt/payment basis.

2. Use of Estimates: -

The presentation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and the estimates are recognized in the period in which the results are known/ materialized.

3. Fixed assets: -

(i) (a) Fixed assets are stated at cost of acquisition or construction less depreciation. All cost relating to the acquisition & installation of fixed assets are capitalized.

(b) Addition in Fixed assets is stated at cost net of VAT & Cenvat credit, Custom duty (where applicable). All cost relating to acquisition and installation of fixed assetare capitalized.

(c) Agricultural land is shown at cost price.

(ii) Revalued assets are recorded at revalued amount less depreciation on revalued amount.

4. Purchases: -

Purchase of all Raw materials, packing material, production & mechanical stores, Polythene & polyester film & paper are accounted for on basic price & CST. Cenvat and VAT on purchase of these items is shown as Cenvat recoverable & VAT recoverable which are adjusted against the Excise/Sales Tax liabilities.

5. Investment: -

Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary in the opinion of the management. Dividends reinvested are added to the cost of investments.

6. CurrentAssets: -

Inventories as certified by the management are valued asunder

(a) Raw materials, dyes & At cost excluding cenvat creditand VAT. Chemicals & packing material

(b) Production consumable store & spares : At cost excluding cenvat credit & VAT

c) Oil & lubricants : At cost excluding excise duty except HSD.

(d) Work in process : Atestimatedcost(valuedascertified by the management.)

(e) Aluminium wire rods : At cost or market price whichever is lower.

(f) Scrap & rejected goods : At net realizable value determined by management.

(g) Finishedgoods 1. Received after conversion Valued at costor market

Price, whichever is lower inclusive of Excise duty. 2. Manufactured goods: Valuation of finished goods Manufactured but not cleared from excise bonded warehouse up to the end of the year is at cost or market price, whichever is lower inclusive of Excise Duty. (Cost priceestimated by deducting approx 19% from the selling price). (h) Stock at port & in transit : At Sellingprice

(i) Stock in transit/ware house (Purchase) : At cost

(j) DEPB licences Purchased : At cost.

Note: The cost of raw materials, dyes, chemicals, packing material, oil & lubricant and consumable stores are arrived at on first in first out method and in the case of basic raw material, freight inward expenses have also been considered.

7. Expenditure:-

(a) Benefitto employees:

(i) Contribution to statutory funds is accounted for on accrual basis.

(ii) Provision of Leave encashment has been made on accrual basis on leave un-availed balance available as on 31.03.2010. (iii) Service Awards have been adjusted /accounted on the basis of completed months.

(iv) Gratuity payable to employees is provided for on the basis of premium paid under group gratuity Scheme with Life Insurance Corporation of India

(b) (i) Depreciation on fixed assets is provided on written down value basis atthe rates and in the manner prescribed in Schedule XIV of Companies Act, 1956. Depreciation in respect of revalued amount, the additional depreciation attributable to revaluation is withdrawn from revaluation reserve. Depreciation on addition in fixed assets has been adjusted after deducting the amount of excise duty & VAT availed as Cenvat & VAT setoff, (ii) Depreciation on assets added / disposed off during the year has been provided on prorate basis with reference to date of addition / disposed except for items on which 100% depreciation rate are applicable.

(c) Lease rent in respect of leasehold land for factory building and township are accounted for on accrual basis. The unexpired periods of said leasehold land are 55 and 56 years respectively.

(d) All other expenses are accounted for on accrual basis and consumption of stores has been taken on actual consumption.

(e) Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

(g) Power unit generated from wind power plant which has been wheeled for captive consumption after adjusting wheeling charges @ 10% of the energy fed into grid to RVPNL Discom(s) is accounted on effective tariff rate in power bill and simultaneously such figure was also reflected in other income.

8. Income: -

Turnover:

(a) Sales are inclusive of Cenvat but are net of Sales returns, Shortages and other discounts & rebates but excluding value of recoveries made for insurance, freight and packing forwarding expenses, which have been shown in the invoice value and are adjusted in the respective heads.

(b) Export sales are accounted for on the basis of exchange rate on date of transactions and recognized pnly when export goods leaves the territory oflndia.

(c) Discount and rebates on sales is accounted for as and when settled.

(d) Revenue from investment is accounted on sale/disposal of such investments.

(e) Export Incentive: Revenue from DEPB Licences is recognised when the licences are sold / utilized and are shown as other incomes.

(f) Units generated on wind power plant have been accounted on the basisof effective tariff rate in respective month.

(g) Interest receivable from debtor is considered on receipt system.

(h) The Company has purchased DEPB Licenses from market at discounts and the same has been shown as Discounts received on purchase of DEPB in other income.

9. Transaction in Foreign Currencies:- (Other than for fixed assets) Transactions denominated in foreign currencies are normally recorded

j at the exchange rate prevailing at the time of the transaction. Cain/Loss

arising out of fluctuation in between transaction date and realization date are recognized in profit & loss account & gain/loss arises on account of fluctuation in between transaction date and realization date on sales settled in same year has been accounted for in the same head. Current assets are restated at the exchange rate prevailing at the end and the overall net gain/loss has been adjusted in the profit & loss account.

Monetary items denominated in foreign currencies at the year-end and not covered by foreign exchange contracts are translated at year-end rates.

The difference between the foreign exchange contract rate and the exchange rate on the date of transaction is recognized as income or expenditure over the life of the contract.

Foreign Exchange Cain/Loss of buyers credit taken from foreign bank has been recognized at the date of transaction and recognized in profit & loss account.

10. Impairment of Asscts:-

All assets other than inventory, investment or deferred tax assets are reviewed for impairment where event or changes in circumstances indicate that the carrying amount may not be recoverable. Assets whose carrying amount exceeds their recoverable amount will be written down to recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired.

11. Cenvat &VAT:-

The value of Cenvat benefits eligible on raw materials, other eligible inputs, production stores and capital goods is considered for the clearances of finished goods

12. Accountingof Taxes of Income:-

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961.

Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a reasonable certainty that the asset will be realized in future.

13. Contingent Liabilities:-

The company is not providing for contingent liabilities in the account since the ultimate outcome thereof cannot be determined on the date of balance sheet. However, notes on every contingent liabilities exist on the date of balance sheet are given in notes on account. Contingent assets are neither recognized nor disclosed in the balance sheet.

 
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