Notes to Accounts of Lakhotia Polyesters (India) Ltd.

Mar 31, 2015

1. Terms / Rights attached to shares

The company has one class of Equity Shares having par value of Rs 10/- per share. Each holder of equity shares is entitle to one vote per equity share held.

2. DEFERRED TAX LIABILITIES

The accounting treatment for income - tax in respect of the company's income is based on the Accounting Standard 22 on 'Accounting for taxes on income' as notified by the Companies (Accounting Standards) Rules, 2006. The provision made for income tax in the accounts comprises both, the Current Tax and Deferred Tax. The deferred tax assets and liabilities for the year, arising on account of timing differences, are recognized in the statement of Profit & Loss and the cumulative effect thereof is reflected in the Balance Sheet.

3. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the Balance Sheet date. Deferred tax assets and liabilities are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situation where the company has unabsorbed depreciation or carried forwarded losses, deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that the same can be realized against future taxable profits.

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Mar 31, 2014

1. OTHERS -

a) Certain Balance representing Debtors and Creditors are subject to reconciliation and receipts of confirmation from parties, pursuant to confirmation requests sent by the company.

b) Figures have been regrouped/reclassified/reinstated wherever necessary to make the comparison meaningful.

NOTE 2 DEFERRED TAX LIABILITIES

The effect of the significant timing differences that result in the deferred tax assets and liabilities at the end of the year are given as under :

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Mar 31, 2013

01. COMPANY OVERVIEW:

Lakhotia Polyesters India Limited (the Company) is a public limited company domiciled and headquartered in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on the Bombay Stock Exchange in India. The company is engaged in manufacturing and selling of textile yarn for catering to the domestic and international markets. The company is engaged in the business of manufacturing of lacquer coated Polyester Films, transfer foils and M type metallic yarns, which are appropriate for textile, printing, decoration, and packing industry and manufacturing of grey fabrics used in sarees and as interline cloth. The yarns produced by the company are used for made ups in apparels, hosiery and garment industry.

2. OTHERS -

A. Certain Balance representing Debtors and Creditors are subject to reconciliation and receipts of confirmation from parties, pursuant to confirmation requests sent by the company.

B. Figures have been regrouped/reclassified/reinstated wherever necessary to make the comparison meaningful.

Note: Of the Above Shares, the company capitalized its profit by issue of 192310 equity shares amounting to Rs. 1923100/- as bonus shares during F.Y. 2011 -12

Note: Of the Above Shares, the company issued 355000 equity shares amounting to Rs. 3550000/- against business purchase agreement during F.Y. 2011 -2012

NOTE 3 DEFERRED TAX LIABILITIES

The accounting treatment for income - tax in respect of the company''s income is based on the Accounting Standard 22 on ''Accounting for taxes on income'' as notified by the Companies (Accounting Standards) Rules, 2006. The provision made for income tax in the accounts comprises both, the Current Tax and Deferred Tax. The deferred tax assets and liabilities for the year, arising on account of timing differences, are recognized in the statement of Profit & Loss and the cumulative effect thereof is reflected in the Balance Sheet.

Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the Balance Sheet date. Deferred tax assets and liabilities are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situation where the company has unabsorbed depreciation or carried forwarded losses, deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that the same can be realized against future taxable profits.

NOTE : Land and Building of Factory Premises at Pimpalgaon are on lease hold basis and other assets are charged with UBI for credit facilities as sanctioned.