Mar 31, 2015
27. (a) Accounting Concepts for preparation and Presentation of
Financial Statement
The accounts of the Company are prepared to comply with the Generally
accepted Accounting Principles in India ( Indian GAAP), including the
Accounting Standards notified under the relevant provisions of
Companies Act, 2013.
The financial statements are prepared on accrual basis under the
historical cost convention . The financial statements are presented in
Indian Rupees and converted the figures in lacs rounded upto two
decimals.
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 of the Companies Act, 2013. Based
on the nature of the products and time between the acquisition of
assets for processing and realization in cash and cash equivalents, the
Company has ascertained its operating cycle as 12 months for the
purpose of current and non current classification of assets and
liabilities .
27. (b) Revenue Recognition
*Sales are recognized upon dispatch of goods from factory against firm
orders.
* For other incomes, the company follows the accrual basis of
accounting.
27. (c) Export Incentives
The same are booked as income on the basis of claim accrued in favor of
the company.
27. (d) Fixed Assets
Fixed assets are stated at historical cost of acquisition or
construction net of Tax/duty credits availed, if any, less accumulated
depreciation / amortization. The Cost of Fixed assets includes Freight
and all other incidental expenses related to acquisition, installation
and any attributable cost of bringing the asset to its working
conditions for its intended use. Borrowing cost directly attributable
to fixed assets which necessarily take a substantial period of time to
get ready for their intended use are capitalized. Interest on loans
and other financial charges in respect of qualifying assets and
expenses incurred on start up and commissioning of the project and or
substantial expansion, including the expenditure incurred on trial runs
up to the date of commencement of commercial production are capitalized
Advances paid toward acquisition of fixed assets and the cost of assets
not ready to be put to use before the year end are disclosed under
Capital Work in progress.
27. (e) Depreciation
Depreciation has been provided on straight line method on the basis of
useful life of the assets as specified in schedule II of the Companies
Act, 2013.
27. (f) Borrowing Costs
Borrowing cost attributable to the acquisition, construction or
production of an assets are capitalized as part of the cost of that
asset upto the date the asset is put to use. Borrowing cost, Interest
on Term Loan, which are not related to fixed assets, are recognized as
an expense in the period in which they are incurred.
27. (g) Investments
Investments in the nature of long-term are stated at cost of
acquisition. Provision for decline in value, other than temporary, is
made on the basis of market quotations whenever available.
27. (h) Valuation of Inventories
* Raw Materials, Stores and Packaging Materials are valued at lower of
cost or net realizable value.
* Work in Progress has been valued at Cost of Raw Materials plus 50% of
cost of Production.
* Finished Goods are valued at sale price less selling and distribution
expenses & profits or net realization value , which ever is lower.
* Excise duty on finished goods lying in factory is accounted for on
removal of goods since such liability arises only if they are sold in
Domestic Tariff Area.
27. (i) Preliminary & Pre operative Expenses
Preliminary & Preoperative Expenses of period prior to year 2005-06 is
written off over a period of ten years. Preliminary Expenses and
Preoperative Expenses incurred during the year 2005-06 and later on are
being amortised over a period of five years.
27. (j) Research and Development
Revenue expenditure incurred on Research & Development is charged to
Profit & Loss Account of the year in which it is incurred, except for
development costs which relate to the design and testing of new or
improved materials, products or processes which are recognized as an
asset to the extent that it is expected that such assets will generate
future economic benefits. The expenses incurred prior to year 2005-06 is
written off over a period of ten years and the expenses incurred during
the year 2005-06 and later on are amortised over a period of five years.
However, the expenses incurred during the year 2013-14 and 2014-15 have
not been written off.
27. (k) Employee Benefits
All short term employee benefit plan such as salaries, wages , bonus,
special award and medical benefits which fall due within 12 months of
the period in which the employee render the related services which
entitles him to avail such benefits are recognized on an undiscounted
basis and charged to profit and loss account.
The Company has established retirement benefits in the form of Gratuity
fund with the Life Insurance of India whose premium is calculated on
the basis of actuarial valuation, carried out by an independent actuary
as at the balance sheet for the year ended 31st March 2008 and premium
recalculated by LIC on the basis of Employees data provided to them.
Contribution to the provident funds are made monthly at a predetermined
rate to the Regional Provident fund Commissioner and debited to profit
and loss account on an accrual basis.
27. (l) Foreign Currency Transaction
Transaction in foreign currency are recorded at the exchange rates
prevailing on the date of the transaction. To the extent, the Foreign
bills got discounted with bank ,AS-11 is not applicable and remaining
foreign Bills are entered in books at the rate on the date of
transaction . Foreign currency assets and liabilities at the year end
are translated at the year end exchange rates and the resultant
exchange difference is recognized in the Profit & Loss Account, except
those relating to acquisition of Fixed assets which are not put to use
till year end as the same are adjusted in the cost of fixed assets.
Investments made in the foreign Subsidiaries Companies are calculated
on the exchange rates at the date of transactions.
Further the corresponding figures of overseas subsidiary companies are
converted in USD i.e 1USD = 61.04 INR being the average foreign
exchange rates prevailing during the financial year . The corresponding
figures of Assets and liabilities of overseas subsidiary company is
converted in USD at the rates as on date of Balance Sheet i.e 1USD =
62.53 INR
Forward Contracts in the nature of derivatives are market to market,
wherever required, as at the Balance sheet date and provision for
losses ,if any, is dealt with in the profit and Loss account .
Unrealised gains, if any on such derivatives are not recognized in the
Profit and Loss account.
27. (m) Tax on Income
a. Current tax is the amount of tax payable on taxable income for the
year determined in accordance with the provisions of Income Tax Act,
1961.
b. Deferred tax is provided on timing difference between tax and
accounting treatments that originate in one period and are expected to
be reversed or settled in subsequent periods. Deferred tax assets and
liabilities are measured using the enacted / substantively enacted tax
rate for continuing operations. Adjustment of deferred tax liability
attributable to change in tax rate is shown in the profit and loss
account as a part of the deferred tax adjustments for the period.
Deferred tax assets are recognized only to the extend there is a
reasonable certainty that the asset can be realized in future .
Deferred tax assets such as MAT paid under section 115JB of Income tax
act are reviewed as at the balance sheet date and written down or
written up to reflect the amount that is reasonably /virtually certain
( as the case may be) to be realized.
27. (n) Contingencies
Contingencies loss arising from claims, litigation, assessments, fines,
penalties etc. are provided for when it is probable that a liability
may be incurred, and the amount can be reasonably estimated and are
disclosed by the way of notes to accounts in the basis of available
information.
Mar 31, 2014
(1) Securities offered to Banks to secure Term Loan:- (a) State Bank of
India:
- First pari-passu charge on company''s fixed assets (including land &
building) situated at A-197, Eldeco SIDCUL Industrial Park, Sitarganj,
Uttrakhand.
- First charge on company''s land & building situated at following
locations
B  48, Phase  II, Noida, U.P.
19 Â A, Udyog Vihar, Greater Noida, U.P.
- Personal Guarantee of Mr. Premjit Singh, Managing Director
(b) Yes Bank Ltd. :
- First pari-passu charge on company''s fixed assets (including land &
building) situated at A-197, Eldeco SIDCUL Industrial Park, Sitarganj,
Uttrakhand.
- First charge on company''s fixed assets (including land & building)
situated at 150-A, SEZ, Noida, U.P.
- Personal Guarantee of Mr. Premjit Singh, Managing Director
(c) Development Credit Bank Ltd. :
- First pari-passu charge on company''s fixed assets (including land &
building) situated at A-197, Eldeco SIDCUL Industrial Park, Sitarganj,
Uttrakhand.
- First charge on company''s fixed assets situated at 14/6, Mathura
Road, Faridabad, Haryana.
- Personal Guarantee of Mr. Premjit Singh, Managing Director
(2) Securities offered to Banks (viz. State Bank of India, Bank of
Baroda, Development Credit Bank Ltd., Yes Bank Ltd. and Citibank N. A.)
to secure working capital facilities under multiple banking
arrangement, on pari-passu basis:- (a) Hypothecation of inventories viz
raw material, stock in process, finished goods, stores and spares etc.
including the stock in transit, stocks lying with processors & in third
party godown consisting of automotive components, trailers, trailer
components, receivables and other current assets, both present and
future, except vehicles exclusively hypothecated to banks.
(b) Second charge on gross block (including Land & Building) of the
company on pari-passu basis.
(c) Personal Guarantee of Mr. Premjit Singh, Managing Director.
(3) Securities offered to Factoring Companies (viz. SBI Global Factors
Ltd. and IFCI Factors Ltd.):
(a) First charge on receivables factored by factoring companies.
(b) Personal Guarantee of Mr. Premjit Singh, Managing Director
(4) GNIDA dues amount is for the deferred instalments on the land at
19-A, Udyog Vihar, Greater Noida, U.P.
(5) All Vehicle Loans are secured by Hypothecation of vehicles
financed.
(6) Charge of M/S Intec Capital Ltd. on machinery financed by them.
-Gratuity Fund
The employee''s Gratutity fund scheme is managed by a Trust ( Life
Insurance Corp.of India) is a defined Benefit Plan .The present value
of obligation is determined based on Acturial valuation , carreid out
by an independent actuary from the Balance sheet for the year ended
31st March 2008 and premium recalculated by LIC on the basis of
employees data provided to them on annualy basis for subsequent years.
Contribution to the Provident funds are made monthly at a Predetermined
rate to the regional Provident Fund Commissioner and Debited to Profit
and Loss account on an accurial basis .
26.(a) Accounting Concepts for preparation and Presentation of
Financial Statement
The accounts of the Company are prepared under historical cost
convention on accrual basis of accounting, in accordance with generally
accepted accounting principles in India and comply with the mandatory
Accounting Standards notified under the Companies ( Accounting
Standards) Rules, 2006, as amended, and the relevant provisions of the
Companies Act, 1956. The financial statements are presented in Indian
Rupees and converted the figures in lacs rounded upto two decimals.
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 of the Companies Act, 1956. Based on
the nature of the products and time between the acquisition of assets
for processing and realization in cash and cash equivalents, the
Company has ascertained its operating cycle as 12 months for the
purpose of current and non current classification of assets and
liabilities .
26.(b) Revenue Recognition
-Sales are recognized upon dispatch of goods from factory against firm
orders.
-For other incomes, the company follows the accrual basis of
accounting. 26.(c) Export Incentives
The same are booked as income on the basis of claim accrued in favor of
the company.
26.(d) Fixed Assets
Fixed assets are stated at historical cost of acquisition or
construction net of Tax/duty credits availed, if any, less accumulated
depreciation / amortization. The Cost of Fixed assets includes Freight
and all other incidental expenses related to acquisition, installation
and any attributable cost of bringing the asset to its working
conditions for its intended use. Borrowing cost directly attributable
to fixed assets which necessarily take a substantial period of time to
get ready for their intended use are capitalized . Interest on loans
and other financial charges in respect of qualifying assets and
expenses incurred on start up and commissioning of the project and or
substantial expansion, including the expenditure incurred on trial runs
up to the date of commencement of commercial production are capitalized
Advances paid toward acquisition of fixed assets and the cost of assets
not ready to be put to use before the year end are disclosed under
Capital Work in progress.
26.(e) Depreciation
Depreciation has been provided on straight line method basis as per the
rates specified in schedule XIV of the Companies Act, 1956.
26.(f) Borrowing Costs
Borrowing cost attributable to the acquisition, construction or
production of an assets are capitalized as part of the cost of that
asset upto the date the asset is put to use. Borrowing cost, Interest
on Term Loan, which are not related to fixed assets, are recognized as
an expense in the period in which they are incurred.
26.(g) Investments
Investments in the nature of long-term are stated at cost of
acquisition. Provision for decline in value, other than temporary, is
made on the basis of market quotations whenever available.
26.(h) Valuation of Inventories
- Raw Materials, Stores and Packaging Materials are valued at lower of
cost or net realizable value.
- Work in Progress has been valued at Cost of Raw Materials plus 50% of
cost of Production.
- Finished Goods are valued at sale price less selling and distribution
expenses & profits or net realization value , which ever is lower.
- Excise duty on finished goods lying in factory is accounted for on
removal of goods since such liability arises only if they are sold in
Domestic Tariff Area.
26.(i) Preliminary & Pre operative Expenses
Preliminary & Preoperative Expenses of period prior to year 2005-06 is
written off over a period of ten years. Preliminary Expenses and
Preoperative Expenses incurred during the year 2005-06 and later on are
being amortised over a period of five years.
26.(j) Research and Development
Revenue expenditure incurred on Research & Development is charged to
Profit & Loss Account of the year in which it is incurred, except for
development costs which relate to the design and testing of new or
improved materials, products or processes which are recognized as an
asset to the extent that it is expected that such assets will generate
future economic benefits. The expenses incurred prior to year 2005-06
is written off over a period of ten years and the expenses incurred
during the year 2005-06 and later on are amortised over a period of
five years. However , the expenses incurred during the year 2013-14
have not been written off during the year.
26.(k) Employee Benefits
All short term employee benefit plan such as salaries, wages , bonus,
special award and medical benefits which fall due within 12 months of
the period in which the employee render the related services which
entitles him to avail such benefits are recognized on an undiscounted
basis and charged to profit and loss account .
The Company has established retirement benefits in the form of Gratuity
fund with the Life Insurance of India whose premium is calculated on
the basis of actuarial valuation, carried out by an independent actuary
as at the balance sheet for the year ended 31st March 2008 and premium
recalculated by LIC on the basis of Employees data provided to them .
Contribution to the provident funds are made monthly at a predetermined
rate to the Regional Provident fund Commissioner and debited to profit
and loss account on an accrual basis.
26.(l) Foreign Currency Transaction
Transaction in foreign currency are recorded at the exchange rates
prevailing on the date of the transaction. To the extent, the Foreign
bills got discounted with bank ,AS-11 is not applicable and remaining
foreign Bills are entered in books at the rate on the date of
transaction . Foreign currency assets and liabilities at the year end
are translated at the year end exchange rates and the resultant
exchange difference is recognized in the Profit & Loss Account, except
those relating to acquisition of Fixed assets which are not put to use
till year end as the same are adjusted in the cost of fixed assets.
Investments made in the foreign Subsidiaries Companies are calculated
on the exchange rates at the date of transactions.
Further the corresponding figures of overseas subsidiary companies are
converted in USD i.e 1USD = 60.28 INR being the average foreign
exchange rates prevailing during the financial year . The corresponding
figures of Assets and liabilities of overseas subsidiary company is
converted in USD at the rates as on date of Balance Sheet i.e 1USD =
59.76 INR
Forward Contracts in the nature of derivatives are market to market,
wherever required, as at the Balance sheet date and provision for
losses ,if any, is dealt with in the profit and Loss account .
Unrealised gains, if any on such derivatives are not recognized in the
Profit and Loss account.
26.(m) Tax on Income
a. Current tax is the amount of tax payable on taxable income for the
year determined in accordance with the provisions of Income Tax Act,
1961.
b. Deferred tax is provided on timing difference between tax and
accounting treatments that originate in one period and are expected to
be reversed or settled in subsequent periods. Deferred tax assets and
liabilities are measured using the enacted / substantively enacted tax
rate for continuing operations. Adjustment of deferred tax liability
attributable to change in tax rate is shown in the profit and loss
account as a part of the deferred tax adjustments for the period.
Deferred tax assets are recognized only to the extend there is a
reasonable certainty that the asset can be realized in future .
Deferred tax assets such as MAT paid under section 115JB of Income tax
act are reviewed as at the balance sheet date and written down or
written up to reflect the amount that is reasonably /virtually certain
( as the case may be) to be realized.
26.(n) Contingencies
Contingencies loss arising from claims, litigation, assessments, fines,
penalties etc. are provided for when it is probable that a liability
may be incurred, and the amount can be reasonably estimated and are
disclosed by the way of notes to accounts in the basis of available
information.
Mar 31, 2013
1.(a) Accounting Concepts for Preparation and Presentation of
Financial Statement
The accounts of the Company are prepared under historical cost
convention on accrual basis of accounting, in accordance with generally
accepted accounting principles in India and comply with the mandatory
Accounting Standards notified under the
Companies (Accounting Standards) Rules, 2006, as amended, and the
relevant provisions of the Companies Act, 1956. The financial
statements are presented in Indian Rupees and converted the figures in
lacs rounded upto two decimals.
During the year ended March 2012, the revised Schedule VI notified
under the Companies Act, 1956 has become applicable to the Company for
presentation of its financial statements. The revised Schedule VI has a
significant impact on the presentation and disclosure made in the
financial statements. The Company has also reclassified the previous
year figures in accordance with the requirement applicable in the
current year .
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 of the Companies Act, 1956. Based on
the nature of the products and time between the acquisition of assets
for processing and realization in cash and cash equivalents, the
Company has ascertained its operating cycle as 12 months for the
purpose of current and non current classification of assets and
liabilities .
1.(b) Revenue Recognition
-Sales are recognized upon dispatch of goods from factory against firm
orders.
-For other incomes, the company follows the accrual basis of
accounting.
1.(c) Export Incentives
The same are booked as income on the basis of claim accrued in favor of
the Company.
1.(d) Fixed Assets
Fixed assets are stated at historical cost of acquisition or
construction net of Tax/duty credits availed, if any, less accumulated
depreciation / amortization. The Cost of Fixed assets includes Freight
and all other incidental expenses related to acquisition, installation
and any attributable cost of bringing the asset to its working
conditions for its intended use. Borrowing cost directly attributable
to fixed assets which necessarily take a substantial period of time to
get ready for their intended use are capitalized . Interest on loans
and other financial charges in respect of qualifying assets and
expenses incurred on start up and commissioning of the project and or
substantial expansion, including the expenditure incurred on trial runs
up to the date of commencement of commercial production are capitalized
Advances paid toward acquisition of fixed assets and the cost of assets
not ready to be put to use before the year end are disclosed under
Capital Work in Progress.
1.(e) Depreciation
Depreciation has been provided on straight line method basis as per the
rates specified in schedule XIV of the Companies Act, 1956.
1.(f) Borrowing Costs
Borrowing cost attributable to the acquisition, construction or
production of an assets are capitalized as part of the cost of that
asset upto the date the asset is put to use. Borrowing cost, Interest
on Term Loan, which are not related to fixed assets, are recognized as
an expense in the period in which they are incurred.
1.(g) Investments
Investments in the nature of long-term are stated at cost of
acquisition. Provision for decline in value, other than temporary, is
made on the basis of market quotations whenever available.
1.(h) Valuation of Inventories
- Raw Materials, Stores and Packaging Materials are valued at lower of
cost or net realizable value.
- Work in Progress has been valued at Cost of Raw Materials plus 50% of
Cost of Production.
- Finished Goods are valued at sale price less selling and distribution
expenses & profits or net realization value , which ever is lower.
- Excise duty on finished goods lying in factory is accounted for on
removal of goods since such liability arises only if they are sold in
Domestic Tariff Area.
1.(i) Preliminary & Pre operative Expenses
Preliminary & Preoperative Expenses of period prior to year 2005-06 is
written off over a period of ten years. Preliminary Expenses and
Preoperative Expenses incurred during the year 2005-06 and later on are
being amortised over a period of five years.
1.(j) Research and Development
Revenue expenditure incurred on Research & Development is charged to
Profit & Loss Account of the year in which it is incurred, except for
development costs which relate to the design and testing of new or
improved materials, products or processes which are recognized as an
asset to the extent that it is expected that such assets will generate
future economic benefits. The expenses incurred prior to year 2005-06
is written off over a period of ten years and the expenses incurred
during the year 2005-06 and later on are amortised over a period of
five years.
1.(k) Employee Benefits
All short term employee benefit plan such as salaries, wages , bonus,
special award and medical benefits which fall due within 12 months of
the period in which the employee render the related services which
entitles him to avail such benefits are recognized on an undiscounted
basis and charged to profit and loss account .
The Company has established retirement benefits in the form of Gratuity
fund with the Life Insurance of India whose premium is calculated on
the basis of actuarial valuation, carried out by an independent actuary
as at the Balance Sheet for the year ended 31st March 2008 and premium
recalculated by LIC on the basis of Employees data provided to them .
Contribution to the provident funds are made monthly at a predetermined
rate to the Regional Provident Fund Commissioner and debited to profit
and loss account on an accrual basis.
1.(l) Foreign Currency Transaction
Transaction in foreign currency are recorded at the exchange rates
prevailing on the date of the transaction. To the extent, the Foreign
Bills got discounted with bank, AS-11 is not applicable and remaining
foreign Bills are entered in books at the rate on the date of
transaction. Foreign currency assets and liabilities at the year end
are translated at the year end exchange rates and the resultant
exchange difference is recognized in the Profit & Loss Account, except
those relating to acquisition of Fixed assets which are not put to use
till year end as the same are adjusted in the cost of fixed assets.
Investments made in the Foreign Subsidiaries Companies are calculated
on the exchange rates at the date of transactions.
Further the corresponding figures of overseas subsidiary companies are
converted in USD i.e 1USD = INR 54.65 being the foreign exchange rates
prevailing at the end of financial year .
Forward Contracts in the nature of derivatives are market to market,
wherever required, as at the Balance Sheet date and provision for
losses, if any, is dealt with in the Profit and Loss account .
Unrealised gains, if any on such derivatives are not recognized in the
Profit and Loss account.
1.(m) Tax on Income
a. Current tax is the amount of tax payable on taxable income for the
year determined in accordance with the provisions of Income Tax Act,
1961.
b. Deferred tax is provided on timing difference between tax and
accounting treatments that originate in one period and are expected to
be reversed or settled in subsequent periods. Deferred tax assets and
liabilities are measured using the enacted / substantively enacted tax
rate for continuing operations. Adjustment of deferred tax liability
attributable to change in tax rate is shown in the profit and loss
account as a part of the deferred tax adjustments for the period.
Deferred tax assets are recognized only to the extend there is a
reasonable certainty that the asset can be realized in future .
Deferred tax assets such as MAT paid under section 115 JB of Income Tax
Act are reviewed as at the balance sheet date and written down or
written up to reflect the amount that is reasonably /virtually certain
( as the case may be) to be realized. Further, no Deferred Tax is being
provided on the timing difference for the units availed exemption of
Income Tax under section 80 IC etc.
1.(n) Contingencies
Contingencies loss arising from claims, litigation, assessments, fines,
penalties etc. are provided for when it is probable that a liability
may be incurred, and the amount can be reasonably estimated and are
disclosed by the way of notes to accounts in the basis of available
information.
Mar 31, 2012
1. Accounting Concepts
The accounts are prepared under historical cost convention, on accrual
basis of accounting, in accordance with generally accepted accounting
principles in India and comply with the Accounting Standards issued by
the Institute of Chartered Accountants of India and the provisions of
the Companies Act, 1956.
2. Revenue Recognition
-Sales are recognized upon dispatch of goods from factory against firm
orders.
-For other incomes, the company follows the accrual basis of
accounting.
3. Export Incentives
The same are booked as income on the basis of claim accrued in favor of
the company.
4. Fixed Assets
Fixed assets are stated at historical cost of acquisition or
construction and include all other incidental expenses related to
acquisition and any attributable cost of bringing the asset to its
working conditions for its intended use.
Advances paid toward acquisition of fixed assets and the cost of assets
not ready to be put to use before the year end are disclosed under
Capital Work in progress.
5. Depreciation
Depreciation has been provided on straight line method basis as per the
rates specified in schedule XIV of the Companies Act, 1956.
6. Borrowing Costs
Borrowing cost attributable to the acquisition, construction or
production of an assets are capitalized as part of the cost ofthat
asset. Borrowing cost, Interest on Term Loan, which are not related to
fixed assets, are recognized as an expense in the period in which they
are incurred.
7. Investments
Investments in the nature of long-term are stated at cost of
acquisition. Provision for decline in value, other than temporary, is
made on the basis of market quotations whenever available.
8. Valuation of Inventories
- Raw Materials, Stores and Packaging Materials are valued at lower of
cost or net realizable value.
- Work in Progress has been valued at Cost of Raw Materials plus 50% of
cost of Production.
- Finished Goods are valued at sale price less selling and distribution
expenses & profits.
- Excise duty on finished goods lying in factory is accounted for on
removal of goods since such liability arises only if they are sold in
DomesticTariff Area.
9. Preliminary & Pre operative Expenses
Preliminary & Preoperative Expenses of period prior to year 2005-06 is
written off over a period often years. Preliminary Expenses and
Preoperative Expenses incurred during the year 2005-06 and later on are
being amortised over a period of five years.
10. Research and Development
Revenue expenditure incurred on Research & Development is charged to
Profit & Loss Account of the year in which it is incurred, except for
development costs which relate to the design and testing of new or
improved materials, products or processes which are recognized as an
asset to the extent that it is expected that such assets will generate
future economic benefits. The expenses incurred prior to year 2005-06
is written off over a period often years and the expenses incurred
during the year 2005-06 and later on are amortised over a period of
five years.
11. Employee Benefits
All shortterm employee benefit plan such as salaries, wages, bonus,
special award and medical benefits which fall due within 12 months of
the period in which the employee render the related services which
entitles him to avail such benefits are recognized on an undiscounted
basis and charged to profit and loss account.
The Company has established retirement benefits in the form of Gratuity
fund with the Life Insurance of India whose premium is calculated on
the basis of actual valuation, carried out by an independent actual as
at the balance sheet for the year ended 31st March 2008 and premium
recalculated by LIC on the basis of Employees data provided to them .
Contribution to the provident funds are made monthly at a predetermined
rate to the Regional Provident fund Commissioner and debited to profit
and loss account on an accrual basis.
12 Foreign Currency Transactions
Transactions in foreign currency are recorded at the exchange rates
prevailing on the date ofthe transaction. To the extent, the Foreign
bills got discounted with bank, AS-11 is not applicable and remaining
foreign Bills are entered in books at the rate on the date of
transaction . Foreign currency assets and liabilities at the year end
are translated at the year end exchange rates and the resultant
exchange difference is recognized in the Profit & Loss Account, except
those relating to acquisition of Fixed assets which are not put to use
till year end as the same are adjusted in the cost of fixed assets.
Investments made in the foreign Subsidiaries Companies are calculated
on the exchange rates on the date of transactions.
Further the corresponding figures of overseas subsidiary companies are
converted in USD i.e 1USD =INR 50.85 being the foreign exchange rates
prevailing at the end of last financial year.
Forward Contracts in the nature of derivatives are market to market,
wherever required, as at the Balance sheet date and provision for
losses ,if any, is dealt with in the profit and Loss account.
Unrealised gains, if any on such derivatives are not recognized in the
Profit and Loss account.
13 Taxon Income
a. Current tax is the amount of tax payable on taxable income for the
year determined in accordance with the provisions of Income Tax Act,
1961.
b. Deferred tax is provided on timing difference between tax and
accounting treatments that originate in one period and are expected to
be reversed or settled in subsequent periods. Deferred tax assets and
liabilities are measured using the enacted / substantively enacted tax
rate for continuing operations. Adjustment of deferred tax liability
attributable to change in tax rate is shown in the profit and loss
account as a part ofthe deferred tax adjustments for the period.
Deferred tax assets are recognized only to the extend there is a
reasonable certainty that the asset can be realized in future .
Deferred tax assets such as MAT paid under section 115JB of Income Tax
Act are reviewed as at the Balance Sheet date and written down or
written up to reflect the amount that is reasonably/virtually certain
(as the case may be) to be realized. Further, no Deferred tax is being
provided on the timing difference for the units availed exemption of I
ncomeTax under section 801C etc.
14. Contingencies
Contingencies loss arising from claims, litigation, assessments, fines,
penalties etc. are provided for when it is probable that a liability
may be incurred, and the amount can be reasonably estimated and are
disclosed by way of notes to accounts in the basis of available
information.
Mar 31, 2010
1. Accounting Concepts The accounts are prepared under historical cost
convention, on accrual basis of accounting, in accordance with
generally accepted accounting principles in India and comply with the
Accounting Standards issued by the Institute of Chartered Accountants
of India and the provisions of the Companies Act, 1956.
2. Revenue Recognition à Sales are recognised upon dispatch of goods
from factory against firm orders. Ã For other incomes, the Company
follows the accrual basis of accounting. Ã The dividend income is
accounted for as and when received.
3. Export Incentives The same are booked as income on the basis of
claim accrued in favour of the company.
4. Fixed Assets Fixed assets are stated at historical cost of
acquisition or construction and include all other incidental expenses
related to acquisition and any attributable cost of bringing the asset
to its working conditions for its intended use.
Advances paid toward acquisition of fixed assets and the cost of assets
not ready to be put to use before the year end are disclosed under
Capital Work in progress.
5. Depreciation Depreciation has been provided on straight line method
basis as per the rates specified in schedule XIV of the Companies Act,
1956.
6. Borrowing Costs Borrowing cost attributable to the acquisition,
construction or production of an assets are capitalised as part of the
cost of that asset. Borrowing cost, Interest on Term Loan, which are
not related to fixed assets, are recognised as an expense in the period
in which they are incurred.
7. Investments
Investments in the nature of long-term are stated at cost of
acquisition. Provision by decline in value, other than temporary, is
made on the basis of market quotations whenever available.
8. Valuation of Inventories
à Raw Materials, Stores and Packaging Materials are valued at lower of
cost or net realisable value.
à Work in Progress has been valued at Cost of Raw Materials plus 50% of
cost of Production.
à Finished Goods are valued at sale price less selling and distribution
expenses & profits.
à Excise duty on finished goods lying in factory is accounted for on
removal of goods since such liability arises only if they are sold in
Domestic Tariff Area.
9. Preliminary & Pre operative Expenses
Preliminary & Preoperative Expenses of period prior to year 2005-06 is
written off over a period of ten years. Preliminary Expenses and
Preoperative Expenses incurred during the year 2005-06 and later on are
being amortised over a period of five years.
10. Research and Development
Revenue expenditure incurred on Research & Development is charged to
Profit & Loss Account of the year in which it is incurred, except for
development costs which relate to the design and testing of new or
improved materials, products or processes which are recognised as an
asset to the extent that it is expected that such assets will generate
future economic benefits. The expenses incurred prior to year 2005-06
is written off over a period of ten years and the expenses incurred
during the year 2005-06 and later on are amortised over a period of
five years.
11. Employee Benefits
All short term employee benefit plan such as salaries, wages, bonus,
special award and medical benefits which fall due within 12 months of
the period in which the employee render the related services which
entitles him to avail such benefits are recognised on an undiscounted
basis and charged to profit and loss account .
The Company has established retirement benefits in the form of Gratuity
fund with the Life Insurance of India whose premium is calculated on
the basis of actuarial valuation, carried out by an independent actuary
as at the balance sheet for the year ended 31st March 2008 and premium
recalculated by LIC on the basis of Employees data provided to them.
Contribution to the provident funds are made monthly at a predetermined
rate to the Regional Provident fund Commissioner and debited to profit
and loss account on an accrual basis.
12. Foreign Currency Transaction
Transaction in foreign currency are recorded at the exchange rates
prevailing on the date of the transaction. To the extent the Foreign
bills got discounted with bank, AS-11 is not applicable in case of the
Company and remaining foreign Bills are entered in books at the rate on
the date of transaction. Foreign currency assets and liabilities at the
year end are translated at the year end exchange rates and the
resultant exchange difference is recognised in the Profit & Loss
Account, except those relating to acquisition of Fixed assets which are
not put to use till year end as the same are adjusted in the cost of
fixed assets. Investments made in the foreign Subsidiaries Companies
are calculated on the exchange rates at the date of transactions.
In view of Amendment and Postponement of Accounting Standard -11,the
Company has not given the effect of foreign exchange fluctuation on the
foreign currency loans taken and utilised by them for capital assets or
their other long term liabilities and Assets in foreign currency.
Further the corresponding figures of overseas subsidiary companies are
converted in US$ i.e 1 US$=INR 44.90 being the foreign exchange rates
prevailing at the end of last financial year.
As the amendment to AS-11 is applicable retrospectively from Dec-2006
and was to be implemented from March 2009 Quarter, the adjustment for
the back dated effect or retrospective effect of the transaction
difference on their foreign currency borrowings for the previous
accounting years is pending for adjustment for transfer to general
Reserve
13. Tax on Income
a. Current tax is the amount of tax payable on taxable income for the
year determined in accordance with the provisions of Income Tax Act,
1961.
b. Deferred tax is provided on timing difference between tax and
accounting treatments that originate in one period and are expected to
be reversed or settled in subsequent periods. Deferred tax assets and
liabilities are measured using the enacted / substantively
enacted tax rate for continuing operations. Adjustment of deferred tax
liability attributable to change in tax rate is shown in the profit and
loss account as a part of the deferred tax adjustments for the period.
Deferred tax assets are recognised only to the extend there is a
reasonable certainty that the asset can be realised in future. Deferred
tax assets such as MAT paid under section 115JB of Income tax act are
reviewed as at the balance sheet date and written down or written up to
reflect the amount that is reasonably /virtually certain (as the case
may be) to be realised.
14. Contingencies
Contingencies loss arising from claims, litigation, assessments, fines,
penalties etc. are provided for when it is probable that a liability
may be incurred, and the amount can be reasonably estimated and are
disclosed by the way of notes to accounts in the basis of available
information.
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