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Accounting Policies of Seya Industries Ltd. Company

Mar 31, 2015

2.1. Basis for Preparation of Financial Statements:

2.1.1. These financial statements have been prepared to comply in all material aspects with applicable accounting principles in India, the applicable Accounting Standards prescribed under Section 133 of the Companies Act, 2013 ('Act') read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act (to the extent notified) and other generally accepted accounting principles in India (Indian GAAP), to the extent applicable..

2.1.2. The financial statements have been prepared on accrual basis under the historical cost convention except for those with significant uncertainties. The accounting policies adopted in the preparation of financial statements are consistent with those of the previous year.

2.1.3. All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle and other criteria set out in the revised Schedule III to the Act. Based on the nature of business and its activities, the Company has ascertained its operating cycle as twelve months for the purpose of Current & Non-Current classification of Assets & Liabilities.

2.2. Use of Estimates:

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

2.3. Inventories:

i. Raw materials, Stores & Spares are valued at lower of Cost or Market Value whichever is less.

ii. Work in process and Manufactured Goods, are valued at lower of Cost or Market Value whichever is less.

iii. By-products, self-generated Scrap and non-reusable waste are valued at net realisable value.

iv. Cost includes all charges in bringing the goods to the point of sale, including Octroi and other levies, transit insurance and receiving charges. Work-in-progress and Manufactured goods include appropriate proportion of overheads and, where applicable, excise duty.

2.4. Cash and Cash equivalents (for purposes of Cash Flow Statement):

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

2.5. Cash Flow Statement:

Cash flows are reported using the 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 flows from operating, investing and financing activities of the Company are segregated based on the available information.

2.6. Fixed Assets (Tangible) and Depreciation:

Fixed assets are stated at their original cost, less accumulated depreciation / amortization and impairment losses, if any. The Original Cost of fixed assets includes its purchase price net of any trade discounts and rebates, any import duties and other taxes (other than those subsequently recoverable from the tax authorities), any directly attributable expenditure on making the assets ready for its intended use, interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use and other incidental expenses related to acquisition, installation and other pre-operative expenses incurred up to that date which generally coincides with the commissioning date of such assets.

Exchange differences arising on restatement / settlement of long-term foreign currency borrowings relating to acquisition of depreciable fixed assets are adjusted to the cost of the respective assets and depreciated over the remaining useful life of such assets.

Machinery spares which can be used only in connection with an item of fixed asset and whose use is expected to be irregular are capitalised and depreciated over the useful life of the principal item of the relevant assets subsequent expenditure, if any, on fixed assets after its purchase / completion is capitalized only if such expenditure results in an increase in future benefits from such assets beyond its previously assessed standard of performance.

Fixed assets acquired and put to use for project purpose are capitalised and depreciation thereon is included in the project cost till commissioning of the project.

Capital Work in Progress:

Projects under which assets are not ready for their intended use and other capital work-in-progress are carried at cost, comprising direct cost, related incidental expenses and attributable borrowing cost.

Depreciation has been provided as per Section 123 of the 2013 Act on a straight line method basis ("SLM") over the estimated useful lives. Management believes based on a technical evaluation that the revised useful lives of the assets reflect the periods over which these assets are expected to be used, which are as follows:

Asset Useful life based on SLM adopted

Leasehold Land 99 years

Building 1 - 25 years

Plant and Machinery 3 - 20 years

Furniture & Fixtures 3 - 12 years

Vehicles 3 - 10 years

2.7. Leases:

Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor are recognised as operating leases. Lease rentals under operating leases are recognised in the Statement of Profit and Loss on a straight-line basis.

2.8. Revenue Recognition:

Sales of Goods: Sales are recognised, net of returns and trade discounts, on transfer of significant risks and rewards of ownership to the buyer, which generally coincides with the delivery of goods to customers. Sales include excise duty but exclude central sales tax and value added tax.

Other Income:

Interest income is recognised on a time proportion basis taking into account the amount outstanding and the interest rate applicable.

2.9. Foreign Currency Transactions:

Initial Recognition

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

Measurement at the Balance Sheet date

Foreign currency monetary items of the Company outstanding at the Balance Sheet date are restated at the year-end rates. Non-monetary items of the Company are carried at historical cost.

Treatment of exchange differences

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

Exchange differences arising on settlement / restatement of Long term foreign currency monetary are capitalised as part of the depreciable fixed assets to which the monetary item relates and depreciated over the remaining useful life of such assets or amortised on settlement / over the maturity period of such items

2.10. Employee benefits:

Employee benefits include gratuity fund, compensated absences, long service awards.

Defined benefit plans

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

by the fair value of scheme assets. Any asset resulting from this calculation is limited to past service cost, plus the present value of available refunds and reductions in future contributions to the schemes.

Short-term Employee Benefits

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

I. in case of accumulated compensated absences, when employees render the services that increase their entitlement of future compensated absences; and

II. in case of non-accumulating compensated absences, when the absences occur.

Long-term Employee Benefits

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

2.11. Finance 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 its intended use. All other borrowing costs are charged to the statement of Profit and Loss. Borrowing costs 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.

2.12. Segment Reporting:

The Company has disclosed business segment as primary segment. The Company operates in five segments: Fine & Specialty Chemicals Intermediates, Organic Chemical Intermediates, Inorganic Chemical Intermediates and Agrochemical Intermediates, and Pharmaceutical Intermediates.

The Company has classified its business segments based on the respective end use of its products which does not have any financial impact and for which necessary Segment wise statement has been shown as per Accounting Standard - 17 (AS -

17)

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company. Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment.

Inter-segment revenue is accounted on the basis of transactions which are primarily determined based on market / fair value factors.

Revenue, expenses, assets and liabilities which relate to the Company as a whole and are not allocable to segments on reasonable basis have been included under "unallocated revenue / expenses / assets / liabilities".

Secondary segment have been identified with reference to geographical location of external customers. Composition of secondary segment is as follows

i. India

ii. Outside India

2.13. Earnings per share

Basic earnings per share are computed by dividing the net profit for the year by the weighted average number of Ordinary equity shares outstanding during the year. Diluted earnings per share is computed by dividing the net profit for the year by the weighted average number of Ordinary equity shares outstanding during the year plus the weighted average no of Ordinary equity shares that would be issued on conversion of all the dilutive potential ordinary equity shares in Ordinary equity shares.

2.14. Taxes on Income

Tax on income for the current period is determined on the basis of taxable income after considering the various deductions available under the Income Tax Act, 1961. Income Tax comprises both current and deferred tax.

Provision for Current tax is measured at the amount computed under the Income Tax Act, 1961, or Book Profit computed under section 115JB, whichever is higher, and correspondingly set-off available under section 115JAA is credited to the Statement of Profit & Loss of the financial year.

MAT credit is recognised as an asset only when, and to the extent, there is convincing evidence that the Company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of credit to the Statement of Profit and Loss and shown as MAT Credit Entitlement. The Company reviews the same at each Balance Sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent that there is no longer convincing evidence to the effect that Company will pay normal income tax during the specified period.

Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws enacted or substantially enacted as at the reporting date. Deferred tax liabilities are recognised for all timing differences. Deferred tax assets in respect of unabsorbed depreciation and carry forward of losses are recognised only if there is virtual certainty that there will be sufficient future taxable income available to realise such assets. Deferred tax assets are recognised for timing differences of other items only to the extent that reasonable certainty exists that sufficient future taxable income will be available against which these can be realised. Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Company has a legally enforceable right for such set off. Deferred tax assets are reviewed at each Balance Sheet date for their realisation. Current and deferred tax relating to items directly recognised in equity are recognised in equity and not in the Statement of Profit and Loss

2.15. Research and Development Expenses

Revenue expenditure pertaining to research is charged to the Statement of Profit and Loss. Expenditure pertaining to Development of products is capitalised. The amount capitalised comprises expenditure that can be directly attributed or allocated on a reasonable and consistent basis to creating, producing and making the asset ready for its intended use. Fixed assets utilised for research and development are capitalised and depreciated in accordance with the policies stated for Tangible Fixed Assets and Intangible Assets.

2.16. Impairment of Assets

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

2.17. Provisions and Contingencies

A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in respect of possible obligations that arise from past events but their existence is confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company.

2.18. Service tax input credit

Service tax input credit is accounted for in the books in the period in which the underlying service received is accounted and when there is no uncertainty in availing / utilising the credits.




Mar 31, 2014

1.1.1. Basis for preparation of Financial Statements:

i. The Financial Statements are prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under Section 211(3C) of the Companies Act, 1956 ("the 1956 Act") (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 ("the 2013 Act") in terms of General Circular 15/2013 dated September 13, 2013 of the Ministry of Corporate affairs and the relevant provisions of the 1956 Act/ 2013 Act, as applicable.

ii. The financial statements have been prepared on accrual basis under the historical cost convention except for those with significant uncertainties.

iii. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

iv. All assets and liabilities have been classified as current or non-current as per the Company''s normal operating cycle and other criteria set out in the revised schedule VI to the 1956 Act. Based on the nature of business and its activities, the Company has ascertained its operating cycle as twelve months for the purpose of Current & Non-Current classification of Assets & Liabilities.

v. Captive Consumption is considered and valued under sales, as per provisions of Central Excise Act.

1.2.2. Use of Estimates:

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

1.2.3. Inventories:

i. Raw materials, stores & Spares are valued at lower of Cost or Market Value whichever is less.

ii. Work in process and Manufactured Goods, are valued at lower of Cost or Market Value whichever is less.

iii. By-products, self-generated Scrap and non-reusable waste are valued at net realisable value.

iv. Cost includes all charges in bringing the goods to the point of sale, including Octroi and other levies,

transit insurance and receiving charges. Work-in-progress and Manufactured goods include appropriate proportion of overheads and, where applicable, excise duty.

1.2.4. Cash and cash equivalents (for purposes of Cash Flow Statement):

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

1.2.5. Cash Flow Statement:

Cash flows are reported using the 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 flows from operating, investing and financing activities of the Company are segregated based on the available information.

1.2.6. Fixed Assets (Tangible)and Depreciation:

Fixed assets are stated at their original cost, less accumulated depreciation / amortization and impairment losses,

if any. The Original Cost of fixed assets includes its purchase price net of any trade discounts and rebates, any import duties and other taxes (other than those subsequently recoverable from the tax authorities), any directly attributable expenditure on making the assets ready for its intended use, interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use and other incidental expenses related to acquisition, installation and other pre-operative expenses incurred up to that date. Exchange differences arising on restatement / settlement of long-term foreign currency borrowings relating to acquisition of depreciable fixed assets are adjusted to the cost of the respective assets and depreciated over the remaining useful life of such assets. Machinery spares which can be used only in connection with an item of fixed asset and whose use is expected to be irregular are capitalised and depreciated over the useful life of the principal item of the relevant assets Subsequent expenditure, if any, on fixed assets after its purchase / completion is capitalized only if such expenditure results in an increase in future benefits from such assets beyond its previously assessed standard of performance.

Fixed assets acquired and put to use for project purpose are capitalised and depreciation thereon is included in the project cost till commissioning of the project.

Capital Work in Progress:

Projects under which assets are not ready for their intended use and other capital work-in-progress are carried at cost, comprising direct cost, related incidental expenses and attributable interest.

Depreciation on Tangible Fixed Assets is provided on Original cost of Fixed Assets on straight line method under Section 205(2) (b) of the 1956 Act, at the rates and in the manner prescribed in Schedule XIV to the 1956 Act.

1.2.7. Leases:

Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor are recognised as operating leases. Lease rentals under operating leases are recognised in the Statement of Profit and Loss on a straight-line basis.

1.2.8. Revenue Recognition:

Sales of Goods: Sales are recognised, net of returns and trade discounts, on transfer of significant risks and rewards of ownership to the buyer, which generally coincides with the delivery of goods to customers. Sales include excise duty but exclude central sales tax and value added tax.

1.2.9. other Income:

Interest income is accounted on accrual basis.

1.2.10. Foreign Currency Transactions:

Initial Recognition

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

Measurement at the Balance Sheet date

Foreign currency monetary items of the Company outstanding at the Balance Sheet date are restated at the year- end rates. Non-monetary items of the Company are carried at historical cost.

Treatment of exchange differences

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

Exchange differences arising on settlement / restatement of Long term foreign currency monetary are capitalised as part of the depreciable fixed assets to which the monetary item relates and depreciated over the remaining useful life of such assets or amortised on settlement / over the maturity period of such items.

1.2.11. Employee benefits:

Employee benefits include gratuity fund, compensated absences, long service awards.

Defined benefit plans

For defined benefit plans in the form of gratuity fund the cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each Balance Sheet date. Actuarial gains and losses are recognised in the Statement of Profit and Loss in the period in which they occur. Past service

cost is recognised immediately to the extent that the benefits are already vested and otherwise is amortised on a straight-line basis over the average period until the benefits become vested. The retirement benefit obligation recognised in the Balance Sheet represents the present value of the defined benefit obligation as adjusted for unrecognised past service cost, as reduced by the fair value of scheme assets. Any asset resulting from this calculation is limited to past service cost, plus the present value of available refunds and reductions in future contributions to the schemes.

Short-term Employee Benefits

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

I. in case of accumulated compensated absences, when employees render the services that increase their entitlement of future compensated absences; and

II. in case of non-accumulating compensated absences, when the absences occur.

Long-term Employee Benefits

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

1.2.12. Borrowing Cost:

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 its intended use. All other borrowing costs are charged to the statement of Profit and Loss. Borrowing costs 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.

1.2.13. Segment Reporting:

The Company has disclosed business segment as primary segment. The Company operates in five segments: Inorganic Intermediates, Organic Intermediates, Pharmaceutical Intermediates, Fine & Specialty Chemicals and Others.

The Company has classified its business segments based on the respective end use of its products which does not have any financial impact and for which necessary Segment wise statement has been shown as per Accounting Standard - 17 (AS - 17)

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company. Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment.

Inter-segment revenue is accounted on the basis of transactions which are primarily determined based on market / fair value factors.

Revenue, expenses, assets and liabilities which relate to the Company as a whole and are not allocable to segments on reasonable basis have been included under "unallocated revenue / expenses / assets / liabilities".

Secondary segment have been identified with reference to geographical location of external customers. Composition of secondary segment is as follows.

i. India

ii. Outside India

1.2.14. Earnings per share:

Basic earning per share is computed by dividing the net profit for the year by the weighted average number of Ordinary equity shares outstanding during the year. Diluted earnings per share is computed by dividing the net

profit for the year by the weighted average number of Ordinary equity shares outstanding during the year plus the weighted average no of Ordinary equity shares that would be issued on conversion of all the dilutive potential ordinary equity shares in Ordinary equity shares.

1.2.15. Taxes on Income:

Income taxes are accounted for in accordance with Accounting Standards (AS-22) - accounting taxes on Income, notified under the Companies (Accounting Standards) Rules, 2006. Income Tax comprises both current and deferred tax.

Provision for Current tax is measured at the amount computed under the Income Tax Act, 1961, or Book Profit computed under section 115JB, whichever is higher, and correspondingly set-off available under section 115JAA is credited to the Statement of Profit & Loss of the financial year.

MAT credit is recognised as an asset only when, and to the extent, there is convincing evidence that the Company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of credit to the Statement of Profit and Loss and shown as MAT Credit Entitlement. The Company reviews the same at each Balance Sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent that there is no longer convincing evidence to the effect that Company will pay normal income tax during the specified period.

Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws enacted or substantially enacted as at the reporting date. Deferred tax liabilities are recognised for all timing differences. Deferred tax assets in respect of unabsorbed depreciation and carry forward of losses are recognised only if there is virtual certainty that there will be sufficient future taxable income available to realise such assets. Deferred tax assets are recognised for timing differences of other items only to the extent that reasonable certainty exists that sufficient future taxable income will be available against which these can be realised. Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Company has a legally enforceable right for such set off. Deferred tax assets are reviewed at each Balance Sheet date for their realisation. Current and deferred tax relating to items directly recognised in equity are recognised in equity and not in the Statement of Profit and Loss

1.2.16. Research and Development Expenses:

Revenue expenditure pertaining to research is charged to the Statement of Profit and Loss. Expenditure pertaining to Development of products is capitalised. The amount capitalised comprises expenditure that can be directly attributed or allocated on a reasonable and consistent basis to creating, producing and making the asset ready for its intended use. Fixed assets utilised for research and development are capitalised and depreciated in accordance with the policies stated for Tangible Fixed Assets and Intangible Assets.

1.2.17. Impairment of Assets:

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

1.2.18. Provisions and Contingencies:

A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in respect of possible obligations that arise from past events but their existence is confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company.

1.2.19. Service tax input credit:

Service tax input credit is accounted for in the books in the period in which the underlying service received is accounted and when there is no uncertainty in availing / utilising the credits.


Mar 31, 2013

A. Basis of preparation of financial statements:

i. The financial statements have been prepared to comply in all material respects with the mandatory Accounting Standards notified under Provisions of the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956.

ii. The Company follows mercantile system of accounting and recognizes income and expenditure on an accrual basis except those with significant uncertainties.

iii. The accounting policies applied by the Company are consistent with those used in the previous year, and

iv. Captive Consumption is considered and valued under sales, as per provisions of Central Excise Act.

b. Use of Estimates:

Estimates and assumptions used in the preparation of the financial statements are based on management''s evaluation of the relevant facts and circumstances as of date of the Financial Statements, which may differ from the actual results at a subsequent date.

c. Fixed Assets:

Fixed assets are stated at original cost less accumulated depreciation. Cost comprises the purchase price and any other attributable cost of bringing the asset to its working condition for its intended use. Financing costs relating to acquisition of qualifying fixed assets are also included to the extent they relate to the period till such assets are ready to be put to use. Cenvat / other credits availed have been deducted from the cost of respective assets.

d. Depreciation and Amortization:

Depreciation provided on straight-line method in the manner and at the rates specified in Schedule-XIV to the Companies Act, 1956.

e. Investments

Investments are recorded on readily realizable and intended to be held for not more than a year by classifying as Current Investments. All other investments are classified as Long Term Investments.

i. Current Investments are carried at lower of cost and fair value determined on an individual investment basis; and

ii. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of investments.

f. Inventories:

i. Raw Materials, Stores & Spares are valued at lower of Cost or Market Value whichever is less.

ii. Work in process and finished goods, are valued at lower of Cost or Market Value whichever is less.

iii. By-products, Self Generated Scrap and non-reusable waste are valued at net realizable value.

g. Revenue Recognition:

Revenue from sale of goods is recognized when the significant risks and rewards of ownership of the goods have passed to the customer, which generally coincides with their delivery to customers. Sales are stated net of discounts, rebates and returns.

h. Borrowing Costs:

Borrowing costs are charged to Profit and Loss account, except in cases where the borrowings are directly attributable to the acquisition, construction or production of a qualifying asset. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use.

i. Excise Duty:

Excise Duty in respect of goods manufactured by the Company is accounted on accrual basis.

j. Employee Benefits:

The Company has not framed its'' policies of employees benefits with regard to gratuity and leave liabilities.

k. Research & Development Expenses

Revenue expenditure on the Research & Development is charged off as expense in the year in which it incurred. Capital expenditure is grouped with Fixed Assets under appropriate heads and Depreciation is provided as per the rates applicable.

l. Taxes on Income

i. Deferred tax is recognized on timing differences between the accounting income and the taxable income for the year. The tax effect is calculated on the accumulated timing differences at the end of the year accounting period based on prevailing enacted or subsequently enacted regulations.

ii. Provision for current tax is made on the basis of the income computed for the current accounting period in accordance with Income Tax Act, 1961.

h. EARNINGS PER SHARE

Equity of the Company is employed partly in pre-commercial production activity and partly in commercial production activity, which cannot be ascertained in exact sums. In the circumstances, EPS cannot be comparable.

i. Disclosure as required under clause 32 of listing agreement have not been given as the company do not have any subsidiary.

j. Letters for year-end balance confirmation of sundry debtors and sundry creditors have been sent to the parties. In respect of confirmations received, the company is under process of scrutinizing and reconciling the balances.

m. The company has started its commercial production or additional two products having application in the field of Specialty chemicals and Pharmaceuticals as on October 1, 2012 and January 1, 2013 respectively and certain products still remained under construction and development. In the circumstances, statement of Profit and Loss for the current year pertains to business activities of the products whose commercial production already commenced.

n. During the year, Deferred Tax Assets / Liability is not provided as the management of the Company are not certain about reasonable time in which the timing difference would reverse. However, the amount of Deferred Tax Assets comes to ` 390.96 Lacs (Prev. Year ` 460.35 Lacs).

o. The Company has also reclassified the previous year''s figures in accordance with the requirements applicable in the current year. In view of this reclassification, certain figures of current year are not strictly comparable with those of the previous year.


Mar 31, 2011

1.1 Basis of preparation of financial statements

a) The financial statements have been prepared to comply in all material respects with the mandatory Accounting Standards notified under Provisions of the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956.

b) The Company follows mercantile system of accounting and recognises income and expenditure on an accrual basis except those with significant uncertainties.

c) The accounting policies applied by the Company are consistent with those used in the previous year, and

d) Captive Consumption are considered and valued under sales as per provisions of Central Excise Act.

1.2 Use of Estimates:-

Estimates and assumptions used in the preparation of the financial statements are based on management's evaluation of the relevant facts and circumstances as of date of the Financial Statements, which may differ from the actual results at a subsequent date.

1.3 Fixed Assets:-

Fixed assets are stated at original cost less accumulated depreciation. Cost comprises the purchase price and any other attributable cost of bringing the asset to its working condition for its intended use. Financing costs relating to acquisition of qualifying fixed assets are also included to the extent they relate to the period till such assets are ready to be put to use. Cenvat / other credits availed have been deducted from the cost of respective assets.

1.4 Depreciation and Amortisation:-

Depreciation provided on straight line method in the manner and at the rates specified in Schedule-XIV to the CompaniesAct, 1956.

1.5 Investments:-

Investments are recorded on readily realizable and intended to be held for not more than a year by classifying as Current Investments. All other investments are classified as Long Term Investments.

a) Current Investments are carried at lower of cost and fair value determined on an individual investment basis; and

b) Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of investments

1.6 Inventories:-

a) Raw Materials, Stores & Spares are valued at lower of Cost or Market Value whichever is less.

b) Work in process and finished goods, are valued at lower of Cost or Market Value whichever is less.

c) By-products, Self Generated Scrap and non reusable waste are valued at net realizable value.

1.7 Revenue Recognition:-

Revenue from sale of goods is recognized when the significant risks and rewards of ownership of the goods have passed to the customer, which generally coincides with their delivery to customers. Sales are stated net of discounts, rebates and returns.

1.8 Borrowing Costs:-

Borrowing costs are charged to Profit and Loss account, except in cases where the borrowings are directly attributable to the acquisition, construction or production of a qualifying asset. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use.

1.9 Excise Duty:-

Excise Duty in respect of goods manufactured by the Company is accounted on accrual basis.

1.10 Employee Benefits

The Company has not framed its'policies of employees benefits with regard to gratuity and leave liabilities.

1.11 Research & Development Expenses

Revenue expenditure on the Research & Development is charged off as expense in the year in which it incurred. Capital expenditure is grouped with Fixed Assets under appropriate heads and Depreciation is provided as per the rates applicable.

1.12 Taxes on Income

(a) Deferred tax is recognized on timing differences between the accounting income and the taxable income for the year. The tax effect is calculated on the accumulated timing differences at the end of the year accounting period based on prevailing enacted or subsequently enacted regulations.

(b) Provision for current tax is made on the basis of the income computed for the current accounting period in accordance with Income Tax Act, 1961.

(c ) During the year, Deferred Tax Assets / Liability is not provided as the management of the Company are not certain about reasonable time in which the timing difference would reverse.




Mar 31, 2010

1.1 Basis of preparation of financial statements

a) The financial statements have been prepared to comply in all material respects with the mandatory Accounting Standards notified under Provisions of the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956.

b) The Company follows mercantile system of accounting and recognises income and expenditure on an accrual basis except those with significant uncertainties.

c) The accounting policies applied by the Company are consistent with those used in the previous year.

1.2 Use of Estimates :-

Estimates and assumptions used in the preparation of the financial statements are based on managements evaluation of the relevant facts and circumstances as of date of the financial statements, which may differ from the actual results at a subsequent date.

1.3 Fixed Assets:-

Fixed assets are stated at original cost less accumulated depreciation. Cost comprises the purchase price and any other attributable cost of bringing the asset to its working condition for its intended use. Financing costs relating to acquisition of qualifying fixed assets are also included to the extent they relate to the period till such assets are ready to be put to use. Cenvat / other credits availed will be deducted from the cost of respective assets.

1.4 Depreciation and A mortisation:-

a) Depreciation on the fixed assets is provided on straight line method over the remaining useful life of the asset.

b) In respect of plant and machineries, depreciation is provided on straight line method over the remaining useful life of the asset.

c) On all other fixed assets, depreciation is provided on straight line method in the manner and at the rates specified in Schedule- XIV to the Companies Act, 1956.

1.5 Investments:-

tnvestments will be recorded on readily realizable and intended to be held for not more than a year by classifying as Current Investments. All other investments will be classified as Long Term Investments.

a) Current Investments are carried at lower of cost and fair value determined on an individual investment basis; and

b) Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of investments

1.6 Inventories:-

a) Raw Materials, Stores & Spares are valued at lower of Cost or Market Value whichever is less.

b) Work in process and finished goods, are valued at lower of Cost or Market Value whichever is less. Cost is arrived at by absorption cost method.

c) By-products, Self Generated Scrap and non reusable waste are valued at net realizable value.

1.7 Revenue Recognition:-

Revenue from sale of goods is recognized when the significant risks and rewards of ownership of the goods have passed to the customer, which generally coincides with their delivery to customers. Sales are stated net of discounts, rebates and returns.

1.8 Borrowing Costs:-

Borrowing costs are charged to Profit and Loss account, except in cases where the borrowings are directly attributable to the acquisition, construction or production of a qualifying asset. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use.

1.9 Excise Duty:-

Excise Duty in respect of goods manufactured by the Company is accounted on accrual basis.

1.10 Employee Benefits

The Company has not framed itspolicies of employees benefits with regard to gratuity and leave liabilities.

1.11 Research & Development Expenses

Revenue expenditure on the Research & Development is charged off as expense in the year in which it incurred. Capital expenditure is grouped with Fixed Assets under appropriate heads and Depreciation is provided as per the rates applicable.


Mar 31, 1998

1. Significant Accounting Policies

i) Basis of Accounting : The accounts have been prepared in conformity with the generally accepted accounting principles as enunciated by the relevant authorities and are based on the accrual basis of accounting.

ii) Depreciation :

(i) Leasehold land is not depreciated.

(ii) Other Fixed Assets are depreciated on the Straight Line Method at the rate of depreciation as prescribed in schedule XIV to the Companies Act, 1956.

iii) Amortisation :

The preliminary expenses are amortised over a period of 10 years in equal installments.

iv) Inventories :

Inventories are valued at lower of cost or net realisable value except stores and loose tools which are valued at cost.

v) Retirement Benefits :

The Employees State Insurance Scheme is not applicable to the Company. Provision is made for gratuity for those employees who have completed period of service prescribed under the Payment of Gratuity Act, 1972.

No provision has been made for leave liability in respect of employees (amount unascertained) and the same as per consistent practice is accounted on cash basis.


Mar 31, 1997

1. Basis of Accounting : The accounts have been prepared in conformity with the generally accepted accounting principles as enunciated by the relevant authorities and are based on the accrual basis of accounting.

2. Depreciation :

(i) Leasehold land is not depreciated. (ii) Other Fixed Assets are depreciated on the Straight Line Method at the rate of depreciation as prescribed in schedule XIV to the Companies Act, 1956.

3. Amortisation : The preliminary expenses are amortised over a period of 10 years in equal installments.

4. Inventories : Inventories are valued at lower of cost or net realisable value except stores and loose tools which are valued at cost.

5.Retirement Benefits : The Employees State Insurance Scheme is not applicable to the Company. No provision is made for gratuity as there were no employees who have completed qualifying period of service prescribed under the Payment of Gratuity Act, 1972.

6. A Diesel Generating Set of Rs. 56,57,700/- is acquired on finance lease. The obligation for future lease rentals aggregate to Rs. 33,56,850/-. Lease rentals amounting to Rs. 23,97,750/- for the current year together with three instalments paid in advance are charged to revenue account.

7. No provision has been made for leave liability in respect of employees (amount unascertained) and the same as per consistent practice is accounted on cash basis.


Mar 31, 1996



i) Basis of Accounting: The accounts have been prepared in conformity with the generally accepted accounting principles as enunciated by the relevant authorities and are based on the accrual basis of accounting.

ii) Depreciation:

(i) Leasehold land is not depreciated.

(ii) Other Fixed Assets are depreciated on the Straight Line Method. The rate of depreciation is as prescribed in schedule XIV to the Companies Act, 1956.

iii) Amortisation:

The preliminary expenses are amortised over a period of 10 years in equal installments..

iv) Inventories:

Inventories are valued at lower of cost or net realisable value except stores and loose tools which are valued at cost.

v) Retirement Benefits:

There is no liability under the Employees Provident Fund Scheme, Employees State Insurance Scheme & the Payment of Gratuity Act 1972, as they are not applicable to the company.


Mar 31, 1995

Basis of Accounting: The accounts have been prepared in conformity with the generally accepted accounting principles as enunciated by the relevant authorities and are based on the accrual basis of accounting.

ii) Depreciation:

Leasehold land is not depreciated.

Other Fixed Assets are depreciated on the Straight Line Method. The rate of depreciation is as prescribed in schedule XIV to the Companies Act, 1956.

iii) Amortisation:

The preliminary expenses are amortised over a period of 10 years in equal installments.

iv) Inventories:

Inventories are valued at lower of cost or net realisable value except stores and loose tools which are valued at cost.

v) Retirement Benefits:

There is no liability under the Employees Provident Fund Scheme, Employees State Insurance Scheme & the Payment of Gratuity Act. 1972, as they are not applicable to the company.


Mar 31, 1994

A) Basis of Accounting: The Accounts have been prepared in conformity to the generally accepted accounting principles as enunciated by the relevant authorities and are based on the accrual basis of accounting.

b) Depreciation:

i) Leasehold Land is not depreciated.

ii) Other Fixed Assets are depreciated on the Straight Line method. The rate of depreciation is as prescribed in Schedule XIV to the Companies Act, 1956.

c) Amortisation:

The preliminary expenses are amortised over a period of 10 years in equal installments.

d) Inventories:

Inventories are valued at lower of Cost or Net Realisable Value except stores and loose tools which are valued at cost.

e) Retirement Benefits:

Contribution to provident funds are made monthly at the prescribe rates as per rules applicable and debited to profit & loss account on accrual basis.


Mar 31, 1993

Not Available

 
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