Mar 31, 2018
1. Significant accounting policies:
i) Property, plant and equipment:
Property, plant and equipment are stated at original cost net of tax /duty credit availed, less accumulated depreciation and accumulated impairment Losses, if any, Cost includes all incidental expenses relating to acquisition and installation of Property, plant and equipment.
Depreciation on computers and related equipment is provided on the written down value method except on Lorry & Trucks on which depreciation is provided on straight line method over their useful lives and in the manner prescribed under Schedule II of the Companies Act, 2013.
An Item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset is recognized in profit or loss.
The assets residual values, useful lives and methods of depreciation are reviewed at each financial year end and adjusted prospectively, if appropriate.
ii) Cash and cash equivalents:
Cash and cash equivalents comprise cash on hand and demand deposits with banks which are short-term, highly liquid investments that are ready convertible into known amounts of cash and which are subject to insignificant risk of change in value.
iii) Employees Benefits:
a) Short term employee benefits
All employees'' benefits payable wholly within twelve months rendering services are classified as short term employee benefits. Benefits such as salaries, wages, short-term compensated absences, performance incentives etc., and the expected cost of bonus, ex-gratia are recognised during the period in which the employee renders related service.
b) Post-employment benefits
The Company makes specified monthly contribution towards employee provident fund to the Government. The minimum interest payable by the Government to the beneficiaries every year is notified by the government.
The Company''s gratuity scheme is a defined benefit plan. The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plans, is based on the market yields on Government securities as at the balance sheet date.
Termination benefits:
Termination benefits are recognised as an expense in the period in which they are incurred.
iv) Foreign currency transactions:
(a) Functional and presentation Currency
The Company''s financial statements are presented in INR, which is also the Company''s functional and presentation currency.
(b) Transaction and Balance
Exchange differences arising on foreign exchange transactions settled during the year are recognised in the Statement of profit and loss of the year.
Monetary assets and liabilities denominated in foreign currencies as at the balance sheet date are translated at the closing exchange rates on that date. The resultant exchange differences are recognised in the Statement of profit and loss.
Non-Monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transactions.
v) Revenue recognition:
Revenue is recognised to the extent that it is possible that the economic benefits will flow to the company and the revenue can be reliably measured.
vi) Provisions and contingencies
(a) Provisions
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the amount of the obligation. Provisions are reviewed at each reporting period and are adjusted to reflect the current best estimate.
(b) Contingencies
A disclosure for contingent liability is made when there is possible obligation arising from past event the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.
A disclosure for contingent assets is also made when there is possibility of an inflow of economic benefits to the entity which arise from unplanned or other unexpected events.
Contingent liabilities and contingent assets are reviewed at each balance sheet date.
vii) Earnings per share:
Basic earnings per share are computed using the net profit for the year attributable to the shareholders'' and weighted average number of shares outstanding during the year.
viii) Income Taxes:
Income tax comprises current tax (including MAT) and deferred tax. Income tax expenses is recognized in net profit in statement of Profit and loss extent to the extent that it relates to items recognised directly in other comprehensive income/equity, in which case it is recognized in other comprehensive income/equity.
Current Tax is the amount of tax payable on the estimated taxable income for the current year as per the provisions of Income Tax Act, 1961.Current tax asset and liabilities are offset when company has a legally enforceable right to set off the recognized amount and also intends to settle on net basis.
Deferred income tax assets and liabilities are recognised for deductible and taxable temporary difference arises between the tax basses of assets and liabilities and their carrying amount in the financial statement
Deferred tax assets are recognized for all deductible temporary differences to the extent that it is probable that sufficient taxable profit will be available against which those deductible temporary differences can be utilised. 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 utilized. Unrecognised deferred tax assets are reassessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.
Deferred tax is measured at the tax rates and tax law that that have been enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the year in which those temporary difference is expected to be recovered or settled.
ix) Financial instruments:
Initial measurement
Financial instrument is recognised as soon as the company become a party to the contractual provision of the instruments. All Financial assets and financial liabilities are measured at fair value on initial recognition, except for trade receivable which are initially measured at transaction price. Transaction cost that are directly attributable to the acquisition or issue of financial instrument (other than financial measured at fair value through profit or loss) are added or deducted from the value of the financial instrument, as appropriate, on initial recognition.
Financial Instrument stated as financial assets or financial liabilities are generally not offset, and they are only offset when a legal right to set off exist at that and settlement on a net basis is intended.
Subsequent measurement
Financial assets:
Subsequent measurement of financial assets depends on their classification as follows: -
(a) Financial asset carried at amortised cost
A financial asset is subsequently measured at amortised cost if it is held within business model whose objective is to hold the asset in order to collect contractual cash flow and the contractual term of the asset give rise on specified dates to cash flow that are solely payment of principal and interest on the principal amount outstanding.
(b) Financial asset carried at Fair Value through other comprehensive income
A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flow and selling financial asset the contractual term of the asset give rise on specified dates to cash flow that are solely payment of principal and interest on the principal amount outstanding.
For all other equity instrument, the company make irrevocable election to present in other comprehensive income subsequent change in fair value. The company makes such election on an instrument- to- instrument basis.
(c) Financial asset carried at Fair Value through Profit and loss
A financial asset which is not classified in any of the above category is subsequently measured at fair value through profit and loss.
Financial liabilities and equity instruments:
Debts and equity instrument issued by a company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangement and the definition of a financial liability and an equity instruments.
a) Equity Instruments
An equity instrument is any contract that an evidence and residual interest in the assets of the company after deducting all of its liabilities. Equity instruments issued by the company are recognized at the proceeds received, net of direct issue costs.
b) Financial Liabilities
All Financial liabilities are subsequently measured at amortised cost using the Effective interest method.
De-recognition of financial Instrument: -
A financial asset is primarily derecognized when the contractual right to the cash flow from the financial asset expires and it transfers the financial asset.
A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires.
(x) Impairment
A) Financial Asset
The Company measures the expected credit loss associated with its assets based on historical trend, industry practices and the business environment in which the entity operates or any other appropriate basis. The impairment methodology applied depends on whether there has been a significant increase in credit risk.
B) Non-Financial Asset
(a) Property, plant and equipment and Intangible asset
The carrying amounts of the Company''s assets are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the assets'' recoverable amount is estimated as higher of its net selling price and value in use. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Impairment losses are recognized in the statement of profit and loss.
An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset''s carrying amount does not exceed the carrying amount that would have been determined net of depreciation or amortization, had no impairment loss been recognized.
Post Impairment, depreciation/amortisation is provided on the revised carrying value of the impaired assets over its remaining useful life.
Critical accounting estimates, assumptions and judgments
In the process of applying the Company''s accounting policies, management has made the following estimates, assumptions and judgments, which have significant effect on the amounts recognised in the financial statement. Uncertainty about these assumptions and estimates could result in outcome that require a material adjustment to assets or liabilities affected in future periods.
i) Property, plant and equipment
Property, Plant and equipment represent at proportion of the asset base of the company. The useful lives and residual value of the company''s asset are determined by the management at the time the asset is acquired and reviewed at each reporting date.
ii) Income taxes
The Company''s tax jurisdiction is India. Significant judgements are involved in estimating budgeted profits for the purpose of paying advance tax, determining the provision for income taxes, including amount expected to be paid/ recovered for uncertain tax positions
iii) Contingencies
Management judgement is required for estimating the possible outflow of resources, if any, in respect of contingencies/ claim/litigations against the Company as it is not possible to predict the outcome of pending matters with accuracy.
iv) Allowance for uncollected accounts receivable and advances
Trade receivables do not carry any interest and are stated at their normal value as reduced by appropriate allowances for estimated irrecoverable amounts. Individual trade receivables and advances are written off when management deems them not to be collectible. Impairment is made on the expected credit losses, which are the present value of the cash shortfall over the expected life of the financial assets.
v) 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, or when annual impairment testing for an asset is required, the Company estimates the assets''s recoverable amount. An assets''s recoverable amount is the higher of an assets''s or CGU''s fair value less costs of disposal and its value in use. 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.
vi) Impairment of financial assets
The impairment provisions for financial assets are based on assumptions about risk of default and expected loss rates. The Company uses judgment in making these assumptions and selecting the inputs to the impairment calculation, based on Company''s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.
vii) Fair value measurement of financial instruments
When the fair values of financials assets and financial liabilities recorded in the Balance Sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques, including the discounted cash flow model, which involve various judgments and assumptions.
Mar 31, 2015
1. Corporate information
North Eastern Carrying Corporation Limited is a Limited Company
incorporated under the provisions of the Companies Act, 1956. The
company is engaged in the business of transportation.
2. Basis of preparation
* The financial statements of the company have been prepared in
accordance with generally accepted accounting principles in India
(Indian GAAP).
* The company has prepared these financial statements to comply in all
material respects with the accounting standards notified under the
Companies (Accounting Standards) Rules, 2006, (as amended) and the
relevant provisions of the Companies Act, 2013.
* The company follows the Mercantile System of Accounting recognizing
Income and Expenditure on accrual basis.
* The directors have certified that there are no outstanding expenses
not provided for and nor there are income which have fallen due but not
accounted for. The accounts are prepared on historical cost basis and
as a going concern.
* The accounting policies adopted in the preparation of financial
statements are consistent with those of previous year.
3. Summary of significant accounting policies
From the year ended 31 March 2015, the Schedule III notified under the
Companies Act 2013, has become applicable to the company, for
preparation and presentation of its financial statements. The adoption
of Schedule III does not impact recognition and measurement principles
followed for preparation of financial statements. However, it has
significant impact on presentation and disclosures made in the
financial statements. The company has also reclassified the previous
year figures in accordance with the requirements applicable in the
current year.
* Use of estimates .
The preparation of financial statements in conformity with Indian GAAP
requires the management to make judgments, estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and
liabilities and the disclosure of contingent liabilities, at the end of
the reporting period. Although these estimates are based on the
management's best knowledge of current events and actions, uncertainty
about these assumptions and estimates could result in the outcomes
requiring a material adjustment to the carrying amounts of assets or
liabilities in future periods.
* Contingent Liabilites
Contingent Liability are disclosed by way of notes in the Balance
Sheet.
* Fixed Assets
Fixed Assets are stated at cost. Depreciation of fixed assets is
calculated on the basis of useful life of the assets as per Schedule II
of the Companies Act, 2013.
* Leases
Lease rentals in respect of operating lease arrangements are recognized
as an expense in the profit & loss account on accrual basis with
reference to lease terms and other considerations.
* Investment
Investments, which are readily realizable and intended to be held for
not more than one year from the date on which such investments are
made, are classified as current investments. All other investments are
classified as long-term investments. On initial recognition, all
investments are measured at cost.
Current investments are carried in the financial statements at lower of
cost and fair value determined on an individual investment basis.
Long-term investments are carried at cost. On disposal of an
investment, the difference between its carrying amount and net disposal
proceeds is charged or credited to the statement of profit and loss.
* Inventories
Raw materials, components, stores and spares are valued at lower of
cost and net realizable value. Work in progress and finished goods are
valued at lower of cost and net realizable value.
* Revenue Recognition
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the company and the revenue can be
reliably measured.
* Income tax
* Tax expense comprises current and deferred tax. Current income-tax is
measured at the amount expected to be paid to the tax authorities in
accordance with the Income-tax Act, 1961 enacted in India and tax laws
prevailing in the respective tax jurisdictions where the company
operates. The tax rates and tax laws used to compute the amount are
those that are enacted or substantively enacted, at the reporting date.
* Deferred income taxes reflect the impact of timing differences
between taxable income and accounting income originating during the
current year and reversal of timing differences for the earlier years.
* Retirement Benefits
* Gratuity: The company has a defined employee benefit scheme in the
form of gratuity. Accordingly gratuity is provided on the basis of
calculations made by the company and is payable of the termination of
the services of employee.
* Provident Fund: Contribution to the Provident Fund as per provisions
of Employees Provident Fund Act 1952 is remitted to the P.F.
Comissioner and is charged to the Profit & loss Account.
* Leave Encashment: Leave Encashment benefits (short term compensated
absences) are provided on the basis of calculations made by the Company
based on average encashable salary of the employee.
Mar 31, 2013
During the year ended 31 March 2013, the revised Schedule VI notified
under the Companies Act 1956, has become applicable to the company, for
preparation and presentation of its financial statements. The adoption
of revised Schedule VI does not impact recognition and measurement
principles followed for preparation of financial statements. However,
it has significant impact on presentation and disclosures made in the
financial statements. The company has also reclassified the previous
year figures in accordance with the requirements applicable in the
current year.
* Use of estimates
The preparation of financial statements in conformity with Indian GAAP
requires the management to make judgments, estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and
liabilities and the disclosure of contingent liabilities, at the end of
the reporting period. Although these estimates are based on the
management''s best knowledge of current events and actions, uncertainty
about these assumptions and estimates could result in the outcomes
requiring a material adjustment to the carrying amounts of assets or
liabilities in future periods.
* Contingent Liabilities
Contingent Liability are disclosed by way of notes .in the Balance
Sheet.
* Fixed Assets
Fixed Assets are stated ail cost. Depreciation of fixed assets is
calculated at the rates prescribed under Schedule XIV to the Companies
Act, 1956.
» Leases
Lease rentals in respect of operating lease arrangements are recognized
as an expense in the profit & loss account on accrual basis with
reference to lease terms and other considerations.
* Investment
Investments; which are readily realizable and intended to be held for
not more than one year from the date on which such investments are
made, are classified as current investments. All other investments are
classified as long-term investments. On initial recognition, all
investments are measured at cost.
Current investments are carried in the financial statements at lower of
cost and fair value determined on an individual investment basis.
Long-term investments are carried at cost. On disposal of an
investment, the difference between its carrying amount and net disposal
proceeds is charged or credited to the statement of profit and loss.
* Inventories
Raw materials, components, stores and spares are valued at lower of
cost and net realizable value. Work in progress and finished goods are
valued at lower of cost and net realizable value.
* Revenue Recognition
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the company and the revenue can be
reliably measured.
* Income tax
o Tax expense comprises current and deferred tax. Current income-tax is
measured at the amount expected to be paid to the tax authorities in
accordance with the Income-tax Act, 1961 enacted in India and tax laws
prevailing in the respective tax jurisdictions where the company
operates. The tax rates and tax laws used to compute the amount are
those that are enacted or substantively enacted, at the reporting date.
o Deferred income taxes reflect the impact of timing differences
between taxable income and accounting income originating during the
current year and reversal of timing differences for the earlier years.
* Retirement Benefits
o Gratuity: The company has a defined employee benefit scheme in the
form of gratuity. Accordingly gratuity is provided on the basis of
calculations made by the company and is payable of the termination of
the services of employee.
o Provident Fund: Contribution to the Provident Fund as per provisions
of Employees Provident Fund Act 1952 is remitted to the P.F.
Commissioner and is charged to the Profit & loss Account.
o Leave Encashment : Leave Encashment benefits (short term compensated
absences) are provided on the basis of calculations made by the Company
based on average encashable salary of the employee.
Mar 31, 2012
During the year ended 31 March 2012, the revised Schedule VI notified
under the Companies Act 1956, has become applicable to the company, for
preparation and presentation of its financial statements. The adoption
of revised Schedule VI does not impact recognition and measurement
principles followed for preparation of financial statements. However,
it has significant impact on presentation and disclosures made in the
financial statements. The company has also reclassified the previous
year figures in accordance with the requirements applicable in the
current year.
- Use of estimates
The preparation of financial statements in conformity with Indian GAAP
requires the management to make judgments, estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and
liabilities and the disclosure of contingent liabilities, at the end of
the reporting period. Although these estimates are based on the
management's best knowledge of current events and actions, uncertainty
about these assumptions and estimates could result in the outcomes
requiring a material adjustment to the carrying amounts of assets or
liabilities in future periods.
- Contingent Liabilities
Contingent Liability are disclosed by way of notes in the Balance
Sheet.
- Fixed Assets
Fixed Assets are stated at cost. Depreciation of fixed assets is
calculated at the rates prescribed under Schedule XIV to the Companies
Act, 1956.
- Leases
Lease rentals in respect of operating lease arrangements are recognized
as an expense in the profit & loss account on accrual basis with
reference to lease terms and other considerations.
- investment
Investments, which are readily realizable and Intended to be held for
not more than one year from the date on which such investments are
made, are classified as current investments. All other investments are
classified as long-term investments. On initial recognition, all
investments are measured at cost.
Current investments are carried in the financial statements at lower of
cost and fair value determined on an individual investment basis.
Long-term investments are carried at cost. On disposal of an
investment, the difference between its carrying amount and net disposal
proceeds is charged or credited to the statement of profit and loss.
- Inventories
Raw materials, components, stores and spares are valued at lower of
cost and net realizable value. Work in progress and finished goods are
valued at lower of cost and net realizable value.
- Revenue Recognition
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the company and the revenue can be
reliably measured.
- Income tax
- Tax expense comprises current and deferred tax. Current income-tax
is measured at the amount expected to be paid to the tax authorities in
accordance with the Income-tax Act, 1961 enacted in India and tax laws
prevailing in the respective tax jurisdictions where the company
operates. The tax rates and tax laws used to compute the amount are
those that are enacted or substantively enacted, at the reporting date.
- Deferred income taxes reflect the impact of timing differences
between taxable income and accounting income originating during the
current year and reversal of timing differences for the earlier years.
- Retirement Benefits
- Gratuity: The company has a defined employee benefit scheme in the
form of gratuity. Accordingly gratuity is provided on the basis of
calculations made by the company and is payable of the termination of
the services of employee.
- Provident Fund : Contribution to the Provident Fund as per provisions
of Employees Provident Fund Act 1952 is remitted to the P.F.
Commissioner and is charged to the Profit & loss Account.
- Leave Encashment : Leave Encashment benefits (short term compensated
absences) are provided on the basis of calculations made by the Company
based on average encashable salary of the employee.
Mar 31, 2011
A) BASIS OF ACCOUNTING:
The company follows mercantile system of accounting recognizing Income
& Expenditure on accrual basis. However, demurrage is accounted for on
cash basis. The accounts are prepared on historical cost basis as a
going concern. Accounting policies not referred to specifically are
otherwise consistent with the generally accepted accounting principles.
(b) REVENUE RECOGNITION:
a Income of Delivery Freight is accounted for on accrual basis. This
coincides with delivery of goods or reaching of goods carried on behalf
of the clients in the godowns of the company at destinations, which
ever is earlier.
c) DEPRECIATION:
a Depreciation has been provided in the accounts for the year at the
rates provided in Schedule -XIV to the Companies Act, 1956 on WDV
Method and in respect of Lorries & Trucks on Straight Line Method.
Pro-rata depreciation has been provided on assets acquired/sold during
the year. Depreciation is charged from the date of assets are put to
use.
(d) FIXED ASSETS:
a Fixed Assets are valued at cost. They are stated at historical costs
in the books of account. All costs directly relating to acquisition and
installation of assets is capitalised.
a In case of very old and immaterial amount of assets which has been
sold during the year and whose costs and WDV are not identifiable it
has been assumed that their costs has been fully amortised therefore,
the whole of the sale proceeds has been taken as profit on sale of
fixed assets.
Goodwill is being recorded in the books of account as per accounting
treatment laid down in AS 10 issued by ICAI. The Management has decided
not to amortise goodwill and it is being retained as an asset.
(e) CLAIMS:
a The company provides for shortage/losses as claims in the accounts on
the basis of payment or settlement of claim whichever is earlier. The
recovery against such losses, if any, is taken as income of the year in
which it is recovered. Insurance, if any and admissible, is accounted
for on accrual basis. The insurance claims are deemed to accrue on the
date on which claims are admitted by Insurance Company.
(f) RETIREMENT BENEFITS:
Contribution to Provident Fund, ESI etc. is charged to Profit & Loss
Account
The company has made provisions for Gratuity liability on accrual
basis. The provision for Gratuity has been made based on estimates made
by the Company Management.
(g) LEASES:
- Leases, where the Lessor retains substantially all the risks and
rewards incidental to the ownership are classified as Operating Leases.
Operating Lease payments are recognized as an expense in Profit & Loss
Account on Straight Line Basis over the Lease Term.
h) TAXATION:
- Tax Expenses (tax saving) is the aggregate of current year tax and
deferred tax charged (or credited) to the Profit & Loss A/c. of the
year.
-Deferred tax is recognized, on timing differences, being the
differences resulting from the recognition of items in the financial
statements and in estimating its current income tax provision.
- Deferred tax assets and liabilities are measured using the tax rates
and tax laws that have been enacted on the Balance Sheet date.
- Provision for Wealth Tax has been made on estimated basis.
(i) CONTINGENT LIABILITIES:
- Contingent liabilities are disclosed by way of note in the Balance
Sheet.
Mar 31, 2009
(a) BASIS OF ACCOUNTING:
- The company follows mercantile system of accounting recognizing
Income & Expenditure on accrual basis. However, demurrage is accounted
for on cash basis. The accounts are prepared on historical cost basis
as a going concern. Accounting policies not referred to specifically
are otherwise consistent with the generally accepted accounting
principles.
(b) REVENUE RECOGNITION:
- Income of Delivery Freight is accounted for on accrual basis. This
coincides with delivery of goods or reaching of goods carried on behalf
of the clients in the godowns of the company at destinations, which
ever is earlier.
(c) DEPRECIATION:
- Depreciation has been provided in the accounts for the year at the
rates provided in Schedule -XIV to the Companies Act, 1956 on WDV
Method and in respect of Lorries & Trucks on Straight Line Method.
Pro-rata depreciation has been provided on assets acquired/sold during
the year. Depreciation is charged from the date of assets are put to
use.
(d) FIXED ASSETS:
- Fixed Assets are valued at cost. They are stated at historical costs
in the books of account. All costs directly relating to acquisition and
installation of assets is capitalised.
- In case of very old and immaterial amount of assets which has been
sold during the year and whose costs and WDV are not identifiable it
has been assumed that their costs has been fully amortised therefore,
the whole of the sale proceeds has been taken as profit on sale of
fixed assets.
- Goodwill is being recorded in the books of account as per accounting
treatment laid down in AS10 issued by ICAI. The Management has decided
not to amortise goodwill and it is being retained as an asset.
(e) CLAIMS:
- The company provides for shortage/losses as claims in the accounts
on the basis of payment or settlement of claim whichever is earlier.
The recovery against such losses, if any, is taken as income of the
year in which it is recovered. Insurance, if any and admissible, is
accounted for on accrual basis. The insurance claims are deemed to
accrue on the date on which claims are admitted by Insurance Company.
(f) RETIREMENT BENEFITS:
- Contribution to Provident Fund, ESI etc. is charged to Profit & Loss
Account
- The company has made provisions for Gratuity liability on accrual
basis. The provision for Gratuity has been made based on estimates made
by the Company Management.
(g) TAXATION:
- Tax Expenses (tax saving) is the aggregate of current year tax and
deferred tax charged (or credited) to the Profit & Loss A/c. of the
year.
- Deferred tax is recognized, on timing differences, being the
differences resulting from the recognition of items in the financial
statements and in estimating its current income tax provision.
- Deferred tax assets and liabilities are measured using the tax rates
and tax laws that have been enacted on the Balance Sheet date.
- Provision for Wealth Tax has been made on estimated basis.
(h) CONTINGENT LIABILITIES:
- Contingent liabilities are disclosed by way of note in the Balance
Sheet.
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