Accounting Policies of Nirlon Ltd. Company

Mar 31, 2026

1A: Material Accounting Policies

(a) Basis of preparation

(i) Compliance with Ind AS

The financial statements have been prepared in
accordance with Indian Accounting Standards
(Ind AS) as notified under the Companies
(Indian Accounting Standards) Rules, 2015
read with section 133 of the Companies Act,
2013 and presentation requirements of Division
II of Schedule III to the Companies Act, 2013 (as
amended from time to time).

The accounting policies adopted are consistent
with those of the previous financial year.

The financial statements have been prepared
on a historical cost basis, except for certain
financial assets and liabilities that are measured
at fair value (Refer accounting policy for financial
instruments)

The financial statements are presented in Indian
Rupees (''INR'') and all values are rounded
to nearest lakhs (INR 00,000), except when
otherwise indicated.

The Company has prepared the financial
statements on the basis that it will continue to
operate as a going concern.

(ii) Current versus Non-current classification

The Company presents assets and liabilities
in the balance sheet based on current / nonÂ¬
current classification.

An asset is treated as current when it is:

- expected to be realised or intended to be
sold or consumed in normal operating
cycle,

- held primarily for the purpose of trading,

- expected to be realised within twelve
months after the reporting period, or

- cash or cash equivalent unless restricted
from being exchanged or used to settle a
liability for at least twelve months after the
reporting period.

All other assets are classified as non-current.

A liability is current when:

- it is expected to be settled in normal
operating cycle,

- it is held primarily for the purpose of trading,

- it is due to be settled within twelve months
after the reporting period, or

- there is no right at the end of the reporting
period to defer the settlement of the liability
for at least twelve months after the reporting
period.

The Company classifies all other liabilities as
non-current.

Deferred tax assets and liabilities are classified
as non-current assets and liabilities.

The operating cycle is the time between the
acquisition of assets for processing and their
realisation in Cash and Cash Equivalents. The
Company has identified twelve months as its
operating cycle.

b) Property, plant & equipment

All items of property, plant and equipment are stated
at historical cost less depreciation and impairment,
if any. Historical cost includes expenditure that is
directly attributable to the acquisition of the items.

Subsequent costs are included in the asset''s
carrying amount or recognised as a separate asset,
as appropriate, only when it is probable that future
economic benefits associated with the item will

flow to the Company and the cost of the item can
be measured reliably. The carrying amount of any
component accounted for as a separate asset is
derecognised when replaced. All other repairs and
maintenance are charged to the Statement of Profit
and Loss during the reporting period in which they
are incurred.

Capital work- in- progress includes cost of property,
plant and equipment under installation / under
development as at the balance sheet date.

Depreciation methods, estimated useful lives
and residual value

Depreciation on property, plant and equipment
has been provided on straight line method over
the estimated useful lives of the assets, based on
technical evaluation done by management''s expert,
which are lower than those specified by Schedule II
to the Companies Act, 2013, in order to reflect the
actual usage of the assets.

Useful life considered for calculation of depreciation
for various assets class are as follows-

The residual values are not more than 5% of the
original cost of the asset. The residual values, useful
lives and methods of depreciation of property, plant
and equipment are reviewed at each financial year
end and adjusted prospectively, if appropriate.

Gains and losses on disposals are determined by
comparing proceeds with carrying amount. These
are included in the Statement of Profit and Loss.

Property that is held for long-term rental yields or
for capital appreciation or for both, and that is not
occupied by the Company, is classified as investment
property. Investment property is measured initially at
its cost, including related transaction cost and where
applicable borrowing costs. Subsequent expenditure
is capitalised to assets carrying amount only when it
is probable that future economic benefits associated
with the expenditure will flow to the Company and
the cost of the item can be measured reliably. All
other repair and maintenance cost are expensed
when incurred. When part of an investment property
is replaced, the carrying amount of the replaced part
is derecognised.

Though the Company measures investment
properties using cost-based measurement, the fair
value of investment properties are disclosed in the
notes (refer note 3 of the financial statements). Fair
values are determined based on an annual evaluation
performed by an accredited external independent
valuer applying a valuation model recommended by
the International Valuation Standards Committee.

Investment properties are derecognised either
when they have been disposed of or when they
are permanently withdrawn from use and no future
economic benefit is expected from their disposal.
The difference between the net disposal proceeds
and the carrying amount of the asset is recognised
in profit or loss in the period of derecognition.

Depreciation methods, estimated useful lives
and residual value

Investment property consists of Freehold Land,
Building, Plant & Equipment, Office Equipment and
Furniture & Fixture, which is depreciated using the
straight line method over the estimated useful lives
of the assets, based on technical evaluation done by
management''s expert, which is at a variance than
those specified by Schedule II to the Companies
Act, 2013, in order to reflect the actual usage of
the assets. The management believes that these
estimated useful lives are realistic and reflect fair
approximation of the period over which the assets
are likely to be used.

Gains and losses on disposals are determined by
comparing proceeds with carrying amount. These
are included in the Statement of Profit and Loss.

(d) Impairment of Non-financial assets

The Company assesses, at each reporting date,
whether there is an indication that an asset may
be impaired. If any indication exists, the Company
estimates the asset''s recoverable amount. An
asset''s recoverable amount is the higher of an
asset''s or cash-generating units (CGU) fair value
less costs of disposal and its value in use.

Recoverable amount is determined for an individual
asset, unless the asset does not generate cash
inflows that are largely independent of those from
other assets or group of assets. Where the carrying
amount of an asset or CGU exceeds its recoverable
amount, the asset is considered impaired and is
written down to its recoverable amount.

In assessing value in use, the estimated future cash
flows are discounted to their present value using
a pre-tax discount rate that reflects current market
assessments of the time value of money and the
risks specific to the asset. In determining fair value
less costs of disposal, recent market transactions are
taken into account, if available. If no such transactions
can be identified, an appropriate valuation model is
used. After impairment, depreciation is provided on
the revised carrying amount of the asset over its
remaining useful life.

(e) Financial Instruments

A financial instrument is any contract that gives
rise to a financial asset of one entity and a financial
liability or equity instrument of another entity.

(I) Financial Assets

The Company classifies its financial assets in the
following measurement categories:

> those to be measured subsequently at fair value
(either through other comprehensive income, or
through profit or loss), and

> those measured at amortised cost

The classification depends on the Company''s
business model for managing the financial assets
and the contractual terms of the cash flows.

Initial Recognition & Measurement

profit or loss, transaction costs that are attributable
to the acquisition of the financial asset. Trade
receivables that do not contain a significant financing
component or for which the Group has applied the
practical expedient are measured at the transaction
price determined under Ind AS 115.

Subsequent Measurement

For purposes of subsequent measurement financial
assets are classified in following categories:

Â» Debt instruments at fair value through profit and
loss (FVTPL)

Â» Debt instruments at fair value through other
comprehensive income (FVTOCI)

Â» Debt instruments at amortised cost

Â» Equity instruments

Where assets are measured at fair value, gains and
losses are either recognised entirely in the statement
of profit and loss (i.e. fair value through profit or loss),
or recognised in other comprehensive income (i.e.
fair value through other comprehensive income).
For investment in debt instruments, this will depend
on the business model in which the investment is
held. For investment in equity instruments, this will
depend on whether the Company has made an
irrevocable election at the time of initial recognition
to account for equity instruments at FVTOCI.

Debt instruments at amortised cost

A Debt instrument is measured at amortised cost if
both the following conditions are met:

a) Business Model Test: The objective is to hold
the debt instrument to collect the contractual
cash flows (rather than to sell the instrument
prior to its contractual maturity to realize its fair
value changes).

b) Cash flow characteristics test: The contractual
terms of the debt instrument give rise on specific
dates to cash flows that are solely payments
of principal and interest on principal amount
outstanding.

After initial measurement, such financial assets are
subsequently measured at amortised cost using the
effective interest rate (EIR) method. Amortised cost
is calculated by taking into account any discount or
premium on acquisition and fees or costs that are
an integral part of EIR. EIR is the rate that exactly
discounts the estimated future cash receipts over
the expected life of the financial instrument or a

shorter period, where appropriate, to the gross
carrying amount of the financial asset.

Debt instruments at fair value through OCI

A Debt instrument is measured at fair value through
other comprehensive income if following criteria are
met:

a) Business Model Test: The objective of financial
instrument is achieved by both collecting
contractual cash flows and for selling financial
assets.

Debt instrument included within the FVTOCI
category are measured initially as well as at each
reporting date at fair value. Fair value movements
are recognised in the other comprehensive income
(OCI), except for the recognition of interest income,
impairment gains or losses and foreign exchange
gains or losses which are recognised in Statement
of Profit and Loss. On derecognition of asset,
cumulative gain or loss previously recognised in OCI
is reclassified from the equity to Statement of Profit
and Loss. Interest earned whilst holding FVTOCI
financial asset is reported as interest income using
the EIR method.

Debt instruments at FVTPL

FVTPL is a residual category for financial instruments.
Any financial instrument which does not meet the
criteria for amortised cost or FVTOCI is classified as
at FVTPL. A gain or loss on a Debt instrument that is
subsequently measured at FVTPL and is not a part
of a hedging relationship is recognised in statement
of profit or loss and presented net in the Statement
of Profit and Loss within other gains or losses in the
period in which it arises. Interest income from these
Debt instruments is included in other income.

Equity Instruments

For all equity instruments, the Company may
make an irrevocable election to present in other
comprehensive income all subsequent changes in
the fair value.

The Company makes such election on an instrument-
by-instrument basis. The classification is made on
initial recognition and is irrevocable.

If the Company decides to classify an equity
instrument as at FVTOCI, then all fair value
changes on the instrument, excluding dividends, are
recognised in the OCI. There is no recycling of the
amounts from OCI to profit and loss, even on sale
of investment. However, the Company may transfer
the cumulative gain or loss within equity. Equity
instruments included within the FVTPL category are
measured at fair value with all changes recognised
in the Statement of Profit and loss.

Derecognition

A financial asset is derecognised only when:

> the rights to receive cash flows from the asset
have expired, or

> the Company has transferred its rights to receive
cash flows from the asset or has assumed an
obligation to pay the received cash flows in full
without material delay to a third party under a
âpass throughâ arrangement and either:

(a) The Company has transferred the rights to
receive cash flows from the financial assets
or

(b) The Company has retained the contractual
right to receive the cash flows of the
financial asset, but assumes a contractual
obligation to pay the cash flows to one or
more recipients.

Where the entity has not transferred substantially
all the risks and rewards of the ownership of
the financial assets, the financial asset is not
derecognised. Where the Company has neither
transferred nor retains substantially all risks and
rewards of ownership of the financial asset, the
financial asset is derecognised if the Company has
not retained control of the financial asset. Where the
Company retains control of the financial asset, the
asset is continued to be recognised to the extent of
continuing involvement in the financial asset.

Impairment of financial assets

The Company assesses on a forward looking
basis the expected credit losses associated with its
assets carried at amortised cost and FVOCI debt
instruments. The impairment methodology applied

depends on whether there has been a significant
increase in credit risk. Note 34 details how the
Company determines whether there has been a
significant increase in credit risk.

For trade receivables only, the Company applies
the simplified approach permitted by Ind AS 109
Financial Instruments, which requires expected
lifetime losses to be recognise on initial recognition
of the receivables.

(II) Financial Liabilities

The measurement of financial liabilities depends on
their classification, as described below:

Trade and other payables

These amounts represent liabilities for goods and
services provided to the Company prior to the end
of financial year which are unpaid. The amounts are
unsecured and are usually paid within 120 days of
recognition. Trade and other payables are presented
as current liabilities unless payment is not due within
12 months after the reporting period. They are
recognised initially at fair value and subsequently
measured at amortised cost using EIR method.

Borrowings

Borrowings are initially recognised at fair value, net
of transaction cost incurred. After initial recognition,
interest-bearing loans and borrowings are
subsequently measured at amortised cost using the
EIR method.

Gains and losses are recognised in profit or loss
when the liabilities are derecognised as well as
through the EIR amortization process. Amortised
cost is calculated by taking into account any discount
or premium on acquisition and fees or costs that are
an integral part of the EIR. The EIR amortization is
included as finance costs in the statement of profit
and loss.

Lease Deposits

Lease deposits received are financial liability
and need to be measured at fair value on initial
recognition. The difference between the fair value
and the nominal value of deposits is considered
as rent in advance and recognised over the lease
term on a straight line basis. Unwinding of discount
is treated as interest expense (finance cost) for
deposits received and is accrued as per the EIR
method.

Derecognition

A financial liability is derecognised when the
obligation under the liability is discharged or
cancelled or expires. When an existing financial
liability is replaced by another from the same
lender on substantially different terms, or the terms
of an existing liability are substantially modified,
such an exchange or modification is treated as
the derecognition of the original liability and the
recognition of a new liability. The difference in the
respective carrying amounts is recognised in the
Statement of Profit and Loss.

(III) Derivative financial instruments

Derivative financial instruments such as forward
contracts are taken by the Company to hedge its
foreign currency risks, are initially recognised at fair
value on the date a derivative contract is entered
into and are subsequently re-measured at their fair
value with changes in fair value recognised in the
Statement of Profit and Loss in the period when they
arise.

(IV) Offsetting of financial instruments

Financials assets and financial liabilities are offset
and the net amount is reported in the balance sheet
if there is a currently enforceable legal right to offset
the recognised amounts and there is an intention to
settle on a net basis, to realize the assets and settle
the liabilities simultaneously.

(f) Fair Value Measurement

The Company measures certain financial
instruments at fair value.

Fair value is the price that would be received to sell
an asset or paid to transfer a liability in an orderly
transaction between market participants at the
measurement date. The fair value measurement is
based on the presumption that the transaction to sell
the asset or transfer the liability takes place either:

> In the principal market for the asset or liability, or

> In the absence of a principal market, in the most
advantageous market for the asset or liability.

The fair value of an asset or a liability is measured
using the assumptions that market participants would
use when pricing the asset or liability, assuming
that market participants act in their economic best
interest.

All assets and liabilities for which fair value is
measured or disclosed in the financial statements
are categorised within the fair value hierarchy,
described as follows, based on the lowest level input
that is significant to the fair value measurement as a
whole:

> Level 1 â Quoted (unadjusted) market prices in
active markets for identical assets or liabilities

> Level 2 â Valuation techniques for which the
lowest level input that is significant to the fair
value measurement is directly or indirectly
observable

> Level 3 â Valuation techniques for which the
lowest level input that is significant to the fair
value measurement is unobservable

(g) Taxes

Tax expense comprises of current and deferred tax.

Current income tax assets and liabilities are
measured at the amount expected to be recovered
from or paid to the taxation authorities. The tax rates
and tax laws used to compute the amount are those
that are enacted or substantively enacted, at the
reporting date in the countries where the Company
operates and generates taxable income.

The Company''s current tax is calculated using
tax rates that have been enacted or substantively
enacted by the end of the reporting period.

Deferred tax is recognised on temporary differences
between the carrying amounts of assets and liabilities
in the financial statements and the corresponding
tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognised
for all taxable temporary differences. Deferred tax
assets are generally recognised for all deductible
temporary differences to the extent that it is probable
that taxable profits will be available against which
those deductible temporary differences can be
utilised. Such deferred tax assets and liabilities are
not recognised if the temporary difference arises
from the initial recognition of assets and liabilities in
a transaction that affects neither the taxable profit
nor the accounting profit.

The carrying amount of deferred tax assets is
reviewed at each reporting date and reduced to the
extent that it is no longer probable that sufficient
taxable profit will be available to allow all or part of
the deferred tax asset to be utilised. ''Deferred tax
assets are recognised for unused tax losses to the
extent that it is probable that taxable profit will be
available against which the losses can be utilised.

Significant management judgement is required to
determine the amount of deferred tax assets that
can be recognised, based upon the likely timing and
the level of future taxable profits together with future
tax planning strategies.

Deferred tax assets and liabilities are offset when
they relate to income taxes levied by the same
taxation authority and the relevant entity intends to
settle its current tax assets and liabilities on a net
basis.

Deferred tax liabilities (DTL) and assets are
measured at the tax rates that are expected to apply
in the period in which the liability is settled or the
asset realised, based on tax rates (and tax laws) that
have been enacted or substantively enacted by the
end of the reporting period.

Deferred tax relating to items recognised outside
Statement of Profit and Loss is recognised outside
profit or loss (either in Other Comprehensive Income
or in Equity). Deferred tax items are recognised in
correlation to the underlying transaction either in
OCI or directly in Equity.

(h) Employee Benefits

(i) Short-term obligations

Liabilities for wages and salaries, including
non-monetary benefits that are expected to
be settled wholly within 12 months after the
end of the period in which the employees
render the related service are recognised in
respect of employees'' services up to the end
of the reporting period and are measured at the
amounts expected to be paid when the liabilities
are settled.

(ii) Other long-term employee benefit
obligations

The liabilities for compensated absences that
are not expected to be settled wholly within 12
months are measured as the present value of
expected future payments to be made in respect
of services provided by employees up to the
end of the reporting period using the projected
unit credit method. Remeasurements as a
result of experience adjustments and changes
in actuarial assumptions are recognised in the
Statement of Profit and Loss.

The obligations are presented as current
liabilities in the balance sheet if the entity
does not have an unconditional right to defer
settlement for at least 12 months after the end

of the reporting period, regardless of when the
actual settlement is expected to occur.

(iii) Post-employment obligations

The Company operates the following postÂ¬
employment schemes:

(a) Defined benefit plans such as gratuity and

(b) Defined contribution plans such as provident
fund.

(iv) Termination Benefits

Termination benefits are expensed at the
earlier of when the Company can no longer
withdraw the offer of those benefits and when
the Company recognizes cost of a restructuring.
If benefits are not expected to be settled wholly
within 12 months of the reporting date, then they
are discounted.

Gratuity Obligations

The liability or asset recognised in the balance
sheet in respect of defined benefit gratuity
plans is the present value of the defined benefit
obligation at the end of the reporting period. The
defined benefit obligation is calculated annually
by actuaries using the projected unit credit
method.

The present value of the defined benefit
obligation is determined by discounting the
estimated future cash outflows by reference
to market yields at the end of the reporting
period on government bonds that have terms
approximating to the terms of the related
obligation.

The net interest cost is calculated by applying
the discount rate to the net balance of the
defined benefit obligation and the fair value of
plan assets. This cost is included in employee
benefit expense in the Statement of Profit and
Loss.

Remeasurement gains and losses arising
from experience adjustments and changes in
actuarial assumptions are recognised in the
period in which they occur, directly in other
comprehensive income. They are included in
retained earnings in the statement of changes
in equity and in the balance sheet.

Defined Contribution plans

Defined Contribution Plans such as Provident

Fund are charged to the Statement of Profit
and Loss as an expense, when an employee
renders the related services. If the contribution
payable to scheme for service received before
the balance sheet date exceeds the contribution
already paid, the deficit payable to the scheme
is recognised as liability after deducting the
contribution already paid. If the contribution
already paid exceeds the contribution due for
services received before the balance sheet
date, then excess is recognised as an asset.

(i) Cash and cash equivalents

For the purpose of presentation in the statement
of cash flows, cash and cash equivalents includes
cash on hand, demand deposits with banks, other
short-term highly liquid investments with original
maturities of three months or less that are readily
convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value.

(j) Earnings per share
Basic earnings per share

Basic earnings per share is calculated by dividing:

> the profit attributable to owners of the Company

> by the weighted average number of equity
shares outstanding during the financial year,
adjusted for bonus elements in equity shares
issued during the year and excluding treasury
shares.

Diluted earnings per share

Diluted earnings per share adjust the figures used in
the determination of basic earnings per share to take
into account:

> the after income tax effect of interest and other
financing costs associated with dilutive potential
equity shares, and

> the weighted average number of additional
equity shares that would have been outstanding
assuming the conversion of all dilutive potential
equity shares.

(k) Borrowing Cost

General and specific borrowing costs that are
directly attributable to the acquisition/construction of
a qualifying asset are capitalised during the period
of time that is required to complete and prepare the
asset for its intended use or sale. Qualifying assets

are assets that necessarily take a substantial period
of time to get ready for their intended use or sale.

Any specific borrowing remains outstanding after
the related asset is ready for its intended use or
sale, that borrowing becomes part of the funds that
an entity borrows generally when calculating the
capitalisation rate on general borrowings.

Investment income earned on the temporary
investment of specific borrowing pending their
expenditure on qualifying assets is deducted from
the borrowing cost eligible for capitalisation.

Other borrowing costs are expensed in the period in
which they are incurred.

(l) Foreign currency translation

Functional and presentation currency

Items included in the financial statements of the
Company are measured using the currency of the
primary economic environment in which the entity
operates (i.e. functional currency). The financial
statements are presented in Indian rupee (INR),
which is Company''s functional and presentation
currency.

Transactions and balances

Foreign currency transactions are translated into the
functional currency using the exchange rates at the
dates of the transactions. Foreign exchange gains
and losses resulting from the settlement of such
transactions and from the translation of monetary
assets and liabilities denominated in foreign
currencies at year-end exchange rates are generally
recognised in profit or loss.

Foreign exchange differences regarded as an
adjustment to borrowing cost are presented in the
Statement of Profit and Loss, within finance costs.
All other foreign exchange gains and losses are
presented in the Statement of profit and loss on a
net basis within other income or other expenses.

Non-monetary items that are measured at fair
value in a foreign currency are translated using the
exchange rates at the date when the fair value was
determined. Translation differences on assets and
liabilities carried at fair value are reported as part of
the fair value gain or loss.

Mar 31, 2025

Note 1: Material Accounting Policies

(a) Basis of preparation

(i) Compliance with Ind AS

The financial statements have been prepared on
a historical cost basis, except for certain financial
assets and liabilities that are measured at fair value
(Refer accounting policy for financial instruments)

The financial statements are presented in Indian
Rupees (âINRâ) and all values are rounded to nearest
lakhs ('' 00,000), except when otherwise indicated.

The Company has prepared the financial statements
on the basis that it will continue to operate as a going
concern.

(ii) Current versus Non-current classification

The Company segregates assets and liabilities into
current and non-current categories for presentation
in the Balance Sheet after considering its normal
operating cycle and other criteria set out in Ind AS 1,
âPresentation of Financial Statementsâ.

For this purpose, current assets and liabilities
include the current portion of non-current assets
and liabilities respectively. Deferred tax assets and
liabilities are always classified as non-current. The
operating cycle is the time between the acquisition
of assets for processing and their realization in cash
and cash equivalents. The Company has identified
period up to twelve months as its operating cycle.

(b) Property, plant & equipments

All items of property, plant and equipment are stated
at historical cost less depreciation and impairment, if
any. Historical cost includes expenditure that is directly
attributable to the acquisition of the items.

Subsequent costs are included in the asset''s carrying
amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic benefits
associated with the item will flow to the Company and the
cost of the item can be measured reliably. The carrying
amount of any component accounted for as a separate
asset is derecognised when replaced. All other repairs
and maintenance are charged to the Statement of Profit
and Loss during the reporting period in which they are
incurred.

Capital work- in- progress includes cost of property, plant
and equipment under installation / under development as
at the Balance Sheet date.

Depreciation methods, estimated useful lives and
residual value

Depreciation on property, plant & equipments has been
provided on straight line method over the estimated
useful lives of the assets, based on technical evaluation
done by management''s expert, which are lower than
those specified by Schedule II to the Companies Act,
2013, in order to reflect the actual usage of the assets.

Useful life considered for calculation of depreciation for
various assets class are as follows-

The residual values are not more than 5% of the original
cost of the asset. The residual values, useful lives and
methods of depreciation of property, plant and equipment
are reviewed at each financial year end and adjusted
prospectively, if appropriate.

Gains and losses on disposals are determined by
comparing proceeds with carrying amount. These are
included in the Statement of Profit and Loss.

(c) Investment properties

Property that is held for long-term rental yields or for
capital appreciation or for both, and that is not occupied
by the Company, is classified as investment property.
Investment property is measured initially at its cost,
including related transaction cost and where applicable
borrowing costs. Subsequent expenditure is capitalised
to assets carrying amount only when it is probable that
future economic benefits associated with the expenditure
will flow to the Company and the cost of the item can be
measured reliably. All other repair and maintenance cost
are expensed when incurred. When part of an investment
property is replaced, the carrying amount of the replaced
part is derecognised.

Though the Company measures investment properties
using cost-based measurement, the fair value of
investment properties are disclosed in the notes
(refer note 3). Fair values are determined based on
an annual evaluation performed by an accredited
external independent valuer applying a valuation model
recommended by the International Valuation Standards
Committee.

Investment properties are derecognised either when they
have been disposed of or when they are permanently
withdrawn from use and no future economic benefit is
expected from their disposal. The difference between
the net disposal proceeds and the carrying amount of
the asset is recognised in profit or loss in the period of
derecognition.

Depreciation methods, estimated useful lives and
residual value

Investment property consists of Freehold Land, Building,
Plant & Equipment, Office Equipment and Furniture &
Fixture, which is depreciated using the straight line
method over the estimated useful lives of the assets,
based on technical evaluation done by management''s
expert, which is at a variance than those specified by
Schedule II to the Companies Act, 2013, in order to
reflect the actual usage of the assets. The management
believes that these estimated useful lives are realistic
and reflect fair approximation of the period over which
the assets are likely to be used.

The residual values are not more than 5% of the original
cost of the asset. The residual values, useful lives and
methods of depreciation of property, plant and equipment
are reviewed at each financial year end and adjusted
prospectively, if appropriate.

Gains and losses on disposals are determined by
comparing proceeds with carrying amount. These are
included in the Statement of Profit and Loss.

(d) Impairment of Non-financial assets

The Company assesses, at each reporting date, whether
there is an indication that an asset may be impaired. If
any indication exists, the Company estimates the asset''s
recoverable amount. An asset''s recoverable amount is
the higher of an asset''s or cash-generating units (CGU)
fair value less costs of disposal and its value in use.

Recoverable amount is determined for an individual
asset, unless the asset does not generate cash inflows
that are largely independent of those from other assets
or group of assets. Where the carrying amount of an
asset or CGU exceeds its recoverable amount, the
asset is considered impaired and is written down to its
recoverable amount.

In assessing value in use, the estimated future cash flows
are discounted to their present value using a pre-tax
discount rate that reflects current market assessments
of the time value of money and the risks specific to the
asset. In determining fair value less costs of disposal,
recent market transactions are taken into account, if
available. If no such transactions can be identified, an
appropriate valuation model is used. After impairment,
depreciation is provided on the revised carrying amount
of the asset over its remaining useful life.

(e) Financial Instruments

A financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability or
equity instrument of another entity.

(I) Financial Assets

The Company classifies its financial assets in the
following measurement categories:

Â¦ those to be measured subsequently at fair value
(either through other comprehensive income, or
through profit or loss), and

Â¦ those measured at amortised cost

The classification depends on the Company''s business
model for managing the financial assets and the
contractual terms of the cash flows.

With the exception of trade receivables that do not contain
a significant financing component or for which the Company
has applied the practical expedient, the Company initially
measures a financial asset at its fair value plus, in the case
of financial assets not recorded at fair value through profit or
loss, transaction costs that are attributable to the acquisition
of the financial asset. Trade receivables that do not contain
a significant financing component or for which the Group
has applied the practical expedient are measured at the
transaction price determined under Ind AS 115.

Subsequent Measurement

For purposes of subsequent measurement financial assets
are classified in following categories:

Â¦ Debt instruments at fair value through Profit and Loss
(FVTPL)

Â¦ Debt instruments at fair value through other
comprehensive income (FVTOCI)

Â¦ Debt instruments at amortised cost

Â¦ Equity instruments

Where assets are measured at fair value, gains and losses
are either recognised entirely in the statement of Profit and
Loss (i.e. fair value through profit or loss), or recognised in
other comprehensive income (i.e. fair value through other
comprehensive income). For investment in debt instruments,
this will depend on the business model in which the investment
is held. For investment in equity instruments, this will depend
on whether the Company has made an irrevocable election at
the time of initial recognition to account for equity instruments
at FVTOCI.

Debt instruments at amortised cost

A Debt instrument is measured at amortised cost if both the
following conditions are met:

a) Business Model Test: The objective is to hold the debt
instrument to collect the contractual cash flows (rather
than to sell the instrument prior to its contractual maturity
to realize its fair value changes).

b) Cash flow characteristics test: The contractual terms
of the debt instrument give rise on specific dates to cash
flows that are solely payments of principal and interest
on principal amount outstanding.

After initial measurement, such financial assets are
subsequently measured at amortised cost using the effective
interest rate (EIR) method. Amortised cost is calculated by
taking into account any discount or premium on acquisition
and fees or costs that are an integral part of EIR. EIR is the
rate that exactly discounts the estimated future cash receipts
over the expected life of the financial instrument or a shorter

period, where appropriate, to the gross carrying amount of
the financial asset.

Debt instruments at fair value through OCI

A Debt instrument is measured at fair value through other
comprehensive income if following criteria are met:

a) Business Model Test: The objective of financial instrument
is achieved by both collecting contractual cash flows and
for selling financial assets.

b) Cash flow characteristics test: The contractual terms
of the debt instrument give rise on specific dates to cash
flows that are solely payments of principal and interest on
principal amount outstanding.

Debt instrument included within the FVTOCI category are
measured initially as well as at each reporting date at fair
value. Fair value movements are recognised in the other
comprehensive income (OCI), except for the recognition
of interest income, impairment gains or losses and foreign
exchange gains or losses which are recognised in Statement of
Profit and Loss. On derecognition of asset, cumulative gain or
loss previously recognised in OCI is reclassified from the equity
to Statement of Profit and Loss. Interest earned whilst holding
FVTOCI financial asset is reported as interest income using the
EIR method.

Debt instruments at FVTPL

FVTPL is a residual category for financial instruments. Any
financial instrument which does not meet the criteria for
amortised cost or FVTOCI is classified as at FVTPL. A gain or
loss on a Debt instrument that is subsequently measured at
FVTPL and is not a part of a hedging relationship is recognised
in statement of profit or loss and presented net in the Statement
of Profit and Loss within other gains or losses in the period in
which it arises. Interest income from these Debt instruments is
included in other income.

Equity Instruments

For all equity instruments, the Company may make an
irrevocable election to present in other comprehensive income
all subsequent changes in the fair value.

The Company makes such election on an instrument-byÂ¬
instrument basis. The classification is made on initial recognition
and is irrevocable.

If the Company decides to classify an equity instrument as
at FVTOCI, then all fair value changes on the instrument,
excluding dividends, are recognised in the OCI. There is no
recycling of the amounts from OCI to Profit and Loss, even
on sale of investment. However, the Company may transfer
the cumulative gain or loss within equity. Equity instruments
included within the FVTPL category are measured at fair value
with all changes recognised in the Statement of Profit and Loss.

A financial asset is derecognised only when:

Â¦ the rights to receive cash flows from the asset have
expired, or

Â¦ the Company has transferred its rights to receive cash
flows from the asset or has assumed an obligation to
pay the received cash flows in full without material delay
to a third party under a âpass throughâ arrangement and
either:

(a) The Company has transferred the rights to receive
cash flows from the financial assets or

(b) The Company has retained the contractual right to
receive the cash flows of the financial asset, but
assumes a contractual obligation to pay the cash
flows to one or more recipients.

Where the entity has not transferred substantially all the
risks and rewards of the ownership of the financial assets,
the financial asset is not derecognised. Where the Company
has neither transferred nor retains substantially all risks and
rewards of ownership of the financial asset, the financial asset
is derecognised if the Company has not retained control of
the financial asset. Where the Company retains control of the
financial asset, the asset is continued to be recognised to the
extent of continuing involvement in the financial asset.

Impairment of financial assets

The Company assesses on a forward looking basis the
expected credit losses associated with its assets carried at
amortised cost and FVOCI debt instruments. The impairment
methodology applied depends on whether there has been
a significant increase in credit risk. Note 34 details how the
Company determines whether there has been a significant
increase in credit risk.

For trade receivables only, the Company applies the simplified
approach permitted by Ind AS 109 Financial Instruments,
which requires expected lifetime losses to be recognise on
initial recognition of the receivables.

(II) Financial Liabilities

The measurement of financial liabilities depends on their
classification, as described below:

Trade and other payables

These amounts represent liabilities for goods and
services provided to the Company prior to the end

of financial year which are unpaid. The amounts are
unsecured and are usually paid within 120 days of
recognition. Trade and other payables are presented
as current liabilities unless payment is not due within 12
months after the reporting period. They are recognised
initially at fair value and subsequently measured at
amortised cost using EIR method.

Borrowings

Borrowings are initially recognised at fair value, net
of transaction cost incurred. After initial recognition,
interest-bearing loans and borrowings are subsequently
measured at amortised cost using the EIR method.

Gains and losses are recognised in profit or loss when
the liabilities are derecognised as well as through the
EIR amortization process. Amortised cost is calculated
by taking into account any discount or premium on
acquisition and fees or costs that are an integral part
of the EIR. The EIR amortization is included as finance
costs in the Statement of Profit and Loss.

Lease Deposits

Lease deposits received are financial liability and need
to be measured at fair value on initial recognition. The
difference between the fair value and the nominal
value of deposits is considered as rent in advance and
recognised over the lease term on a straight line basis.
Unwinding of discount is treated as interest expense
(finance cost) for deposits received and is accrued as
per the EIR method.

Derecognition

A financial liability is derecognised when the obligation
under the liability is discharged or cancelled or expires.
When an existing financial liability is replaced by another
from the same lender on substantially different terms, or
the terms of an existing liability are substantially modified,
such an exchange or modification is treated as the
derecognition of the original liability and the recognition
of a new liability. The difference in the respective carrying
amounts is recognised in the Statement of Profit and
Loss.

(III) Derivative financial instruments

Derivative financial instruments such as forward contracts
are taken by the Company to hedge its foreign currency
risks, are initially recognised at fair value on the date a
derivative contract is entered into and are subsequently
re-measured at their fair value with changes in fair value
recognised in the Statement of Profit and Loss in the
period when they arise.

(IV) Offsetting of financial instruments

Financials assets and financial liabilities are offset
and the net amount is reported in the Balance Sheet if
there is a currently enforceable legal right to offset the
recognised amounts and there is an intention to settle on
a net basis, to realize the assets and settle the liabilities
simultaneously.

(f) Fair Value Measurement

The Company measures certain financial instruments at
fair value.

Fair value is the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date.
The fair value measurement is based on the presumption
that the transaction to sell the asset or transfer the liability
takes place either:

Â¦ In the principal market for the asset or liability, or

Â¦ In the absence of a principal market, in the most
advantageous market for the asset or liability.

The fair value of an asset or a liability is measured using
the assumptions that market participants would use
when pricing the asset or liability, assuming that market
participants act in their economic best interest.

All assets and liabilities for which fair value is measured
or disclosed in the financial statements are categorised
within the fair value hierarchy, described as follows,
based on the lowest level input that is significant to the
fair value measurement as a whole:

Â¦ Level 1 â Quoted (unadjusted) market prices in
active markets for identical assets or liabilities

Â¦ Level 2 â Valuation techniques for which the
lowest level input that is significant to the fair value
measurement is directly or indirectly observable

Â¦ Level 3 â Valuation techniques for which the
lowest level input that is significant to the fair value
measurement is unobservable

(g) Taxes

The income tax expense or credit for the period is the tax
payable on the current period''s taxable income based
on the applicable income tax rate adjusted by changes
in deferred tax assets and liabilities attributable to
temporary differences and to unused tax losses.

to situations in which applicable tax regulations are
subject to interpretations. It establishes provisions where
appropriate on the basis of amount expected to be paid
to tax authorities.

Deferred income tax is provided in full, using the Balance
Sheet approach on temporary differences arising
between the tax bases of assets and liabilities and their
carrying amount in the financial statement. Deferred
income tax is determined using tax rates (and laws) that
have been enacted or substantially enacted by the end
of the reporting period and are expected to apply when
the related deferred income tax assets is realised or the
deferred income tax liability is settled.

Deferred tax assets are recognised for all deductible
temporary differences and unused tax losses, only if, it is
probable that future taxable amounts will be available to
utilise those temporary differences and losses.

Current tax assets and tax liabilities are offset where the
Company has a legally enforceable right to offset and
intends either to settle on a net basis, or to realize the
asset and settle the liability simultaneously.

Current and deferred tax is recognised in the Statement
of Profit and Loss, except to the extent that it relates
to items recognised in other comprehensive income or
directly in equity. In this case, the tax is also recognised
in other comprehensive income or directly in equity,
respectively.

Minimum Alternate Tax credit is recognised as deferred
tax asset only when and to the extent there is convincing
evidence that the Company will pay normal income tax
during the specified period. Such asset is reviewed at
each Balance Sheet date and the carrying amount of the
MAT credit asset is written down to the extent there is
no longer a convincing evidence to the effect that the
Company will pay normal income tax during the specified
period.

(h) Employee Benefits

(i) Short-term obligations

Liabilities for wages and salaries, including nonÂ¬
monetary benefits that are expected to be settled
wholly within 12 months after the end of the period in
which the employees render the related service are
recognised in respect of employees'' services up to

the end of the reporting period and are measured at
the amounts expected to be paid when the liabilities
are settled.

(ii) Other long-term employee benefit obligations

The liabilities for compensated absences that
are not expected to be settled wholly within 12
months are measured as the present value of
expected future payments to be made in respect
of services provided by employees up to the end of
the reporting period using the projected unit credit
method. Remeasurements as a result of experience
adjustments and changes in actuarial assumptions
are recognised in the Statement of Profit and Loss.

The obligations are presented as current liabilities
in the Balance Sheet if the entity does not have an
unconditional right to defer settlement for at least
12 months after the end of the reporting period,
regardless of when the actual settlement is expected
to occur.

(iii) Post-employment obligations

The Company operates the following postÂ¬
employment schemes:

(a) Defined benefit plans such as gratuity and

(b) Defined contribution plans such as provident
fund, Employee State Insurance Corporation
(ESIC).

(iv) Termination Benefits

Termination benefits are expensed at the earlier of
when the Company can no longer withdraw the offer
of those benefits and when the Company recognizes
cost of a restructuring. If benefits are not expected
to be settled wholly within 12 months of the reporting
date, then they are discounted.

Gratuity Obligations

The liability or asset recognised in the Balance Sheet in
respect of defined benefit gratuity plans is the present value
of the defined benefit obligation at the end of the reporting
period. The defined benefit obligation is calculated annually
by actuaries using the projected unit credit method.

The present value of the defined benefit obligation is
determined by discounting the estimated future cash outflows
by reference to market yields at the end of the reporting
period on government bonds that have terms approximating
to the terms of the related obligation.

The net interest cost is calculated by applying the discount
rate to the net balance of the defined benefit obligation and

the fair value of plan assets. This cost is included in employee
benefit expense in the Statement of Profit and Loss.

Remeasurement gains and losses arising from experience
adjustments and changes in actuarial assumptions are
recognised in the period in which they occur, directly in
other comprehensive income. They are included in retained
earnings in the statement of changes in equity and in the
Balance Sheet.

Defined Contribution plans

Defined Contribution Plans such as Provident Fund and
ESIC are charged to the Statement of Profit and Loss as an
expense, when an employee renders the related services.
If the contribution payable to scheme for service received
before the Balance Sheet date exceeds the contribution
already paid, the deficit payable to the scheme is recognised
as liability after deducting the contribution already paid. If
the contribution already paid exceeds the contribution due
for services received before the Balance Sheet date, then
excess is recognised as an asset.

(i) Cash and cash equivalents

For the purpose of presentation in the statement of
cash flows, cash and cash equivalents includes cash
on hand, demand deposits with banks, other short-term
highly liquid investments with original maturities of three
months or less that are readily convertible to known
amounts of cash and which are subject to an insignificant
risk of changes in value.

(j) Earnings per share
Basic earnings per share

Basic earnings per share is calculated by dividing:

Â¦ the profit attributable to owners of the Company

Â¦ by the weighted average number of equity shares
outstanding during the financial year, adjusted for
bonus elements in equity shares issued during the
year and excluding treasury shares.

Diluted earnings per share

Diluted earnings per share adjust the figures used in the
determination of basic earnings per share to take into
account:

Â¦ the after income tax effect of interest and other
financing costs associated with dilutive potential
equity shares, and

Â¦ the weighted average number of additional equity
shares that would have been outstanding assuming
the conversion of all dilutive potential equity shares.

(k) Borrowing Cost

General and specific borrowing costs that are directly
attributable to the acquisition/construction of a qualifying
asset are capitalised during the period of time that
is required to complete and prepare the asset for its
intended use or sale. Qualifying assets are assets that
necessarily take a substantial period of time to get ready
for their intended use or sale.

Any specific borrowing remains outstanding after the
related asset is ready for its intended use or sale, that
borrowing becomes part of the funds that an entity
borrows generally when calculating the capitalisation
rate on general borrowings.

Investment income earned on the temporary investment
of specific borrowing pending their expenditure on
qualifying assets is deducted from the borrowing cost
eligible for capitalisation.

Other borrowing costs are expensed in the period in
which they are incurred.

(l) Foreign currency translation

Functional and presentation currency

Items included in the financial statements of the Company
are measured using the currency of the primary economic
environment in which the entity operates (i.e. functional
currency). The financial statements are presented in
Indian rupee (''), which is Company''s functional and
presentation currency.

Transactions and balances

Foreign currency transactions are translated into the
functional currency using the exchange rates at the
dates of the transactions. Foreign exchange gains and
losses resulting from the settlement of such transactions
and from the translation of monetary assets and liabilities
denominated in foreign currencies at year-end exchange
rates are generally recognised in profit or loss.

Foreign exchange differences regarded as an adjustment
to borrowing cost are presented in the Statement of Profit
and Loss, within finance costs. All other foreign exchange
gains and losses are presented in the Statement of Profit
and Loss on a net basis within other income or other
expenses.

Non-monetary items that are measured at fair value in
a foreign currency are translated using the exchange
rates at the date when the fair value was determined.
Translation differences on assets and liabilities carried
at fair value are reported as part of the fair value gain or
loss.

Mar 31, 2024

Note 1: Material Accounting Policies followed by the Company

(a) Basis of preparation

(i) Compliance with Ind AS

The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 (as amended from time to time) and presentation requirements of Division II of Schedule III to the Companies Act, 2013, (Ind AS compliant Schedule III). During the year the Company has adopted amendments to the said Schedule III. The application of these amendments does not impact recognition and measurement in financial statements. However, it has resulted in additional disclosure which are given under various notes.

The financial statements have been prepared on a historical cost basis, except for the following assets and liabilities:

i) Certain financial assets and liabilities that are measured at fair value (Refer accounting policy for financial instruments)

The financial statements are presented in Indian Rupees (''INR'') and all values are rounded to nearest lakhs (INR 00,000), except when otherwise indicated.

(ii) Current versus Non-current classification

The Company presents assets and liabilities in the Balance Sheet based on current/non-current classification. An asset is treated as current when it is:

â¦ Expected to be realized or intended to be sold or consumed in normal operating cycle

â¦ Held primarily for purpose of trading

â¦ Expected to be realized within twelve months after the reporting period, or

â¦ Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current.

A liability is current when:

â¦ It is expected to be settled in normal operating cycle

â¦ It is held primarily for purpose of trading

â¦ It is due to be settled within twelve months after the reporting period, or

â¦ There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

All other liabilities are classified as non-current.

(b) Property, plant & equipments

All items of property, plant and equipment are stated at historical cost less depreciation and impairment, if any. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the asset''s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to the Statement of Profit and Loss during the reporting period in which they are incurred.

Capital work- in- progress includes cost of property, plant and equipment under installation / under development as at the Balance Sheet date.

Depreciation methods, estimated useful lives and residual value

Depreciation on property, plant & equipments has been provided on straight line method over the estimated useful lives of the assets, based on technical evaluation done by management''s expert, which are lower than those specified by Schedule II to the Companies Act, 2013, in order to reflect the actual usage of the assets.

Useful life considered for calculation of depreciation for various assets class are as follows-

Asset class	Useful Life
Office Equipment	3 - 15 years
Furniture & Fixtures	15 years

The residual values are not more than 5% of the original cost of the asset. The assets residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the Statement of Profit and Loss.

Property that is held for long-term rental yields or for capital appreciation or for both, and that is not occupied by the Company, is classified as investment property. Investment property is measured initially at its cost, including related transaction cost and where applicable borrowing costs. Subsequent expenditure is capitalised to assets carrying amount only when it is probable that future economic benefits associated with the expenditure will flow to the Company and the cost of the item can be measured reliably. All other repair and maintenance cost are expensed when incurred. When part of an investment property is replaced, the carrying amount of the replaced part is derecognised.

Depreciation methods, estimated useful lives and residual value

Investment property consists of Freehold Land, Building, Plant & Equipment, Office Equipment and Furniture & Fixture, which is depreciated using the straight line method over the estimated useful lives of the assets, based on technical evaluation done by management''s expert, which is at a variance than those specified by Schedule II to the Companies Act, 2013, in order to reflect the actual usage of the assets.

Useful life considered for calculation of depreciation for assets class are as follows-

Asset class	Useful Life (in Years)
Buildings	10-60
Plant & Equipments	3-60
Office Equipments	5-30
Furniture & Fixtures	3-60

The residual values are not more than 5% of the original cost of the asset. The assets residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the Statement of Profit and Loss.

(d) Intangible Assets

Intangible assets are stated at cost less accumulated amortisation and impairment losses, if any. Cost comprises the acquisition price and any attributable / allocable incidental cost of bringing the asset to its working condition for its intended use.

Amortisation

Intangible assets are amortised on straight line method over the estimated useful life. The method of amortisation and useful life is reviewed at the end of each accounting year with the effect of any changes in the estimate being accounted for on a prospective basis.

Useful life considered for amortisation of intangible assets for various assets class are as follows-

Asset class	Useful Life
Software & Licenses	3 years

Gains and losses on disposals are determined by comparing net disposal proceeds with carrying amount. These are included in the Statement of Profit and Loss.

(e) Impairment of Non-financial assets

The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, the Company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating units (CGU) fair value less costs of disposal and its value in use.

Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or group of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments

of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

(f) Financial Instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

(I) Financial Assets

The Company classifies its financial assets in the following measurement categories:

â¦ those to be measured subsequently at fair value (either through other comprehensive income, or through profit or loss), and

â¦ those measured at amortised cost

The classification depends on the Company''s business model for managing the financial assets and the contractual terms of the cash flows.

Initial Recognition & Measurement

All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.

Subsequent Measurement

For purposes of subsequent measurement financial assets are classified in following categories:

â¦ Debt instruments at fair value through profit and loss (FVTPL)

â¦ Debt instruments at fair value through other comprehensive income (FVTOCI)

â¦ Debt instruments at amortised cost

â¦ Equity instruments

is held. For investment in equity instruments, this will depend on whether the Company has made an irrevocable election at the time of initial recognition to account for equity instruments at FVTOCI.

Debt instruments at amortised cost

A Debt instrument is measured at amortised cost if both the following conditions are met:

a) Business Model Test: The objective is to hold the debt instrument to collect the contractual cash flows (rather than to sell the instrument prior to its contractual maturity to realize its fair value changes).

b) Cash flow characteristics test: The contractual terms of the debt instrument give rise on specific dates to cash flows that are solely payments of principal and interest on principal amount outstanding.

After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of EIR. EIR is the rate that exactly discounts the estimated future cash receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the gross carrying amount of the financial asset.

Debt instruments at fair value through OCI

A Debt instrument is measured at fair value through other comprehensive income if following criteria are met:

a) Business Model Test: The objective of financial instrument is achieved by both collecting contractual cash flows and for selling financial assets.

b) Cash flow characteristics test: The contractual terms of the debt instrument give rise on specific dates to cash flows that are solely payments of principal and interest on principal amount outstanding.

Debt instrument included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognised in the other comprehensive income (OCI), except for the recognition of interest income, impairment gains or losses and foreign exchange gains or losses which are recognised in Statement of Profit and Loss. On derecognition of asset, cumulative gain or loss previously recognised in OCI is reclassified from the equity to Statement of Profit and Loss. Interest earned

whilst holding FVTOCI financial asset is reported as interest income using the EIR method.

Debt instruments at FVTPL

FVTPL is a residual category for financial instruments. Any financial instrument which does not meet the criteria for amortised cost or FVTOCI is classified as at FVTPL. A gain or loss on a Debt instrument that is subsequently measured at FVTPL and is not a part of a hedging relationship is recognised in statement of profit or loss and presented net in the Statement of Profit and Loss within other gains or losses in the period in which it arises. Interest income from these Debt instruments is included in other income.

Equity Instruments

For all equity instruments, the Company may make an irrevocable election to present in other comprehensive income all subsequent changes in the fair value.

The Company makes such election on an instrument-by-instrument basis. The classification is made on initial recognition and is irrevocable.

If the Company decides to classify an equity instrument as at FVTOCI, then all fair value changes on the instrument, excluding dividends, are recognised in the OCI. There is no recycling of the amounts from OCI to profit and loss, even on sale of investment. However, the Company may transfer the cumulative gain or loss within equity. Equity instruments included within the FVTPL category are measured at fair value with all changes recognised in the Statement of Profit and loss.

Derecognition

A financial asset is derecognised only when:

â¦ the rights to receive cash flows from the asset have expired, or

â¦ the Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a âpass throughâ arrangement and either:

(a) The Company has transferred the rights to receive cash flows from the financial assets or

(b) The Company has retained the contractual right to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients.

Where the entity has not transferred substantially all the risks and rewards of the ownership of the financial assets, the financial asset is not derecognised. Where the Company has neither transferred nor retains substantially all risks and rewards of ownership of the financial asset, the financial asset is derecognised if the Company has not retained control of the financial asset. Where the Company retains control of the financial asset, the asset is continued to be recognised to the extent of continuing involvement in the financial asset.

Impairment of financial assets

The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortised cost and FVOCI debt instruments. The impairment methodology applied depends on whether there has been a significant increase in credit risk. Note 37 details how the Company determines whether there has been a significant increase in credit risk.

For trade receivables only, the Company applies the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to be recognise on initial recognition of the receivables.

(II) Financial Liabilities

The measurement of financial liabilities depends on their classification, as described below:

Trade and other payables

These amounts represent liabilities for goods and services provided to the Company prior to the end of financial year which are unpaid. The amounts are unsecured and are usually paid within 120 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after the reporting period. They are recognised initially at fair value and subsequently measured at amortised cost using EIR method.

Borrowings

Borrowings are initially recognised at fair value, net of transaction cost incurred. After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method.

Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortization process. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the Statement of Profit and Loss.

Lease Deposits

Lease deposits received are financial liability and need to be measured at fair value on initial recognition. The difference between the fair value and the nominal value of deposits is considered as rent in advance and recognised over the lease term on a straight line basis. Unwinding of discount is treated as interest expense (finance cost) for deposits received and is accrued as per the EIR method.

Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the Statement of Profit and Loss.

(III) Derivative financial instruments

Derivative financial instruments such as forward contracts are taken by the Company to hedge its foreign currency risks, are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value with changes in fair value recognised in the Statement of Profit and Loss in the period when they arise.

(IV) Offsetting of financial instruments

Financials assets and financial liabilities are offset and the net amount is reported in the Balance Sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously.

(a) Fair Value Measurement

The Company measures certain financial instruments at fair value.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

â¦ In the principal market for the asset or liability, or

â¦ In the absence of a principal market, in the most advantageous market for the asset or liability.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

â¦ Level 1 â Quoted (unadjusted) market prices in active markets for identical assets or liabilities

â¦ Level 2 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

â¦ Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

(b) Taxes

The income tax expense or credit for the period is the tax payable on the current period''s taxable income based on the applicable income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

The Company''s liability for current tax is calculated using the Indian tax rates and laws that have

been enacted at the end of the reporting period. The Company periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretations. It establishes provisions where appropriate on the basis of amount expected to be paid to tax authorities.

Deferred income tax is provided in full, using the liability method on temporary differences arising between the tax bases of assets and liabilities and their carrying amount in the financial statement. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax assets is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised for all deductible temporary differences and unused tax losses, only if, it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Current tax assets and tax liabilities are offset where the Company has a legally enforceable right to offset and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

Current and deferred tax is recognised in the Statement of Profit and Loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

Minimum Alternate Tax credit is recognised as deferred tax asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period. Such asset is reviewed at each Balance Sheet date and the carrying amount of the MAT credit asset is written down to the extent there is no longer a convincing

evidence to the effect that the Company will pay normal income tax during the specified period.

(c) Employee Benefits

(i) Short-term obligations

Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in respect of employees'' services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled.

(ii) Other long-term employee benefit obligations

The liabilities for compensated absences that are not expected to be settled wholly within 12 months are measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. Remeasurements as a result of experience adjustments and changes in actuarial assumptions are recognised in the Statement of Profit and Loss.

The obligations are presented as current liabilities in the Balance Sheet if the entity does not have an unconditional right to defer settlement for at least 12 months after the end of the reporting period, regardless of when the actual settlement is expected to occur.

(iii) Post-employment obligations

The Company operates the following postemployment schemes:

(a) Defined benefit plans such as gratuity and

(b) Defined contribution plans such as

Provident Fund, Employee State Insurance Corporation (ESIC).

(iv) Termination Benefits

Termination benefits are expensed at the earlier of when the Company can no longer withdraw the offer of those benefits and when the Company recognizes cost of a restructuring.

If benefits are not expected to be settled wholly within 12 months of the reporting date, then they are discounted.

Gratuity Obligations

The liability or asset recognised in the Balance Sheet in respect of defined benefit gratuity plans is the present value of the defined benefit obligation at the end of the reporting period. The defined benefit obligation is calculated annually by actuaries using the projected unit credit method.

The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense in the Statement of Profit and Loss.

Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in the period in which they occur, directly in other comprehensive income. They are included in retained earnings in the statement of changes in equity and in the Balance Sheet.

Defined Contribution plans

Defined Contribution Plans such as Provident Fund and ESIC are charged to the Statement of Profit and Loss as an expense, when an employee renders the related services. If the contribution payable to scheme for service received before the Balance Sheet date exceeds the contribution already paid, the deficit payable to the scheme is recognised as liability after deducting the contribution already paid. If the contribution already paid exceeds the contribution due for services received before the Balance Sheet date, then excess is recognised as an asset.

(i) Cash and cash equivalents

months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

(j) Earnings per share Basic earnings per share

Basic earnings per share is calculated by dividing:

â¦ the profit attributable to owners of the Company

â¦ by the weighted average number of equity shares outstanding during the financial year, adjusted for bonus elements in equity shares issued during the year and excluding treasury shares.

Diluted earnings per share

Diluted earnings per share adjust the figures used in the determination of basic earnings per share to take into account:

â¦ the after income tax effect of interest and other financing costs associated with dilutive potential equity shares, and

â¦ the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares.

(k) Borrowing Cost

General and specific borrowing costs that are directly attributable to the acquisition/construction of a qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

Any specific borrowing remains outstanding after the related asset is ready for its intended use or sale, that borrowing becomes part of the funds that an entity borrows generally when calculating the capitalisation rate on general borrowings.

Investment income earned on the temporary investment of specific borrowing pending their expenditure on qualifying assets is deducted from the borrowing cost eligible for capitalisation.

Other borrowing costs are expensed in the period in which they are incurred.

(l) Foreign currency translation

Functional and presentation currency

Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the entity operates (i.e. functional currency). The financial statements are presented in Indian rupee (INR), which is Company''s functional and presentation currency.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year-end exchange rates are generally recognised in profit or loss.

Foreign exchange differences regarded as an adjustment to borrowing cost are presented in the Statement of Profit and Loss, within finance costs. All other foreign exchange gains and losses are presented in the Statement of profit and loss on a net basis within other income or other expenses.

Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss.

Mar 31, 2023

Background of the Company

Nirlon Limited is a Company limited by shares, incorporated and domiciled in India. The Company is engaged in development and management of the industrial park/ information technology (IT) park. The registered office of the Company is located at Pahadi Village, Off the Western Express Highway, Goregaon (East), Mumbai.

Note 1: Significant Accounting Policies followed by the Company

(a) Basis of preparation

(i) Compliance with Ind AS

The financial statements have been prepared on a historical cost basis, except for the following assets and liabilities:

i) Certain financial assets and liabilities that are measured at fair value (Refer accounting policy for financial instruments)

The financial statements are presented in Indian Rupees (''INR'') and all values are rounded to nearest lakhs (INR 00,000), except when otherwise indicated.

(ii) Current versus Non-current classification

The Company presents assets and liabilities in the balance sheet based on current/non- current classification. An asset is treated as current when it is:

â¦ Expected to be realized or intended to be sold or consumed in normal operating cycle

â¦ Held primarily for purpose of trading

â¦ Expected to be realized within twelve months after the reporting period, or

â¦ Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current.

A liability is current when:

â¦ It is expected to be settled in normal operating cycle

â¦ It is held primarily for purpose of trading

â¦ It is due to be settled within twelve months after the reporting period, or

â¦ There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

All other liabilities are classified as non-current.

(b) Property, plant & equipments

All items of property, plant and equipment are stated at historical cost less depreciation and impairment, if any. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the asset''s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to the Statement of Profit and Loss during the reporting period in which they are incurred.

Capital work- in- progress includes cost of property, plant and equipment under installation / under development as at the balance sheet date.

Depreciation methods, estimated useful lives and residual value

Depreciation on property, plant & equipments has been provided on straight line method over the estimated useful lives of the assets, based on technical evaluation done by management''s expert, which are lower than those specified by Schedule II to the Companies Act, 2013, in order to reflect the actual usage of the assets.

Useful life considered for calculation of depreciation for various assets class are as follows-

Asset class	Useful Life
Office Equipments	3 - 15 years
Furniture & Fixtures	15 years

The residual values are not more than 5% of the original cost of the asset. The assets residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the Statement of Profit and Loss.

Property that is held for long-term rental yields or for capital appreciation or for both, and that is not occupied by the Company, is classified as investment property. Investment property is measured initially at its cost, including related transaction cost and where applicable borrowing costs. Subsequent expenditure is capitalised to assets carrying amount only when it is probable that future economic benefits associated with the expenditure will flow to the Company and the cost of the item can be measured reliably. All other repair and maintenance cost are expensed when incurred. When part of an investment property is replaced, the carrying amount of the replaced part is derecognised.

Depreciation methods, estimated useful lives and residual value

Investment property consists of Freehold Land, Building, Plant & Equipment, Office Equipment and Furniture & Fixture, which is depreciated using the straight line method over the estimated useful lives of the assets, based on technical evaluation done by management''s expert, which is at a variance than those specified by Schedule II to the Companies Act, 2013, in order to reflect the actual usage of the assets.

Useful life considered for calculation of depreciation for assets class are as follows-

Asset class	Useful Life (in Years)
Buildings	10-60
Plant & Equipments	3-60
Office Equipments	5-30
Furniture & Fixtures	3-60

The residual values are not more than 5% of the original cost of the asset. The assets residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the Statement of Profit and Loss.

d) Intangible Assets

Intangible assets are stated at cost less accumulated amortisation and impairment losses, if any. Cost comprises the acquisition price and any attributable/ allocable incidental cost of bringing the asset to its working condition for its intended use.

Amortisation

Useful life considered for amortisation of intangible assets for various assets class are as follows-

Asset class	Useful Life
Software & Licenses	3 years

Gains and losses on disposals are determined by comparing net disposal proceeds with carrying amount. These are included in the Statement of Profit and Loss.

(e) Impairment of Non-financial assets

The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, the Company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating units (CGU) fair value less costs of disposal and its value in use.

Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or group of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

(f) Financial Instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

(I) Financial Assets

The Company classifies its financial assets in the following measurement categories:

â¦ those to be measured subsequently at fair value (either through other comprehensive income, or through profit or loss), and

â¦ those measured at amortised cost

The classification depends on the Company''s business model for managing the financial assets and the contractual terms of the cash flows.

Initial Recognition & Measurement

Subsequent Measurement

For purposes of subsequent measurement financial assets are classified in following categories:

â¦ Debt instruments at fair value through profit and loss (FVTPL)

â¦ Debt instruments at fair value through other comprehensive income (FVTOCI)

â¦ Debt instruments at amortised cost

â¦ Equity instruments

Where assets are measured at fair value, gains and losses are either recognised entirely in the Statement of Profit and Loss (i.e. fair value through profit or loss), or recognised in other comprehensive income (i.e. fair value through other comprehensive income). For investment in debt instruments, this will depend on the business model in which the investment is held. For investment in equity instruments, this will depend on whether the Company has made an irrevocable election at the time of initial recognition to account for equity instruments at FVTOCI.

Debt instruments at amortised cost

A Debt instrument is measured at amortised cost if both the following conditions are met:

a) Business Model Test: The objective is to hold the debt instrument to collect the contractual cash flows (rather than to sell the instrument prior to its contractual maturity to realize its fair value changes).

b) Cash flow characteristics test: The contractual terms of the debt instrument give rise on specific dates to cash flows that are solely payments of principal and interest on principal amount outstanding.

After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of EIR. EIR is the rate that exactly discounts the estimated future cash receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the gross carrying amount of the financial asset.

Debt instruments at fair value through OCI

A Debt instrument is measured at fair value through other comprehensive income if following criteria are met:

a) Business Model Test: The objective of financial instrument is achieved by both collecting contractual cash flows and for selling financial assets.

b) Cash flow characteristics test: The contractual terms of the debt instrument give rise on specific dates to cash flows that are solely payments of principal and interest on principal amount outstanding.

Debt instrument included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognised in the other comprehensive income (OCI), except for the recognition of interest income, impairment gains or losses and foreign exchange gains or losses which are recognised in Statement of Profit and Loss. On derecognition of asset, cumulative gain or loss previously recognised in OCI is reclassified from the equity to Statement of Profit and Loss. Interest earned whilst holding FVTOCI

financial asset is reported as interest income using the EIR method.

Debt instruments at FVTPL

FVTPL is a residual category for financial instruments. Any financial instrument which does not meet the criteria for amortised cost or FVTOCI is classified as at FVTPL. A gain or loss on a Debt instrument that is subsequently measured at FVTPL and is not a part of a hedging relationship is recognised in Statement of Profit or Loss and presented net in the Statement of Profit and Loss within other gains or losses in the period in which it arises. Interest income from these Debt instruments is included in other income.

Equity Instruments

For all equity instruments, the Company may make an irrevocable election to present in other comprehensive income all subsequent changes in the fair value.

The Company makes such election on an instrument-by-instrument basis. The classification is made on initial recognition and is irrevocable.

If the Company decides to classify an equity instrument as at FVTOCI, then all fair value changes on the instrument, excluding dividends, are recognised in the OCI. There is no recycling of the amounts from OCI to profit and loss, even on sale of investment. However, the Company may transfer the cumulative gain or loss within equity. Equity instruments included within the FVTPL category are measured at fair value with all changes recognised in the Statement of Profit and loss.

Derecognition

A financial asset is derecognised only when:

â¦ the rights to receive cash flows from the asset have expired, or

(a) The Company has transferred the rights to receive cash flows from the financial assets or

(b) The Company has retained the contractual right to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients.

Where the Company has transferred an asset, the Company evaluates whether it has transferred

substantially all the risks and rewards of the ownership of the financial assets. In such cases, the financial asset is derecognised.

Where the entity has not transferred substantially all the risks and rewards of the ownership of the financial assets, the financial asset is not derecognised. Where the Company has neither transferred nor retains substantially all risks and rewards of ownership of the financial asset, the financial asset is derecognised if the Company has not retained control of the financial asset. Where the Company retains control of the financial asset, the asset is continued to be recognised to the extent of continuing involvement in the financial asset.

Impairment of financial assets

The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortised cost and FVOCI debt instruments. The impairment methodology applied depends on whether there has been a significant increase in credit risk. Note 37 details how the Company determines whether there has been a significant increase in credit risk.

For trade receivables only, the Company applies the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to be recognise on initial recognition of the receivables.

(II) Financial Liabilities

The measurement of financial liabilities depends on their classification, as described below:

Trade and other payables

These amounts represent liabilities for goods and services provided to the Company prior to the end of financial year which are unpaid. The amounts are unsecured and are usually paid within 120 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after the reporting period. They are recognised initially at fair value and subsequently measured at amortised cost using EIR method.

Borrowings

Borrowings are initially recognised at fair value, net of transaction cost incurred. After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method.

Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortization process. Amortised cost is calculated

by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the Statement of Profit and Loss.

Lease Deposits

Lease deposits received are financial liability and need to be measured at fair value on initial recognition. The difference between the fair value and the nominal value of deposits is considered as rent in advance and recognised over the lease term on a straight line basis. Unwinding of discount is treated as interest expense (finance cost) for deposits received and is accrued as per the EIR method.

Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the Statement of Profit and Loss.

(III) Derivative financial instruments

Derivative financial instruments such as forward contracts are taken by the Company to hedge its foreign currency risks, are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value with changes in fair value recognised in the Statement of Profit and Loss in the period when they arise.

(IV) Offsetting of financial instruments

Financials assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously.

(a) Fair Value Measurement

The Company measures certain financial instruments at fair value.

based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

â¦ In the principal market for the asset or liability, or

â¦ In the absence of a principal market, in the most advantageous market for the asset or liability.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

â¦ Level 1 â Quoted (unadjusted) market prices in active markets for identical assets or liabilities

â¦ Level 2 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

â¦ Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

(b) Taxes

The income tax expense or credit for the period is the tax payable on the current period''s taxable income based on the applicable income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

The Company''s liability for current tax is calculated using the Indian tax rates and laws that have been enacted at the end of the reporting period. The Company periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretations. It establishes provisions where appropriate on the basis of amount expected to be paid to tax authorities.

(and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax assets is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised for all deductible temporary differences and unused tax losses, only if, it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Current tax assets and tax liabilities are offset where the Company has a legally enforceable right to offset and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

Current and deferred tax is recognised in the Statement of Profit and Loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

Minimum Alternate Tax credit is recognised as deferred tax asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period. Such asset is reviewed at each Balance Sheet date and the carrying amount of the MAT credit asset is written down to the extent there is no longer a convincing evidence to the effect that the Company will pay normal income tax during the specified period.

(i) Short-term obligations

Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in respect of employees'' services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled.

(ii) Other long-term employee benefit obligations

The liabilities for compensated absences that are not expected to be settled wholly within 12 months are measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. Remeasurements as a result of experience adjustments and changes in actuarial assumptions are recognised in the Statement of Profit and Loss.

The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to defer settlement for at least 12 months after the end of the reporting period, regardless of when the actual settlement is expected to occur.

(iii) Post-employment obligations

The Company operates the following postemployment schemes:

(a) Defined benefit plans such as gratuity and

(b) Defined contribution plans such as provident fund, Employee State Insurance Corporation (ESIC).

(iv) Termination Benefits

Termination benefits are expensed at the earlier of when the Company can no longer withdraw the offer of those benefits and when the Company recognizes cost of a restructuring. If benefits are not expected to be settled wholly within 12 months of the reporting date, then they are discounted.

Gratuity Obligations

The liability or asset recognised in the balance sheet in respect of defined benefit gratuity plans is the present value of the defined benefit obligation at the end of the reporting period. The defined benefit obligation is calculated annually by actuaries using the projected unit credit method.

The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense in the Statement of Profit and Loss.

Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in the period in which they occur, directly in other comprehensive income. They are included in retained earnings in the statement of changes in equity and in the balance sheet.

Defined Contribution plans

Defined Contribution Plans such as Provident Fund and ESIC are charged to the Statement of Profit and Loss as an expense, when an employee renders the related services. If the contribution payable to scheme for service received before the balance sheet date exceeds the contribution already paid, the deficit payable to the scheme is recognised as liability after deducting the contribution already paid. If the contribution already paid exceeds the contribution due for services received before the balance sheet date, then excess is recognised as an asset.

(i) Cash and cash equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, demand deposits with banks, other short-term highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

(j) Earnings per share Basic earnings per share

Basic earnings per share is calculated by dividing:

â¦ the profit attributable to owners of the Company

â¦ by the weighted average number of equity shares outstanding during the financial year, adjusted for bonus elements in equity shares issued during the year and excluding treasury shares.

Diluted earnings per share

Diluted earnings per share adjust the figures used in the determination of basic earnings per share to take into account:

â¦ after income tax effect of interest and other financing costs associated with dilutive potential equity shares, and

â¦ the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares.

(k) Borrowing Cost

General and specific borrowing costs that are directly attributable to the acquisition/construction of a qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

Any specific borrowing remains outstanding after the related asset is ready for its intended use or sale, that borrowing becomes part of the funds that an entity borrows generally when calculating the capitalisation rate on general borrowings.

Investment income earned on the temporary investment of specific borrowing pending their expenditure on qualifying assets is deducted from the borrowing cost eligible for capitalisation.

Other borrowing costs are expensed in the period in which they are incurred.

(l) Foreign currency translation

Functional and presentation currency

Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the entity operates (i.e. functional currency). The financial statements are presented in Indian rupee (INR), which is Company''s functional and presentation currency.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year-end exchange rates are generally recognised in profit or loss.

Foreign exchange differences regarded as an adjustment to borrowing cost are presented in the Statement of Profit and Loss, within finance costs. All other foreign exchange gains and losses are presented in the Statement of Profit and Loss on a net basis within other income or other expenses.

Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange

rates at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss.

(m) Provisions & contingent liabilities Provisions

A provision is recognised when the Company has a present obligation (legal or constructive) as a result of past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and the amount can be reliably estimated. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

Contingent liabilities

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognised because it is not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount cannot be made. The Company does not recognize a contingent liability but discloses its existence in the financial statements unless the probability of outflow of resources is remote.

(n) Leases Company as a lessor

At inception of contract, the Company assesses whether the Contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. At inception or on reassessment of a contract that contains a lease component, the Company allocates consideration in the contract to each lease component on the basis of their relative standalone price.

Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental income. Contingent rents are recognised as revenue in the period in which they are earned.

Leases are classified as finance leases when substantially all of the risks and rewards of ownership transfer from the Company to the lessee. Amounts due from lessees under finance leases are recorded as receivables at the Company''s net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the net investment outstanding in respect of the lease.

(o) Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker.

(p) Revenue recognition

Revenue from contract with customers

Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.

Contract assets are transferred to receivables when the rights become unconditional. Contract asset is the right to consideration in exchange for goods or services transferred to the customer. Contract liabilities are recognised as revenue as and when the performance obligation is satisfied. Contract liability is the entity''s obligation to transfer goods or services to a customer for which the entity has received consideration from the customer in advance.

Rental Income

License fee/Lease income and income incidental to it, arising from operating leases on investment properties is accounted for on a straight-line basis over the lease terms, unless there is another systematic basis which is more representative of the time pattern of the lease.

Other operating revenue comprises of car parking charges which are recognised as income as per the terms and conditions of the agreement with lessees.

Interest income

Interest income from debt instruments is recognised using the effective interest rate method.

Insurance claims and scrap sales are accounted for in the books on an accrual basis.

(q) Dividend distribution to Equity shareholders

The Company recognises a liability to pay dividend to equity holders when the distribution is authorised, and the distribution is no longer at the discretion of the Company. A corresponding amount is recognised directly in equity.

(r) Critical estimates and judgements

The preparation of financial statements requires the use of accounting estimates which, by definition, will seldom equal the actual results. This note provides an overview of the areas that involved a higher degree of judgment or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed. Detailed information about each of these estimates and judgments is included in relevant notes together with information about the basis of calculation for each affected line item in the financial statements.

The areas involving critical estimates or judgments are:

- Estimation of defined benefit obligation (Note 35)

- Estimation of Useful life of Property, plant and equipment and Investment property (Note 2 and 3)

- Estimation of taxes (Note 6, 17 and 29)

- Estimation of provision and assessment of the likely outcome of contingent liabilities (Note 16 and 31)

- Estimation of fair value measurement of financial assets and liabilities (Note 36)

Estimates and judgments are continually evaluated. They are based on historical experience and other factors, including expectations of future events that may have a financial impact on the group and that are believed to be reasonable under the circumstances.

(s) Changes in Ind AS and related pronouncements effective at a future date

Ministry of Corporate Affairs (âMCAâ) notifies new standard or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. On March 31, 2023, MCA amended the Companies (Indian Accounting Standards) Amendment Rules, 2023, applicable from April 1, 2023, as below:

Ind AS 1 - Disclosure of material accounting policies:

The amendments related to shifting of disclosure of erstwhile âsignificant accounting policiesâ to âmaterial

accounting policiesâ in the notes to the financial statements requiring companies to reframe their accounting policies to make them more âentity specificâ. This amendment aligns with the âmaterialâ concept already required under International Financial Reporting Standards (IFRS).

Ind AS 8 - Definition of accounting estimates:

The amendments will help entities to distinguish between accounting policies and accounting estimates. The definition of a âchange in accounting estimatesâ has been replaced with a definition of âaccounting estimates.â Under the new definition, accounting estimates are âmonetary amounts in financial statements that are subject to measurement uncertainty.â Entities develop accounting estimates if accounting policies require items in financial statements to be measured in a way that involves measurement uncertainty.

Ind AS 12 - Income Taxes

The amendments narrowed the scope of the recognition exemption in paragraphs 15 and 24 of Ind AS 12. At the date of transition to Ind ASs, a first-time adopter shall recognize a deferred tax asset to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilized. Similarly, a deferred tax liability be recognised for all deductible and taxable temporary differences associated with:

a) right-of-use assets and lease liabilities

b) decommissioning, restoration and similar liabilities and the corresponding amounts recognized as part of the cost of the related asset.

Therefore, if a company has not yet recognised deferred tax on right-of-use assets and lease liabilities or has recognised deferred tax on net basis, the same need to be recognised on gross basis based on the carrying amount of right-of-use assets and lease liabilities

Ind AS 103 - Common control Business Combination

The amendments modify the disclosure requirement for business combination under common control in the first financial statement following the business combination. It requires to disclose the date on which the transferee obtains control of the transferor is required to be disclosed.

The amendments are extensive and the Company is in the process of evaluating the impact of the above amendments on the financial statements.

Mar 31, 2018

Notes to Financial Statements as at and for the Year ended March 31, 2018

Background of the Company

Nirlon Limited is a Company limited by shares, incorporated and domiciled in India. The Company is engaged in development and management of the industrial park/ information technology (IT) park. The Registered Office of the Company is located at Pahadi Village, off the Western Express Highway, Goregaon (East), Mumbai.

Note 1: Significant Accounting Policies followed by the Company

(a) Basis of preparation

(i) Compliance with Ind AS

These Financial Statements comply in all material aspects with Indian Accounting Standards (Ind AS) notified under section 133 of the Companies Act, 2013 (the Act) [Companies (Indian Accounting Standards) Rules, 2015] and other relevant provisions of the Act.

The Financial Statements up to year ended March

31, 2017 were prepared in accordance with the accounting standards notified under Companies (Accounting Standard) Rules, 2006 (as amended) and other relevant provisions of the Act.

These Financial Statements for the Year ended March 31, 2018 are the first Financial Statements, which have been prepared in accordance with Ind AS notified under the Companies (Indian Accounting Standard) Rules, 2015.

Refer note 42 for an explanation of how the transition from previous GAAP to Ind AS has affected the Companyâs financial position, financial performance and cash flows.

The Financial Statements have been prepared on a historical cost basis, except for the following assets and liabilities:

i) Certain financial assets and liabilities that are measured at fair value

ii) Assets held for sale-measured at fair value less cost to sell.

The financial statements are presented in Indian Rupees (âINRâ) and all values are rounded to nearest lakh (INR 00,000), except when otherwise indicated.

(ii) Current versus Non-current classification

The Company presents assets and liabilities in the Balance Sheet based on current / non-current classification. An asset is treated as current when it is:

- Expected to be realized or intended to be sold or consumed in normal operating cycle

- Held primarily for purpose of trading

- Expected to be realized within twelve months after the reporting period, or

- Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current.

A liability is current when:

- It is expected to be settled in normal operating cycle

- It is held primarily for purpose of trading

- It is due to be settled within twelve months after the reporting period, or

- There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

All other liabilities are classified as non-current.

(b) Property, plant & equipment

All items of property, plant and equipment are stated at historical cost less depreciation and impairment, if any. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the assetâs carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to the Statement of Profit and Loss during the reporting period in which they are incurred.

Capital work- in- progress includes cost of property, plant and equipment under installation / under development as at the Balance Sheet date.

On transition to Ind AS

Under the previous GAAP (Indian GAAP), property plant and equipment was carried in the Balance Sheet at cost, less accumulated depreciation and accumulated impairment losses, if any. On the date of transition to Ind AS, the Company has elected to continue with the carrying value of property plant and equipment as deemed cost as at April 1, 2016.

Depreciation methods, estimated useful lives and residual value

Depreciation on property, plant & equipment has been provided on written down value method over the estimated useful lives of the assets, based on technical evaluation done by managementâs expert, which are lower than those specified by Schedule II to the Companies Act, 2013, in order to reflect the actual usage of the assets.

The residual values are not more than 5% of the original cost of the asset. The assets residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the Statement of Profit and Loss.

Property that is held for long-term rental yields or for capital appreciation or for both, and that is not occupied by the Company, is classified as investment property. Investment property is measured initially at its cost, including related transaction cost and where applicable borrowing costs. Subsequent expenditure is capitalised to assets carrying amount only when it is probable that future economic benefits associated with the expenditure will flow to the Company and the cost of the item can be measured reliably. All other repair and maintenance cost are expensed when incurred. When part of an investment property is replaced, the carrying amount of the replaced part is derecognised.

Depreciation methods, estimated useful lives and residual value

Investment property consists of Freehold Land, Building (including Other Assets such as Plant & Equipment, Office Equipment and Furniture & Fixture), which is depreciated using the written down value method over the estimated useful lives of the assets, based on technical evaluation done by managementâs expert, which are lower than those specified by Schedule II to the Companies Act, 2013, in order to reflect the actual usage of the assets.

* Other assets mainly comprise of Plant & Equipment, Office Equipment and Furniture & Fixture forming an integral part of Building.

The residual values are not more than 5% of the original cost of the asset. The assets residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the Statement of Profit and Loss.

On transition to Ind AS

Under the previous GAAP (Indian GAAP), building and other assets (plant & equipment, furniture & fixtures, office equipment,) was carried in the balance sheet at cost, less accumulated depreciation and accumulated impairment losses, if any and freehold land was carried at revalued amount. For investment property, Ind AS 101 gives the option either to carry the previous GAAP carrying value or apply the provisions of Ind AS 40 retrospectively. The Company has opted to apply Ind AS 40 retrospectively as at the transition date.

(d) Intangible Assets

On transition to Ind AS

On the date of transition to Ind AS, the Company has elected to continue with the carrying value of intangible assets recognised as at April 1, 2016 measured as per previous GAAP and use that carrying value as the deemed cost of intangible assets.

Amortisation

Intangible assets are amortised on written down value method over the estimated useful life. The method of amortisation and useful life is reviewed at the end of each accounting year with the effect of any changes in the estimate being accounted for on a prospective basis.

Useful life considered for amortisation of intangible assets for various assets class are as follows :

Gains and losses on disposals are determined by comparing net disposal proceeds with carrying amount. These are included in the Statement of Profit and Loss.

(e) Impairment of Non-financial assets

The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, the Company estimates the assetâs recoverable amount. An assetâs recoverable amount is the higher of an assetâs or cash-generating units (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or Companies of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

(f) Financial Instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

(i) Financial Assets

The Company classifies its financial assets in the following measurement categories:

- those to be measured subsequently at fair value (either through other comprehensive income, or through profit or loss), and

- those measured at amortised cost

The classification depends on the Companyâs business model for managing the financial assets and the contractual terms of the cash flows.

Initial Recognition & Measurement

All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at

fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.

Subsequent Measurement

For purposes of subsequent measurement financial assets are classified in following categories:

- Debt instruments at fair value through profit and loss (FVTPL)

- Debt instruments at fair value through other comprehensive income (FVTOCI)

- Debt instruments at amortised cost

- Equity instruments

Where assets are measured at fair value, gains and losses are either recognised entirely in the statement of profit and loss (i.e. fair value through profit or loss), or recognised in other comprehensive income (i.e. fair value through other comprehensive income). For investment in debt instruments, this will depend on the business model in which the investment is held. For investment in equity instruments, this will depend on whether the Company has made an irrevocable election at the time of initial recognition to account for equity instruments at FVTOCI.

Debt instruments at amortised cost

A Debt instrument is measured at amortised cost if both the following conditions are met:

a) Business Model Test: The objective is to hold the debt instrument to collect the contractual cash flows (rather than to sell the instrument prior to its contractual maturity to realize its fair value changes).

b) Cash flow characteristics test: The contractual terms of the debt instrument give rise on specific dates to cash flows that are solely payments of principal and interest on principal amount outstanding.

After initial measurement, such financial assets are subsequently measured at amortised cost using the Effective Interest Rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of EIR. EIR is the rate that exactly discounts the estimated future cash receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the gross carrying amount of the financial asset.

Debt instruments at fair value through OCI

A Debt instrument is measured at fair value through other comprehensive income if following criteria are met:

a) Business Model Test: The objective of financial instrument is achieved by both collecting contractual cash flows and for selling financial assets.

b) Cash flow characteristics test: The contractual terms of the debt instrument give rise on specific dates to cash flows that are solely payments of principal and interest on principal amount outstanding.

Debt instrument included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognised in the other comprehensive income (OCI), except for the recognition of interest income, impairment gains or losses and foreign exchange gains or losses which are recognised in Statement of Profit and Loss. On derecognition of asset, cumulative gain or loss previously recognised in OCI is reclassified from the equity to Statement of Profit and Loss. Interest earned whilst holding FVTOCI financial asset is reported as interest income using the EIR method.

Debt instruments at FVTPL

FVTPL is a residual category for financial instruments. Any financial instrument which does not meet the criteria for amortised cost or FVTOCI is classified as at FVTPL. A gain or loss on a Debt instrument that is subsequently measured at FVTPL and is not a part of a hedging relationship is recognised in statement of profit or loss and presented net in the Statement of Profit and Loss within other gains or losses in the period in which it arises. Interest income from these Debt instruments is included in other income.

Equity Instruments

For all equity instruments, the Company may make an irrevocable election to present in other comprehensive income all subsequent changes in the fair value. The Company makes such election on an instrument-by-instrument basis. The classification is made on initial recognition and is irrevocable.

If the Company decides to classify an equity instrument as at FVTOCI, then all fair value changes on the instrument, excluding dividends, are recognised in the OCI. There is no recycling of the amounts from OCI to profit and loss, even on sale of investment. However, the Company may transfer the cumulative gain or loss within equity. Equity instruments included within the FVTPL category are measured at fair value with all changes recognised in the Statement of Profit and loss.

Derecognition

A financial asset is derecognised only when:

- the rights to receive cash flows from the asset have expired, or

- the Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a âpass throughâ arrangement and either:

(a) The Company has transferred the rights to receive cash flows from the financial assets or

(b) The Company has retained the contractual right to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients.

Where the Company has transferred an asset, the Company evaluates whether it has transferred substantially all the risks and rewards of the ownership of the financial assets. In such cases, the financial asset is derecognised. Where the entity has not transferred substantially all the risks and rewards of the ownership of the financial assets, the financial asset is not derecognised.

Where the Company has neither transferred a financial asset nor retains substantially all risks and rewards of ownership of the financial asset, the financial asset is derecognised if the Company has not retained control of the financial asset. Where the Company retains control of the financial asset, the asset is continued to be recognised to the extent of continuing involvement in the financial asset.

Impairment of financial assets

The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortised cost and FVOCI debt instruments. The impairment methodology applied depends on whether there has been a significant increase in credit risk. Note 40 details how the Company determines whether there has been a significant increase in credit risk.

For trade receivables only, the Company applies the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to e recognise from initial recognition of the receivables.

(ii) Financial Liabilities

The measurement of financial liabilities depends on their classification, as described below:

Trade and other payables

These amounts represent liabilities for goods and services provided to the Company prior to the end of financial year which are unpaid. The amounts are unsecured and are usually paid within 120 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after the reporting period. They are recognised initially at fair value and subsequently measured at amortised cost using EIR method.

Borrowings

Borrowings are initially recognised at fair value, net of transaction cost incurred. After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method.

Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortization process. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the statement of profit and loss.

Lease Deposits

Lease deposits received are financial liability and need to be measured at fair value on initial recognition. The difference between the fair value and the nominal value of deposits is considered as rent in advance and recognised over the lease term on a straight line basis. Unwinding of discount is treated as interest expense (finance cost) for deposits received and is accrued as per the EIR method.

Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the Statement of Profit and Loss.

(iii) Derivative financial instruments

Derivative financial instruments such as forward contracts are taken by the Company to hedge its foreign currency risks, are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value with changes in fair value recognised in the Statement of Profit and Loss in the period when they arise.

(iv) Offsetting of financial instruments

Financials assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously.

(g) Fair Value Measurement

The Company measures financial instruments at fair value at each balance sheet date.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

- In the principal market for the asset or liability, or

- In the absence of a principal market, in the most advantageous market for the asset or liability.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

All assets and liabilities for which fair value is measured or disclosed in the Financial Statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

- Level 1 â Quoted (unadjusted) market prices in active markets for identical assets or liabilities

- Level 2 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

- Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

(h) Taxes

The income tax expense or credit for the period is the tax payable on the current periodâs taxable income based on the applicable income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

The Companyâs liability for current tax is calculated using the Indian tax rates and laws that have been enacted at the end of the reporting period. The Company periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretations. It establishes provisions where appropriate on the basis of amount expected to be paid to tax authorities.

Deferred tax assets are recognised for all deductible temporary differences and unused tax losses, only if, it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the Company has a legally enforceable right to offset and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

Current and deferred tax is recognised in the Statement of Profit and Loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

Minimum Alternate Tax credit is recognised as deferred tax asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period. Such asset is reviewed at each Balance Sheet date and the carrying amount of the MAT credit asset is written down to the extent there is no longer a convincing evidence to the effect that the Company will pay normal income tax during the specified period.

(i) Employee Benefits

(i) Short-term obligations

Liabilities for wages and salaries, including nonmonetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in respect of employeesâ services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled.

(ii) Other long-term employee benefit obligations

The liabilities for compensated absences that are not expected to be settled wholly within 12 months are measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. Remeasurements as a result of experience adjustments and changes in actuarial assumptions are recognised in the Statement of Profit and Loss.

(iii) Post-employment obligations

The Company operates the following postemployment schemes:

(a) defined benefit plans such as gratuity and

(b) defined contribution plans such as provident fund, Employee State Insurance Corporation(ESIC).

Gratuity Obligations

The liability or asset recognised in the balance sheet in respect of defined benefit gratuity plans is the present value of the defined benefit obligation at the end of the reporting period. The defined benefit obligation is calculated annually by actuaries using the projected unit credit method.

The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense in the Statement of Profit and Loss.

Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in the period in which they occur, directly in other comprehensive income. They are included in retained earnings in the statement of changes in equity and in the balance sheet.

Defined Contribution plans

Defined Contribution Plans such as Provident Fund and ESIC are charged to the Statement of Profit and Loss as an expense, when an employee renders the related services. If the contribution payable to scheme for service received before the balance sheet date exceeds the contribution already paid, the deficit payable to the scheme is recognised as liability after deducting the contribution already paid. If the contribution already paid exceeds the contribution due for services received before the balance sheet date, then excess is recognised as an asset.

(j) Cash and cash equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, demand deposits with banks, other short-term highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

(k) Earnings per share

Basic earnings per share

Basic earnings per share is calculated by dividing:

- the profit attributable to owners of the Company

- by the weighted average number of equity shares outstanding during the financial year, adjusted for bonus elements in equity shares issued during the year and excluding treasury shares.

Diluted earnings per share

Diluted earnings per share adjust the figures used in the determination of basic earnings per share to take into account:

- the after income tax effect of interest and other financing costs associated with dilutive potential equity shares, and

- the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares.

(l) Assets held for sale

Non-current assets are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and a sale is considered highly probable. They are measured at the lower of their carrying amount and fair value less costs to sell, except for assets such as deferred tax assets, assets arising from employee benefits, financial assets and contractual rights under insurance contracts, which are specifically exempt from this requirement.

An impairment loss is recognised for any initial or subsequent write down of the asset to fair value less cost to sell. A gain is recognised for any subsequent increase in fair value less cost to sell of an asset, but not in excess of any cumulative impairment loss previously recognised. A gain or loss not previously recognised by the date of the sale of the non-current asset is recognised at the date de-recognition.

Non-current assets are not depreciated or amortised while they are classified as held for sale. Assets and liabilities classified as held for sale are presented separately as current items in the balance sheet.

(m) Borrowing Cost

General and specific borrowing costs that are directly attributable to the acquisition/construction of a qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

Investment income earned on the temporary investment of specific borrowing pending their expenditure on qualifying assets is deducted from the borrowing cost eligible for capitalisation.

Other borrowing costs are expensed in the period in which they are incurred.

(n) Foreign currency translation

Functional and presentation currency

Items included in the Financial Statements of the Company are measured using the currency of the primary economic environment in which the entity operates (i.e. functional currency). The Financial Statements are presented in Indian rupee (INR), which is Companyâs functional and presentation currency.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year-end exchange rates are generally recognised in profit or loss.

Foreign exchange differences regarded as an adjustment to borrowing cost are presented in the Statement of Profit and Loss, within finance costs. All other foreign exchange gains and losses are presented in the Statement of profit and loss on a net basis within other income or other expenses.

Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss.

(o) Provisions & contingent liabilities Provisions

Contingent liabilities

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognised because it is not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount cannot be made. The Company does not recognize a contingent liability but discloses its existence in the Financial Statements unless the probability of outflow of resources is remote.

(p) Leases

Company as a lessee

A lease is classified at the inception date as a finance lease or an operating lease. A lease that transfers substantially all the risks and rewards incidental to ownership to the Company is classified as a finance lease. Finance leases are capitalised at the commencement of the lease at the inception date at fair value of the leased property or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognised in finance costs in the statement of profit or loss, unless they are directly attributable to qualifying assets, in which case they are capitalised in accordance with Companyâs general policy on the borrowing cost.

A leased asset is depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Company will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term.

Operating lease payments are recognised as an expense in the Statement of Profit or Loss account on straight-line basis over the lease term, unless the payments are structured to increase in line with the expected general inflation to compensate for the lessor in expected inflationary cost increase.

Company as a lessor

Leases in which the Company does not transfer substantially all the risks and rewards of ownership of an asset are classified as operating leases. Rental income from operating lease is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental income. Contingent rents are recognised as revenue in the period in which they are earned.

Leases are classified as finance leases when substantially all of the risks and rewards of ownership transfer from the Company to the lessee. Amounts due from lessees under finance leases are recorded as receivables at the Companyâs net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the net investment outstanding in respect of the lease.

(q) Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. Refer Note 35 for segment information presented.

(r) Revenue Recognition

Revenue is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duties collected on behalf of the government. Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured, regardless of when the payment is being made.

Rental Income

Revenue from common area maintenance service is recognised at value of service and is disclosed net of indirect taxes, if any.

Other operating revenue comprises of income from car parking charges and other recoveries from customers as per the terms and conditions agreed with them.

Interest income

Interest income from debt instruments is recognised using the effective interest rate method.

Insurance claims and scrap sales are accounted for in the books on an accrual basis.

(s) ESOP

The Company offers ESOP under which options to subscribe for the Companyâs share have been granted to certain employees and senior management. The shares have been issued at fair value as on the grant date. These shares are vested before the transition date.

Employee welfare trust financed through interest free loan by the Company and warehousing the shares which have not vested yet, for distribution to employees of the Company, has been consolidated on line by line basis by reducing from equity share capital of the Company the face value of such treasury shares held by the trust.

(t) Dividend distribution to equity shareholders

Dividend distributed to Equity shareholders is recognised as distribution to owners of capital in the Statement of Changes in Equity, in the period in which it is paid.

(u) Critical estimates and judgements

The preparation of Financial Statements requires the use of accounting estimates which, by definition, will seldom equal the actual results. This note provides an overview of the areas that involved a higher degree of judgment or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed. Detailed information about each of these estimates and judgments is included in relevant notes together with information about the basis of calculation for each affected line item in the Financial Statements.

The areas involving critical estimates or judgments are:

- Estimation of defined benefit obligation (Note 37)

- Estimation of Useful life of Property, plant and equipment, Investment property and intangibles (Note 2, 3 and 4)

- Estimation of taxes (Note 7, 18 and 30)

- Estimation of provision and contingent liabilities (Note 17 and 32)

- Estimation of fair value measurement of financial assets and liabilities (Note 39)

(v) Standard issued but not effective

The amendments to standards that are issued, but not yet effective, up to the date of issuance of the Companyâs Financial Statements are disclosed below.

Ind AS 115 - Revenue from Contracts with Customers

Ind AS 115, is effective for periods beginning on or after April 01, 2018. Ind AS 115 sets out the requirements for recognising revenue that apply to all contracts with customers (except for contracts that are within the scope of the Standards on leases, insurance contracts and financial instruments). Ind AS 115 replaces the previous revenue Standards: Ind AS 18 Revenue and Ind AS 11 Construction Contracts, and the related appendices.

The standard establishes a comprehensive framework for determining when to recognise revenue and how much revenue to recognise. Under Ind AS 115, an entity recognises revenue when (or as) a performance obligation is satisfied, i.e. when âcontrolâ of the goods or services underlying the particular performance obligation is transferred to the customer. The core principle in that framework is that a Company should recognise revenue to depict the transfer of promised goods or services to the customer in an amount that reflects the fair value of consideration to which the Company expects to be entitled in exchange for those goods or services.

Mar 31, 2017

1.1 BASIS FOR PREPARATION OF FINANCIAL STATEMENTS :

The Financial Statements are prepared in accordance with Generally Accepted Accounting Principles (âGAAPâ) in India under the historical cost convention on accrual basis except if specifically stated otherwise. These Financial Statements have been prepared to comply in all material respects with the Accounting Standards specified under section 133 of the Companies Act, 2013 read with rules 7 of Companies (Accounts) Rules, 2014.

1.2 ACCOUNTING POLICIES :

a. Fixed Assets :

Fixed Assets are stated at cost or revalued amount wherever applicable. Cost comprises of cost of acquisition, cost of improvements, borrowing costs and any other cost attributable in bringing the assets to the condition required for their intended use.

b. Depreciation and Amortization :

i. Depreciation on fixed assets has been provided on written down value method based on the useful life specified in Schedule II of the Companies Act, 2013.

ii. Intangible Assets are amortized over the estimated useful life of the asset.

c. Borrowing Cost :

Borrowing costs include interest and other charges incurred in connection with the borrowing of funds and is recognized as an expense for the year in which it is incurred, except for borrowing costs attributable to the acquisition/construction of qualifying assets, and incurred till all the activities necessary to prepare the qualifying asset for its intended use are complete, which are capitalized as the cost of that asset

d. Forward Contracts:

The Company uses foreign exchange forward contracts to hedge its exposure to movements in foreign exchange rates: In relation to forward contracts entered into to hedge the underlying liability pertaining to capital projects till the time all the activities necessary to prepare the qualifying asset for its intended use, the premium or discount arising at the inception of such contracts are adjusted towards the cost of the project. For forward contracts taken thereafter, the premium or discount arising at the inception of such contracts is amortized as expense or income over the life of the contract.

e. Taxes on Income :

Current Tax

Provision for Income Tax is determined in accordance with the provisions of Income Tax Act, 1961.

Minimum alternate tax (MAT) paid in a year is charged to the statement of profit and loss as current tax. The company recognizes MAT credit available as an asset only to the extent that there is convincing evidence that the company will pay normal income tax during the specified period, i.e. the period for which MAT credit is allowed to be carried forward. In the year in which the company recognizes MAT credit as an asset in accordance with the Guidance Note on accounting for Credit Available in respect of Minimum Alternative TAX under the Income-tax Act, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as âMAT Credit Entitlementâ.

Deferred Tax

Deferred tax is recognized on timing differences between the accounting income and the taxable income for the year, and quantified using the tax rates and laws enacted or substantively enacted on the balance sheet date. Deferred tax assets in a situation where unabsorbed depreciation and carry forward business loss exists, are recognized only if there is virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax asset can be realized. Deferred tax assets, other than in a situation of unabsorbed depreciation and carry forward business loss, are recognized only if there is reasonable certainty that they will be realized.

f. Employee Stock Compensation Cost :

The Company measures the compensation cost relating to employee stock options in accordance with the SEBI (Employees Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and the Guidance Note on Accounting for Employee Share Based Payment. The cost of equity settled transactions is measured using the intrinsic value method. The compensation cost, if any is amortized over the vesting period.

g. Foreign Currency Transactions :

i. Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction.

ii. Monetary items denominated in foreign currencies at the yearend are restated at year end rates.

iii. Non monetary foreign currency items are carried at cost.

iv. Any income or expense on account of exchange difference either on settlement or on translation is recognized in the statement of profit and loss.

h. Employee Benefits :

i. Defined Benefit Plan :

The Company providesâ for gratuity liability based on the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

ii. Defined Contribution Plans :

Companyâs contribution paid/payable for Provident Fund, ESIC and Pension Fund for the year is recognized in the statement of Profit and Loss.

iii. Long Term Employee benefits :

Long term compensated absences are provided as per the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

iv. Short Term Employee benefits :

Short term benefits are recognized as an expense in the statement of profit and loss of the year in which the related services are rendered.

v. Actuarial gains/losses :

Actuarial gains/losses are immediately recognized in the statement of profit and loss and are not deferred.

i. Revenue Recognition:

i. License fee income and income incidental to it, are accounted for on an accrual basis .

ii. Insurance claims and scrap sales are accounted for in the books on an accrual basis.

iii. Interest income is accounted on an accrual basis. j. Leave & License :

Leave & License payments are recognized as an expense in the statement of profit and loss.

Leave & License income is recognized based on the terms of the agreement.

Initial direct costs incurred specifically to earn revenue from Leave & License agreements are amortized over the lock in period of respective licensees.

b. Rights, Preferences and Restrictions attached to the shares

Equity Shares

i. The Company has only one class of equity share having a par value of ''10/-.

Each holder of equity shares is entitled to one vote per share. The Shareholders have the right to receive interim dividends declared by the Board of Directors and final dividends proposed by the Board of Directors and approved by the Shareholders.

The Shareholders have all other rights as available to equity Shareholders as per the provisions of the Companies Act, 2013, read together with the Memorandum of Association & Articles of Association of the Company, as applicable.

ii. During the financial year 2013-14, the Company had allotted 1,76,34,798 equity shares of ''10/- each @ premium of ''33.76 per share to Promoters and Others on a preferential basis in compliance with SEBI (ICDR) Regulations.

d. Share Issued to Nirlon Employees Stock Option Trust

In accordance with Nirlon ESOP 2012, during the financial year 2013-14 the Company had issued 7,17,656 shares of ''10/- each at a premium of ''31.30 per share to Nirlon Employees Stock Option Trust. As on March 31, 2017, 7,08,000 (previous year 6,80,000) options have been exercised equal to 7,08,000 number of shares. Nirlon ESOP Plan 2012

Pursuant to the Resolution passed by the Shareholders of the Company by way of postal ballot on May 23, 2012, the Company granted 7,15,000 stock options to its employees at an issue price of ''41.30 per share on May 30, 2012 in accordance with Nirlon ESOP 2012. Each option entitles the holder to purchase one Equity Share of the Company at the issue price.

The weighted average contractual life for the stock options was 5 years and they vested at the rate of 15%, 20%, 25%, 40% at the end of 15 months, 30 months, 42 months, 54 months respectively from the date of grant. During the year 2014-15, the Nomination and Remuneration committee has vide its Resolution dated February 9, 2015, accelerated the vesting period for all the unvested options to February 15, 2015 and accelerated the exercise period for all the options upto September 30, 2016. Accordingly all the options granted have been already vested. Further, the Board of Directors vide their circular Resolution dated October 8, 2016 extended the exercise period for all the options granted upto September 30, 2017.

Details regarding the number of stock options are as follows :

a. The Board of Directors, at their Meeting held on April 27, 2017 have proposed a dividend of 7.50 % i.e '' 0.75 per equity share on the face value of '' 10/- (previous year Rs, 0.75 per equity share of Rs, 10/- each). The proposal is subject to the approval of Shareholders at the ensuing Annual General Meeting. Dividend amounting to Rs, 675.88 lakh (previous year Rs, 675.88 lakh) and dividend distribution tax thereon amounting to Rs, 137.62 lakh (previous year Rs,137.62 lakh) is appropriated during the year.

The loan from HDFC Ltd is secured by a charge in the nature of an equitable mortgage by deposit of title deeds of land situated at Goregaon, Mumbai together with buildings and structures standing thereon, both present and future, and right, title and interest in the license fee receivables.

# The amount of each installment is subject to change based on changes in Interest rates & other factors.

* The terms of repayment for Loan 3 will be finalized once the same is securitized, as done for Loans 1 & 2.

In respect of Deferred tax assets on unabsorbed depreciation, the same has been recognized based on the current tax laws entailing the benefit over the lifetime of the Company, against any taxable source of income.

The Buyers Credit facility provided by HDFC Bank is repayable on demand. The amount is secured by way of earmarking, facilities to this extent, (vide a letter of undertaking from HDFC Ltd to HDFC Bank) out of the total facility granted by HDFC Ltd to the Company. Refer Note 2.3 for security provided to HDFC Ltd.

4. Buildings include building constructed on Leasehold Land at Worli, Mumbai having a written down value of '' 47.60 lakh (Previous year ''56.62 lakh), being the share of the Company in the property which is jointly owned with Nirlon Foundation Trust

5. Based on valuation reports submitted by I.H. Shah & Associates, Approved Valuers, the land at Goregaon had been revalued on April 1, 1984, June 30, 2006 and March 31, 2012 on the basis of assessment of their market value

6. Amount written up on revaluation of freehold land (including FSI purchased) as on March 31, 2017 ''1,17,537.12 lakh (previous year ''1,17,537.12 lakh)

a. Property tax write back is on account of the earlier years on account of assessment as per Capital Value system.

b. Mesne profit received from Pfizer Ltd. under the consent terms filed before the Small Causes Court Rs,163.70 lakh less expenses incurred thereon of Rs,30.20 lakh.

c. Excise duty of Rs,110.53 lakh and interest thereon of Rs,236.59 lakh based on the Supreme Court order received during the year 2015-16 in relation to manufacture of Nylon Tyrecord Yarn and Fabrics for the period April 1999 to June 2000.

d. Liquidated damages of Rs,13.45 lakh and interest thereon of Rs,5.35 lakh on delayed payment of Provident Fund dues for the period January 2000 to February 2007.

Mar 31, 2016

1.1 Basis for preparation of financial statements :

The financial statements are prepared in accordance with Generally Accepted Accounting Principles (âGAAP'') in India under the historical cost convention on accrual basis except if specifically stated otherwise. These financial statements have been prepared to comply in all material respects with the Accounting Standards specified under section 133 of the Companies Act, 2013 read with rules 7 of Companies (Accounts) Rules, 2014.

1.2 Accounting Policies :

a. Fixed Assets :

b. Depreciation and Amortization :

i) Depreciation on fixed assets has been provided on the written down value method based on the useful life specified in Schedule II of the Companies Act, 2013.

ii) Intangible Assets are amortized over the estimated useful life of the asset.

c. Borrowing Cost :

Borrowing costs include interest and other charges incurred in connection with the borrowing of funds and is recognized as an expense for the year in which it is incurred, except for borrowing costs attributable to the acquisition / construction of qualifying assets, and incurred till all the activities necessary to prepare the qualifying asset for its intended use are complete, which are capitalized as the cost of that asset.

d. Forward Contracts:

The Company uses foreign exchange forward contracts to hedge its exposure to movements in foreign exchange rates :

In relation to forward contracts entered into to hedge the underlying liability pertaining to capital projects till the time all the activities necessary to prepare the qualifying asset for its intended use, the premium or discount arising at the inception of such contracts are adjusted towards the cost of the project. For forward contracts taken thereafter, the premium or discount arising at the inception of such contracts is amortized as expense or income over the life of the contract.

e. Taxes on Income Current Tax

Provision for Income Tax is determined in accordance with the provisions of the Income Tax Act, 1961.

Deferred Tax

Deferred tax assets in a situation where unabsorbed depreciation and carry forward business loss exists, are recognized only if there is virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax asset can be realized. Deferred tax assets, other than in a situation of unabsorbed depreciation and carry forward business loss, are recognized only if there is reasonable certainty that they will be realized.

f. Employee Stock Compensation Cost :

g. Foreign Currency Transactions :

i) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction.

ii) Monetary items denominated in foreign currencies at the yearend are restated at year end rates.

iii) Non monetary foreign currency items are carried at cost.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognized in the statement of profit and loss.

h. Employee Benefits :

i) Defined Benefit Plan :

The Company provides for gratuity liability based on the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

ii) Defined Contribution Plans :

Company''s contribution paid / payable for Provident Fund, ESIC and Pension Fund for the year is recognized in the statement of Profit and Loss.

iii) Long Term Employee benefits :

Long term compensated absences are provided as per the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

iv) Short Term Employee benefits :

Short term benefits are recognized as an expense in the statement of profit and loss of the year in which the related services are rendered.

v) Actuarial gains / losses :

Actuarial gains / losses are immediately recognized in the statement of profit and loss and are not deferred.

i. Revenue Recognition:

i) License fee income and income incidental to it is accounted for on an accrual basis.

ii) Insurance claims and scrap sales are accounted for in the books on an accrual basis.

iii) Interest income is accounted on an accrual basis. j. Leave & License :

Leave & License payments are recognized as an expense in the statement of profit and loss.

Leave & License income is recognized based on the terms of the agreement.

Initial direct costs incurred specifically to earn revenue from Leave & License agreements are amortized over the lock in period of respective licensees.

b. Rights, Preferences and Restrictions attached to the shares Equity shares

i) The Company has only one class of equity shares having a par value of Rs, 10 / -.

Each holder of equity shares is entitled to one vote per share. The shareholders have the right to receive interim dividends declared by the Board of Directors and final dividend proposed by the Board of Directors and approved by the shareholders.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the Company after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held by the shareholders. The shareholders have all other rights as are available to equity shareholders as per the provisions of the Companies Act, 2013, read together with the Memorandum of Association & Articles of Association of the Company, as applicable.

d. Shares Issued to Nirlon Employees Stock Option Trust

In accordance with Nirlon ESOP 2012, during the financial year 2013-14 the Company had issued 7,17,656 shares of Rs, 10 each at a premium of Rs, 31.3 per share to the Nirlon Employees Stock Option Trust. The Company had provided a loan of Rs, 296.39 lakh to the Trust for subscribing such shares. As on 31st March, 2016, 6,80,000 (previous year 6,80,000) options have been exercised equal to 6,80,000 number of shares. In accordance with the provision of the Guidance Note on Accounting for Employee Share-based payments, the outstanding loan amount given to the Trust is disclosed as recoverable under the head âShare Capital & Securities Premium Reserves''.

Nirlon ESOP Plan 2012

Pursuant to the Resolution passed by the Shareholders of the Company by way of postal ballot on May 23, 2012, the Company granted 7,15,000 stock options to its employees at an issue price of Rs, 41.30 per share on May 30, 2012 in accordance with Nirlon ESOP 2012. Each option entitles the holder to purchase one Equity Share of the Company at the issue price.

(a) The Board of Directors, in their meeting held on 28th April 2016 has proposed a dividend of 7.50% i.e Rs, 0.75 per equity share on the face value of Rs, 10 / - (previous year Rs, 0.75 per equity share of Rs, 10 / - each) . The proposal is subject to the approval of shareholders at the ensuing Annual General Meeting. Dividend amounting to Rs, 675.88 lakh (previous year Rs, 675.88 lakh) and dividend distribution tax thereon amounting to Rs, 137.62 lakh (previous year Rs, 137.62 lakh) is appropriated during the year.

(b) At the AGM held on 23rd September, 2014, the shareholders approved the dividend for the year 2013-14 on a prorata basis on the equity shares issued during the year 2013-14. However, subsequently, the Bombay Stock Exchange informed the company that the dividend should not be on a prorata basis as equity shares issued during the year 2013-14 rank pari passu in all respects with the then existing equity shares of the company. Accordingly, the differential dividend of Rs, 115.33 lakh and tax thereon of Rs, 19.61 lakh aggregating to Rs, 134.94 lakh has also been appropriated during the year 2014-15 by debiting the same to surplus.

# The amount of e ach installment is subject to change based on changes in Interest rates & other factors.

* The terms of repayment for Loan 3 will be finalised once the same is securitised, as done for Loans 1 & 2.

In respect of deferred tax assets on unabsorbed depreciation, the same has been recognized based on the current tax laws entailing the benefit over the lifetime of the Company, against any taxable source of income.

The Buyers Credit facility provided by HDFC Bank is repayable on demand. The amount is secured by way of earmarking facilities to this extent, (vide a letter of undertaking from HDFC Ltd to HDFC Bank) out of the total facility granted by HDFC Ltd to the Company. Refer Note 2.3 for security provided to HDFC Ltd.

Mar 31, 2015

A) Fixed Assets :

Fixed Assets are stated at cost or revalued amount wherever applicable. Cost comprises of cost of acquistion, cost of improvements, borrowing costs and any other cost attributable in bringing assets to the condition for their intended use.

b) Depreciation and Amortization :

i) Depreciation on fixed assets has been provided on the written down value method based on the useful life specified in Schedule II of the Companies Act, 2013.

ii) Intangible Assets are amortised over the estimated useful life of the asset.

c) Borrowing Cost :

Borrowing costs includes interest and other charges incurred in connection with the borrowing of funds and is recognised as an expense for the year in which it is incurred, except for borrowing costs attributable to the acquisition/construction of qualifying assets and incurred till all the activities necessary to prepare the qualifying asset for its intended use, which are capitalised as the cost of that asset.

d) Forward Contracts:

The Company uses foreign exchange forward contracts to hedge its exposure to movements in foreign exchange rates.

In relation to forward contracts entered into to hedge the underlying liability pertaining to capital projects till the time all the activities necessary to prepare the qualifying asset for its intended use, the premium or discount arising at the inception of such contracts are adjusted towards the cost of the project. For forward contracts taken thereafter, the premium or discount arising at the inception of such contracts is amortised as expense or income over the life of the contract.

e) Taxes on Income:

Current Tax

Provision for Income Tax is determined in accordance with the provisions of Income Tax Act, 1961.

Minimum Alternate Tax (MAT) paid in a year is charged to the Statement of Profit and Loss as current tax. The Company recognizes MAT credit available as an asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the specified period, i.e. the period for which MAT credit is allowed to be carried forward. In the year in which the Company recognizes MAT credit as an asset in accordance with the Guidance Note on accounting for Credit Available in respect of MAT under the Income-tax Act, 1961, the said asset is created by way of credit to the Statement of Profit and Loss and shown as "MAT Credit Entitlement".

Deferred Tax

Deferred tax is recognised on timing differences between the accounting income and the taxable income for the year, and quantified using the tax rates and laws enacted or substantively enacted on the Balance Sheet date.

Deferred tax assets in a situation where unabsorbed depreciation and carry forward business loss exists, are recognized only if there is virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax asset can be realized. Deferred tax assets, other than in a situation of unabsorbed depreciation and carry forward business loss, are recognized only if there is reasonable certainty that they will be realized.

f) Employee Stock Compensation Cost :

The Company measures the compensation cost relating to employee stock options in accordance with the SEBI (Employees Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and the Guidance Note on Accounting for Employee Share Based Payment. The cost of equity settled transactions is measured using the intrinsic value method. The compensation cost, if any is amortised over the vesting period.

g) Foreign Currency Transactions :

i) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction.

ii) Monetary items denominated in foreign currencies at the year end are restated at year end rates.

iii) Non monetary foreign currency items are carried at cost.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the statement of profit and loss.

h) Employee Benefits :

i) Defined Benefit Plan :

The Company provides' for gratuity liability based on the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

ii) Defined Contribution Plans :

The Company's contribution paid/payable for Provident Fund, ESIC and Pension Fund for the year is recognised in the Statement of Profit and Loss.

iii) Long Term Employee Benefits :

Long term compensated absences are provided as per the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

iv) Short Term Employee Benefits :

Short term benefits are recognised as an expense in the Statement of Profit and Loss of the year in which the related services are rendered.

v) Actuarial gains/losses :

Actuarial gains/losses are immediately recognised in the Statement of Profit and Loss and are not deferred.

i) Revenue Recognition:

i) License fee income and income incidental to it, are accounted for on an accrual basis.

ii) Insurance claims and scrap sales are accounted for in the books on an accrual basis.

iii) Interest income is accounted on an accrual basis.

j) Leave & License :

Leave & License payments are recognised as an expense in the Statement of Profit and Loss.

Leave & License income is recognised based on the terms of the agreement.

Initial direct costs incurred specifically to earn revenue from Leave & Licenses are amortised over the lock in period of the respective licensees.

Mar 31, 2014

1.1 Basis for Preparation of the Financial Statements :

The Financial Statements are prepared in accordance with Generally Accepted Accounting Principles (''GAAP'') in India under the historical cost convention on accrual basis.These Financial Statements have been prepared to comply in all material respects with the Accounting Standards notified under the Companies, (Accounting Standards), Rules, 2006, (as amended) and other relevant provisions of the Companies Act, 1956.

1.2 Accounting Policies :

a. Fixed Assets :

Fixed Assets are stated at cost or revalued amount wherever applicable. Cost comprises of cost of acquistion, cost of improvements, borrowing costs and any other cost attributable in bringing assets to the condition for their intended use.

b. Depreciation and Amortization :

i) Depreciation on Fixed Assets has been provided on written down value method at the rates specified in Schedule XIV of the Companies Act, 1956.

ii) Intangible Assets are amortised over the estimated useful life of the asset.

iii) Depreciation and amortization on the revalued portion of Fixed Assets is adjusted against the Revaluation Reserve.

c. Borrowing Cost :

Borrowing cost includes interest and other charges incurred in connection with the borrowing of funds and is recognised as an expense for the year in which it is incurred, except for borrowing costs attributable to the acquisition/construction of qualifying assets, and incurred for all the activities necessary to prepare the qualifying asset for its intended use, which are capitalised as the cost of that asset.

d. Forward Contracts :

The Company uses foreign exchange forward contracts to hedge its exposure to movements in foreign exchange rates.

In relation to forward contracts entered into to hedge the underlying liability pertaining to capital projects for the time all the activities necessary to prepare the qualifying asset for its intended use, the premium or discount arising at the inception of such contracts are adjusted towards the cost of the project. For forward contracts taken thereafter, the premium or discount arising at the inception of such contracts is amortised as expense or income over the life of the contract.

e. Taxes on Income :

Current Tax

Provision for Income Tax is determined in accordance with the provisions of the Income Tax Act, 1961.

Minimum Alternate Tax (MAT) paid in a year is charged to the Statement of Profit and Loss as current tax. The Company recognizes MAT credit available as an asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the specified period, i.e. the period for which MAT credit is allowed to be carried forward. In the year in which the Company recognizes MAT credit as an asset in accordance with the Guidance Note on accounting for Credit Available in respect of MAT under the Income-tax Act, 1961, the said asset is created by way of credit to the Statement of Profit and Loss and shown as "mAt Credit Entitlement".

Deferred Tax

Deferred tax is recognised on timing differences between the accounting income and the taxable income for the year, and quantified using the tax rates and laws enacted or substantively enacted on the Balance Sheet date.

Deferred tax assets in a situation where unabsorbed depreciation and carry forward business losses exist, are recognized only if there is virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax asset can be realized. Deferred tax assets, other than in situations of unabsorbed depreciation and carried forward business losses, are recognized only if there is reasonable certainty that they will be realized.

f. Employee Stock Compensation Cost:

The Company measures the compensation cost relating to employee stock options in accordance with the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and the Guidance Note on Accounting for Employee Share Based Payment. The cost of equity settled transactions is measured using the intrinsic value method. The compensation cost, if any is amortised over the vesting period.

g. Foreign Currency Transactions :

i) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction.

ii) Monetary items denominated in foreign currencies at the year end are restated at year end rates.

iii) Non monetary foreign currency items are carried at cost.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Statement of Profit and Loss.

h. Employee Benefits :

i) Defined Benefit Plan

The Company provides for gratuity liability based on the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

ii) Defined Contribution Plans

The Company''s contribution paid/payable for Provident Fund, ESIC and Pension Fund for the year is recognised in the Statement of Profit and Loss.

iii) Long Term Employee Benefits

Long term compensated absences are provided as per the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

iv) Short Term Employee Benefits

Short term benefits are recognised as an expense in the Statement of Profit and Loss for the year in which the related services are rendered.

v) Actuarial Gains/Losses

Actuarial Gains/Losses are immediately recognised in the Statement of Profit and Loss and are not deferred.

i. Revenue Recognition :

i) License fee income and income incidental to it, are accounted for on an accrual basis .

ii) Insurance claims and scrap sales are accounted for in the books on an accrual basis.

iii) Interest income is accounted on an accrual basis.

j. Leave & License :

Leave & License payments are recognised as an expense in the Statement of Profit and Loss.

Leave & License income is recognised based on the terms of the agreement.

Initial direct costs incurred specifically to earn revenue from licensing are amortised over the lock in period of respective licensees.

Mar 31, 2013

1.1 Basis for preparation of the Financial Statements :

The Financial Statements are prepared in accordance with Generally Accepted Accounting Principles (''GAAP'') in India under the historical cost convention on an accrual basis.

1.2 Accounting Policies :

a. Fixed Assets :

Fixed Assets are stated at cost or revalued amount wherever applicable. Cost comprises of cost of acquistion, cost of improvements, borrowing costs and any other cost attributable in bringing assets to the condition for their intended use.

b. Depreciation and Amortization :

i) Depreciation on Fixed Assets has been provided on the written down value method at the rates specified in Schedule XIV of the Companies Act, 1956.

ii) Intangible Assets are amortised over the estimated useful life of the asset.

iii) Depreciation and amortization on the revalued portion of Fixed Assets are adjusted against the Revaluation Reserve.

c. Borrowing Cost :

Borrowing costs includes interest and other charges incurred in connection with the borrowing of funds and is recognised as an expense for the year in which it is incurred, except for borrowing costs attributable to the acquistion/construction of qualifying assets and incurred till the commencement of the commercial use of the assets, which are capitalised as the cost of that asset.

d. Foreign Currency Transactions :

i) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction.

ii) Monetary items denominated in foreign currencies at the year end are restated at year end rates.

iii) Non monetary foreign currency items are carried at cost.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Statement of Profit and Loss.

v) Premiums or Discounts arising at the inception of forward contracts entered into to hedge the underlying liability in relation to Capital Projects are adjusted towards the cost of the Project.

e. Taxes on Income:

Current Tax

Provision for Income Tax is determined in accordance with the provisions of Income Tax Act, 1961.

Deferred Tax

Deferred tax is recognised on timing differences, being the difference between the taxable income and accounting income that originates in one period and is capable of reversal in one or more subsequent periods.

f. Employee Benefits :

i) Defined Benefit Plan

The Company provides for gratuity liability based on the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

ii) Defined Contribution Plans

The Company''s contribution paid /payable for Provident Fund, ESIC and Pension Fund for the year is recognised in the Statement of Profit and Loss.

iii) Long Term Employee Benefits

Long term compensated absences are provided as per the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

iv) Short Term Employee Benefits

Short term benefits are recognised as an expense in the Statement of Profit and Loss of the year in which the related service is rendered.

v) Actuarial Gains/Losses

Actuarial gains/losses are immediately recognised in the Statement of Profit and Loss and are not deferred.

g. Revenue Recognition:

i) License fee income and income incidental to it, are accounted for on an accrual basis.

ii) Insurance claims and scrap sales are accounted for in the books on an accrual basis.

iii) Interest income is accounted on an accrual basis.

h. Leave & License :

Leave & License payments are recognised as an expense in the Statement of Profit and Loss.

Leave & License income is recognised based on the terms of the agreement.

Initial direct costs incurred specifically to earn revenue from Leave & Licenses are amortised over the lock in period of the respective licensees.

Mar 31, 2012

1.1 Basis for preparation of Financial Statements :

The Financial Statements are prepared in accoardance with Generally Accepted Accounting Principles ('GAAP') in India under the historical cost convention on accrual basis.

1.2 Accounting Policies :

a. Fixed Assets :

Fixed Assets are stated at cost or revalued amount wherever applicable. Cost comprises of cost of acquistion, cost of improvements, borrowing costs and any other cost attributable in bringing assets to the condition for its intended use.

b. Depreciation and Amortization :

i) Depreciation on fixed assets has been provided on written down value method at the rates specified in Schedule XIV of the Companies Act, 1956.

ii) Depreciation and amortization on the revalued portion of Fixed Assets is adjusted against the Revaluation Reserve.

c. Borrowing Cost :

Borrowing costs includes interest and other charges incurred in connection with the borrowing of funds and is recognised as an expense for the year in which it is incurred, except for borrowing costs attributable to the acquistion/construction of qualifying assets and incurred till the commencement of the commercial use of the assets, which are capitalised as the cost of that asset.

d. Investments :

Long term investments are stated at Cost less permanent diminution in value, if any. Current investments are stated at the lower of cost or fair value.

e. Foreign Currency Transactions :

i) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction.

ii) Monetary items denominated in foreign currencies at the year end are restated at year end rates.

iii) Non monetary foreign currency items are carried at cost.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Statement of Profit and Loss.

f. Inventory Valuation :

Stores and spares, are valued at cost on a weighted average basis.

g. Taxes on Income: Current Tax

Provision for Income Tax is determined in accordance with the provisions of Income Tax Act, 1961.

Deferred Tax

Deferred tax is recognised on timing differences, being the difference between the taxable income and accounting income that originates in one period and is capable of reversal in one or more subsequent periods.

h. Employee Benefits :

i) Defined Benefit Plan

The Company provides for gratuity liability based on the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

ii) Defined Contribution Plans

The Company's contribution paid/payable for Provident Fund, ESIC and Pension Fund for the year is recognised in the Statement of Profit and Loss.

iii) Long Term Employee benefits

Long term compensated absences are provided as per the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

iv) Short Term Employee benefits

Short term benefits are recognised as an expense in the Statement of Profit and Loss of the year in which the related services are rendered.

v) Actuarial gains/losses

Actuarial gains/losses are immediately recognised in the Statement of Profit and Loss and are not deferred.

i. Revenue Recognition:

i) License fee income and income incidental to it, are accounted for on an accrual basis.

ii) Insurance claims and scrap sales are accounted for in the books on an accrual basis.

iii) Interest income is accounted on an accrual basis.

iv) Processing charges received include excise duty recovered.

j. Leave & License :

Leave & License payments are recognised as an expense in the Statement of Profit and Loss.

Leave & License income is recognised based on the terms of the agreement.

Initial direct costs incurred specifically to earn revenue from Leave & License agreements are amortised over the lock in period of the respective license agreements.

Mar 31, 2011

1. Basis for preparation of financial statements :

The financial statements are prepared in accoardance with Generally Accepted Accounting Principles ('GAAP') in India under the historical cost convention on accrual basis.

2. Accounting Policies :

a. Fixed Assets :

Fixed Assets are stated at cost or revalued amount wherever applicable. Cost comprises of cost of acquistion, cost of improvements, borrowing costs and any other cost attributable in bringing assets to the condition for their intended use.

b. Depreciation :

i) Depreciation on fixed assets has been provided on the written down value method at the rates specified in Schedule XIV of the Companies Act, 1956.

ii) Depreciation on the revalued portion of Fixed Assets is adjusted against the Revaluation Reserve.

c. Borrowing Cost :

Borrowing costs includes interest and other charges incurred in the connection with the borrowing of the funds, and is recognised as an expense for the year in which it is incurred, except for borrowing costs attributable to the acquistion / contruction of qualifying assets and incurred till the commencement of the commerical use of the asset which are capitalised as cost of that asset.

d. Investments :

Long term investments are stated at cost less permanent diminution in value, if any. Current investments are stated at lower of cost or fair value.

e. Foreign Currency Transactions :

i) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction.

ii) Monetary items denominated in foreign currencies at the year end are restated at year end rates.

iii) Non monetary foreign currency items are carried at cost.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the profit and loss account except in cases where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of Fixed Assets.

f. Inventory Valuation :

Raw materials, Packing materials and Stores and Spares, are valued at cost on a weighted average basis. Materials in transit and semi finished goods are valued at cost.

Finished goods are valued at cost including excise duty or net realisable value, whichever is lower.

g. Taxes on Income:

Current Tax :

Provision for Income Tax is determined in accordance with the provisions of Income Tax Act, 1961.

Deferred Tax:

Deferred tax is recognised on timing differences, being the difference between the taxable income and accounting income that originates in one period and is capable of reversal in one or more subsequent periods.

h. Employee Benefits :

i) Defined Benefit Plan :

The Company provides for gratuity liability based on the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

ii) Defined Contribution Plans :

Company's contribution paid/payable for Provident Fund, ESIC and Pension Fund for the year is recognised in the Profit and Loss Account.

iii) Long Term Employee benefits :

Long term compensated absences are provided as per the actuarial valuation by an independent actuary which is determined using the projected unit credit method.

iv) Short Term Employee benefits :

Short term benefits are recognised as an expense in the profit and loss account of the year in which the related services is rendered.

v) Actuarial gains/losses :

Actuarial gains/losses are immediately recognised in the profit and loss account and are not deferred.

i. Revenue Recognition:

i) Sales and processing charges received include excise duty recovered and excludes sales tax.

ii) Insurance claims, sale of production waste/scrap are accounted for in the books on an accrual basis.

iii) Interest income is accounted on an accrual basis.

iv) License fee income and income incidental to it, are accounted for on an accrual basis .

j. Leave & License :

Leave & License payments are recognised as an expense in the profit and loss account.

Leave & License income is recognised based on the terms of the agreement.

Initial direct costs incurred specifically to earn revenue from Leave & Licenses are amortised over the lock in period of respective licensees.

Mar 31, 2010

A. Fixed Assets :

Fixed Assets are stated at cost /revalued amount whereever applicable. Cost comprises of cost of acquistion, cost of improvements, borrowing costs and any attributable cost of bringing assets to the condition for its intended use. Cost also includes direct expenses incurred upto the date of capitalistion / comission. The cost of Fixed Assets includes additions on account of revaluation of land and buildings done as on 30th June, 2006.

b. Borrowing Cost :

Borrowing costs include interest,fees and other charges incurred in the connection with the borrowing of the funds and is considered as a revenue expenditure for the year in which it is incurred except for borrowing cost attributable to the acquistion / improvement of qualifying capital assets and incurred till the commencement of the commercial use of the asset and which is capitalised as cost of that asset.

All the revenue expenses related to the construction/ development of Nirlon Knowledge Park have been capitalised.

c. Investments :

Investments, being long term, are stated at Cost less permanent diminution in value, if any. Current investment is stated at lower of cost or fair value.

d. Foreign Currency Transactions :

i) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction.

ii) Monetary items denominated in foreign currencies at the year end are restated at year end rates.

iii) Non monetary foreign currency items are carried at cost.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the profit and loss account except in cases where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets.

e. Inventory Valuation :

Raw materials, packing materials and stores and spares, are valued on a weighted average basis. Materials in transit and semi finished goods are valued at cost.

Finished goods are valued at cost including excise duty or net realisable value, whichever is lower.

f. Depreciation :

i) Depreciation on fixed assets has been provided at the rates specified in Schedule XIV of the Companies Act, 1956.

Method of providing Depreciation

a) Continuous Process Plants SLM

b) Other Assets WDV

c) The cost of leasehold land is amortised over the period of the lease.

ii) Depreciation on a revalued portion of Fixed Assets is provided on a basis consistent with the policy for book depreciation and the same is directly adjusted against the Revaluation Reserve.

g. Taxes on Income:

Current Tax:

Provision for Income Tax is determined in accordance with the provisions of Income Tax Act, 1961.

Deferred Tax Provision:

Deferred tax is recognised on timing differences, being the difference between the taxable income and accounting income that originates in one period and is capable of reversal in one or more subsequent periods.

h. Employee Benefits :

1) Defined Benefit plan

The Company provides for retirement/post retirements benefits in the form of gratuity. The CompanyÃs liablity towards these benefits is determined using the projected cost method.These benefits are provided based on the acturial valuation on the balance sheet date by an independent actuary.

2) i) Retirement Benefit in the form of Provident

Fund (Defined Contribution Plan) is accounted on an accrual basis and is charged to the Profit and Loss Account for the year.

ii) Retirement benefit in the form of Pension is charged to Profit and Loss Account for the year.

iii) Long term Leave Benefits are provided as per the acturial valuation as on the balance sheet date by an independent actuary using the project unit credit method.

iv) Short term benefits are recognised as an expense in the Profit and Loss Account of the year in which the related services is rendered.

3) Termination benefits

Compensation paid under Voluntary Retirement Scheme is amortised over three years.

i. Revenue Recognition:

i) Sales and processing charges received include excise duty recovered from customers and excludes sales tax.

ii) Insurance claims, sale of production waste/scrap are accounted for in the books on an accrual basis.

iii) Rent/license fee income (excluding Service Tax) and expenses and income incidental to it, are accounted for on an accrual basis.

iv) Overdue Interest receivable from customers is accounted as and when realised.

j. Marketing fees:

Marketing fees are amortised over the lock-in-period of each Licensee.

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Accounting Policies of Nirlon Ltd. Company

Note 1: Material Accounting Policies

Depreciation methods, estimated useful lives andresidual value

(c) Investment properties

Depreciation methods, estimated useful lives andresidual value

Debt instruments at amortised cost

(IV) Offsetting of financial instruments

(k) Borrowing Cost

Transactions and balances

Note 1: Material Accounting Policies followed by the Company

(a) Basis of preparation

(i) Compliance with Ind AS

(ii) Current versus Non-current classification

Depreciation methods, estimated useful lives and residual value

Depreciation methods, estimated useful lives and residual value

(d) Intangible Assets

Amortisation

(e) Impairment of Non-financial assets

(f) Financial Instruments

(I) Financial Assets

Initial Recognition & Measurement

Subsequent Measurement

Debt instruments at amortised cost

Debt instruments at fair value through OCI

Debt instruments at FVTPL

Equity Instruments

Derecognition

Impairment of financial assets

(II) Financial Liabilities

Trade and other payables

Borrowings

Lease Deposits

Derecognition

(III) Derivative financial instruments

(IV) Offsetting of financial instruments

(a) Fair Value Measurement

(c) Employee Benefits

(i) Short-term obligations

(ii) Other long-term employee benefit obligations

(iii) Post-employment obligations

(iv) Termination Benefits

Gratuity Obligations

Defined Contribution plans

(i) Cash and cash equivalents

(k) Borrowing Cost

(l) Foreign currency translation

Functional and presentation currency

Transactions and balances

Background of the Company

Depreciation methods, estimated useful lives and residual value

Depreciation methods, estimated useful lives and residual value

Amortisation

(f) Financial Instruments

Debt instruments at amortised cost

Debt instruments at FVTPL

(ii) Other long-term employee benefit obligations

Transactions and balances

(m) Provisions & contingent liabilities Provisions

Revenue from contract with customers

Ind AS 12 - Income Taxes

Ind AS 103 - Common control Business Combination

Depreciation methods, estimated useful lives and
residual value

Depreciation methods, estimated useful lives and
residual value