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Accounting Policies of Ventura Textiles Ltd. Company

Mar 31, 2015

A. Basis of Accounting:

i) The financial statements are prepared under the historical cost convention in accordance with the Generally Accepted Accounting Principles, the applicable Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act,2013.

ii) The Company adopts the accrual concept in the preparation of accounts unless otherwise stated

B. Use of Estimates:

The presentation of financial statements in conformity with the Generally Accepted Accounting Principles require estimates and assumption to be made that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Differences between, the actual results and estimates are recognized in the period in which the results are known / materialized.

C. Fixed Assets and Depreciation:

i) Fixed assets are stated at historical cost less depreciation. Cost of fixed assets comprises of purchase price, duties, levies and any directly attributable cost of bringing the asset to its working condition for its intended use. In respect of project involving construction, related pre-operational and trial run expenses including finance cost relating to deferred credits or borrowed funds attributable to the acquisition of fixed assets, up to completion are included in the gross book value of the assets.

ii) Depreciation on Fixed Assets is provided on Straight Line Method based on useful life of the assets as prescribed in Section II of Companies Act, 2013 . Till 31st March, 2014 depreciation was provided on Straight Line Method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

The difference between the depreciation charged as per the earlier method and the depreciation should have been charged by using useful life method as per Schedule II of the Companies Act 2013 is charged to the retained earning.

D. Impairment of Assets:

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged for when an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

E. Borrowing Cost:

Borrowing Cost incurred in relation to the acquisition, construction of assets are capitalized as the part of the cost of such assets up to the date when such assets are ready for intended use. Other borrowing cost is charged as an expense in the year in which these are incurred.

F. Inventories:

i) Raw materials, Consumable stores and Packing materials are valued at cost.

ii) Finished goods are valued at sale price less gross margin or cost which ever is lower.

iii) Stock- in- process is valued at lower of cost or net realizable value.

G. Foreign Currency Transaction:

Transactions in foreign currency are recorded at the original rate of exchange in force at the time the transactions are effected except export sales, which are recorded at a rate notified by the customs for invoice purposes. Such rate is notified in the last week of every month and is adopted for recording export sales of the next month. The exchange fluctuation arising as a result of negotiation of export bills is accounted for in the difference in exchange rate. Foreign Currency Assets and Liabilities other than for financing fixed assets are stated at the rate of exchange prevailing at the year end and resultant gains/losses are recognized in the Profit & Loss account except in cases covered by forward foreign exchange contracts in which case, these are translated at the contracted rates and the resultant gains/losses are recognized over the life of the contracts. Foreign Currency loans for financing fixed assets are stated at the contracted/prevailing rates of exchange at the yearend and the resultant gains/losses are adjusted to the cost of assets.

H. Recognition of Income and Expenditure:

i) Income and Expenditure are accounted on accrual basis. Income in respect of insurance/other claims, interest, commission etc. is recognized when it is reasonably certain that the ultimate collection will be made.

ii) Local Sales are recognized on dispatch of goods to customers. Export sales are recognized on the basis of bill of lading. Sales exclude excise duty and sales tax and are net of trade discounts.

iii) Purchases are net of sales tax set off and freight inward but include cenvat wherever applicable.

I As per normal practice Excise duty/Custom duty on goods not cleared is neither provided for nor is the same

considered for valuation of closing stock. This has no impact on the loss for the year. The amount of Excise Duty /Customs Duty on Finished Goods Stock as on 31st March, 2015 is NIL.

J. Provision for Taxation :

In view of the losses the Company has not provided for taxation.

K. Excise Duty:

Liability of Excise duty on finished goods wherever applicable is accounted as and when they are cleared from the factory premises.

L. Accounting of Cenvat Credit:

Cenvat credit available is accounted on accrual basis on purchase of materials net of excise duty and appropriated against payment of excise duty on clearance of the finished goods wherever applicable.

M. Tax on Income:

Income taxes are accounted for in accordance with Accounting Standard on "Accounting for taxes on Income", (AS-22) issued by ICAI.

Taxes on income for the current period is determined on the basis of taxable income and tax credits computed in accordance with the provisions of Income Ta x Act, 1961 and based on expected outcome of the assessment/ appeals.

Deferred tax is recognized on timing difference between the accounting income and taxable income for the year and quantified using the tax rates and laws enacted or substantively enacted as on the balance sheet date.

Deferred tax assets are recognized and carried forward to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

N. Provision for 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 and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2014

A. Basis of Accounting:

i) The financial statements are prepared under the historical cost convention in accordance with the Generally Accepted Accounting Principles, the applicable Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act,1956.

ii) The Company adopts the accrual concept in the preparation of accounts unless otherwise stated

B. Use of Estimates:

The presentation of financial statements in conformity with the Generally Accepted Accounting Principles require estimates and assumption to be made that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Differences between, the actual results and estimates are recognized in the period in which the results are known / materialized.

C. Fixed Assets and Depreciation:

i) Fixed assets are stated at historical cost less depreciation. Cost of fixed assets comprises of purchase price, duties, levies and any directly attributable cost of bringing the asset to its working condition for its intended use. In respect of project involving construction, related pre-operational and trial run expenses including finance cost relating to deferred credits or borrowed funds attributable to the acquisition of fixed assets, up to completion are included in the gross book value of the assets.

ii) Depreciation is provided on Straight Line Method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

D. Impairment of Assets:

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged for when an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

E. Borrowing Cost:

Borrowing Cost incurred in relation to the acquisition, construction of assets are capitalized as the part of the cost of such assets up to the date when such assets are ready for intended use. Other borrowing cost is charged as an expense in the year in which these are incurred.

F. Inventories:

i) Raw materials, Consumable stores and Packing materials are valued at cost.

ii) Finished goods are valued at sale price less gross margin or cost which ever is lower.

iii) Stock- in- process is valued at lower of cost or net realizable value.

G. Foreign Currency Transaction:

Transactions in foreign currency are recorded at the original rate of exchange in force at the time the transactions are effected except export sales, which are recorded at a rate notified by the customs for invoice purposes. Such rate is notified in the last week of every month and is adopted for recording export sales of the next month. The exchange fluctuation arising as a result of negotiation of export bills is accounted for in the difference in exchange rate. Foreign Currency Assets and Liabilities other than for financing fixed assets are stated at the rate of exchange prevailing at the year end and resultant gains/losses are recognized in the Profit & Loss account except in cases covered by forward foreign exchange contracts in which case, these are translated at the contracted rates and the resultant gains/losses are recognized over the life of the contracts. Foreign Currency loans for financing fixed assets are stated at the contracted/prevailing rates of exchange at the yearend and the resultant gains/losses are adjusted to the cost of assets.

H. Retirement Benefits Scheme:

i) Retirement benefits on-account of provident fund are provided for by payment to Provident Fund Authorities and periodic contributions are charged to revenue.

ii) Gratuity Liability is provided on estimated basis and charged to Profit & Loss account.

iii) Liability for leave encashment benefit is determined in accordance with the rules of the Company and charged to revenue.

I. Recognition of Income and Expenditure:

i) Income and Expenditure are accounted on accrual basis. Income in respect of insurance/other claims, interest, commission etc. is recognized when it is reasonably certain that the ultimate collection will be made.

ii) Local Sales are recognized on dispatch of goods to customers. Export sales are recognized on the basis of bill of lading. Sales exclude excise duty and sales tax and are net of trade discounts.

iii) The revenue in respect of DEPB / Duty Drawback benefit is recognized on post export basis at the rate at which the entitlement accrues.

iv) Purchases are net of sales tax set off and freight inward but include cenvat wherever applicable.

J. As per normal practice Excise duty/Custom duty on goods not cleared is neither provided for nor is the same considered for valuation of closing stock. This has no impact on the loss for the year. The amount of Excise Duty/ Customs Duty on Finished Goods Stock as on 31th March 2014 is NIL.

K. Provision for Taxation :

In view of the losses the Company has not provided for taxation.

L. Excise Duty:

Liability of Excise duty on finished goods wherever applicable is accounted as and when they are cleared from the factory premises.

M. Accounting of Cenvat Credit:

Cenvat credit available is accounted on accrual basis on purchase of materials net of excise duty and appropriated against payment of excise duty on clearance of the finished goods wherever applicable.

N. Tax on Income:

Income taxes are accounted for in accordance with Accounting Standard on "Accounting for taxes on Income", (AS-22) issued by ICAI.

Taxes on income for the current period is determined on the basis of taxable income and tax credits computed in accordance with the provisions of Income Tax Act, 1961 and based on expected outcome of the assessment/ appeals.

Deferred tax is recognized on timing difference between the accounting income and taxable income for the year and quantified using the tax rates and laws enacted or substantively enacted as on the balance sheet date.

Deferred tax assets are recognized and carried forward to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

O. Provision for 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 and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2012

A. Basis of Accounting:

i) The financial statements are prepared under the historical cost convention in accordance with the Generally Accepted Accounting Principles' the applicable Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act'1956.

ii) The Company adopts the accrual concept in the preparation of accounts unless otherwise stated.

b. Use of Estimates:

The presentation of financial statements in conformity with the Generally Accepted Accounting Principles require estimates and assumption to be made that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Differences between' the actual results and estimates are recognized in the period in which the results are known / materialized.

c. Fixed Assets and Depreciation:

i) Fixed assets are stated at historical cost less depreciation. Cost of fixed assets comprises of purchase price' duties' levies and any directly attributable cost of bringing the asset to its working condition for its intended use. In respect of project involving construction' related pre-operational and trial run expenses including finance cost relating to deferred credits or borrowed funds attributable to the acquisition of fixed assets' up to completion are included in the gross book value of the assets.

ii) Depreciation is provided on Straight Line Method at the rates and in the manner prescribed in Schedule XIV to the Companies Act' 1956.

d. Impairment of Assets:

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged for when an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

e. Borrowing Cost:

Borrowing Cost incurred in relation to the acquisition' construction of assets are capitalized as the part of the cost of such assets up to the date when such assets are ready for intended use. Other borrowing cost is charged as an expense in the year in which these are incurred.

f. Inventories:

i) Raw materials' Consumable stores and Packing materials are valued at cost.

ii) Finished goods are valued at sale price less gross margin or cost which ever is lower.

iii) Stock- in- process is valued at lower of cost or net realizable value.

g. Foreign Currency Transaction:

Transactions in foreign currency are recorded at the original rate of exchange in force at the time the transactions are effected except export sales' which are recorded at a rate notified by the customs for invoice purposes. Such rate is notified in the last week of every month and is adopted for recording export sales of the next month. The exchange fluctuation arising as a result of negotiation of export bills is accounted for in the difference in exchange rate. Foreign Currency Assets and Liabilities other than for financing fixed assets are stated at the rate of exchange prevailing at the year end and resultant gains/losses are recognized in the Profit & Loss account except in cases covered by forward foreign exchange contracts in which case' these are translated at the contracted rates and the resultant gains/losses are recognized over the life of the contracts. Foreign Currency loans for financing fixed assets are stated at the contracted/prevailing rates of exchange at the year end and the resultant gains/losses are adjusted to the cost of assets.

h. Retirement Benefits Scheme:

i) Retirement benefits on-account of provident fund are provided for by payment to Provident Fund Authorities and periodic contributions are charged to revenue.

ii) Gratuity Liability is provided on estimated basis and charged to Profit & Loss account' except in the current year where no provision has been made.

iii) Liability for leave encashment benefit is determined in accordance with the rules of the Company and charged to revenue' except in the current year where no provision has been made.

i. Recognition of Income and Expenditure:

i) Income and Expenditure are accounted on accrual basis. Income in respect of insurance/other claims' interest' commission etc. is recognized when it is reasonably certain that the ultimate collection will be made.

ii) Local Sales are recognized on dispatch of goods to customers. Export sales are recognized on the basis of bill of lading. Sales exclude excise duty and sales tax and are net of trade discounts.

iii) The revenue in respect of DEPB / Duty Drawback benefit is recognized on post export basis at the rate at which the entitlement accrues.

iv) Purchases are net of sales tax set off and freight inward but include cenvat wherever applicable.

j. As per normal practice Excise duty/Custom duty on goods not cleared is neither provided for nor is the same considered for valuation of closing stock. This has no impact on the loss for the year. The amount of Excise Duty / Customs Duty on Finished Goods Stock as on 31st March 2012 is NIL.

k. Provision for Taxation :

In view of the losses the Company has not provided for taxation.

l. Excise Duty:

Liability of Excise duty on finished goods wherever applicable is accounted as and when they are cleared from the factory premises.

m. Accounting of Cenvat Credit:

Cenvat credit available is accounted on accrual basis on purchase of materials net of excise duty and appropriated against payment of excise duty on clearance of the finished goods wherever applicable.

n. Tax on Income:

Income taxes are accounted for in accordance with Accounting Standard on "Accounting for taxes on Income"' (AS-22) issued by ICAI.

Taxes on income for the current period is determined on the basis of taxable income and tax credits computed in accordance with the provisions of Income Tax Act' 1961 and based on expected outcome of the assessment appeals.

Deferred tax is recognized on timing difference between the accounting income and taxable income for the year and quantified using the tax rates and laws enacted or substantively enacted as on the balance sheet date.

Deferred tax assets are recognized and carried forward to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

o. Provision for Contingent Liabilities and Contingent Assets :

Provision involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2011

1. Basis of Accounting :

a. The financial statements are prepared under the historical cost convention in accordance with the Generally Accepted Accounting Principles, the applicable Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956.

b. The Company adopts the accrual concept in the preparation of accounts unless otherwise stated.

2. Use of Estimates:

The presentation of financial statements in conformity with the Generally Accepted Accounting Principles require estimates and assumption to be made that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Differences between, the actual results and estimates are recognized in the period in which the results are known / materialized.

3. Fixed Assets and Depreciation:

a. Fixed assets are stated at historical cost less depreciation. Cost of fixed assets comprises of purchase price, duties, levies and any directly attributable cost of bringing the asset to its working condition for its intended use. In respect of project involving construction, related pre-operational and trial run expenses including finance cost relating to deferred credits or borrowed funds attributable to the acquisition of fixed assets, up to completion are included in the gross book value of the assets.

b. Depreciation is provided on Straight Line Method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

4. Impairment of Assets:

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged for when an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

5. Borrowing Cost:

Borrowing Cost incurred in relation to the acquisition, construction of assets are capitalized as the part of the cost of such assets up to the date when such assets are ready for intended use. Other borrowing cost is charged as an expense in the year in which these are incurred.

6. Inventories:

a) Raw materials, Consumable stores and Packing materials are valued at cost.

b) Finished goods are valued at sale price less gross margin or cost which ever is lower.

c) Stock- in- process is valued at lower of cost or net realizable value.

7. Foreign Currency Transaction:

Transactions in foreign currency are recorded at the original rate of exchange in force at the time the transactions are effected except export sales, which are recorded at a rate notified by the customs for invoice purposes. Such rate is notified in the last week of every month and is adopted for recording export sales of the next month. The exchange fluctuation arising as a result of negotiation of export bills is accounted for in the difference in exchange rate. Foreign Currency Assets and Liabilities other than for financing fixed assets are stated at the rate of exchange prevailing at the year end and resultant gains/losses are recognized in the Profit & Loss account except in cases covered by forward foreign exchange contracts in which case, these are translated at the contracted rates and the resultant gains/losses are recognized over the life of the contracts. Foreign Currency loans for financing fixed assets are stated at the contracted/prevailing rates of exchange at the yearend and the resultant gains/losses are adjusted to the cost of assets.

8. Retirement Benefits Scheme:

i) Retirement benefits on-account of provident fund are provided for by payment to Provident Fund

Authorities and periodic contributions are charged to revenue.

ii) Gratuity Liability is provided on estimated basis and charged to Profit & Loss account, except in the current year where no provision has been made.

iii) Liability for leave encashment benefit is determined in accordance with the rules of the Company and charged to revenue, except in the current year where no provision has been made.

9. Recognition of Income and Expenditure:

i) Income and Expenditure are accounted on accrual basis. Income in respect of insurance/other claims, interest, commission etc. is recognized when it is reasonably certain that the ultimate collection will be made.

ii) Local Sales are recognized on dispatch of goods to customers. Export sales are recognized on the basis of bill of lading. Sales exclude excise duty and sales tax and are net of trade discounts.

iii) The revenue in respect of DEPB / Duty Drawback benefit is recognized on post export basis at the rate at which the entitlement accrues.

iv) Purchases-are net of sales tax set off and freight inward but include cenvat wherever applicable.

10. As per normal practice Excise duty/Custom duty on goods not cleared is neither provided for nor is the same considered for valuation of closing stock. This has no impact on the loss for the year. The amount of Excise Duty / Customs Duty on Finished Goods Stock as on 31s1 March 2011 is NIL.

11. Provision for Taxation :

In view of the losses the Company has not provided for taxation.

12. Excise Duty:

Liability of Excise duty on finished goods wherever applicable is accounted as and when they are cleared from the factory premises.

13. Accounting of Cenvat Credit:

Cenvat credit available is accounted on accrual basis on purchase of materials net of excise duty and appropriated against payment of excise duty on clearance of the finished goods wherever applicable.

14. Tax on Income:

Income taxes are accounted for in accordance with Accounting Standard on "Accounting for taxes on Income",

(AS-22) issued by ICAI.

Taxes on income for the current period is determined on the basis of taxable income and tax credits computed in accordance with the provisions of Income Tax Act, 1961 and based on expected outcome of the assessment/ appeals.

Deferred tax is recognized on timing difference between the accounting income and taxable income for the year and quantified using the tax rates and laws enacted or substantively enacted as on the balance sheet date.

Deferred tax assets are recognized and carried forward to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.


Mar 31, 2010

1. Basis of Accounting :

a. The financial statements are prepared under the historical cost convention in accordance with the Generally Accepted Accounting Principles, the applicable Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956.

b. The Company adopts the accrual concept in the preparation of accounts unless otherwise stated.

2. Use of Estimates :

The presentation of financial statements in conformity with the Generally Accepted Accounting Principles require estimates and assumption to be made that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Differences between, the actual results and estimates are recognized in the period in which the results are known / materialized.

3. Fixed Assets and Depreciation :

a. Fixed assets are stated at historical cost less depreciation. Cost of fixed assets comprises of purchase price, duties, levies and any directly attributable cost of bringing the asset to its working condition for its intended use. In respect of project involving construction, related pre-operational and trial run expenses including finance cost relating to deferred credits or borrowed funds attributable to the acquisition of fixed assets, up to completion are included in the gross book value of the assets.

b. Depreciation is provided on Straight Line Method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

4. Impairment of Assets :

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged for when an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

5. Borrowing Cost :

Borrowing Cost incurred in relation to the acquisition, construction of assets are capitalized as the part of the cost of such assets up to the date when such assets are ready for intended use. Other borrowing cost is charged as an expense in the year in which these are incurred.

6. Inventories :

a) Raw materials, Consumable stores and Packing materials are valued at cost.

b) Finished goods are valued at sale price less gross margin or cost which ever is lower.

c) Stock- in- process is valued at lower of cost or net realizable value.

7. Foreign Currency Transaction:

Transactions in foreign currency are recorded at the original rate of exchange in force at the time the transactions are effected except export sales, which are recorded at a rate notified by the customs for invoice purposes. Such rate is notified in the last week of every month and is adopted for recording export sales of the next month. The exchange fluctuation arising as a result of negotiation of export bills is accounted for in the difference in exchange rate. Foreign Currency Assets and Liabilities other than for financing fixed assets are stated at the rate of exchange prevailing at the year end and resultant gains/losses are recognized in the

Profit & Loss account except in cases covered, by forward foreign exchange contracts in which case, these are translated at the contracted rates and the resultant gains/losses are recognized over the life of the contracts. Foreign Currency loans for financing fixed assets are stated at the contracted/prevailing rates of exchange at the yearend and the resultant gains/losses are adjusted to the cost of assets.

8. Retirement Benefits Scheme :

i) Retirement benefits on-account of provident fund are provided for by payment to Provident Fund Authorities and periodic contributions are charged to revenue.

ii) Gratuity Liability is provided on estimated basis and charged to Profit & Loss account, except in the current year where no provision has been made.

iii) Liability for leave encashment benefit is determined in accordance with the rules of the Company and charged to revenue, except in the current year where no provision has been made.

9. Recognition of Income and Expenditure :

i) Income and Expenditure are accounted on accrual basis. Income in respect of insurance/other claims, interest, commission etc. is recognized when it is reasonably certain that the ultimate collection will be made.

ii) Local Sales are recognized on dispatch of goods to customers. Export sales are recognized on the basis of bill of lading. Sales exclude excise duty and sales tax and are net of trade discounts.

iii) The revenue in respect of DEPB / Duty Drawback benefit is recognized on post export basis at the rate at which the entitlement accrues.

iv) Purchases are net of sales tax set off and freight inward but include cenvat wherever applicable.

10. As per normal practice Excise duty/Custom duty on goods not cleared is neither provided for nor is the same considered for valuation of closing stock. This has no impact on the loss for the year. The amount of Excise Duty / Customs Duty on Finished Goods Stock as on 31st March 2010 is NIL.

11. Provision for Taxation :

In view of the losses the Company has not provided for taxation.

12. Excise Duty:

Liability of Excise duty on finished goods wherever applicable is accounted as and when they are cleared from the factory premises.

13. Accounting of Cenvat Credit:

Cenvat credit available is accounted on accrual basis on purchase of materials net of excise duty and appropriated against payment of excise duty on clearance of the finished goods wherever applicable.

14. Tax on Income:

Income taxes are accounted for in accordance with Accounting Standard on "Accounting for taxes on Income", (AS-22) issued by ICAI.

Taxes on income for the current period is determined on the basis of taxable income and tax credits computed in accordance with the provisions of Income Tax Act, 1961 and based on expected outcome of the assessment/ appeals.

Deferred tax is recognized on timing difference between the accounting income and taxable income for the year and quantified using the tax rates and lav.!: enacted or substantively enacted as on the balance sheet date.

Deferred tax assets are recognized and carried forward to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

 
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