Mar 31, 2019
NOTES ON FINANCIAL STATEMENT FOR THE YEAR ENDED ON 31ST MARCH, 2019 Note No. 1
CORPORATE INFORMATION
Norben Tea & Exports Limited is a company limited by shares, incorporated and domiciled in India. The Company is engaged in the business of growing and manufacturing of Tea and providing Commission.
Note No. 2
BASIS OF ACCOUNTING
The financial statements of the company have been prepared in accordance with the Indian Accounting Standards (Ind As) as per the Companies (Indian Accounting Standards) Rules, 2015 notified under Section 133 of the Companies Act, 2013 ("the Actâ) and other relevant provisions of the Act.
Company''s financial statements are presented in Indian Rupees, which is also its functional currency.
The standalone Ind AS financial statements have been prepared on historical cost basis except the following items:
a) Financial Assets - Current Investments in Shares - Valued at book value instead of market.
b) Deferred Tax Assets/Liabilities - Valued at fair value on Balance Sheet approach.
c) Unrealized Gain/Loss on Current Investments - The management is of the opinion that the investment is long term and strategic in nature. The management does not foresee any diminution in value of these investments; hence no provision is required to be made.
Note No. 3
Significant Accounting Policies
This note provides a list of the significant accounting policies adopted in the preparation of these financial statements. These policies have been consistently applied to all the years presented, unless otherwi se stated. The financial statements are for M/s Norben Tea & Exports Limited (the ''Company'').
3.1 Fair valuation of Investments
Under the previous GAAP, investments in equity instruments and mutual funds were classified as long-term investments or current investments based on the intended holding period and reliability. Long-term investments were carried at cost less provision for other than temporary decline in the value of such investments. Current investments were carried at lower of cost and fair value. Under I nd AS, these investments are required to be measured at fair value. The resulting fair value changes of these investments (other than equity instruments designated as at FVOCI) have been recognized in retained earnings as at the date of transition and subsequently in the profit or loss for the year ended 31 March 2019.
Fair value changes with respect to investments in equity instruments designated as at FVOCI have been recognized in FVOCI - Equity investments reserve as at the date of transition and subsequently in the other comprehensive income for the year ended 31 March 2019.
3.2 Borrowings
Ind AS 109 requires transaction costs incurred towards origination of borrowings to be deducted from the carrying amount of borrowings on initial recognition. These costs are recognized in the profit or loss over the tenure of the borrowing as part of the interest expense by applying the effective interest rate method.
Under previous GAAP, these transaction costs were charged off to Statement of Profit & Loss or capitalized with the qualifying asset as per the application of the corresponding Borrowings.
3.3 Remeasurements of post-employment benefit obligations
Under Ind AS, remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognized in other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurements
were forming part of the profit or loss for the year.
3.4 Retained Earnings
Retained earnings as at April 1, 2016 has been adjusted consequent to the above Ind AS transition adjustments.
3.5 Other Comprehensive Income
Under Ind AS, all items of income and expense recognized in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognized in profit or loss but are shown in the statement of profit and loss as ''other comprehensive income'' includes remeasurements of defined benefit plans and fair value gains or (losses) on FVOCI equity instruments and debt instruments. The concept of other comprehensive income did not exist under previous GAAP
3.6 Deferred Tax
Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required under Indian GAAP
In addition, the various transitional adjustments lead to different temporary differences. According to the accounting policies, the company has to account for such differences. Deferred tax adjustments are recognized in correlation to the underlying transaction either in retained earnings or a separate component of equity.
3.7 Re-classifications
The Company has done the following reclassifications as per the requirements of Ind-AS :
Assets / liabilities which do not meet the definition of financial asset / financial liability have been reclassified to other asset / liability.
Remeasurement gain/loss on long term employee defined benefit plans are re-classified from statement of profit and loss to OCI.
The Company has re-classified unpaid dividend balance form cash and cash equivalents to other bank balances.
Excise duty on sales was earlier netted off with Sales, has now been presented separately.
3.8 Property Plant and Equipment, Intangible Assets and Investment Properties
As permitted by para D5-D8B of Ind AS 101, the Company has elected to continue with the carrying values under previous GAAP for all the items of property, plant and equipment. The same election has been made in respect of intangible assets also.
Fixed Assets
i) Tangible Fixed Assets are stated at their original cost less depreciation. Cost includes incidental expenses. Profits or losses on sale of tangible fixed assets are included in the statement of profit and loss and calculated as difference between the value realized and book value. Capital work-in-progress is stated at cost. Subsidies received in respect of tangible fixed assets are deducted from the cost of respective assets.
ii) Cost of Plantations being Bearer Plants are valued on historical cost basis based on the cost incurred for new extension beginning from uprooting, planting, rejuvenation and maintenance etc. till the time it started bearing fruits/Green Tea leaves.
iii) Capital work-in-progress is stated at the amount expended up to the stage of completion of the project.
Depreciation
Depreciation on tangible assets is provided on Straight Line Method on all assets except land.
Depreciation on tangible assets is provided over the useful lives of assets estimated by the management. Depreciation for assets purchased / sold during the period is proportionately charged. Intangible assets are amortized over their respective individual estimated useful lives on a Straight Line basis commencing from the date assets are available to the Company for use. The management estimates the useful lives for the fixed assets are as follows :
* For these class of assets, based on internal assessment and independent technical evaluation carri ed out by external values the management believes that the useful lives as given above best represent the period over which management expects to use these assets.
Hence the useful lives for the assets is different from the useful lives as prescribed under Part C of Schedule 11 of the Companies Act, 2013. Freehold and Leasehold land are not depreciated.
3.9 Cash and cash equivalents
Cash and cash equivalents includes Cash on Hand, Cash at Bank, Cheque in Hand and other short-term highly liquid investments with an original maturity of three months or less.
3.10 Provisions
A provision is recognized when the company has a present obligation 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 a reliable estimate can be made of the amount of the obligation. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.
Where the company expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is recognized as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in the statement of profit and loss net of any reimbursement.
3.11 Earnings Per Share
Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders (after deducting preference dividends and attributable taxes) by the weighted average number of equity shares outstanding during the period. Partly paid equity shares are treated as a fraction of an equity share to the extent that they are entitled to participate in dividends re lative to a fully paid equity share during the reporting period. The weighted average number of equity shares outstanding during the period is adjusted for events such as bonus issue, bonus element in a rights issue, share split, and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without a corresponding change in resources.
For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.
3.12 Contingent liabilities
Provision of contingent liabilities are not made, unless & until the demand raised by statutory authorities, against which the company has preferred an appeal which is pending with the different forum of the said authorities are ascertained.
3.13 Recognition of Revenue
Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are inclusive of excise duty and net of returns, trade allowances, rebates, value added taxes, goods and service tax (GST) and amounts collected on behalf of third parties.
The Company recognizes revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the Company''s activities as described below. The Company bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.
Sale of goods
Sales represents invoiced value of goods sold excluding Goods and Service tax.
Income from Investment
Income from Investment other than investment in shares of companies is included, together with related tax deducted at source in the Statement of Profit & Loss on an accrual basis. Income from investment in shares of companies is recognized on actual realization.
Interest Income
Interest income is recognized on accrual basis.
Dividends
Dividend income is recognized when the company''s right to receive dividend is established by the reporting date.
3.14 Inventories
Inventories are valued as under :
Raw materials - At weighted average cost.
Stock of Tea - at cost or net realizable value whichever is lower.
Stock of stores & spare parts - At cost (net of modvat credit) or net realizable value whichever is lower.
Other Stocks - At cost or net realizable value whichever is lower.
Obsolete, slow-moving and defective stocks are identified at the time of physical verification of stocks and where necessary provision is made for such stocks.
Mar 31, 2015
1.1 Basis of Presentation
The accounts have been prepared using historical cost convention and on
the basis of going concern concept. Accounting policies not referred to
otherwise are consistent with generally accepted accounting policies.
1.2 Fixed Assets
Tangible Fixed Assets are stated at cost less accumulated depreciation.
Cost includes cost of acquisition and all direct expenses relating
thereto.
1.3 Depreciation
Depreciation on Fixed Assets are provided on Straight Line Method, on
pro-rata basis and estimating the useful life of the assets keeping in
force with the Schedule II to the Companies Act, 2013.
Depreciable amount of an asset is the cost of an asset as reduced by
its residual value of five percent of such asset.
1.4 Investments
Current investments are carried at lower of cost and fair value. Long
Term Investments are stated at cost. Provision for diminution in the
value of investments is made only if such a decline is other than
temporary.
1.5 Inventories
Inventories are valued at lower of cost or net value since
realized/estimated net realizable value.
1.6 Recognition of Revenue
i) Sales represent invoice value of goods sold and are exclusive of
Sales Tax but inclusive of discount, rebate and all incidental expenses
relating thereto.
ii) Income & Expenditure are recognized on accrual basis, except rates
and taxes and certain petty items which can not be estimated with
reasonable certainty.
1.7 Borrowing Cost
Interest and other costs on borrowed funds used to finance the
acquisition of fixed assets, upto the date the assets are ready for use
are capitalised under respective fixed assets on a rational basis.
Other interest and costs incurred on borrowed funds are recognized as
expenses in the year in which they are incurred.
1.8 Excise Duty and Cess
Excise Duty payable on Black Tea has been accounted for on the basis of
both, payments made in respect of tea cleared from factory and also
provision made for tea made lying at factory.
1.9 Accounting for Taxes on Income
Current tax is recognized as per Income Tax Act, 1961 based on
applicable tax rates & laws. Deferred Tax is recognized subject to
consideration of prudence on timing differences being differences
between taxable and accounting income/expenditure that originate in one
period and are capable of reversal in one or more subsequent period(s)
and is measured using tax rates and laws that have been enacted or
substantially enacted as at the balance sheet date. Deferred Tax assets
are recognized unless there is virtual certainty that sufficient future
taxable income will be available against which such Deferred Tax assets
will be realized.
1.10 Employee Benefits
i) Short-term Employee Benefits
The undiscounted amount of short-term employee benefits expected to be
paid in exchange for the services rendered by employees is recognized
during the period when the employee renders the service except leave
encashment.
Leave Encashment: Liability for leave is treated as short term
liability. For Internal control, leave as per management's policy is
not to be accumulated but availed of during the year. Accordingly the
employees have been advised to plan their leave in advance while in
service and immediately before superannuation. Leave not availed is not
encashable.
ii) Post employment benefits plans
a) Defined Contribution Plan
Contribution under defined contribution plans payable in keeping with
the related schemes are recognized as expenses for the year.
b) Defined Benefit Plan
Gratuity liability, being a defined benefit obligation, is provided for
on the basis of an actuarial valuation on projected unit credit method
made at the end of each financial year.
1.11 Government Grants
Remission of Sales Tax under State Incentive Scheme is being credited
to reserves.
Government grants related to revenue are recognized on a systematic
basis in the profit & loss account over the periods necessary to match
them with their related cost.
Government grant related to a specific asset is subtracted from the
gross value of the asset concerned and accordingly depreciation has
been calculated on the remaining value.
1.12 Impairments
An Asset is treated as impaired when the carrying cost of the asset
exceeds its recoverable value. An impairment loss is charged to the
Profit and Loss Account in the year in which an asset is identified as
impaired. The impairment loss recognized in prior accounting period is
reversed if there has been a change in the estimate of recoverable
amount.
1.13 Contingent liabilities
Provision of contingent liabilities are not made, unless & until the
demand raised by statutory authorities, against which the company has
preferred an appeal which is pending with the different forum of the
said authorities are ascertained.
2.3 The Company has only one class of equity share having a par value
of Rs.10 per share. Each holder of equity share will be entitled to one
vote per share. In the event of liquidation of the Company, the holder
of equity shares will be entitled to receive remaining assets of the
Company, after distribution of all preferential amount. The
distribution will be in proportion to the no. of equity shares held by
the shareholders.
Mar 31, 2013
1.1 Basis of Presentation
The accounts have been prepared using historical cost convention and on
the basis of going concern concept. Accounting policies not referred to
otherwise are consistent with generally accepted accounting policies.
1.2 Fixed Assets
Fixed Assets are stated at cost less accumulated depreciation. Cost
includes cost of acquisition and all direct expenses relating thereto.
1.3 Depreciation
Depreciation on Fixed Assets are provided on the basis of Straight Line
Method and at the rates specified in Schedule XIV to the Companies Act,
1956.
1.4 Investments
Current investments are carried at lower of cost and fair value. Long
Term Investments are stated at cost. Provision for diminution in the
value of investments is made only if such a decline is other than
temporary.
1.5 Inventories
Inventories are valued at lower of cost or net value since
realized/estimated net realizable value.
1.6 Recognition of Revenue
i) Sales represent invoice value of goods sold and are exclusive of
Sales Tax but inclusive of discount, rebate and all incidental expenses
relating thereto.
ii) Income & Expenditure are recognized on accrual basis, except rates
and taxes and certain petty items which can not be estimated with
reasonable certainty.
1.7 Borrowing Cost
Interest and other costs on borrowed funds used to finance the
acquisition of fixed assets, upto the date the assets are ready for use
are capitalised under respective fixed assets on a rational basis.
Other interest and costs incurred on borrowed funds are recognized as
expenses in the year in which they are incurred.
1.8 Excise Duty and Cess
Excise Duty payable on Black Tea has been accounted for on the basis of
both, payments made in respect of tea cleared from factory and also
provision made for tea made lying at factory.
1.9 Accounting for Taxes on Income
Current tax is recognized as per Income Tax Act, 1961 based on
applicable tax rates & laws. Deferred Tax is recognized subject to
consideration of prudence on timing differences being differences
between taxable and accounting income/expenditure that originate in one
period and are capable of reversal in one or more subsequent period(s)
and is measured using tax rates and laws that have been enacted or
substantially enacted as at the balance sheet date. Deferred Tax assets
are recognized unless there is virtual certainty that sufficient future
taxable income will be available against which such Deferred Tax assets
will be realized.
1.10 Employee Benefits
i) Short-term Employee Benefits
The undiscounted amount of short-term employee benefits expected to be
paid in exchange for the services rendered by employees is recognized
during the period when the employee renders the service except leave
encashment.
Leave Encashment: For Internal control, leave as per management''s
policy is notto be accumulated but availed of and the employees have
been advised to plan their leave in advance while in service and
immediately before superannuation. Leave not availed is not encashable.
ii) Post employment benefits plans
Contribution under defined contribution plans payable in keeping with
the related schemes are recognized as expenses for the year.
For defined benefit plans, the cost of providing benefit is recognized
as and when paid.
ii) Other long-term employment benefits (Unfunded)
The cost of providing long-term employee benefits is generally
recognized on cash basis.
1.11 Government Grants
Remission of Sales Tax Under State Incentive Scheme, had been credited
to reserves.
Government grants related to revenue are recognized on a systematic
basis in the profit & loss account
over the periods necessary to match them with their related cost.
The Department of Biotechnology, Government of West Bengal has
sanctioned Project for Biotechnological Studies in tea for
Demonstration of New Tea Plants Genotypes in our site at Jalpaiguri
District.
1.12 ImpairmentsAn Asset is treated as impaired when the carrying cost
of the asset exceeds its recoverable value. An impairment loss is
charged to the Profit and Loss Account in the year in which an asset is
identified as impaired. The impairment loss is recognized in prior
accounting period is reversed if there has been a change in the
estimate of recoverable amount.
1.13 Contingent liabilities
Provision of contingent liabilities are not made, unless & until the
demand raised by statutory authorities, against which the company has
preferred an appeal which is pending with the different forum of the
said authorities are ascertained.
Mar 31, 2012
1. Basis of Presentation
The accounts have been prepared using historical cost convention and on
the basis of going concern concept. Accounting policies not referred to
otherwise are consistent with generally accepted accounting policies.
2. Fixed Assets
Fixed Assets are stated at cost less accumulated depreciation. Cost
includes cost of acquisition and all direct expenses relating thereto.
3. Depreciation
Depreciation on Fixed Assets are provided on the basis of Straight Line
Method and at the rates specified in Schedule XIV to the Companies Act,
1956.
4. Investments
Current investments are carried at lower of cost and quoted value. Long
Term Investments are stated at cost.Provision for diminution in the
value of long term investments is made only if such a decline is other
than temporary.
5. Inventories
Inventories are valued at lower of cost or net value since
realized/estimated net realizable value.
6. Recognition of Revenue
i) Sales represent invoice value of goods sold and are exclusive of
Sales Tax but inclusive of discount, rebate and all incidental expenses
relating thereto.
ii) Income & Expenditure are recognized on accrual basis, except rates
and taxes and certain petty items which can not be estimated with
reasonable certainty.
7. Borrowing Cost
Interest and other costs on borrowed funds used to finance the
acquisition of fixed assets, upto the date the assets are ready for use
are capitalised under respective fixed assets on a rational basis.
Other interest and costs incurred on borrowed funds are recognized as
expenses in the year in which they are incurred.
8. Excise Duty and Cess
Excise Duty payable on Black Tea has been accounted for on the basis of
both, payments made in respect of tea cleared from factory and also
provision made for tea made lying at factory.
9. Accounting for Taxes on Income
Current tax is recognized as per Income Tax Act, 1961 based on
applicable tax rates & laws. Deferred Tax is recognized subject to
consideration of prudence on timing differences being differences
between taxable and accounting income/expenditure that originate in one
period and are capable of reversal in one or more subsequent period(s)
and is measured using tax rates and laws that have been - enacted or
substantially enacted as at the balance sheet date. Deferred Tax assets
are recognized unless there is virtual certainty that sufficient future
taxable income will be available against which such Deferred Tax assets
will be realized.
10. Employee Benefits
i) Short-term Employee Benefits
The undiscounted amount of short-term employee benefits expected to be
paid in exchange for the services rendered by employees is recognized
during the period when the employee renders the service except leave
encashment.
Leave Encashment: For Internal control, leave as per management's
policy is not to be accumulated but availed of and the employees have
been advised to plan their leave in advance while in service and
immediately before superannuation. Leave not availed is not encashable.
ii) Post employment benefits plans
Contribution under defined contribution plans payable in keeping with
the related schemes are recognized as expenses for the year. For
defined benefit plans, the cost of providing benefit is recognized as
and when paid.
iii) Other long-term employment benefits (Unfunded)
The cost of providing long-term employees benefits is generally
recognised on cash basis.
11. Government Grants
Remission of Sales Tax Under State Incentive Scheme, had been credited
to reserves.
Government grants related to revenue are recognized on a systematic
basis in the profit & loss account over the periods necessary to match
them with their related cost.
The Department of Biotechnology, Government of West Bengal has
sanctioned Project for Biotechnological Studies in tea for
Demonstration of New Tea Plants Genotypes in our site at Jalpaiguri
District.
12. Impairments
An Asset is treated as impaired when the carrying cost of the asset
exceeds its recoverable value. An impairment loss is charged to the
Profit and Loss Account in the year in which an asset is identified as
impaired .The impairment loss is recognised in prior accounting period
is reversed if there has been a change in the estimate of recoverable
amount.
13. Contingent liabilities
Provision of contingent liabilities are not made, unless & until the
demand raised by statutory authorities, against which the company has
preferred an appeal which is pending with the different forum of the
said authorities are ascertained.
Mar 31, 2010
1. Basis of Presantation
The accounts have been prepared using historical cost convention and on
the basis of going concern concept. Accounting policles not referred to
otherwise are consistant with generally accepted accounting policies.
2. Fixed Assets
Fixed Assests are stated at cost less accumulated depreslation. Cost
includes cost of acquisition and all direct expenses ralating thereto.
3. Deprecistion
Depreclation on Fixed Assts are provided on the basis of Stralght Line
Method and at she rates specilled in Schedule XIV to the Companues Act,
1956.
4. Investments
Long Term Invesments are stated at cost.
5. Inventorles
Inventorles are valued at lower of cost or net value since
realised/estimated net realisable value.
6. Recognision of Revenus.
i) Sales represent Invoice value of goods sold and are exclusive of
Sales Tax but taxes and certain petty them which can not be estimated
with reasonable certainty.
7. Borrowing Cost
Excise Duty payable on Black Tea has been accounted for on the basis of
both, payments made in respect of tea cleared from factoru and also
provision made for tea made fying at factory.
9. Accoounting for Taxes on Income
Current tax is recognized as per income Tax Act, 1961 based on
applicable tax rates & laws. Detterred Tax is recognized subject to
consideration of prudence on timing differences being differences
between taxable and accouting income/expenditure that originale in one
period and are capable of reversal in one or more subsequent period(s)
and is measured using tax rates and laws that have been enacted or
substantially enacted as at the balance sheet date. Defarrd Tax assets
are recognized uniess there is vilual certainly that sufficiant future
taxable income will be available against which such Deterred Tax assets
will be realized.
10. Employes Benefits
i) Shortterm Employee Benefits
The undiscounted amount of short-term employee benefits expected to be
paid in exchange for the services rendered by employees is recofnized
during the period when the employee renders the service except leave
encashment.
Leave Encashment : For Internal control, leave as per managements
policy is not to be accoumuisted but availed of and the employees have
been advised to plan their leave in advance white in service and
immedistely before suporannuation, Leave not availed is not encashable.
ii) Post emplyment benefits plans
Contribution under defined contribution plans payable in keeping with
the related schemes are recognized as expensea for the year.
iii) Other long-term employment benefits (Unfunded)
The cost of providing longterm employee benefits is generally
racognized on cash basis.
11. Government Granis
Remission of Sales Tax under State incertive Schams, had been credited
to resarves.
Governmen grants related to ravanue are recognized on a systematic
basis in the profit & loss account over the periods neceasary to match
them with their related cost.
The Department of Biotechnology, Government of West Bangal has
sanclioned Project for Blotechnological Studies in tea for
Demonetration of New Tea Plants Genotypes in our sits at Jaipaiguri
District.
12. Impalinents:
At each Balance Sheet date, the Company reviews the carrying amount of
its Fixed Assets to determine whether there is any indication that
those assets suffered any impalmentloss. It any such indication exists,
the recoverable amount of the asset is estimated in order to determine
the exlent of impalment loce. Recoverative amount is the higher of an
assets net selfing price and value in use. In assessing value in use,
the estimated future cash flows expected from the contineing use of the
assets and from its disposat are discounted to they present value using
a pre-determined rate that reflects the current market assessment of
time value of money and the risks specific to the asset. Reversal of
impaltment loss is recognized immediately as income in the Profit &
Loss Account.
13. Contingent liabilities
Provision of contingent liabilities are not made, unless & until the
demand raised by statutory authorities, against which the company has
preferred an appeal which is pending with the different forum of the
said authorities are ascertained.
Mar 31, 2009
1. Basis of Presentation
The accounts have been prepared using historical cost convention and on
the basis of going concern concept. Accounting policies not referred
to otherwise are consistent with generally accepted accounting
policies.
2. Fixed Assets
Fixed Assets are stated at cost less accumulated depreciation. Cost
includes cost of acquisition and all direct expenses relating thereto.
3. Depreciation
Depreciation on Fixed Assets are provided on the basis of Straight Line
Method and at the rates specified in Schedule XIV to the Companies Act,
1956.
4. Investments
Long Term Investments are stated at cost.
5. Inventories
Inventories are valued at lower of cost or net value since
realised/estimated net realisable value.
6. Recognition of Revenue
i) Sales represent invoice value of goods sold and are exclusive of
Sales Tax but inclusive of discount, rebate and all incidental expenses
relating thereto.
ii) Income & Expenditure are recognized on accrual basis, except rates
and taxes and certain petty items which can not be estimated with
reasonable certainty.
7. Borrowing Cost
Interest and other costs on borrowed funds used to finance the
acquisition of fixed assets, upto the date the assets are ready for use
are capitalised under respective fixed assets on a rational basis.
Other interest and costs incurred on borrowed funds are recognized as
expenses in the year in which they are incurred.
8. Excise Duty and Cess
Excise Duty payable on Black Tea has been accounted for on the basis of
both, payments made in respect of tea cleared from factory and also
provision made for tea made lying at factory.
9. Accounting for Taxes on Income
Current tax is recognized as per Income Tax Act, 1961 based on
applicable tax rates & laws. Defferred Tax is recognized subject to
consideration of prudence on timing differences being differences
between taxable and accounting income/expenditure that originate in one
period and are capable of reversal in one or more subsequent period(s)
and is measured using tax rates and laws that have been enacted or
substantially enacted as at the balance sheet date. Deferred Tax assets
are recognized unless there is virtual certainty that sufficient future
taxable income will be available against which such Deferred Tax assets
will be realized.
Fringe benefit tax is accounted for based on the estimated Fringe
benefit for the period as per the related provision of the Income Tax
Act, 1961.
10. Employee Benefits
i) Short-term Employee Benefits
The undiscounted amount of short-term employee benefits expected to be
paid in exchange for the services rendered by employees is recognized
during the period when the employee renders the service except leave
encashment.
Leave Encashment: For Internal control, leave as per managements
policy is not to be accoumulated but availed of and the employees have
been advised to plan their leave in advance while in service and
immediately before superannuation. Leave not availed is not encashable.
ii) Post employment benefits plans
Contribution under defined contribution plans payable in keeping with
the related schemes are recognized as expenses for the year. For
defined benefit plans, the cost of providing benefit is recognized as
and when paid.
iii) Other long-term employment benefits (Unfunded)
The cost of providing long-term employee benefits is generally
recognized on cash basis.
11. Government Grants
Remission of Sales Tax Under State Incentive Scheme, had been credited
to reserves. Government grants related to revenue are recognized on a
systematic basis in the profit & loss account over the periods
necessary to match them with their related cost.
The Department of Biotechnology, Government of West Bengal has
sanctioned Project for Biotechnological Studies in tea for
Demonstration of New Tea Plants Genotypes in our site at Jalpaiguri
District.
12. Impairments:
At each Balance Sheet date, the Company reviews the carrying amount of
its Fixed Assets to determine whether there is any indication that
those assets suffered any impairment loss. If any such indication
exists, the recoverable amount of the asset is estimated in order to
determine the extent of impairment loss. Recoverable amount is the
higher of an assets net selling price and value in use. In assessing
value in use, the estimated future cash flows expected from the
continuing use of the assets and from its disposal are discounted to
their present value using a pre-determined rate that reflects the
current market assessment of time value of money and the risks specific
to the asset. Reversal of impairment loss is recognized immediately as
income in the Profit & Loss Account.
13. Contingent liabilities
Provision of contingent liabilities are not made, unless & until the
demand raised by statutory authorities, against which the company has
preferred an appeal which is pending with the different forum of the
said authorities are ascertained.
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