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Accounting Policies of Rajapalayam Mills Ltd. Company

Mar 31, 2015

1. Basis of preparation and presentation of financial statements

(i) The financial statements have been prepared under the historical cost convention and in accordance with the generally accepted accounting principles in India, and in compliance of 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 1956 and Companies Act 2013, as applicable.

(ii) The accounting policies that are adopted in preparation of the financial statements are consistently followed as in the previous years except for change in the accounting policy for depreciation, as adopted consistently by the Company.

(iii) Pursuant to the notification of Schedule II to the Companies Act, 2013 for computation of Depreciation with effect from 01-04-2014, the Company revised the estimated useful life of its assets to align the useful life with those specified in Schedule II. The depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less 5% being its residual value. The carrying amount of the asset whose useful life as on 01-04-2014 is NIL, after retaining the residual value, is adjusted in the General Reserve.

(iv) Assets individually costing Rs. 5,000/- or less that were fully depreciated earlier in the year of purchase, are now depreciated based on the useful life considered by the Company for the respective category of assets.

(v) The financial statements are presented in Indian Rupees and the amounts are rounded to the nearest Lakhs with two decimals, except as stated otherwise.

(vi) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

(vii) The Company has considered its operating cycle as 12 months for the purpose of Current or Non-current classification of assets and liabilities.

(viii) The previous year figures are regrouped / restated wherever necessary.

2. Use of Estimates

The preparation of financial statements in accordance with the generally accepted accounting principles requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based upon management's best knowledge of current events and actions, actual results could differ from these estimates in the future periods. Estimates and underlying assumptions are reviewed on an ongoing basis. Any revision to accounting estimates is recognized prospectively in current and future periods.

3. Tangible Fixed Assets

(i) Tangible Fixed Assets are stated at cost of acquisition (net of CENVAT / VAT wherever applicable) less accumulated depreciation / amortization and impairment losses if any, except freehold land which is carried at cost less impairment losses if any. The cost comprises purchase price, borrowing cost if capitalisation criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Subsequent expenditure related to an item of fixed asset is added to its book value only if it increases the future benefits from the asset beyond its previously assessed standard of performance. All other expenses on fixed assets, including day-to-day repair and maintenance expenditure and cost of replacing parts, are charged to the statement of profit and loss for the period during which such expenses are incurred.

(ii) Fixed assets acquired in full or part exchange for another asset are recorded at the fair market value or the net book value of the asset given up, adjusted for any balancing cash transaction. Fair market value is determined either for the assets acquired or asset given up, whichever is more clearly evident.

(iii) Gains or losses arising from disposal of fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of such assets are recognised in the statement of profit and loss.

(iv) Projects / tangible fixed assets, which are not yet ready for their intended use are carried at cost, including related expenses and attributable interest are recognised as "Capital Work-in-Progress".

4. Intangible Assets

The costs of computer software that are installed are accounted at cost of acquisition of such software and are carried at cost less accumulated amortisation and impairment, if any. Internally generated software is not capitalized and the expenditure is reflected in the statement of profit and loss in the year in which the expenditure is incurred.

5. Investments

(i) All investments being non-current and non-trade are valued at cost. Costs of investments include acquisition charges such as brokerage, fees and duties.

(ii) The carrying amount of long term investments is determined on an individual investment basis.

(iii) As at the balance sheet date, provision for diminution, if any, is made to recognise the decline other than temporary, in the value of investments. The reduction in carrying amount is charged to statement of profit and loss. This reduction amount is reversed when there is a rise in the value of investment other than temporary.

6. Investment Properties

(i) An investment in land or buildings, which are not intended to be occupied substantially for use by, or in the operations of the Company, is classified as investment property. Investment properties are stated at cost, net of accumulated depreciation and accumulated impairment loss if any.

(ii) Depreciation on building component of investment property, which are held for rental to others, is calculated on straight-line basis using the rate prescribed under Schedule II to the Companies Act, 2013.

(iii) Gains or losses arising from disposal of investment properties, measured as the difference between the net disposal proceeds and the carrying amount of such investment properties are recognised in the statement of profit and loss.

7. Inventories

(i) Raw materials, stores, spares, packing materials etc., are valued at cost including the cost incurred in bringing the inventories to their present location and condition.

(ii) Work-in-progress is valued at cost including the cost of conversion. The cost of conversion includes direct costs.

(iii) Finished goods are valued at cost or net realisable value whichever is lower. Cost includes cost of conversion and other costs incurred in bringing the inventory to their present location and condition.

8. Revenue Recognition

(i) Revenue is recognised to the extent that is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

(ii) Sale of products is recognised when the significant risks and rewards of ownership of the goods have been passed to the buyer. Sale value excludes Excise duty, Education Cess, Secondary and Higher education cess, trade discounts, VAT /CST and returns.

(iii) Industrial Promotion Assistance (IPA) is recognised when the Company's right to receive the same is established with reasonable certainty.

(iv) Power Generated from Wind Mills:

The monetary value of the power generated at Wind Farms that are consumed at Mills under wheeling and banking arrangement with TANGEDCO are not treated as revenue but have been set off against the cost of Power & Fuel. The value of unadjusted units available if any, at the end of the financial year and sold to the Electricity Board at an agreed rate / Tariff rate are recognised and shown as Income from Wind Mills.

(v) Dividend Income is recognised when the Company's right to receive dividend is established by the reporting date.

(vi) Interest Income and Rental income are recognised on time proportion basis.

(vii) Scrap Sales does not include Excise duty, Education Cess, Secondary and Higher education cess, VAT / CST.

(viii) Exports Incentives are recognised on accrual basis against goods exported.

9. Employee Benefits

(i) Short-term employee benefit viz., Salaries and Wages, 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.

(ii) Defined Contribution plan viz., Contributions to Provident Fund and Superannuation Fund are recognized as an expense in the statement of Profit and Loss for the year in which the employees have rendered services.

(iii) The Company contributes to Provident Fund administered by the Government on a monthly basis at 12% of employee's eligible salary.

(iv) The Company also contributes for superannuation a sum equivalent to 15% of the employee's eligible annual basic salary subject to a maximum of Rs. 1 Lakh per employee to "Rajapalayam Mills Limited Officers' Superannuation Fund" administered by trustees and managed by LIC of India.

There are no other obligations other than the above defined contribution plans.

(v) Defined Benefit Plan Gratuity

The Company has its own approved Gratuity Fund. It is in the form of lump sum payments to vested employees on resignation, retirement, death while in employment or on termination of employment of an amount equivalent to 15 Day's basic salary payable for each completed year of service. Vesting occurs upon completion of five years of continuous service. The Company makes annual contributions to "Rajapalayam Mills Limited Employees' Gratuity Fund" administered by trustees and managed by LIC of India, based on the actuarial valuation by an independent external actuary as at the Balance sheet date using the projected unit credit method.

Leave Encashment

The Company has a policy of allowing encashment of unavailed leave for its employees. The expense is recognized at the present value of the amount payable determined based on an independent external actuarial valuation as at the balance sheet date, using projected unit credit method.

10. Provision, Contingent Liabilities and Contingent Assets

(i) Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources in respect of which a reliable estimate can be made. Such provisions are not discounted to their present value except relating to retirement benefits. These provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

(ii) Un-provided contingent liabilities are disclosed in the financial statements. Contingent Assets are neither recognized nor disclosed in the financial statements.

(iii) Insurance claims are accounted for on the basis of claims admitted or expected to be admitted and to the extent that the amount recoverable can be measured reliably and it is reasonable to expect ultimate collection.

11. Borrowing Costs

(i) Borrowing cost include interest, amortisation of ancillary costs incurred and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost. Costs in connection with the borrowing of funds to the extent not directly related to the acquisition of qualifying assets are charged to the Statement of Profit and Loss over the tenure of the loan.

(ii) Borrowing costs that are directly attributable to the acquisition and construction of qualifying assets are capitalized as part of the cost of those assets upto the date of capitalization of such asset.

12. Government Subsidy / Grant

(i) Revenue related grants are recognised on accrual basis wherever there is reasonable assurance that the grant will be received and all attaching conditions will be complied with.

(ii) Interest subsidy under Technology Up-gradation Fund Scheme (TUFS) is recognised on accrual basis and credited to the Interest and Finance cost.

(iii) Power Subsidy under Industrial Investment Promotion Policy of Andhra Pradesh is credited to the Power & Fuel cost.

(iv) Other subsidies under Industrial Investment Promotion Policy of Andhra Pradesh are credited to Industrial Promotion Assistance under Note No. 19 "Other Income".

13. Foreign Currency Transactions

(i) Transactions in Foreign Currency are accounted at the exchange rates prevailing at the time of transaction. The difference in exchange rates arising on the settlement of monetary items are recognized as income or expenses in the Statement of Profit and Loss.

(ii) Monetary Assets and Liabilities in foreign currencies that are covered under a forward contract are accounted at the rate at which they have been covered. Uncovered Monetary Assets and liabilities in foreign currencies are accounted at the rates as on the Balance Sheet date. The exchange difference on account of this is recognized in the Statement of Profit and Loss.

(iii) The difference between the forward rate and the exchange rate at the inception of a forward exchange contract is recognized as income or expense over the life of contract. Any profit or loss arising on cancellation or renewal of such forward exchange contract is recognized as income or expense in the period in which such cancellation or renewal is made.

14. Earnings per share

Basic earnings per share is computed by dividing net profit after tax by weighted average number of equity shares outstanding during the year as stipulated in Accounting Standard - 20 (Earnings per share).

15. Income tax

(i) The tax provision is considered as stipulated in Accounting Standard - 22 (Accounting for Taxes on Income) and includes Current and Deferred Tax Liability.

(ii) Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the applicable tax rates and the provisions of the Income tax Act, 1961 and other applicable tax laws.

(iii) The Company considered credit entitlement of Minimum Alternate Tax (MAT) where it is reasonably certain that this will be available for setoff in accordance with the provisions of the Income Tax Act, 1961.

(iv) Deferred tax is recognized on timing difference between taxable income and the accounting income that originates in one period and is capable of reversal in one or more subsequent periods. It is measured using the tax rates and the tax laws enacted or substantively enacted as at the reporting date.

(v) Current and deferred tax relating to items directly recognized in reserves is recognized in reserves and not in the Statement of Profit and Loss.

16. Segment Reporting

(i) The company prepares its segment information in conformity with accounting policies adopted for preparing and presenting the financial statements of the company as a whole.

(ii) The Company identifies business segment as the primary segment. Under the primary segment, there are two reportable segments viz., Textiles and Power generation from Windmills.

(iii) Segments were identified considering the nature of the products, the differing risks and returns as per Accounting Standard - 17 (Segment Reporting). The inter-segment transfers of units of power from windmills are recognized at the applicable tariff rates of the electricity boards for the purpose of segment reporting as per the relevant accounting standard.

(iv) Costs are allocated to the respective segment based upon the actual incidence of respective cost. Unallocated items include general other income and expenses which are not allocated to any business segment.

17. Impairment of Assets

(i) The carrying values of tangible assets, cash generating units and intangible assets at each balance sheet date are reviewed for impairment if any indication of impairment exists.

(ii) Tangible asset is treated as impaired when the carrying cost of the asset exceeds its recoverable value. The intangible assets are treated as impaired when the asset is not available for use.

(iii) An impairment loss is charged to the Statement of Profit and Loss in the year in which an asset is identified as impaired.

18. Amalgamation

The amalgamation of wholly owned subsidiary of Company made during the last year has been accounted for under the "pooling of interests" method as prescribed by Accounting Standard - 14 (Accounting for Amalgamations).

19. Cash flow statement

(i) Cash flows are presented using indirect method, whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flow from operating, investing and financing activities of the company is segregated based on the available information.

(ii) Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances, highly liquid investments that are readily convertible into cash.

20. Depreciation & Amortization

(i) Depreciation has been provided for Tangible assets on straight-line basis as per the useful life prescribed in Schedule II to the Companies Act, 2013. Till 31-03-2014, the Company had followed Straight Line / Written down value method of depreciation for various categories of Fixed Assets in accordance with rate specified under Schedule XIV of the Companies Act, 1956. Hence there is a change in method of charging depreciation. The impact of the change has been disclosed in Note No. 26(15).

(ii) Intangible assets are amortized over their estimated useful life on straight line method. This is included under "Depreciation & Amortization".

(iii) The estimated useful life of the intangible assets and the amortization period are reviewed at the end of each financial year to reflect the changed pattern, if any.

21. Research & Development Expenditure

Expenditure, if any incurred on Research & Development of revenue nature incurred by the Company is charged to statement of Profit & Loss under the respective revenue heads, while those of capital nature are treated as fixed assets, under the respective asset heads and depreciated in accordance with the policies stated for Tangible Fixed Assets.


Mar 31, 2014

1. Basis of preparation and presentation of financial statements

(i) The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles, the mandatory Accounting Standards issued by the Institute of Chartered Accountants of India and notified under the Companies (Accounting Standards) Rules, 2006, which continuous to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular No.15/2013 dated 13-09-2013 of the Ministry of Corporate Affairs and the relevant provisions of the Companies Act, 1956 and the Companies Act, 2013 as applicable, as adopted consistently by the Company.

(ii) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

2. Use of Estimates

The preparation of financial statements in accordance with the generally accepted accounting principles requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based upon management''s best knowledge of current events and actions, actual results could differ from these estimates in the future periods.

3. Tangible Fixed Assets

(i) Tangible Fixed Assets are stated at cost of acquisition (net of CENVAT/VAT wherever applicable) less accumulated depreciation / amortisation and impairment losses if any, except freehold land which is carried at cost. The cost comprises purchase price, borrowing cost if capitalisation criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Subsequent expenditure related to an item of fixed asset is added to its book value only if it increases the future benefits from the asset beyond its previously assessed standard of performance. All other expenses on fixed assets, including day-to-day repair and maintenance expenditure and cost of replacing parts, are charged to the statement of profit and loss for the period during which such expenses are incurred.

(ii) Depreciation has been provided on Straight Line / Written down value method at the rates specified under rules / Schedule XIV to the Companies Act 1956, prevailing at the time of acquisition of the asset.

(iii) Gains or losses arising from disposal of fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of such assets are recognised in the statement of profit and loss.

4. Intangible Assets

The cost of computer software that are installed are accounted at cost of acquisition of such software and are carried at cost less accumulated amortisation and impairment, if any. Internally generated software is not capitalized and the expenditure is reflected in the Statement of Profit and Loss in the year in which the expenditure is incurred.

5. Investments

All Investments being non-current & non-trade are stated at cost less permanent diminution in value, if any.

6. Investment Properties

(i) An investment in land or buildings, which are not intended to be occupied substantially for use by, or in the operations of the Company, are classified as investment properties. Investment properties are stated at cost, net of accumulated depreciation and accumulated impairment loss if any.

(ii) Depreciation on buildings under of investment properties, which are held for rental to others, are calculated on straight-line basis using the rate prescribed under Schedule XIV to the Companies Act, 1956.

(iii) Gains or losses arising from disposal of investment properties are measured as the difference between the net disposal proceeds and the carrying amount of such investment properties are recognised in the statement of profit and loss.

7. Inventories

(i) Raw materials, stores, spares, packing materials etc., are valued at cost computed on a moving weighted average basis including the cost incurred in bringing the inventories to their present location and condition.

(ii) Work-in-progress is valued at cost including the cost of conversion. The cost of conversion includes direct costs.

(iii) Finished goods are valued at cost or net realisable value whichever is lower. Cost includes cost of conversion and other costs incurred in bringing the inventory to their present location and condition.

8. Revenue Recognition

(i) Revenue is recognised to the extent that is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

(ii) Sale of products is recognised when the significant risks and rewards of ownership of the goods have been passed to the buyer. Sale value excludes Excise duty, Education Cess, Secondary and Higher Education Cess, VAT and CST, Trade discounts, rebates and returns.

(iii) Dividend income is recognised when the Company''s right to receive dividend is established by the reporting date.

(iv) Income from Wind Mills:

The monetary value of the power generated at Wind Farms that are consumed at Mills are not treated as revenue but have been set off against the cost of Power & Fuel. The value of unadjusted units available if any, at the end of the financial year and sold to the Electricity Board at an agreed rate / Tariff rate are recognised and shown as Income from Wind Mills.

9. Employee Benefits

(i) Short-term employee benefit viz., Salaries and Wages 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.

(ii) Defined Contribution plan viz., Contributions to Provident Fund and Superannuation Fund are recognized as an expense in the Statement of Profit and Loss for the year in which the employees have rendered services. The Company contributes to Employees’ Provident Fund and Employees’ Pension Fund administered by the Government on a monthly basis at 12% of employee''s basic salary. The Company also contributed for Superannuation a sum equivalent to 15% of the Officer’s eligible annual basic salary subject to a maximum of Rs. 1 Lakh per employee per annum and is remitted to “Rajapalayam Mills Limited Officers Superannuation Fund” administered by trustees and managed by LIC of India. There are no other obligations other than the above defined contribution plans.

(iii) Defined Benefit Plan

Gratuity

The Company has its own approved Gratuity Fund. It is in the form of lump sum payments to vested employees on resignation, retirement, death while in employment or on termination of employment of an amount equivalent to 15 Day''s basic salary payable for each completed year of service. Vesting occurs upon completion of five years of continuous service. The Company makes annual contributions to “Rajapalayam Mills Limited Employees Gratuity Fund” administered by trustees and managed by LIC of India, based on the actuarial valuation by an independent external actuary as at the Balance Sheet date using the projected unit credit method.

Leave Encashment

The Company has a policy of allowing encashment of unavailed leave for its employees. The obligation for the leave encashment is recognized based on an independent external actuarial valuation at the Balance Sheet date. The expense is recognized at the present value of the amount payable determined based on actuarial valuation using projected unit credit method.

10. Provision, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Un-provided contingent liabilities are disclosed in the Financial Statements. Contingent Assets are not recognized.

11. Borrowing Costs

Borrowing costs that are directly attributable to the acquisition and construction of qualifying assets are capitalized as part of the cost of those assets as per Accounting Standard-16 (Borrowing Costs). All other borrowing costs are charged to revenue.

12. Government Subsidy / Grant

Revenue related to grants/subsidies are recognised on accrual basis wherever there is reasonable certainty and are disclosed as follows:

(i) Interest subsidy under Technology Upgradation Fund Scheme (TUF) is credited to the Interest and Finance cost.

(ii) Power Subsidy under Industrial Investment Promotion Policy of Andhra Pradesh is credited to the Power & Fuel cost.

(iii) Other subsidies under Industrial Investment Promotion Policy of Andhra Pradesh are credited to Industrial Promotion Assistance under Note "Other Income".

(iv) Receivables of such grant / subsidies are shown under Loans & Advances.

13. Foreign Currency Transactions

(i) Transactions in Foreign Currency are accounted at the exchange rates prevailing at the time of transaction. The difference in exchange rates arising on the settlement of monetary items are recognized as income or expenses in the Statement of Profit and Loss.

(ii) Covered liabilities in foreign currencies are accounted at the rate at which they have been covered. Uncovered liabilities in foreign currency are accounted at the rates as on the Balance Sheet date. The exchange difference on account of this is recognized in the Statement of Profit and Loss as per Accounting Standard-11 (The Effects of Changes in Foreign Exchange Rates).

(iii) The difference between the forward rate and the exchange rate at the inception of a forward exchange contract is recognized as income or expense over the life of contract.

14. Earnings per share

Net profit after tax is divided by weighted average number of equity shares as stipulated in Accounting Standard - 20 (Earnings per share).

15. Income tax

The tax provision is considered as stipulated in Accounting Standard-22 (Accounting for Taxes on Income) and includes Current and Deferred Tax Liability. The Company recognizes the Deferred Tax Liability based on the accumulated timing difference using the current tax rate.

The Company considered credit entitlement of Minimum Alternate Tax (MAT) where it is reasonably certain that this will be available for setoff in accordance with the provisions of the Income Tax Act, 1961.

16. Segment Reporting

The Company has identified three reportable segments viz., Textiles, Tissue Culture and Power Generation from Windmills as primary business segments considering the nature of the products, the differing risks and returns as per Accounting Standard -17 (Segment Reporting). The valuation of inter segment transfers are based on prevailing market prices.

17. Impairment of Assets

The recoverable amount of an individual asset related to Discontinuing Operation is determined at the reporting date and where the carrying amount of an asset exceeds its recoverable amount, the value of the asset is written down to its recoverable amount as per Accounting Standard - 28 (Impairment of Assets). The recoverable amount is determined based on the asset''s net selling price.

18. Amalgamation

The amalgamation has been accounted for under the "pooling of interests" method as prescribed by Accounting Standard - 14 ''Accounting for Amalgamations''.


Mar 31, 2013

1. Basis of preparation and presentation of financial statements

(i) The financial statements have been prepared under the historical cost convention and in accordance with the generally accepted accounting principles, the mandatory Accounting Standards issued by the Institute of Chartered Accountants of India and notified under the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act 1956, as adopted consistently by the Company.

(ii) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

(iii) During the year the monetary value of the power generated at wind farms that are consumed at Mills are not treated as revenue but have been set off against the cost of Power & Fuel in accordance with the announcement of Institute of Chartered Accountants of India on Treatment of inter-divisional transfers. Hitherto such value was treated as revenue in the wind farms and included as expenditure in Textile Divisions grouped under Power & Fuel. The change in presentation does not have any impact in the financial statements.

2. Use of Estimates

The preparation of financial statements in accordance with the generally accepted accounting principles requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based upon management''s best knowledge of current events and actions, actual results could differ from these estimates in the future periods.

3. Tangible Fixed Assets

(i) Tangible Fixed Assets are stated at cost of acquisition (net of CENVATA/AT wherever applicable) less accumulated depreciation/amortisation and impairment losses if any, except freehold land which is carried at cost less impairment losses if any. The cost comprises purchase price, borrowing cost if capitalisation criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Subsequent expenditure related to an item of fixed asset is added to its book value only if it increases the future benefits from the asset beyond its previously assessed standard of performance. All other expenses on fixed assets, including day-to-day repair and maintenance expenditure and cost of replacing parts, are charged to the statement of profit and loss for the period during which such expenses are incurred.

(ii) Depreciation has been provided on Straight line / Written down value method at the rates specified under rules / Schedule XIV to the Companies Act 1956, prevailing at the time of acquisition of the asset.

(iii) Gains or losses arising from disposal of fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of such assets are recognised in the statement of profit and loss.

4. Intangible Assets

The cost of computer software that are installed are accounted at cost for acquisition of such software and are carried at cost less accumulated amortisation and impairment, if any. Internally generated software is not capitalized and the expenditure is reflected in the statement of profit and loss in the year in which the expenditure is incurred.

5. Investments

All Investments being long term & non-trade are stated at cost less permanent diminution in value, if any.

6. Investment Property

(i) An investment in land or buildings, which is not intended to be occupied substantially for use by, or in the operations of the Company, is classified as investment property. Investment properties are stated at cost, net of accumulated depreciation and accumulated impairment loss if any.

(ii) Depreciation on building component of investment property is calculated on straight-line basis using the rate prescribed under Schedule XIV to the Companies Act, 1956.

(iii) Gains or losses arising from disposal of investment properties are measured as the difference between the net disposal proceeds and the carrying amount of such investment properties are recognised in the statement of profit and loss.

7. Inventories

(i) Raw materials, stores, spares, packing materials, etc., are valued at cost including the cost incurred in bringing the inventories to their present location and condition.

(ii) Work-in-progress is valued at cost including the cost of conversion. The cost of conversion includes direct costs.

(iii) Finished goods are valued at cost or net realisable value whichever is lower. Cost includes cost of conversion and other costs incurred in bringing the inventory to their present location and condition.

8. Revenue recognition

(i) Revenue is recognised to the extent that is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

(ii) Sale of products is recognised when the significant risks and rewards of ownership of the goods have been passed to the buyer. Sale value excludes Excise duty, Education Cess, Secondary and Higher education cess, VAT and CST

(iii) Dividend income is recognised when the Company''s right to receive dividend is established by the reporting date.

(iv) Income from Wind Mills:

The monetary value of the power generated at wind farms that are consumed at Mills are not treated as revenue but have been set off against the cost of Power & Fuel. The value of unadjusted units available if any, at the end of the financial year and sold to the Electricity Board at an agreed rate/ Tariff rate are recognised and shown as Income from Wind Mills.

9. Employee Benefits

(i) Short-term employee benefit viz., Salaries and Wages, 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.

(ii) Defined Contribution plan viz., Contributions to Provident fund and Superannuation fund are recognized as an expense in the statement of profit and loss for the year in which the employees have rendered services. The Company contributes to Provident fund administered by the Government on a monthly basis at 12% of employee''s basic salary. The Company also contributed for Superannuation a sum equivalent to 15% of the employee''s eligible annual basic salary subject to a maximum of Rs. 1 Lakh per employee to funds administered by trustees and managed by LIC of India annually. There are no other obligations other than the above defined contribution plans.

(Mi) Defined Benefit Plan

Gratuity

The Company has its own approved Gratuity Fund. It is in the form of lump sum payments to vested employees on resignation, retirement, death while in employment or on termination of employment of an amount equivalent to 15 Day''s basic salary payable for each completed year of service. Vesting occurs upon completion of five years of continuous service. The Company makes annual contributions to funds administered by trustees and managed by LIC of India, based on the actuarial valuation by an independent external actuary as at the Balance sheet date using the projected unit credit method.

Leave Encashment

The Company has a policy of allowing encashment of unavailed leave for its employees. The obligation for the leave encashment is recognized based on an independent external actuarial valuation at the Balance Sheet date. The expense is recognized at the present value of the amount payable determined based on actuarial valuation using projected unit credit method.

10. Provision, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Un-provided contingent liabilities are disclosed in the Accounts by way of Notes. Contingent Assets are not recognized.

11. Borrowing Costs

Borrowing costs that are directly attributable to the acquisition, construction of qualifying assets are capitalized as part of the cost of those assets as per Accounting Standard-16 (Borrowing Costs). All other borrowing costs are charged to revenue.

12. Government Subsidy / Grant

(i) Interest subsidy under Technology Upgradation Fund Scheme (TUF) is credited to the Finance Costs.

(ii) Power Subsidy under Industrial Investment Promotion Policy of Andhra Pradesh is credited to the Power & Fuel cost.

(iii) Other subsidies under Industrial Investment Promotion Policy of Andhra Pradesh are credited to Industrial Promotion Assistance under Note "Other Income".

13. Foreign Currency Transactions

(i) Transactions in Foreign Currency are accounted at the exchange rates prevailing at the time of transaction. The difference in exchange rates arising on the settlement of monetary items are recognized as income or expenses in the Statement of Profit and Loss.

(ii) Covered liabilities in foreign currencies are accounted at the rate at which they have been covered. Uncovered liabilities in foreign currency are accounted at the rates as on the Balance Sheet date. The exchange difference on account of this is recognized in the Statement of Profit and Loss as per Accounting Standard - 11 (The Effects of Changes in Foreign Exchange Rates).

(iii) The difference between the forward rate and the exchange rate at the inception of a forward exchange contract is recognized as income or expense over the life of contract.

14. Earnings per share

Net profit after tax is divided by weighted average number of equity shares as stipulated in Accounting Standard - 20 (Earnings per share).

15. Income tax

The tax provision is considered as stipulated in Accounting Standard - 22 (Accounting for Taxes on income) and includes current and deferred tax liability. The Company recognizes the deferred tax liability based on the accumulated timing difference using the current tax rate.

The Company considered credit entitlement of Minimum Alternate Tax (MAT) where it is reasonably certain that this will be available for setoff in accordance with the provisions of the Income Tax Act, 1961.

16. Segment Reporting

The Company has identified three reportable segments viz., Textiles, Tissue Culture and Power generation from Windmills as primary business segments considering the nature of the products, the differing risks and returns as per Accounting Standard -17 (Segment Reporting). The valuation of inter segment transfers are based on prevailing market prices.

17. Impairment of Assets

The recoverable amount of an individual asset related to Discontinuing Operation is determined at the reporting date and where the carrying amount of an asset exceeds its recoverable amount, the value of the asset is written down to its recoverable amount as per Accounting Standard - 28 (Impairment of Assets). The recoverable amount is determined based on the asset''s net selling price.


Mar 31, 2012

1. Basis of preparation of financial statements

(i) The financial statements have been prepared under the historical cost convention and in accordance with the generally accepted accounting principles, the mandatory Accounting Standards issued by the Institute of Chartered Accountants of India and notified under the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act 1956, as adopted consistently by the Company.

(ii) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

2. Use of Estimates

The preparation of financial statements in accordance with the generally accepted accounting principles requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based upon management's best knowledge of current events and actions, actual results could differ from these estimates in the future periods.

3. Tangible Fixed Assets

(i) Tangible Fixed Assets are stated at cost of acquisition (net of CENVAT/VAT wherever applicable) less accumulated depreciation/amortisation and impairment losses if any, except freehold land which is carried at cost less impairment losses if any. The cost comprises purchase price, borrowing cost if capitalisation criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Subsequent expenditure related to an item of fixed asset is added to its book value only if it increases the future benefits from the asset beyond its previously assessed standard of performance. All other expenses on fixed assets, including day-to-day repair and maintenance expenditure and cost of replacing parts, are charged to the statement of profit and loss for the period during which such expenses are incurred.

(ii) Depreciation has been provided on straight line / Written down value method at the rates specified under rules / Schedule XIV to the Companies Act 1956, prevailing at the time of acquisition of the asset.

(iii) Gains or losses arising from disposal of fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of such assets are recognised in the statement of profit and loss.

4. Intangible Assets

The cost of computer software that are installed are accounted at cost for acquisition of such software and are carried at cost less accumulated amortisation and impairment, if any. Internally generated software is not capitalized and the expenditure is reflected in the statement of profit and loss in the year in which the expenditure is incurred.

5. Investments

All Investments being long term & non-trade are stated at cost.

6. Investment Property

(i) An investment in land or buildings, which is not intended to be occupied substantially for use by, or in the operations of the Company, is classified as investment property. Investment properties are stated at cost, net of accumulated depreciation and accumulated impairment loss if any.

(ii) Depreciation on building component of investment property is calculated on straight-line basis using the rate prescribed under Schedule XIV to the Companies Act, 1956.

(iii) Gains or losses arising from disposal of investment properties are measured as the difference between the net disposal proceeds and the carrying amount of such investment properties are recognised in the statement of profit and loss.

7. Inventories

(i) Raw materials, stores, spares, packing materials etc., are valued at cost including the cost incurred in bringing the inventories to their present location and condition.

(ii) Work-in-progress is valued at cost including the cost of conversion. The cost of conversion includes direct costs.

(iii) Finished goods are valued at cost or net realisable value whichever is lower. Cost includes cost of conversion and other costs incurred in bringing the inventory to their present location and condition.

8. Revenue recognition

(i) Revenue is recognised to the extent that is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

(ii) Sale of products is recognised when the significant risks and rewards of ownership of the goods have been passed to the buyer. Sale value excludes Excise duty, Education Cess, Secondary and Higher education cess, VAT and CST.

(iii) Dividend income is recognised when the Company's right to receive dividend is established by the reporting date.

(iv) Income from Wind Mills:

Units generated from windmills are adjusted against the consumption of power at our Mills. The monetary value of the units so adjusted, calculated at the prevailing EB rates net of wheeling charges has been included in power & fuel. The value of unadjusted units as on the Balance Sheet date has been included in Accrued Income under the note Other Current Assets.

9. Employee Benefits

(i) Short-term employee benefit viz., Salaries and Wages, 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.

(ii) Defined Contribution plan viz., Contributions to Provident fund and Superannuation fund are recognized as an expense in the Statement of Profit and Loss for the year in which the employees have rendered services. The Company contributes to Provident fund administered by the Government on a monthly basis at 12% of employee's basic salary. The Company also contributed for superannuation a sum equivalent to 15% of the employee's eligible annual basic salary subject to a maximum of Rs. 1 Lakh per employee to funds administered by trustees and managed by LIC of India annually. There are no other obligations other than the above defined contribution plans.

(iii) Defined Benefit Plan Gratuity

The Company has its own approved Gratuity Fund. It is in the form of lump sum payments to vested employees on resignation, retirement, death while in employment or on termination of employment of an amount equivalent to 15 Day's basic salary payable for each completed year of service. Vesting occurs upon completion of five years of continuous service. The Company makes annual contributions to funds administered by trustees and managed by LIC of India, based on the actuarial valuation by an independent external actuary as at the Balance sheet date using the projected unit credit method.

Leave Encashment

The Company has a policy of allowing encashment of unavailed leave for its employees. The obligation for the leave encashment is recognized based on an independent external actuarial valuation at the Balance Sheet date. The expense is recognized at the present value of the amount payable determined based on actuarial valuation using projected unit credit method.

10. Provision, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Un-provided contingent liabilities are disclosed in the Accounts by way of Notes. Contingent Assets are not recognized.

11. Borrowing Costs

Borrowing costs that are directly attributable to the acquisition, construction of qualifying assets are capitalized as part of the cost of those assets as per Accounting Standard-16 (Borrowing Costs). All other borrowing costs are charged to revenue.

12. Government Subsidy / Grant

(i) Interest subsidy under Technology Upgradation Fund Scheme (TUF) is credited to the Finance Costs.

(ii) Power Subsidy under Industrial Investment Promotion Policy of Andhra Pradesh is credited to the Power & Fuel cost.

(iii) Other subsidies under Industrial Investment Promotion Policy of Andhra Pradesh are credited to Industrial Promotion Assistance under Note "Other Income".

13. Foreign Currency Transactions

(a) Transactions in Foreign Currency are accounted at the exchange rates prevailing at the time of transaction. The difference in exchange rates arising on the settlement of monetary items are recognized as income or expenses in the Statement of Profit and Loss.

(b) Covered liabilities in foreign currencies are accounted at the rate at which they have been covered. Uncovered liabilities in foreign currency are accounted at the rates as on the Balance Sheet date. The exchange difference on account of this is recognized in the Statement of Profit and Loss as per Accounting Standard-11 (The Effects of Changes in Foreign Exchange Rates).

(c) The difference between the forward rate and the exchange rate at the inception of a forward exchange contract is recognized as income or expense over the life of contract.

14. Earnings per share

Net profit after tax is divided by weighted average number of equity shares as stipulated in Accounting Standard - 20 (Earnings per share).

15. Income tax

The tax provision is considered as stipulated in Accounting Standard-22 (Accounting for Taxes on income) and includes current and deferred tax liability. The Company recognizes the deferred tax liability based on the accumulated timing difference using the current tax rate.

The Company considered credit entitlement of Minimum Alternate Tax (MAT) where it is reasonably certain that this will be available for setoff in accordance with the provisions of the Income Tax Act, 1961.

16. Segment Reporting

The Company has identified three reportable segments viz., Textiles, Tissue Culture and Power generation from Windmills as primary business segments considering the nature of the products, the differing risks and returns as per Accounting Standard - 17 (Segment Reporting). The valuation of inter segment transfers are based on prevailing market prices.


Mar 31, 2011

1. Basis of preparation of financial statements

(i) The financial statements have been prepared under the historical cost convention and in accordance with the generally accepted accounting principles, the mandatory Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956, as adopted consistently by the Company.

(ii) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

2. Depreciation

(i) For Buildings, Plant & Machinery

(a) On additions to Buildings, Plant & Machinery from 1978-79 to 1986-87: Under Straight Line Method in accordance with Circular No.1/86 dated 21-05-1986 issued by the Department of Company Affairs as per rates then in force.

(b) On additions to Buildings, Plant & Machinery from 1987-88 to 1992-93: Under Straight Line Method as per rates specified in Schedule XIV.

(c) On additions to Buildings, Plant & Machinery from 1993-94 onwards: Under Straight Line Method as per rates specified in Schedule XIV vide notification dated 16-12-1993.

(ii) On Other Assets

Under Written Down Value Method as per rates specified in Schedule XIV, then in force in accordance with period stated above.

3. Investments

All Investments being long term & non-trade are stated at cost.

4. Fixed Asset

Fixed Assets are stated at cost (net of CENVAT/VAT wherever applicable) less accumulated Depreciation.

5. Inventories

(i) Raw materials, stores, spares, packing materials etc., are valued at cost including the cost incurred in bringing the inventories to their present location and condition or net realisable value whichever is lower.

(ii) Process stock is valued at cost including the cost of conversion. The cost of conversion includes direct costs.

(iii) Finished goods are valued at cost or net realisable value whichever is lower. Cost includes cost of conversion and other costs incurred in bringing the inventory to their present location and condition. .

6. Sales

Net Sales exclude VAT / CST.

7. Income from Wind Mills

Units generated from Wind Mills are adjusted against the consumption of power at our Mills. The monetary value of the units so adjusted, calculated at the prevailing EB rates net of wheeling charges has been included in power & fuel and the same value has been taken as Income from Wind Mills in Profit and Loss Account. The value of unadjusted units as on Balance Sheet date has been included under loans and advances.

8. Employee Benefits

(i) Short-term employee benefit viz., Salaries and Wages, are recognized as an expense at the undiscounted amount in the profit and loss account for the year in which the related service is rendered.

(ii) Defined Contribution plan viz., Contributions to Provident Fund and Superannuation Fund are recognized as an expense in the profit and loss account for the year in which the employees have rendered services. The Company contributes to Provident Fund administered by the Government on a monthly basis at 12% of employee’s basic salary. The Company also contributed for superannuation a sum equivalent to 15% of the employee's eligible annual basic salary subject to a maximum of Rs.1 Lakh per employee to funds administered by trustees and managed by LIC of India annually. There are no other obligations other than the above defined contribution plans.

(iii) Defined Benefit Plan

Gratuity

The Company has its own approved Gratuity Fund. It is in the form of lump sum payments to vested employees on resignation, retirement, death while in employment or on termination of employment of an amount equivalent to 15 Day's basic salary payable for each completed year of service. Vesting occurs upon completion of five years of continuous service. The Company makes annual contributions to funds administered by trustees and managed by LIC of India, based on the actuarial valuation by an independent external actuary as at the Balance sheet date using the projected unit credit method.

Leave Encashment

The Company has a policy of allowing encashment of unavailed leave for its employees. The obligation for the leave encashment is recognized based on an independent external actuarial valuation at the Balance Sheet date. The expense is recognized at the present value of the amount payable determined based on actuarial valuation using projected unit credit method.

9. Provision, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Un-provided contingent liabilities are disclosed in the Accounts by way of Notes. Contingent Assets are not recognized.

10. Borrowing Costs

Borrowing Costs that are directly attributable to the acquisition, construction of qualifying assets are capatalized as part of the cost of those assets as per Accounting Standard-16 (Borrowing Costs). All other borrowing costs are charged to revenue.

11. Government Subsidy / Grant

Interest subsidy under Technology Upgradation Fund Scheme (TUF) is credited to interest and finance charges.

12. Foreign Currency Transactions

(i) Transactions in Foreign Currency are accounted at the exchange rates prevailing at the time of transaction.

(ii) Covered liabilities in Foreign Currencies are accounted at the rate at which they have been covered. Uncovered liabilities in Foreign Currency are accounted at the rates as on the Balance Sheet date.

(iii) The difference between the forward rate and the exchange rate at the inception of a forward exchange contract is recognized as income or expense over the life of contract.

(iv) Exchange difference in respect of uncovered foreign currency liabilities are recognized in the profit and loss account.

13. Earnings Per Share

Net profit after tax is divided by the number of equity shares outstanding as on Balance Sheet date.

14. Income tax

The tax provision is considered as stipulated in Accounting Standard-22 (Accounting for Taxes on income) and includes current and deferred tax liability. The Company recognises the deferred tax liability based on the accumulated timing difference using the current tax rate.

The Company considered credit entitlement of Minimum Alternate Tax (MAT) where it is reasonably certain that this will be available for setoff in accordance with the provisions of the Income Tax Act, 1961.

15. Segment Reporting

The Company has identified three reportable segments viz., Textiles, Tissue Culture and Power generation from Wind Mills as primary business segments considering the nature of the products, the differing risks and returns as per Accounting Standard -17 (Segment Reporting). The valuation of inter segment transfers are based on prevailing market prices.


Mar 31, 2010

1. Basis of preparation of financial statements

(i) The financial statements have been prepared under the historical cost convention and in accordance with the generally accepted accounting principles, the mandatory Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956, as adopted consistently by the Company.

(ii) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

2. Depreciation

(i) For Buildings, Plant & Machinery and Electrical Machineries

(a) On additions to Buildings, Plant & Machinery and Electrical Machineries from 1978-79 to 1986-87: Under Straight Line Method in accordance with Circular No.1/86 dated 21-05-1986 issued by the Department of Company Affairs as per rates then in force.

(b) On additions to Buildings, Plant & Machinery and Electrical Machineries from 1987-88 to 1992-93: Under Straight Line Method as per rates specified in Schedule XIV.

(c) On additions to Buildings, Plant & Machinery and Electrical Machineries from 1993-94 onwards: Under Straight Line Method as per rates specified in Schedule XIV vide notification dated 16-12-1993.

(ii) On Other Assets

Under Written Down Value Method as per rates specified in Schedule XIV

3. Investments

All Investments being long term & non-trade are stated at cost.

4. Fixed Assets

Fixed Assets are stated at cost (net of CENVATA/AT wherever applicable) less accumulated Depreciation.

5. Inventories

(i) Raw materials, stores, spares, packing materials etc., are valued at cost including the cost incurred in bringing the inventories to their present location and condition or net realisable value whichever is lower.

(ii) Process stock is valued at cost including the cost of conversion. The cost of conversion includes direct costs.

(iii) Finished goods are valued at cost or net realisable value whichever is lower. Cost includes cost of conversion and other costs incurred in bringing the inventory to their present location and condition.

6. Sales

Net Sales exclude VAT / CST.

7. Income from Wind Mills

Units generated from Wind Mills are adjusted against the consumption of power at our Mills. The monetary value of the units so adjusted, calculated at the prevailing EB rates net of wheeling charges has been included in power & fuel and the same value has been taken as Income from Wind Mills in Profit and Loss Account. The value of unadjusted units as on Balance Sheet date has been included under loans and advances.

8. Employee Benefits

(i) Short-term employee benefit viz., Salaries and Wages, are recognized as an expense at the undiscounted amount in the profit and loss account for the year in which the related service is rendered.

(ii) Defined Contribution plan viz., Contributions to Provident Fund and Superannuation Fund are recognized as an expense in the profit and loss account for the year in which the employees have rendered services. The Company contributes to Provident Fund administered by the Government on a monthly basis at 12% of employees basic salary. The Company also contributes for superannuation a sum equivalent to 15% of the employees eligible annual basic salary subject to a maximum of Rs.1 Lakh per employee to funds administered by trustees and managed by LIC of India annually. There are no other obligations other than the above defined contribution plans.

(iii) Defined Benefit Plan

Gratuity

The Company has its own approved Gratuity Fund. It is in the form of lump sum payments to vested employees on resignation, retirement, death while in employment or on termination of employment of an amount equivalent to 15 Days basic salary payable for each completed year of service. Vesting occurs upon completion of five years of continuous service. The Company makes annual contributions to funds administered by trustees and managed by LIC of India, based on the actuarial valuation by an independent external actuary as at the Balance sheet date using the projected unit credit method.

Leave Encashment

The Company has a policy of encashing unavailed leave for its employees. The obligation for the leave encashment is recognized based on an independent external actuarial valuation at the Balance Sheet date. The expense is recognized at the present value of the amount payable determined based on actuarial valuation using projected unit credit method.

9. Provision, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Un-provided contingent liabilities are disclosed in the Accounts by way of Notes. Contingent Assets are not recognized.

10. Research and Development Expenditure

Expenditure on Research & Development of revenue nature incurred by this Company during earlier period is amortized over a period of 5 years. No such expenditure incurred during the current year.

11. Borrowing Costs

Borrowing Costs that are directly attributable to the acquisition, construction of qualifying assets are capatalized as part of the cost of those assets as per Accounting Standard -16 (Borrowing Costs). All other borrwing costs are charged to revenue.

12. Government Subsidy / Grant

Interest subsidy under Technology Upgradation Fund Scheme (TUF) is credited to the Interest and Finance Charges.

13. Foreign Currency Transactions

(i) Transactions in Foreign Currency are accounted at the exchange rates prevailing at the time of transaction.

(ii) Covered liabilities in Foreign Currencies are accounted at the rate at which they have been covered. Uncovered liabilities in Foreign Currency are accounted at the rates as on the Balance Sheet date.

(iii) The difference between the forward rate and the exchange rate at the inception of a forward exchange contract is recognized as income or expense over the life of contract.

(iv) Exchange difference in respect of uncovered foreign currency liabilities are recognized in the profit and loss account.

14. Earnings Per Share

Net profit after tax is divided by the number of equity shares outstanding as on Balance Sheet date.

15. Income tax

The tax provision is considered as stipulated in Accounting Standard-22 (Accounting for Taxes on income) and includes current and deferred tax liability. The Company recognises the deferred tax liability based on the accumulated timing difference using the current tax rate.

16. Segment Reporting

The Company has identified three reportable segments viz., Textiles, Tissue Culture and Power generation from Wind Mills as primary business segments considering the nature of the products, the differing risks and returns as per Accounting Standard -17 (Segment Reporting). The valuation of inter segment transfers are based on prevailing market prices.

17. Miscellaneous Expenditure

Amount spent on Research & Development Expenditure which is expected to yield enduring benefits are held under Miscellaneous Expenditure and amortized over the expected beneficial period, not exceeding five years.

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