Accounting Policies of Sangam (India) Ltd. Company

Mar 31, 2023

SIGNIFICANT ACCOUNTING POLICIES

A. Current and non-current classification

All the assets and liabilities have been classified as
current or non-current as per the Company’s normal
operating cycle and other criteria set out in the Schedule
III to the Companies Act, 2013.

Assets:

An asset is classified as current when it satisfies any of
the following criteria:

a) It is expected to be realized in, or is intended for
sale or consumption in, the Company’s normal
operating cycle;

b) It is held primarily for the purpose of being traded;

c) It is expected to be realized within twelve months
after the reporting date; or

d) It is cash or cash equivalent unless it is restricted
from being exchanged or used to settle a liability
for at least twelve months after the reporting date.

Assets held for sale:

An Assets are classified as held for sale if their carrying
amount will be recovered principally through a sale
transaction rather than through continuing use. This
condition is regarded as met only when the asset is
available for immediate sale in its present condition
subject only to terms that are usual and customary
for sales of such asset and its sale is highly probable.
Management must be committed to the sale, which
should be expected to qualify for recognition as a
completed sale within one year from the date of
classification.

The value of Assets has been carried out at its fair value
less cost of sales.

Liabilities:

A liability is classified as current when it satisfies any of
the following criteria:

a) It is expected to be settled in the Company’s
normal operating cycle;

b) It is held primarily for the purpose of being traded;

c) It is due to be settled within twelve months after
the reporting date; or

d) The Company does not have an unconditional
right to defer settlement of the liability for at least
twelve months after the reporting date. Terms of a
liability that could, at the option of the counterparty,
result in its settlement by the issue of equity
instruments do not affect its classification.

All other assets/ liabilities are classified as non-current.

Based on the nature of products and the time between
the acquisition of assets for processing and their
realization in Cash or cash equivalents, the Company
has ascertained its normal operating cycle as 12
months for the purpose of current / Non-current
classification of assets and liabilities.

B. Property, plant and equipment (PPE)

PPE is recognized 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. PPE is stated at original cost net of tax/duty
credits availed, if any, less accumulated depreciation
and cumulative impairment, if any. Property, plant

and equipment acquired on hire purchase basis are
recognized at their cash values. For qualifying assets,
borrowing costs are capitalized in accordance with the
Company’s accounting policy. Any excess of net sale
proceeds of items produced over the cost of testing,
if any, is deducted from the directly attributable costs
considered as part of cost of an item of property, plant
and equipment.

PPE not ready for the intended use on the date of
the Balance Sheet is disclosed as "Capital Work-in¬
Progress".

Depreciation is recognized using straight line method
so as to write off the cost of the assets (other than
freehold land and properties under construction) less
their residual values over their useful lives specified
in Schedule II to the Companies Act, 2013, or in the
case of assets where the useful life was determined by
technical evaluation, over the useful life so determined.

Depreciation method is reviewed at each financial year
end to reflect the expected pattern of consumption of
the future economic benefits embodied in the asset.
The estimated useful life and residual values are also
reviewed at each financial year end and the effect of
any change in the estimates of useful life/residual value
is accounted on prospective basis.

Depreciation on additions to/deductions from, owned
assets is calculated pro rata to the period of use.

Depreciation charge for impaired assets is adjusted
in future periods in such a manner that the revised
carrying amount of the asset is allocated over its
remaining useful life.

Assets acquired under finance leases are depreciated
on a straight line basis over the lease term. Where
there is reasonable certainty that the Company shall
obtain ownership of the assets at the end of the lease
term, such assets are depreciated based on the useful
life prescribed under Schedule II to the Companies
Act, 2013 or based on the useful life adopted by the
Company for similar assets.

Freehold land is not depreciated.

An item of Property, plant and equipment is derecognized
when it is estimated that Company will not receive
future economic benefits from its use or upon its
disposal. Any gains and losses on disposal of such
item of property, plant and equipment are determined
by comparing the proceeds from disposal with the
carrying amount of property, plant and equipment, and
are recognized in the statement of profit and loss.

C. Depreciation and amortization:

Depreciation method, estimated useful lives and

residual values are determined based on technical
parameters / assessment, taking into account the
nature of the asset, the estimated usage of the asset,
the operating conditions of the asset, past history
of replacement, anticipated technological changes,
manufacturers warranties and maintenance support,
etc.

The estimated useful life of Property, Plant & Equipment
is aligned to the useful life specified under Schedule
II to the Companies Act, 2013 except useful life for
computing depreciation in the following case:

The management believes that these estimated useful
lives are realistic and reflect fair approximation of the
period over which the Property, Plant and Equipment
are likely to be used.

Depreciation on additions to property, plant and
equipment is provided on a pro-rata basis from the
date of acquisition or installation, and in the case of
a new project, from the date of commencement of
commercial production.

Depreciation on an item of property, plant and
equipment sold, discarded, demolished or scrapped, is
provided up to the date on which such item of property,
plant and equipment is sold, discarded, demolished or
scrapped.

Capitalized spares are depreciated over their own
estimated useful life or the estimated useful life of the
parent asset whichever is lower.

The Company reviews the residual value, useful lives
and depreciation method annually and, if expectations
differ from previous estimates, the change is accounted
for as a change in accounting estimate on a prospective
basis.

D. Intangible assets

Intangible assets that are acquired by the Company, that
have finite useful lives, are stated at acquisition cost,
net of accumulated amortization and accumulated
impairment losses, if any.

Subsequent expenditures related to an item of intangible
assets are added to its carrying amount when it is
probable that future economic benefits deriving from
the cost incurred will flow to the enterprise and the cost
of the item can be measured reliably.

An intangible asset is derecognized when no future
economic benefits are expected from their use or upon
their disposal. Any gains and losses on disposal of
such intangible assets are determined by comparing
the proceeds from disposal with the carrying amount of
intangible assets and are recognized in the statement
of profit and loss.

Finite life intangible assets are amortized on a straight
line basis over the period of their expected useful lives.

E. Research and development expenditure on new
products:

(i) Expenditure on research is expensed under
respective heads of account in the period in which
it is incurred.

(ii) Development expenditure on new products is
capitalized as intangible asset, if all of the following
can be demonstrated:

A. The technical feasibility of completing the
intangible asset so that it will be available for
use or sale;

B. The Company has intention to complete the
intangible asset and use or sell it;

C. The Company has ability to use or sell the
intangible asset;

D. The manner in which the probable future
economic benefits will be generated including
the existence of a market for output of the
intangible asset or intangible asset itself or
if it is to be used internally, the usefulness of
intangible assets;

E. The availability of adequate technical,
financial and other resources to complete the
development and to use or sell the intangible
asset; and

F. The Company has ability to reliably measure
the expenditure attributable to the intangible
asset during its development.

Development expenditure that does not meet
the above criteria is expensed in the period in
which it is incurred.

Intangible assets not ready for the intended
use on the date of the Balance Sheet are
disclosed as "intangible assets under
development".

F. Impairment of assets

As at the end of each accounting year, the Company
reviews the carrying amounts of its PPE, intangible
assets and investments in subsidiary company
to determine whether there is any indication that
those assets have suffered an impairment loss. If
such indication exists, the said assets are tested for
impairment so as to determine the impairment loss, if
any. The intangible assets with indefinite life are tested
for impairment each year.

Impairment loss is recognized when the carrying
amount of an asset exceeds its recoverable amount.
Recoverable amount is determined:

(i) In the case of an individual asset, at the higher of
the net selling price and the value in use; and

(ii) In the case of a cash generating unit (a group
of assets that generates identified, independent
cash flows), at the higher of the cash generating
unit’s net selling price and the value in use.

The amount of value in use is determined as the
present value of estimated future cash flows from the
continuing use of an asset and from its disposal at the
end of its useful life. For this purpose, the discount rate
(pre-tax) is determined based on the weighted average
cost of capital of the Company suitably adjusted for
risks specified to the estimated cash flows of the asset.

For this purpose, a cash generating unit is ascertained
as the smallest identifiable group of assets that
generates cash inflows that are largely independent of
the cash inflows from other assets or groups of assets.

If recoverable amount of an asset (or cash generating
unit) is estimated to be less than its carrying amount,
such deficit is recognized immediately in the Statement
of Profit and Loss as impairment loss and the carrying
amount of the asset (or cash generating unit) is reduced
to its recoverable amount.

When an impairment loss subsequently reverses, the
carrying amount of the asset (or cash generating unit)
is increased to the revised estimate of its recoverable
amount, but so that the increased carrying amount
does not exceed the carrying amount that would have
been determined had no impairment loss is recognized
for the asset (or cash generating unit) in prior years.
A reversal of an impairment loss is recognized
immediately in the Statement of Profit and Loss.

G. Financial Instrumentsi. Financial assets

Financial assets are recognized when the
Company becomes a party to the contractual
provisions of the instrument.

All financial assets are recognized at fair value on
initial recognition except trade receivables.

Financial assets are subsequently classified as
measured at:

• Amortized cost

• Fair value through profit and loss (FVTPL)

•¦ Fair value through other comprehensive
income (FVTOCI)

Financial assets are not reclassified subsequent
to their recognition, except if and in the period
the Company changes its business model for
managing financial assets.

Derecognition

The Company derecognizes a financial asset
when the contractual rights to the cash flows
from the financial asset expire, or it transfers the
contractual rights to receive the cash flows from
the asset.

Impairment of financial assets

The Company recognizes loss allowances for
expected credit losses on:

- Financial assets measured at amortized
cost;

At each reporting date, the Company assesses
whether financial assets carried at amortized
cost has impaired and provisions are made for
impairment accordingly. A financial asset is ''credit
impaired’ when one or more events that have a
detrimental impact on the estimated future cash
flows of the financial asset have occurred.

The Company measures loss allowances at an
amount equal to lifetime expected credit losses,
except for the following, which are measured as
12 month expected credit losses:

- Debt securities that are determined to have
low credit risk at the reporting date; and

- Other debt securities and bank balances
for which credit risk (i.e. the risk of default
occurring over the expected life of the
financial instrument) has not increased
significantly since initial recognition.

Loss allowances for trade receivables are always
measured at an amount equal to lifetime expected
credit losses.

12-month expected credit losses are the portion
of expected credit losses that result from default
events that are possible within 12 months after the
reporting date (or a shorter period if the expected
life of the instrument is less than 12 months).

When determining whether the credit risk of a
financial asset has increased significantly since
initial recognition and when estimating expected
credit losses, the Company considers reasonable
and supportable information that is relevant and
available without undue cost or effort. This includes
both quantitative and qualitative information
and analysis, based on the Company’s historical
experience and informed credit assessment and
including forward looking information.

Measurement of expected credit losses

Expected credit losses are a probability-
weighted estimate of credit losses. Credit losses
are measured as the present value of all cash
shortfalls (i.e. the difference between the cash
flows due to the Company in accordance with the
contract and the cash flows that the Company
expects to receive).

Presentation of allowance for expected credit
losses in the balance sheet

Loss allowances for financial assets measured
at amortized cost are deducted from the gross
carrying amount of the assets.

Write-off

The gross carrying amount of a financial asset is
written off (either partially or in full) to the extent
that there is no realistic prospect of recovery. This is
generally the case when the Company determines
that the debtor does not have assets or sources of
income that could generate sufficient cash flows
to repay the amounts subject to the write-off.

ii. Financial liabilities

Financial liabilities are recognized when the
Company becomes a party to the contractual

provisions of the instrument. Financial liabilities
are initially measured at the amortized cost unless
at initial recognition, they are classified as fair
value through profit and loss.

Financial liabilities are subsequently measured
at amortized cost using the effective interest rate
(EIR) method. Financial liabilities carried at fair
value through profit or loss are measured at fair
value with all changes in fair value recognized in
the Statement of Profit and Loss.

Derecognition

A financial liability is derecognized when the
obligation specified in the contract is discharged,
cancelled or expires.

iii. Offsetting financial instruments

Financial assets and liabilities are offset and the
net amount is reported in the balance sheet where
there is a legally enforceable right to offset the
recognized amounts and there is an intention to
settle on a net basis or realize the asset and settle
the liability simultaneously. The legally enforceable
right must not be contingent on future events
and must be enforceable in the normal course of
business and in the event of default, insolvency or
bankruptcy of the Company or the counterparty.

iv. Derivative financial instruments and hedging
activities

A derivative is a financial instrument which
changes value in response to changes in an
underlying asset and is settled at a future date.
Derivatives are initially recognized at fair value
on the date a derivative contract is entered into
and are subsequently re-measured at their fair
value. The method of recognizing the resulting
gain or loss depends on whether the derivative is
designated as a hedging instrument, and if so, the
nature of the item being hedged. The Company
designates certain derivatives as either:

(a) hedges of the fair value of recognized assets
or liabilities (fair value hedges); or

(b) hedges of a particular risk associated with
a firm commitment or a highly probable
forecasted transaction (cash flow hedges).

The Company documents at the inception of the
transaction the relationship between hedging
instruments and hedged items, as well as its
risk management objectives and strategy for
undertaking various hedging transactions. The
Company also documents its assessment, both

at hedge inception and on an on-going basis, of
whether the derivatives that are used in hedging
transactions are effective in offsetting changes in
cash flows of hedged items.

Movements in the hedging reserve are accounted
in other comprehensive income and are shown
within the statement of changes in equity. The full
fair value of a hedging derivative is classified as a
non-current asset or liability when the remaining
maturity of hedged item is more than 12 months
and as a current asset or liability when the
remaining maturity of the hedged item is less than
12 months. Trading derivatives are classified as a
current asset or liability.

(a) Fair value hedges

Changes in the fair value of derivatives that
are designated and qualify as fair value
hedges are recorded in the Statement of
Profit and Loss, together with any changes in
the fair value of the hedged asset or liability
that are attributable to the hedged risk.

(b) Cash flow hedges

The effective portion of changes in the fair
value of derivatives that are designated and
qualify as cash flow hedges is recognized in
other comprehensive income. The ineffective
portion of changes in the fair value of the
derivative is recognized in the Statement of
Profit and Loss. Gains or losses accumulated
in equity are reclassified to the Statement
of Profit and Loss in the periods when the
hedged item affects the Statement of Profit
and Loss.

When a hedging instrument expires or
swapped or unwound, or when a hedge
no longer meets the criteria for hedge
accounting, any accumulated gain or loss
existing in statement of changes in equity
is recognized in the Statement of Profit and
Loss.

When a forecasted transaction is no longer
expected to occur, the cumulative gains/
losses that were reported in equity are
immediately transferred to the Statement of
Profit and Loss.

H. Borrowing costs

Borrowing costs include interest expense calculated
using the effective interest method (EIR), finance
charges in respect of assets acquired on finance lease
and exchange differences arising on foreign currency

borrowings to the extent they are regarded as an
adjustment to interest costs.

Borrowing costs net of any investment income from
the temporary investment of related borrowings,
which are attributable to the acquisition, construction
or production of a qualifying asset are capitalized /
inventoried as part of cost of such asset till such time
the asset is ready for its intended use or sale.

A qualifying asset is an asset that necessarily requires
a substantial period of time to get ready for its intended
use or sale. All other borrowing costs are recognized in
profit or loss in the period in which they are incurred.

EIR is the rate that exactly discounts the estimated
future cash payments or receipts over the expected
life of the financial instrument or a shorter period,
where appropriate, to the gross carrying amount of the
financial asset or to the amortized cost of a financial
liability. When calculating the effective interest rate,
the Company estimates the expected cash flows by
considering all the contractual terms of the financial
instrument (for example, prepayment, extension, call
and similar options) but does not consider the expected
credit losses.

I. Income tax

Income tax comprises current and deferred tax. It
is recognized in statement of profit or loss except
to the extent that it relates to an item recognized
directly in equity or in other comprehensive
income.

Current tax

Current tax comprises the expected tax payable or
receivable on the taxable income for the year and
any adjustment to the tax payable or receivable in
respect of previous years. The amount of current
tax reflects the best estimate of the tax amount
expected to be paid or received after considering
the uncertainty, if any, related to income taxes. It is
measured using tax rates (and tax laws) enacted
or substantively enacted by the reporting date.

Current tax assets and current tax liabilities are
offset only if there is a legally enforceable right to
set off the recognized amounts, and it is intended
to realize the asset and settle the liability on a net
basis or simultaneously.

Deferred tax

Deferred tax is recognized in respect of temporary
differences between the carrying amounts
of assets and liabilities for financial reporting
purposes and the corresponding amounts

used for taxation purposes. Deferred tax is also
recognized in respect of carried forward tax losses
and tax credits. Deferred tax is not recognized for:

- Temporary differences arising on the
initial recognition of assets or liabilities
in a transaction that is not a business
combination and that affects neither
accounting nor taxable profit or loss at the
time of transaction;

- Temporary differences related to investment
in subsidiary to the extent that the Company
is able to control the timing of the reversal of
the temporary differences and it is probable
that they will not reverse in the foreseeable
future; and

Deferred tax assets are recognized to the extent
that it is probable that future taxable profits will be
available against which the temporary difference
can be utilized. The existence of unused tax losses
is strong evidence that future taxable profit may not
be available. Therefore, in case of a history of recent
losses the Company recognizes a deferred tax
asset only to the extent that it has sufficient taxable
temporary differences or there is convincing
other evidence that sufficient taxable profit will be
available against which such deferred tax asset
can be realized. Deferred tax assets- unrecognized
or recognized, are reviewed at each reporting date
and are recognized /reduced to the extent that it is
probable/no longer probable respectively that the
related tax benefit will be realized.

Minimum Alternate tax (''MAT'') is not recognized
as a deferred tax asset as the Company is not
liable for Minimum Alternate tax.

J. Inventories

Inventories are valued at the lower of cost and net
realizable value after providing for obsolesces and
damages as under:

Net realizable value is the estimated selling price in the
ordinary course of business, less estimated costs of
completion and the estimated costs necessary to make
the sale.

K. Cash and cash equivalents

Cash and bank balances also include fixed deposits,
margin money deposits, earmarked balances with
banks and other bank balances which have restrictions
on repatriation. Short term and liquid investments
being subject to more than insignificant risk of change
in value, are not included as part of cash and cash
equivalents.

L. Statement of Cash Flows

Statement of Cash Flows is prepared segregating the
cash flows into operating, investing and financing
activities.

Cash flow from operating activities is reported using
indirect method, adjusting the profit before tax
excluding exceptional items for the effects of:

(i) changes during the period in inventories and
operating receivables and payables, transactions
of a non-cash nature;

(ii) non-cash items such as depreciation, provisions,
unrealized foreign currency gains and losses; and

(iii) all other items for which the cash effects are
investing or financing cash flows. Cash and cash
equivalents (including bank balances) shown in
the Statement of Cash Flows exclude items which
are not available for general use as at the date of
Balance Sheet

M. Foreign currency translation

(i) The functional currency and presentation currency
of the Company is Indian Rupee.

(ii) Transactions in currencies other than the
Company’s functional currency are recorded on
initial recognition using the exchange rate at the
transaction date.

At each Balance Sheet date, foreign currency monetary
items are reported using the closing rate. Non¬
monetary items that are measured in terms of historical
cost in foreign currency are not retranslated. Exchange
differences that arise on settlement of monetary items
or on reporting of monetary items at each Balance
Sheet date at the closing spot rate are recognized in
profit or loss in the period in which they arise except for:

A. exchange differences on foreign currency
borrowings relating to assets under construction
for future productive use, which are included in the

cost of those assets when they are regarded as
an adjustment to interest costs on those foreign
currency borrowings; and

B. exchange differences on transactions entered into
in order to hedge certain foreign currency risks.

N. Employee benefitsi. Defined benefit obligations

(a) Post-employment benefits (Gratuity):

The liability recognized in balance sheet in
respect of gratuity (unfunded) is the present
value of defined benefit obligation at the
end of reporting period less fair value of
plan assets. The defined benefit obligation
is calculated annually by actuaries using
projected unit credit method.

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

(b) Other employee benefits:

The liabilities for earned leave are not
expected to be settled wholly within 12
months after the end of the period in which
the employees render the related service.
They are therefore measured as present
value of expected future payments to be
made in respect of services provided by
employees up to the end of reporting period
using the projected unit credit method.

ii. Defined contribution plan:

Company pays contributions to provident fund,
employee pension scheme and employee state
insurance as per statutes/ amounts as advised
by the Authorities. The Company has no further
obligations once the contributions have been
paid. The contributions are accounted for as
defined contribution plan and the contributions
are recognized as employee benefit expense when
they are due.

iii. Short-term benefits:

Liabilities for salaries, including non-monetary
benefits that are expected to be settled wholly
within 12 months after the end of reporting period
in which the employees rendered the related

services are recognized in respect of employee''s
service up to the end of reporting period and are
measured at the amount expected to be paid
when the liabilities are settled. These liabilities are
presented as current employee benefit obligations
in the balance sheet.

---

Mar 31, 2018

I SIGNIFICANT ACCOUNTING POLICIES:

A. Current and non-current classification

All the assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013.

Assets:

An asset is classified as current when it satisfies any of the following criteria:

a) it is expected to be realized in, or is intended for sale or consumption in, the Company’s normal operating cycle;

b) it is held primarily for the purpose of being traded;

c) it is expected to be realized within twelve months after the reporting date; or

d) it is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting date.

Liabilities:

A liability is classified as current when it satisfies any of the following criteria:

a) it is expected to be settled in the Company’s normal operating cycle;

b) it is held primarily for the purpose of being traded;

c) it is due to be settled within twelve months after the reporting date; or

d) the Company does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

All other assets/ liabilities are classified as noncurrent.

Based on the nature of products and the time between the acquisition of assets for processing and their realization in Cash or cash equivalents, the Company has ascertained its normal operating cycle as 12 months for the purpose of Current / Noncurrent classification of assets and liabilities.

B. Property, plant and equipment (PPE)

PPE is recognized 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. PPE is stated at original cost net of tax/duty credits availed, if any, less accumulated depreciation and cumulative impairment, if any. Property, plant and equipment acquired on hire purchase basis are recognized at their cash values. For qualifying assets, borrowing costs are capitalized in accordance with the Company’s accounting policy.

For transition to Ind AS, the Company has elected to adopt as deemed cost, the carrying value of PPE measured as per I-GAAP less accumulated depreciation and cumulative impairment on the transition date of 1st April, 2016.

PPE not ready for the intended use on the date of the Balance Sheet are disclosed as “capital work-in-progress.

Depreciation is recognized using straight line method so as to write off the cost of the assets (other than freehold land and properties under construction) less their residual values over their useful lives specified in Schedule II to the Companies Act, 2013, or in the case of assets where the useful life was determined by technical evaluation, over the useful life so determined.

Depreciation method is reviewed at each financial year end to reflect the expected pattern of consumption of the future economic benefits embodied in the asset. The estimated useful life and residual values are also reviewed at each financial year end and the effect of any change in the estimates of useful life/residual value is accounted on prospective basis.

Depreciation on additions to / deductions from, owned assets is calculated pro rata to the period of use.

Depreciation charge for impaired assets is adjusted in future periods in such a manner that the revised carrying amount of the asset is allocated over its remaining useful life.

Assets acquired under finance leases are depreciated on a straight-line basis over the lease term. Where there is reasonable certainty that the Company shall obtain ownership of the assets at the end of the lease term, such assets are depreciated based on the useful life prescribed under Schedule II to the Companies Act, 2013 or based on the useful life adopted by the Company for similar assets.

Freehold land is not depreciated.

An item of Property, plant and equipment is derecognized when it is estimated that Company will not receive future economic benefits from its use or upon its disposal. Any gains and losses on disposal of such item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment, and are recognized in the statement of profit and loss.

C. Depreciation and amortization:

Depreciation method, estimated useful lives and residual values are determined based on technical parameters / assessment, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers warranties and maintenance support, etc.

The estimated useful life of Property, Plant & Equipment is aligned to the useful life specified under Schedule II to the Companies Act, 2013 except useful life for computing depreciation in the following case:

The management believes that these estimated useful lives are realistic and reflect fair approximation of the period over which the Property, Plant and Equipment are likely to be used.

Depreciation on additions to property, plant and equipment is provided on a pro-rata basis from the date of acquisition or installation, and in the case of a new project, from the date of commencement of commercial production.

Depreciation on an item of property, plant and equipment sold, discarded, demolished or scrapped, is provided up to the date on which such item of property, plant and equipment is sold, discarded, demolished or scrapped.

Capitalized spares are depreciated over their own estimated useful life or the estimated useful life of the parent asset whichever is lower.

The Company reviews the residual value, useful lives and depreciation method annually and, if expectations differ from previous estimates, the change is accounted for as a change in accounting estimate on a prospective basis.

D. Intangible assets

Intangible assets that are acquired by the Company, that have finite useful lives, are stated at acquisition cost, net of accumulated amortization and accumulated impairment losses, if any.

Subsequent expenditures related to an item of intangible assets are added to its carrying amount when it is probable that future economic benefits deriving from the cost incurred will flow to the enterprise and the cost of the item can be measured reliably.

An intangible asset is derecognized when no future economic benefits are expected from their use or upon their disposal. Any gains and losses on disposal of such intangible assets are determined by comparing the proceeds from disposal with the carrying amount of intangible assets and are recognized in the statement of profit and loss.

Finite life intangible assets are amortized on a straight line basis over the period of their expected useful lives.

Amortization

A summary of the policies applied to the intangible assets is, as follows:

Upon first-time adoption of Ind AS, the Company has elected to continue to measure all its intangible assets at the carrying amount as per the previous GAAP as its deemed cost on the date of transition to Ind AS i.e., 1st April, 2016.

Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortization period or method, as appropriate, and are treated as changes in accounting estimates. The amortization expense on intangible assets with finite lives is recognized in the Statement of Profit and Loss unless such expenditure forms part of carrying value of another asset.

E. Research and development expenditure on new products:

(i) Expenditure on research is expensed under respective heads of account in the period in which it is incurred.

(ii) Development expenditure on new products is capitalized as intangible asset, if all of the following can be demonstrated:

A. the technical feasibility of completing the intangible asset so that it will be available for use or sale;

B. the Company has intention to complete the intangible asset and use or sell it;

C. the Company has ability to use or sell the intangible asset;

D. the manner in which the probable future economic benefits will be generated including the existence of a market for output of the intangible asset or intangible asset itself or if it is to be used internally, the usefulness of intangible assets;

E. the availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and

F. the Company has ability to reliably measure the expenditure attributable to the intangible asset during its development.

Development expenditure that does not meet the above criteria is expensed in the period in which it is incurred.

Intangible assets not ready for the intended use on the date of the Balance Sheet are disclosed as “intangible assets under development”.

F. Impairment of assets

As at the end of each accounting year, the Company reviews the carrying amounts of its PPE, investment property, intangible assets and investments in subsidiary company to determine whether there is any indication that those assets have suffered an impairment loss. If such indication exists, the said assets are tested for impairment so as to determine the impairment loss, if any. The intangible assets with indefinite life are tested for impairment each year.

I mpairment loss is recognized when the carrying amount of an asset exceeds its recoverable amount. Recoverable amount is determined:

(i) in the case of an individual asset, at the higher of the net selling price and the value in use; and

(ii) I n the case of a cash generating unit (a group of assets that generates identified, independent cash flows), at the higher of the cash generating unit’s net selling price and the value in use.

The amount of value in use is determined as the present value of estimated future cash flows from the continuing use of an asset and from its disposal at the end of its useful life. For this purpose, the discount rate (pre-tax) is determined based on the weighted average cost of capital of the Company suitably adjusted for risks specified to the estimated cash flows of the asset

For this purpose, a cash generating unit is ascertained as the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets.

If recoverable amount of an asset (or cash generating unit) is estimated to be less than its carrying amount, such deficit is recognized immediately in the Statement of Profit and Loss as impairment loss and the carrying amount of the asset (or cash generating unit) is reduced to its recoverable amount.

When an impairment loss subsequently reverses, the carrying amount of the asset (or cash generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss is recognized for the asset (or cash generating unit) in prior years. A reversal of an impairment loss is recognized immediately in the Statement of Profit and Loss.

G. Financial Instruments

i. Financial assets

Financial assets are recognized when the Company becomes a party to the contractual provisions of the instrument.

All financial assets are recognized at fair value on initial recognition.

Financial assets are subsequently classified as measured at:

- amortized cost

- fair value through profit and loss (FVTPL)

- fair value through other comprehensive income (FVTOCI)

Financial assets are not reclassified subsequent to their recognition, except if and in the period the Company changes its business model for managing financial assets.

Derecognition

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the contractual rights to receive the cash flows from the asset.

Impairment of financial assets

The Company recognizes loss allowances for expected credit losses on:

- financial assets measured at amortized cost;

At each reporting date, the Company assesses whether financial assets carried at amortized cost has impaired and provisions are made for impairment accordingly. A financial asset is ‘credit impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

The Company measures loss allowances at an amount equal to lifetime expected credit losses, except for the following, which are measured as 12 month expected credit losses:

- debt securities that are determined to have low credit risk at the reporting date; and

- other debt securities and bank balances for which credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition.

Loss allowances for trade receivables are always measured at an amount equal to lifetime expected credit losses.

12-month expected credit losses are the portion of expected credit losses that result from default events that are possible within 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months).

When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating expected credit losses, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Company’s historical experience and informed credit assessment and including forward looking information.

Measurement of expected credit losses

Expected credit losses are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the Company in accordance with the contract and the cash flows that the Company expects to receive).

Presentation of allowance for expected credit losses in the balance sheet

Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets.

Write-off

The gross carrying amount of a financial asset is written off (either partially or in full) to the extent that there is no realistic prospect of recovery. This is generally the case when the Company determines that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the amounts subject to the write-off.

ii. Financial liabilities

Financial liabilities are recognized when the Company becomes a party to the contractual provisions of the instrument. Financial liabilities are initially measured at the amortized cost unless at initial recognition, they are classified as fair value through profit and loss.

Financial liabilities are subsequently measured at amortized cost using the effective interest rate (EIR) method. Financial liabilities carried at fair value through profit or loss are measured at fair value with all changes in fair value recognized in the Statement of Profit and Loss.

Derecognition

A financial liability is derecognized when the obligation specified in the contract is discharged, cancelled or expires.

iii. Offsetting financial instruments

Financial assets and liabilities are offset and the net amount is reported in the balance sheet where there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy of the Company or the counterparty.

H. Borrowing costs

Borrowing costs include interest expense calculated using the effective interest method (EIR), finance charges in respect of assets acquired on finance lease and exchange differences arising on foreign currency borrowings to the extent they are regarded as an adjustment to interest costs.

Borrowing costs net of any investment income from the temporary investment of related borrowings, which are attributable to the acquisition, construction or production of a qualifying asset are capitalized / inventoried as part of cost of such asset till such time the asset is ready for its intended use or sale.

A qualifying asset is an asset that necessarily requires a substantial period of time to get ready for its intended use or sale. All other borrowing costs are recognized in profit or loss in the period in which they are incurred.

EIR is the rate that exactly discounts the estimated future cash payments or receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the gross carrying amount of the financial asset or to the amortized cost of a financial liability. When calculating the effective interest rate, the Company estimates the expected cash flows by considering all the contractual terms of the financial instrument (for example, prepayment, extension, call and similar options) but does not consider the expected credit losses.

I. Income tax

I ncome tax comprises current and deferred tax. It is recognized in statement of profit or loss except to the extent that it relates to an item recognized directly in equity or in other comprehensive income.

Current tax

Current tax comprises the expected tax payable or receivable on the taxable income for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax reflects the best estimate of the tax amount expected to be paid or received after considering the uncertainty, if any, related to income taxes. It is measured using tax rates (and tax laws) enacted or substantively enacted by the reporting date.

Current tax assets and current tax liabilities are offset only if there is a legally enforceable right to set off the recognized amounts, and it is intended to realise the asset and settle the liability on a net basis or simultaneously.

Deferred tax

Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the corresponding amounts used for taxation purposes. Deferred tax is also recognized in respect of carried forward tax losses and tax credits. Deferred tax is not recognized for:

- Temporary differences arising on the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss at the time of transaction;

- Temporary differences related to investment in subsidiary to the extent that the Company is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and

Deferred tax assets are recognized to the extent that it is probable that future taxable profits will be available against which the temporary difference can be utilized. The existence of unused tax losses is strong evidence that future taxable profit may not be available. Therefore, in case of a history of recent losses the Company recognizes a deferred tax asset only to the extent that it has sufficient taxable temporary differences or there is convincing other evidence that sufficient taxable profit will be available against which such deferred tax asset can be realized. Deferred tax assets- unrecognized or recognized, are reviewed at each reporting date and are recognized /reduced to the extent that it is probable/no longer probable respectively that the related tax benefit will be realized.

Minimum Alternate Tax (‘MAT’) credit is recognized as an 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.

J. Inventories

Inventories are valued at the lower of cost and net realizable value after providing for obsolesces and damages as under:

Cost includes cost of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on first in first out (FIFO) basis.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.

K. Cash and cash equivalents

Cash and bank balances also include fixed deposits, margin money deposits, earmarked balances with banks and other bank balances which have restrictions on repatriation. Short term and liquid investments being subject to more than insignificant risk of change in value, are not included as part of cash and cash equivalents.

L. Foreign currency translation

(i) The functional currency and presentation currency of the Company is Indian Rupee.

(ii) Transactions in currencies other than the Company’s functional currency are recorded on initial recognition using the exchange rate at the transaction date.

At each Balance Sheet date, foreign currency monetary items are reported using the closing rate. Non-monetary items that are measured in terms of historical cost in foreign currency are not retranslated. Exchange differences that arise on settlement of monetary items or on reporting of monetary items at each Balance Sheet date at the closing spot rate are recognized in profit or loss in the period in which they arise except for:

A. exchange differences on foreign currency borrowings relating to assets under construction for future productive use, which are included in the cost of those assets when they are regarded as an adjustment to interest costs on those foreign currency borrowings; and

B. exchange differences on transactions entered into in order to hedge certain foreign currency risks.

M. Employee benefits i. Defined benefit obligations

(a) Post-employment benefits (Gratuity):

The liability recognized in balance sheet in respect of gratuity (unfunded) is the present value of defined benefit obligation at the end of reporting period less fair value of plan assets. The defined benefit obligation is calculated annually by actuaries using projected unit credit method.

Remeasurement actuarial 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 if changes in equity and in the balance sheet.

(b) Other employee benefits:

The liabilities for earned leave are not expected to be settled wholly within 12 months after the end of the period in which the employees render the related service. They are therefore measured as present value of expected future payments to be made in respect of services provided by employees up to the end of reporting period using the projected unit credit method.

ii. Defined contribution plan:

Company pays contributions to provident fund, employee pension scheme and employee state insurance as per statutes/ amounts as advised by the Authorities. The Company has no further obligations once the contributions have been paid. The contributions are accounted for as defined contribution plan and the contributions are recognized as employee benefit expense when they are due.

iii. Short-term benefits:

Liabilities for salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of reporting period in which the employees rendered the related services are recognized in respect of employee’s service up to the end of reporting period and are measured at the amount expected to be paid when the liabilities are settled. These liabilities are presented as current employee benefit obligations in the balance sheet.

N. Provision and contingent liabilities

The Company sets up a provision when there is a present legal or constructive obligation as a result of a past event and it will probably requires an outflow of resources to settle the obligation and a reliable estimate can be made. If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pretax rate that reflects current market assessments of the time value of money and the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.

The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at reporting date, taking into account the risks and uncertainties surrounding the obligation.

A disclosure for a contingent liability is made where there is a possible obligation that arises from past events and the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not 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 the obligation or where reliable estimate of the obligation cannot be made. Contingent liabilities are disclosed on the basis of judgment of the management/ independent experts. These are reviewed at each balance sheet date and are adjusted to reflect the current management estimate.

O. Contingent Assets

Contingent Assets are not recognized in the financial statements. However, these are disclosed in the Director’s report.

P. Revenue recognition

Revenue is recognized based on nature of activity when consideration can be reasonably measured and recovered with reasonable certainty. Revenue is measured at the fair value of the consideration received or receivable and is reduced for estimated customer returns, rebates and other similar allowances.

(i) Revenue from operations

Revenue includes excise duty and adjustments made towards liquidated damages and price variation wherever applicable. However, it is net of Goods and Services Tax (GST) and Value Added Tax.

Escalation and other claims, which are not ascertainable/acknowledged by customers are not taken into account.

A. Sale of goods

Revenue from the sale of manufactured and traded goods is recognized when the goods are delivered and titles have been passed, provided all the following conditions are satisfied:

1. significant risks and rewards of ownership of the goods are transferred to the buyer;

2. the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the good sold;

3. the amount of revenue can be measured reliably;

4. it is probable that the economic benefits associated with the transaction will flow to the Company; and

5. the costs incurred or to be incurred in respect of the transaction can be measured reliably.

B. Rendering of services

Revenue from rendering of services is recognized when the outcome of a transaction can be estimated reliably by reference to the stage of completion of the transaction. The outcome of a transaction can be estimated reliably when all the following conditions are satisfied:

1. the amount of revenue can be measured reliably;

2. it is probable that the economic benefits associated with the transaction will flow to the Company;

3. t he stage of completion of the transaction at the end of the reporting period can be measured reliably; and

4. the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Stage of completion is determined by the proportion of actual costs incurred to-date, to the estimated total costs of the transaction

Unbilled revenue represents value of services performed in accordance with the contract terms but not billed. Such revenue is measured as based on the stage of completion of service.

C. Other operational revenue

Other operational revenue represents income earned from the activities incidental to the business and is recognized when the right to receive the income is established as per the terms of the contract.

(ii) Other income

A. Interest income is accrued on a time basis by reference to the principal outstanding and the effective interest rate.

B. Dividend income is accounted in the period in which the right to receive the same is established.

C. Other items of income are accounted as and when the right to receive such income arises and it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably.

Q. Exceptional items

An item of income or expense which by its size, type or incidence requires disclosure in order to improve an understanding of the performance of the Company is treated as an exceptional item and the same is disclosed in the notes to accounts.

R. Government grants

Grants from government are recognized at their fair value where there is reasonable assurance that the grant will be received and the Company will comply with all attached conditions.

Government grants relating to income are deferred and recognized in the statement of profit and loss account over the period necessary to match them with the costs that they are intended to compensate and presented within other income.

Government grants relating to the purchase of property, plant and equipment are included in noncurrent liabilities as deferred income and are credited to profit or loss on a straight line basis over the expected lives of the related assets and presented within other income.

S. Segment reporting

An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Company’s other components, and for which discrete financial information is available. Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker (‘CODM’).

The Company’s Board has identified the CODM who is responsible for financial decision making and assessing performance. The Company has a single operating segment as the operating results of the Company are reviewed on an overall basis by the CODM.

T. Leases

The determination of whether an agreement is, or contains, a lease is based on the substance of the agreement at the date of inception.

(i) Finance leases:

A. Leases where the Company has substantially all the risks and rewards of ownership of the related assets are classified as finance leases. Assets under finance leases are capitalized at the commencement of the lease at the lower of the fair value or the present value of minimum lease payments and a liability is created for an equivalent amount. Each lease rental paid is allocated between the liability and the interest cost, so as to obtain a constant periodic rate of interest on the outstanding liability for each period.

B. Assets given under a finance lease are recognized as a receivable at an amount equal to the net investment in the lease. Lease income is recognized over the period of the lease so as to yield a constant rate of return on the net investment in the lease.

(ii) Operating leases:

The leases which are not classified as finance lease are operating leases.

A. Lease rentals on assets under operating lease are charged to the Statement of Profit and Loss on a straight-line basis over the term of the relevant lease.

B. Assets leased out under operating leases are continued to be shown under the respective class of assets. Rental income is recognized on a straight-line basis over the term of the relevant lease.

U. Earnings per share

Basic earnings per equity share is computed by dividing the net profit or loss attributable to equity shareholders of the Company by the weighted average number of equity shares outstanding during the financial year.

Diluted earnings per equity share is computed by dividing the net profit or loss attributable to equity shareholders of the Company by the weighted average number of equity shares considered for deriving basic earnings per equity share and also the weighted average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares.

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Mar 31, 2015

1. Basis of Accounting

a) The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles in India and provisions of the Companies Act, 2013.

b) Accounting policies not specifically referred to otherwise, have been followed consistently and are in consonance with generally accepted accounting principles.

2. Fixed Assets

a) Fixed assets are stated at cost, net of Canvas/ VAT, if any, less accumulated depreciation. Cost includes freight, duties and other incidental expenses incurred till the commencement of commercial production. Incidental expenses include establishment expenses, interest on borrowed funds used for capital expenditure and other administrative expenses.

b) Capital Work in Progress includes incidental expenses pending allocation/ apportionment in respect of the uninstalled/ incomplete fixed assets.

3. Intangible Assets

Expenditure incurred on acquisition of intangibles are accounted for as Intangible Assets on completion, being identifiable non-monetary assets without physical substance at the acquisition cost and further expenses incurred in relation to expenses incurred in acquiring those intangible assets.

4. Depreciation

a) Depreciation on Fixed Assets has been provided based on useful lives prescribed in Schedule II of the Companies Act, 2013 on all assets, except in respect of the following assets, where useful life is different than those prescribed in the Schedule II are used as per technical estimate.

b) Intangible Assets

Intangible assets comprise of computer software. These intangible assets are amortized on straight line basis over a period of 5 years useful life, which in management's estimate represents the period during which economic benefits will be derived.

5. Revenue Recognition

a) All revenues, costs, assets and liabilities are accounted for on accrual basis except where there is no reasonable certainty. Turnover is excluding Inter Division Sales & Sales-tax but inclusive of excise duty, export incentives and exchange fluctuations.

b) Claim lodged with insurance companies are recognized as income on acceptance by the Insurance Company. The Excess / Shortfall of claims passed are adjusted in the year of receipt.

6. Inventories

Inventories are valued at lower of cost or net realizable

7. Foreign Exchange Transaction/ Translation

a) Monetary and Non-monetary items /transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of transaction.

b) Monetary items denominated in foreign currencies at the year end and not covered by forward exchange contract are translated at the year end rate and those covered by forward exchange contract are translated at the rate ruling on the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such differences are recognized over the life of the contract.

c) Exchange differences in respect of monetary and non-monetary items are recognized as income or expense in the profit and loss account for the relevant year except otherwise disclosed in other notes.

8. Research AND Development

Revenue expenditure on research and development is charged as an expense in the year in which they are incurred. Capital expenditure is shown as addition to fixed assets.

9. RETIREMENT benefits

a) Defined contribution plan

The company contributes to Government Provident Fund Scheme. The Company's contribution paid/ payable under the scheme is recognized as an expense in the profit and loss account during the period in which the employee renders the related service.

b) Defined benefit plan

The Company's liabilities on account of gratuity and leave encashment are determined at the end of each financial year on the basis of actuarial Valuation as per requirements of Accounting Standard 15 (revised 2005) on "Employee Benefits".

10. borrowing costs

Borrowing costs relating to acquisition/ construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

11. Accounting For TAXEs on Income

a) Current tax has been provided as per the provision of Income Tax Act 1961.

b) Tax expenses comprise of current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961. Deferred tax reflects the impact of current year timing differences between book profit and taxable income for the year and reversal of timing differences of earlier years.

The deferred tax for timing differences between the book profit and taxable income for the year is accounted for using the tax rates and laws that have been substantially enacted as of the Balance Sheet date. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. If the company has carry forward unabsorbed depreciation and tax losses, deferred tax assets are recognized only to the extent there is virtual certainty supported by convincing evidence that sufficient taxable income will be available against which such deferred tax asset can be realized.

Minimum Alternate Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in guidance note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit entitlement. The company reviews the same at each Balance Sheet date and write down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that the company will pay normal income-tax during specified period.

12. Impairment of Assets (As-28)

Factors giving rise any indication of any impairment of the carrying amount of the Company's assets are appraised at each Balance Sheet date to determine and provide/revert an impairment loss following accounting standard AS-28 for impairment of assets.

13. provisions, contingent Liabilities AND contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized nor disclosed in the financial statements.

14. EARNING per share

Basic earning per share is calculated by dividing the net profit or loss for the year attributable to equity shareholders (after deducting attributable taxes) by the weighted average number of equity shares outstanding during the year. The weighted average number of equity shares outstanding during the year is adjusted for events of preferential issue allotment of equity shares. For the purpose of calculating diluted earnings per shares, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

15. Joint venture

The Company's interest in Joint Venture/Jointly controlled operations is no longer there as at the close of the year since the company has divested its investments partly during the year.

16. cash Flow statement

The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard 3 on Cash Flow Statements and presents the cash flows by operating, investing and financing activities of the company. Cash and cash equivalents presented in the Cash Flow Statement consist of cash on hand and demand deposits with banks.

17. Miscellaneous Expenditure:

Miscellaneous Expenditure is debited fully in the year in which expenditure is incurred.

18. Investment:

Long term investments are carried at cost less provision for permanent diminution, if any, in value of such investments. Current investments are carried at lower of cost and fair value.

19. segment Reporting

The company has identified primary segments based on the products and secondary segments based on the geographical area.

Till previous year the company has two primary segments i.e. Textile and Toll Plaza but during the current year the company has only one primary segment i.e. Textile since the operation in Toll Plaza has been discontinued during the previous year. The secondary segments identified are as follows:

a. Domestic

b. Overseas

Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue, expenses, assets and liabilities to the extent possible are allocated and which relate to the Company as a whole and are not allocable to segments on reasonable basis have been included under "Unallocated revenue / expenses / assets / liabilities".

20. Government GRANTs

Capital grants relating to specific assets are reduced from the gross value of the Fixed Assets and those relating to revenue are credited to Profit & Loss A/c or netted from the related expenditure.

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Mar 31, 2014

1. BASIS OF ACCOUNTING

a) The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles in India and provisions of the Companies Act, 1956.

b) Accounting policies not specifically referred to otherwise, have been followed consistently and are in consonance with generally accepted accounting principles.

2. FIXED ASSETS

a) Fixed assets are stated at cost, net of Cenvat/ VAT, if any, less accumulated depreciation. Cost includes freight, duties and other incidental expenses incurred till the commencement of commercial production. Incidental expenses include establishment expenses, interest on borrowed funds used for capital expenditure and other administrative expenses.

b) Capital Work in Progress includes incidental expenses pending allocation/ apportionment in respect of the uninstalled/ incomplete fixed assets.

3. INTANGIBLE ASSETS

Expenditure incurred on acquisition of intangibles are accounted for as Intangible Assets on completion, being identifiable non-monetary assets without physical substance at the acquisition cost and further expenses incurred in relation to expenses incurred in acquiring those intangible assets.

4. DEPRECIATION

a) Depreciation on Fixed Assets has been provided on straight-line method at the rates and in the manner specified in schedule XIV of the Companies Act, 1956. The company has technically considered process house machinery (Installed prior to 31.03.11), wind power project & thermal power plant as continuous process plant.

b) Intangible Assets

Intangible assets comprise of computer software. These intangible assets are amortised on straight line basis over a period of 5 years useful life, which in management''s estimate represents the period during which economic benefits will be derived.

5. REVENUE RECOGNITION

a) All revenues, costs, assets and liabilities are accounted for on accrual basis except where there is no reasonable certainty. Turnover is excluding Inter Division Sales & Sales-tax but inclusive of excise duty, export incentives and exchange fluctuations.

b) Claim lodged with insurance companies are recognized as income on acceptance by the Insurance Company. The Excess / Shortfall of claims passed are adjusted in the year of receipt.

6. INVENTORIES

Inventories are valued at lower of cost or net realizable value, after providing for obsolescence and damages as follows:

a) Raw Material, At cost, on FIFO/ Packing Material weighted average basis. & Stores and Spares

b) Finished goods At cost, plus appropriate production overheads, including excise duty paid/ payable on such goods if applicable.

c) Material in Process At Cost, plus appropriate production overheads.

7. FOREIGN EXCHANGE TRANSACTION/ TRANSLATION

a) Monetary and Non-monetary items / transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of transaction.

b) Monetary items denominated in foreign currencies at the year end and not covered by forward exchange contract are translated at the year end rate and those covered by forward exchange contract are translated at the rate ruling on the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such differences are recognized over the life of the contract.

c) Exchange differences in respect of monetary and non-monetary items are recognized as income or expense in the profit and loss account for the relevant year except otherwise disclosed in other notes.

8. RESEARCH AND DEVELOPMENT

Revenue expenditure on research and development is charged as an expense in the year in which they are incurred. Capital expenditure is shown as addition to fixed assets.

9. RETIREMENT BENEFITS

a) Defined Contribution Plan

The company contributes to Government Provident Fund Scheme. The Company''s contribution paid/ payable under the scheme is recognized as an expense in the profit and loss account during the period in which the employee renders the related service.

b) Defined Benefit Plan

The Company''s liabilities on account of gratuity and leave encashment are determined at the end of each financial year on the basis of actuarial Valuation as per requirements of Accounting Standard 15 (revised 2005) on "Employee Benefits".

10. BORROWING COSTS

Borrowing costs relating to acquisition/ construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

11. ACCOUNTING FOR TAXES ON INCOME

a) Current tax has been provided as per the provision of Income Tax Act 1961.

b) Tax expenses comprise of current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961. Deferred tax reflects the impact of current year timing differences between book profit and taxable income for the year and reversal of timing differences of earlier years.

The deferred tax for timing differences between the book profit and taxable income for the year is accounted for using the tax rates and laws that have been substantially enacted as of the Balance Sheet date. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. If the company has carry forward unabsorbed depreciation and tax losses, deferred tax assets are recognized only to the extent there is virtual certainty supported by convincing evidence that sufficient taxable income will be available against which such deferred tax asset can be realized.

Minimum Alternate Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in guidance note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit entitlement. The company reviews the same at each Balance Sheet date and write down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that the company will pay normal income-tax during specified period.

12. IMPAIRMENT OF ASSETS (AS-28)

Factors giving rise any indication of any impairment of the carrying amount of the Company''s assets are appraised at each Balance Sheet date to determine and provide/revert an impairment loss following accounting standard AS-28 for impairment of assets.

13. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognized when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized nor disclosed in the financial statements.

14. EARNING PER SHARE

Basic earning per share is calculated by dividing the net profit or loss for the year attributable to equity shareholders (after deducting attributable taxes) by the weighted average number of equity shares outstanding during the year. The weighted average number of equity shares outstanding during the year is adjusted for events of preferential issue allotment of equity shares. For the purpose of calculating diluted earning per shares, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

15. JOINT VENTURE

The interest in Joint Venture/ jointly controlled operations is disclosed as per Accounting Standard-27, with no effect of the profits or losses and assets and liabilities thereof in the financial statements.

16. CASH FLOW STATEMENT

The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard 3 on Cash Flow Statements and presents the cash flows by operating, investing and financing activities of the company. Cash and cash equivalents presented in the Cash Flow Statement consist of cash on hand and demand deposits with banks.

17. MISCELLANEOUS EXPENDITURE:

Miscellaneous Expenditure is debited fully in the year in which expenditure is incurred.

18. INVESTMENT

Long term investments are carried at cost less provision for permanent diminution, if any, in value of such investments. Current investments are carried at lower of cost and fair value.

19. SEGMENT REPORTING

The company has identified primary segments based on the products and secondary segments based on the geographical area.

The primary segments identified are as follows:

I. Textile

II. Toll Plaza

The secondary segments identified are as follows:

a. Domestic

b. Overseas

Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue, expenses, assets and liabilities to the extent possible are allocated and which relate to the Company as a whole and are not allocable to segments on reasonable basis have been included under "Unallocated revenue / expenses / assets / liabilities".

20. GOVERNMENT GRANTS

Capital grants relating to specific assets are reduced from the gross value of the Fixed Assets and those relating to revenue are credited to Profit & Loss A/c or netted from the related expenditure.

---

Mar 31, 2012

1. Basis of Accounting

a) The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles in India and provisions of the Companies Act, 1956.

b) Accounting policies not specifically referred to otherwise, have been followed consistently and are in consonance with generally accepted accounting principles.

2. Fixed Assets

a) Fixed assets are stated at cost, net of Cenvat/ VAT, if any, less accumulated depreciation. Cost includes freight, duties and other incidental expenses incurred till the commencement of commercial production. Incidental expenses include establishment expenses, interest on borrowed funds used for capital expenditure and other administrative expenses.

b) Capital Work in Progress includes incidental expenses pending allocation/ apportionment in respect of the uninstalled/ incomplete fi xed assets.

3. Intangible Assets

Expenditure incurred on acquisition of intangibles are accounted for as Intangible Assets on completion, being identifiable non-monetary assets without physical substance at the acquisition cost and further expenses incurred in relation to expenses incurred in acquiring those intangible assets.

4. Depreciation

a) Depreciation on Fixed Assets has been provided on straight-line method at the rates and in the manner specified in schedule XIV of the Companies Act, 1956. The company has technically considered process house machinery (Installed prior to 31.03.11), wind power project & thermal power plant as continuous process plant.

b) Intangible Assets

Intangible assets comprise of computer software. These intangible assets are amortised on straight line basis over a period of 5 years useful life, which in management's estimate represents the period during which economic benefits will be derived.

5. Revenue Recognition

a) All revenues, costs, assets and liabilities are accounted for on accrual basis except where there is no reasonable certainty. Turnover is excluding Inter Division Sales & Sales-tax but inclusive of excise duty, export incentives and exchange fluctuations.

b) Claim lodged with insurance companies are recognized as income on acceptance by the Insurance Company. The Excess / Shortfall of claims passed are adjusted in the year of receipt.

6. Inventories

Inventories are valued at lower of cost or net realizable value , after providing for obsolescence and damages as follows:

a) Raw Material,

Packing Material & Stores and Spares

At cost, on FIFO/ weighted average basis.

b) Finished goods

At cost, plus appropriate production overheads, including excise duty paid/ payable on such goods if applicable.

c) Material in Process

At Cost, plus appropriate production overheads.

7. Foreign Exchange Transaction/Translation

a) Monetary and Non-monetary items /transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of transaction.

b) Monetary items denominated in foreign currencies at the year end and not covered by forward exchange contract are translated at the year end rate and those covered by forward exchange contract are translated at the rate ruling on the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such differences are recognized over the life of the contract.

c) Exchange differences in respect of monetary and non-monetary items are recognized as income or expense in the Profit and loss account for the relevant year except otherwise disclosed in other notes.

8. Research and Development

Revenue expenditure on research and development is charged as an expense in the year in which they are incurred. Capital expenditure is shown as addition to fixed assets.

9. Retirement benefits

a) Defined Contribution Plan

The company contributes to Government Provident Fund Scheme. The Company's contribution paid/ payable under the scheme is recognized as an expense in the Profit and loss account during the period in which the employee renders the related service.

b) Defined benefit Plan

The Company's liabilities on account of gratuity and leave encashment are determined at the end of each financial year on the basis of actuarial Valuation as per requirements of Accounting Standard 15 (revised 2005) on "Employee benefits".

10. Borrowing Costs

Borrowing costs relating to acquisition/construction of qualifying assets are capitalised until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete. A qualifying assets is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

11. Accounting for Taxes on Income

a) Current tax has been provided as per the provision of Income Tax Act 1961.

b) Tax expenses comprise of current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961. Deferred tax refl ects the impact of current year timing differences between book Profit and taxable income for the year and reversal of timing differences of earlier years.

The deferred tax for timing differences between the book Profit and taxable income for the year is accounted for using the tax rates and laws that have been substantially enacted as of the Balance Sheet date. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. If the company has carry forward unabsorbed depreciation and tax losses, deferred tax assets are recognized only to the extent there is virtual certainty supported by convincing evidence that sufficient taxable income will be available against which such deferred tax asset can be realized.

Minimum Alternate Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in guidance note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit entitlement. The company reviews the same at each Balance Sheet date and write down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that the company will pay normal income-tax during specified period.

12. Impairment of Assets (AS-28)

Factors giving rise any indication of any impairment of the carrying amount of the Company's assets are appraised at each Balance Sheet date to determine and provide/revert an impairment loss following accounting standard AS-28 for impairment of assets.

13. Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized nor disclosed in the fi nancial statements.

14. Earning Per Share

Basic earning per share is calculated by dividing the net Profit or loss for the year attributable to equity shareholders (after deducting attributable taxes) by the weighted average number of equity shares outstanding during the year. The weighted average number of equity shares outstanding during the year is adjusted for events of preferential issue allotment of equity shares. For the purpose of calculating diluted earning per shares, the net Profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

15. Joint Venture

The interest in Joint Venture / jointly controlled operations is disclosed as per Accounting Standard- 27,with no effect of the profits or losses and assets and liabilities thereof in the financial statements.

16. Cash Flow Statement

The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard 3 on Cash Flow Statements and presents the cash fl ows by operating, investing and financing activities of the company. Cash and cash equivalents presented in the Cash Flow Statement consist of cash on hand and demand deposits with banks.

17. Miscellaneous Expenditure:

Miscellaneous Expenditure is debited fully in the year in which expenditure is incurred.

18. Investment:

Long term investments are carried at cost less provision for permanent diminution, if any, in value of such investments. Current investments are carried at lower of cost and fair value.

19. Segment Reporting

The company has identified primary segments based on the products and secondary segments based on the geographical area.

The primary segments identified are as follows:

I. Textile

II. Toll Plaza

The secondary segments identified are as follows:

a. Domestic

b. Overseas

Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue, expenses, assets and liabilities to the extent possible are allocated and which relate to the Company as a whole and are not allocable to segments on reasonable basis have been included under "Unallocated revenue / expenses / assets / liabilities".

20. Government Grants

Capital grants relating to specific assets are reduced from the gross value of the Fixed Assets and those relating to revenue are credited to Profit & Loss A/c or netted from the related expenditure.

---

Mar 31, 2011

1. BASIS OF ACCOUNTING

a) The financial statements have been prepared under the histori- cal cost convention in accordance with the generally accepted ac- counting principles in India and provisions of the Companies Act, 1956.

b) Accounting policies not specifically referred to otherwise, have been followed consistently and are in consonance with generally accepted accounting principles.

2. FIXED ASSETS

a) Fixed assets are stated at cost, net of Cenvat/ VAT, if any, less ac- cumulated depreciation. Cost includes freight, duties and other in- cidental expenses incurred till the commencement of commercial production. Incidental expenses include establishment expenses, interest on borrowed funds used for capital expenditure and other administrative expenses.

b) Capital Work in Progress includes incidental expenses pending al- location/ apportionment in respect of the uninstalled/ incomplete fixed assets and advances to suppliers of Plant and machinery, equipment etc.

c) Expenditure incurred on acquisition of intangibles are accounted for as Intangible Assets on completion, being identifiable non- monetary assets without physical substance at the acquisition cost and further expenses incurred in relation to expenses in- curred in acquiring those intangible assets.

3. DEPRECIATION

a) Depreciation on Fixed Assets has been provided on straight-line method at the rates and in the manner specified in schedule XIV of the Companies Act, 1956. The company has technically con- sidered process house machinery, wind power project & thermal power plant as continuous process plant.

b) Intangible Assets

Intangible assets comprise of computer software. These intan- gible assets are amortised on straight line basis over a period of 5 years useful life, which in management's estimate represents the period during which economic benefits will be derived.

4. REVENUE RECOGNITION

a) All revenues, costs, assets and liabilities are accounted for on ac- crual basis except where there is no reasonable certainty. Turn- over is excluding Inter Division Sales & Sales-tax but inclusive of excise duty, export incentives and exchange fluctuations.

b) Claim lodged with insurance companies are recognized as income on acceptance by the Insurance Company. The Excess / Shortfall of claims passed are adjusted in the year of receipt.

5. INVENTORIES

Inventories are valued at lower of cost or net realizable value, after providing for obsolescence and damages as follows:

a)

Raw Material, Packing Material & Stores and Spares

At cost, on FIFO/ weighted average basis.

b) Finished goods

At cost, plus appropriate production overheads, including excise duty paid/ payable on such goods if applicable.

c) Material in Process

At Cost, plus appropriate production overheads.

6. FOREIGN EXCHANGE TRANSACTION/TRANSLATION

a) Monetary and Non-monetary items /transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of transaction.

b) Monetary items denominated in foreign currencies at the year end and not covered by forward exchange contract are translated at the year end rate and those covered by forward exchange con- tract are translated at the rate ruling on the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such differences are recognized over the life of the contract.

c) Exchange differences in respect of monetary and non-monetary items are recognized as income or expense in the profit and loss account for the relevant year except otherwise disclosed in other notes.

7. RESEARCH AND DEVELOPMENT

Revenue expenditure on research and development is charged as an expense in the year in which they are incurred. Capital expen- diture is shown as addition to fixed assets.

8. RETIREMENT BENEFITS

a) Defined Contribution Plan

The company contributes to Government Provident Fund Scheme. The Company's contribution paid/ payable under the scheme is recognized as an expense in the profit and loss account during the period in which the employee renders the related service.

b) Defined Benefit Plan

The Company's liabilities on account of gratuity and leave encash- ment are determined at the end of each financial year on the basis of actuarial Valuation as per requirements of Accounting Standard 15 (revised 2005) on "Employee Benefits".

9. BORROWING COSTS

Borrowing costs relating to acquisition/ construction of qualify- ing assets are capitalized until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete. A qualifying asset is one that necessarily takes sub- stantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

10. ACCOUNTING FOR TAXES ON INCOME

a) Current tax has been provided as per the provision of Income Tax Act 1961.

b) Tax expenses comprise of current and deferred tax. Current in- come tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961. Deferred tax reflects the impact of current year timing differences between book profit and taxable income for the year and reversal of timing differences of earlier years.

The deferred tax for timing differences between the book profit and taxable income for the year is accounted for using the tax rates and laws that have been substantially enacted as of the Balance Sheet date. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. If the company has carry forward unab- sorbed depreciation and tax losses, deferred tax assets are rec- ognized only to the extent there is virtual certainty supported by convincing evidence that sufficient taxable income will be avail- able against which such deferred tax asset can be realized.

Minimum Alternate Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified pe- riod. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in guidance note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit entitlement. The company reviews the same at each Balance Sheet date and write down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that the company will pay normal income-tax during specified period.

11. IMPAIRMENT OF ASSETS (AS-28)

Factors giving rise any indication of any impairment of the carry- ing amount of the Company's assets are appraised at each Balance Sheet date to determine and provide/revert an impairment loss following accounting standard AS-28 for impairment of assets.

12. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measure- ment are recognized when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are dis- closed in the notes. Contingent assets are neither recognized nor disclosed in the financial statements.

13. EARNING PER SHARE

Basic earning per share is calculated by dividing the net profit or loss for the year attributable to equity shareholders (after de- ducting attributable taxes) by the weighted average number of equity shares outstanding during the year. The weighted average number of equity shares outstanding during the year is adjusted for events of preferential issue allotment of equity shares. For the purpose of calculating diluted earning per shares, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

14. JOINT VENTURE

The interest in Joint Venture/ jointly controlled operations is disclosed as per Accounting Standard-27, with no effect of the profits or losses and assets and liabilities thereof in the financial statements.

15. CASH FLOW STATEMENT

The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard 3 on Cash Flow Statements and presents the cash flows by operating, investing and financing activities of the company. Cash and cash equivalents presented in the Cash Flow Statement consist of cash on hand and demand deposits with banks.

16. MISCELLANEOUS EXPENDITURE:

Miscellaneous Expenditure is debited fully in the year in which expenditure is incurred.

17. INVESTMENT:

Long term investments are carried at cost less provision for per- manent diminution, if any, in value of such investments. Current investments are carried at lower of cost and fair value.

18. SEGMENT REPORTING

The company has identified primary segments based on the prod- ucts and secondary segments based on the geographical area.

The primary segments identified are as follows:

I. Textile

ii. Toll Plaza The secondary segments identified are as follows:

a. Domestic

b. Overseas

Segment revenue, segment expenses, segment assets and seg- ment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue, expenses, assets and liabilities to the extent possible are allocated and which relate to the Company as a whole and are not allocable to segments on reasonable basis have been included under "Unallocated revenue / expenses / assets / liabilities".

---

Mar 31, 2010

1. Basis of Accouniiog

a) The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles in India and provisions of the Companies Act, 1 956.

b) Accounting policies not specifically referred to otherwise, have been followed consistently and are in consonance with generally accepted accounting principles.

a) Fixed assets are stated at cost, net of Cenvat/ VAT, if any, less accumulated depreciation. Cost includes freight, duties and other incidental expenses incurred till the commencement of commercial production. Incidental expenses include establishment expenses, interest on borrowed funds used for capital expenditure and other administrative expenses.

b) Capital Work in Progress includes incidental expenses pending allocation/ apportionment in respect of the uninstalled/ incomplete fixed assets and advances to suppliers of Plant and machinery, equipment etc.

c) Expenditure incurred on acquisition of intangibles are accounted for as Intangible Assets on completion, being identifiable non- monetary assets without physical substance at the acquisition cost and further expenses incurred in relation to expenses incurred in acquiring those intangible assets.

3. Depredators

a) Depreciation on Fixed Assets has been provided on straight-line method at the rates and in the manner specified in schedule XIV of the Companies Act, 1 956. The company has technically considered process house machinery, wind power project & thermal power piant as continuous process plant.

b) Intangible Assets

Intangible assets comprise of computer software. These intangible assets are amortised on straight line basis over a period of 5 years useful life, which in managements estimate represents the period during which economic benefits will be derived.

4. Revenue- Recognition

a) All revenues, costs, assets and liabilities are accounted for on accrual basis except where there is no reasonable certainty. Turnover is excluding Inter Division Sales & Sales-tax but inclusive of excise duty, export incentives and exchange fluctuations.

b) Claim lodged with insurance companies are recognized as income on acceptance by the Insurance Company. The Excess / Shortfall of claims passed are adjusted in the year of receipt.

5. inventories

Inventories are valued at lower of cost or net realizable value, after providing for obsolescence and damages as follows:

6, Foreign Exchange Ttanslation;TrGruk*f*of;

a) Monetary and Non-monetary items /transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of transaction.

b) Monetary items denominated in foreign currencies at the year end and not covered by forward exchange contract are translated at the year end rate and those covered by forward exchange contract are translated at the rate ruling on the date of transaction as increased or decreased by the proportionate difference between the forward rate and exchange rate on the date of transaction, such differences are recognized over the life of the contract.

c) Exchange differences in respect of monetary and non-monetary items are recognized as income or expense in the profit and loss account for the relevant year except otherwise disclosed in other notes.

Revenue expenditure on research and development is charged as an expense in the year in which they are incurred. Capital expenditure is shown as addition to fixed assets.

a) Defined Contribution Plan

The company contributes to Government Provident Fund Scheme. The Companys contribution paid/ payable under the scheme is recognized as an expense in the profit and loss account during the period in which the employee renders the related service.

b) Defined Benefit Plan

The Companys liabilities on account of gratuity and leave encashment are determined at the end of each financial year on the basis of actuarial Valuation as per requirements of Accounting Standard 15 (revised 2005) on "Employee Benefits".

9 Borrawmq Costs

Borrowing costs relating to acquisition/ construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

a) Current tax has been provided as per the provision of Income Tax Act 1961.

b) Tax expenses comprise of current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authoritie in accordance with the Indian Income Tax Act, 1 961. Deferred income tax reflects the impact of current year timing differences between taxable income for the year and reversal of timing differences of earlier years. The deferred tax for timing differences between the book and taxable profits for the year is accounted for using the tax rates and laws that have been substantiaily enacted as of the Balance Sheet date. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. If the company has carry forward unabsorbed depreciation and tax losses, deferred tax assets are recognized only to the extent there is virtual certainty supported by convincing evidence that sufficient taxable income will be available against which such deferred tax asset can be realized.

Minimum Alternate Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in guidance note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit and Loss Account and shown as MAT Credit entitlement. The company reviews the same at each Balance Sheet date and write down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that the company will pay normal income-tax during specified period.

Factors giving rise any indication of any impairment of the carrying amount of the Companys assets are appraised at each Balance Sheet date to determine and provide/revert an impairment loss following accounting standard AS-28 for impairment of assets.

Provisions involving substantial degree of estimation in measurement are recognized when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized nor disclosed in the financial statements.

Basic earning per share is calculated by dividing the net profit or loss for the year attributable to equity shareholders {after deducting attributable taxes) by the weighted average number of equity shares outstanding during the year. The weighted average number of equity shares outstanding during the year is adjusted for events of preferential issue allotment of equity shares. For the purpose of calculating diluted earning per shares, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

The interest in Joint Venture/ jointly controlled operations are disclosed as per Accounting Standard-27, with no effect of the profits or losses and assets and liabilities thereof in the financial statements.

The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard 3 on Cash Flow Statements and presents the cash flows by operating, investing and financing activities of the company. Cash and cash equivalents presented in the Cash Flow Statement consist of cash on hand and demand deposits with banks.

Miscellaneous Expenditure is debited fully in the year in which expenditure is incurred.

Long term investments are carried at cost less provision for permanent diminution, if any, in value of such investments. Current investments are carried at lower of cost and fair value.