Accounting Policies of Supreme Engineering Ltd. Company

Mar 31, 2025

1 Significant Accounting Policies

1.1 Basis of preparation

(a) Compliance with Ind AS:

The Financial Statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) notified under Section 133 of the Act
read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015, as amended and Companies (Indian Accounting Standards) Amendment Rules,
2016 (Ind AS) . The Financial Statements comply in all material respects with Ind AS. The Company’s first Ind AS Financial Statements and Ind AS 101,
’First-time Adoption of Indian Accounting Standards’ has been applied for Financial Year ended 31 March 2021. The policies set out below have been
consistently applied during the years presented.

These Financial Statements for the year ended 31 March 2023 are Financial Statements of the Company prepared in accordance with Ind AS.

All 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 Act.

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

The items are regrouped whereever required so as to give a better presentation of the financial statements. The figures of previous year are also changed to that
effect.

(b) Historical cost convention

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

a. certain financial assets and liabilities that are measured at fair value;

b. defined benefit plans - plan assets measured at fair value;

The Financial Statements are presented in Indian Rupees (''INR'') which is the functional and presentational currency and all values are rounded to the nearest
Lakh, except otherwise indicated.

Summary of significant accounting policies

1.2 Property, plant and equipment:

All items of property, plant and equipment are stated at acquisition cost net of accumulated depreciation and accumulated impairment losses, if any. Historical
cost includes expenditure that is directly attributable to the acquisition of the items. The Company follows cost model for subsequent measurement for all
classes and items of property, plant and equipment.

Subsequent costs are included in the carrying amount of asset or recognised as a separate asset, as appropriate, only when it is probable that future economic
benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. All other repairs and maintenance expenses are
charged to the Statement of Profit and Loss during the period in which they are incurred. Gains or losses arising on retirement or disposal of assets are
recognised in the Profit or Loss.

Spare parts, stand-by equipment and servicing equipment are recognised as property, plant and equipment if they meet the definition of property, plant and
equipment.

Property, plant and equipment which are not ready for intended use as on the date of Balance Sheet are disclosed as ''Capital work-in-progress''.

Depreciation on Tangible Fixed Assets is provided on Written Down Value (WDV) on the basis of useful life of assets specified in Part C of Schedule II of the
Companies Act, 2013.

Property, plant and equipment which are added / disposed off during the year, depreciation is provided on pro-rata basis with reference to the day of addition /
deletion.

Gains and losses on disposals are determined by comparing the proceeds with the carrying method.

The residual values are not more than 5% of the original cost of the asset, wherever applicable.

The residual values, useful lives and method of depreciation of property, plant and equipment are reviewed at each financial year end and any changes there-in
are considered as change in estimate and accounted prospectively.

Depreciation and useful life

Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value. Depreciation is recognised so as to
write off the cost of assets (other than freehold land and properties under construction) less their residual values over their useful lives, using straight-line
method as per the useful life prescribed in Schedule II to the Companies Act, 2013.

Derecognition

An item of PPE is de-recognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss
arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying
amount of the asset and is recognised in Statement of Profit and Loss.

1.3 Investment properties:

Property that is held for long-term rental yields or for capital appreciation or both, and that is not in use by the Company, is classified as investment property.
Land held for a currently undetermined future use is also classified as an investment property.

Investment property is measured initially at its acquisition cost, including related transaction costs and where applicable borrowing costs and are carried at cost
less accumulated impairment losses.

Investment properties are subsequently measured at cost less depreciation. Investment properties are depreciated using the straight-line method over their
estimated useful lives. Investment properties generally have a useful life of 35-50 years. The useful life has been determined based on technical evaluation
performed by the management’s expert.

1.4 Impairment of fixed assets

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

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market
assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken
into account. If no such transactions can be identified, an appropriate valuation model is used. Impairment losses are recognised in statement of profit and loss.

1.5 Inventories:

Inventories are carried in the balance sheet as follows:

(i) Raw materials, components, stores and spares :

Raw materials, components, stores and spares are valued at lower of cost or net realisable value. The Raw material is valued at Net Realisable Value in the year
under consideration.

(ii) Work-in-progress and Finished goods:

Cost of work-in-progress and finished goods comprises direct materials, direct labour and an appropriate proportion of variable and fixed overhead
expenditure. Fixed overheads are allocated on the basis of normal operating capacity. Cost of inventories also include all other costs incurred in bringing the
inventories to their present location and condition. Costs are assigned to the individual items in a group of inventories on the basis of First in first out basis.
Costs of purchased inventory are determined after deducting rebates and discounts. Net realisable value is the estimated selling price in the ordinary course of
business less the estimated costs of completion and the estimated costs necessary to make the sale.

The devaluation of the stock is due to the following factors and reasons and hence, Net Realisable Value is reported:

1. Cancellation of orders: There were various orders that were received from government companies during the COVID-19 pandemic period. Due to
operational issues, the manufacturing of these orders got delayed, which resulted in cancellation of various high value orders from customers. These materials
were made-to-order and hence once the chemical composition for the required customer is made, it cannot be diverted or sold to any other customer. Due to
this reason, the valuation of the product has to be revalued as scrap.

2. Obsolete stock: There was various stock manufactured for supply of material to distributors. During the pandemic, these distributors had cash flow trouble
due to which their payments to our company got very delayed. The company decided to stop this line of business in this financial year. Hence, the stock
manufactured for these customers also need to be revalued accordingly.

The stock issues were discussed in the board meeting dated 13/12/22 and the revaluation was accepted by the board on 14/02/2023. The devaluation to net
realisable value was implemented once the management was clear of the fact that there is no market otherwise for the products and the quality over the period
has also depleted.

The diminished value of the inventory is reported under the exceptional item which has increased the loss of the company. The total value reduces is
of Rs. 4,24.54 ( in lakhs) which consists of Rs. 352.23 (in lakhs) in case of Raw Material and Rs. 72.31 (in lakhs) in case of Work in Progress.

(i) Cash and cash equivalents:

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less,
which are subject to an insignificant risk of changes in value.

The Balance with banks includes Rs. 1.67 Crores which has been appropriated by Bank of India during Holding On Operations. However, we are not able to
determine the corresponding impact of the same and is therefore appearing as cash and cash equivalents.

1.7 Foreign currency transactions:

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

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

1.8 Revenue recognition:

(i) Sale of goods

Revenue is measured at the fair value of the consideration received or receivable. The Company recognises revenues on sale of products, net of discounts, sales
incentives, rebates granted, returns, sales taxes/GST and duties when the products are delivered to customer or when delivered to a carrier for export sale,
which is when title and risk and rewards of ownership pass to the customer. Export incentives are recognised as income as per the terms of the scheme in
respect of the exports made and included as part of export turnover.

Revenue from sales is recognised when control of the products has transferred, being when the products are delivered to the customer, the customer has full
discretion over the channel and price to sell / consume the products, and there is no unfulfilled obligation that could affect the customer’s acceptance of the
products. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the
customer, and either the customer has accepted the products in accordance with the sales contract or the acceptance provisions have lapsed.

(ii) Accounting for Claims

Claims are accounted as income in the period of receipt of arbitration award or acceptance by client or evidence of acceptance received.

(iii) Interest income

Interest income is recognised on a time proportion basis taking into account the amount outstanding using the effective interest rate method.

(iv) Dividend income

Revenue is recognised when the company’s right to receive the payment is established.

(v) Rental Income

Revenue is recognised at the start of the period for which the property is rented. The company is receiving rent from Commerical property commencing from
21st Oct 2022. Taxes are levied over and above the rental which is charged.

1.9 Leases

The company has applied Ind AS 116 using the modified retrospective approach. Ind AS 116 is applicable for annual reporting period beginning on or after 1
April 2019. The Company has adopted Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs with effect from 1st April, 2020,
with a transition date of 1st April, 2019.This lease ended as on 31st October 2021 and later again continued for further 3 years.

(i) Company as a lessee:

The company recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which
comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs
incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease
incentives received.

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the
right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of property and
equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain re-measurements of the lease
liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate
implicit in the lease or, if that rate cannot be readily determined, company’s incremental borrowing rate. Generally, the company uses its incremental borrowing
rate as the discount rate.

Lease payments included in the measurement of the lease liability comprise the following:

- Fixed payments, including in-substance fixed payments;

- Variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;

- Amounts expected to be payable under a residual value guarantee; and

- The exercise price under a purchase option that the company is reasonably certain to exercise, lease payments in an optional renewal period if the company is
reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the company is reasonably certain not to terminate early.

The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in future lease payments arising
from a change in an index or rate, if there is a change in the company’s estimate of the amount expected to be payable under a residual value guarantee, or if
company changes its assessment of whether it will exercise a purchase, extension or termination option.

When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit
or loss if the carrying amount of the right-of-use asset has been reduced to zero.

(ii) Short-term leases and leases of low-value assets Company as a lessee:

The company has elected not to recognise right-of-use assets and lease liabilities for short term leases of real estate properties that have a lease term of 12
months. The company recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

(iii) Company as a lessor:

Lease income from operating leases where the Company is a lessor is recognised in income on a straight-line basis over the lease term unless the receipts are
structured to increase in line with expected general inflation to compensate for the expected inflationary cost increases. The respective leased assets are
included in the balance sheet based on their nature.

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

1.10 Employee Benefits

(i) Short term employee benefits

All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits and they are recognized in
the period in which the employee renders the related service. The Company recognizes the undiscounted amount of short term employee benefits expected to be
paid in exchange for services rendered as a liability (accrued expense) after deducting any amount already paid.

(ii) Post-Employment Benefits

The company operates the following post-employment schemes:

(i) defined benefit plans and

(ii) defined contribution plans

Defined benefit plans - Gratuity obligations

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

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

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

Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are recognised immediately in profit or loss as
past service cost.

Defined contribution plans - Provident fund

The company pays provident fund contributions to publicly administered provident funds as per local regulations. The company has no further payment
obligations once the contributions have been paid. The contributions are accounted for as defined contribution plans and the contributions are recognised as
employee benefit expense when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future
payments is available.

1.11 Borrowing Costs:

Borrowing costs attributable to the acquisition or construction of qualifying assets. Borrowing costs are capitalized as part of the cost of such asset up to the
date when the asset is ready for its intended use. All other borrowing costs are expensed as incurred. Borrowing costs consist of interest and other cost that an
entity incurs in connection with the borrowing of funds. Borrowing cost includes exchange differences to the extent regarded as an adjustment to the borrowing
costs. The company has not provided for accrued interest, charges, penalty or any other charges from the date of becoming classified as Non Performing Assets
and the impact of the same on the financial result and statement remain unaccounted for.

1.12 Earnings Per Share:

Basic earnings per share are calculated by dividing the net profit or loss for the year attributable to equity shareholders 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 bonus issue;
bonus element in a rights issue, share split; and reverse share split (consolidation of shares).

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average
number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

1.13 Taxes on Income:

Income tax expense comprises current and deferred tax. It is recognised in the statement of profit and loss except to the extent that it relates to a business
combination, or items recognised directly in equity or in OCI.

(i) Current income tax

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

Current income tax relating to items recognised outside profit or loss is (either in other comprehensive income or in equity). Current tax items are recognised in
correlation to the underlying transaction either in OCI (Other Comprehensive Income) or directly in equity. Management periodically evaluates positions taken
in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

(ii) Deferred tax

Deferred tax is provided using the liability method on temporary differences between the tax bases of assets and liabilities and their carrying amounts for
financial reporting purposes at the reporting date.

Deferred tax liabilities are recognised for all taxable temporary differences, except:

- When the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and, at
the time of the transaction, affects neither the accounting profit nor taxable profit or loss

- Taxable temporary differences arising on the initial recognition of goodwill.

Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax
assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry
forward of unused tax credits and unused tax losses can be utilised, except:

- When the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not
a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit
will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are
recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on
tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets against current tax liabilities and the
deferred taxes relate to the same taxable entity and the same taxation authority.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax items are recognised in correlation to the
underlying transaction either in OCI or directly in equity.

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Mar 31, 2024

1 Significant Accounting Policies

1.1 Basis of preparation (a) Compliance with Ind AS:

The Financial Statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) notified under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015, as amended and Companies (Indian Accounting Standards) Amendmen Rules. 2016 (Ind AS). The Financial Statements comply in all material respects with Ind AS The Company’s first Ind AS Financial Statements and n .

101,’First-time Adoption of Indian Accounting Standards’ has been applied for Financial Year ended 31 March 2021. The policies set out ow ia\e een consistently applied during the years presented.

These Financial Statements for the year ended 31 March 2023 arc Financial Statements of the Company prepared in accordance with Ind AS.

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

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

The items are regrouped whereever required so as to give a better presentation of the financial statements The figures of previous year are also changed to that effect

(b) Historical cost convention

The Financial Statements have been prepared on a historical cost basis, except for the following.

a. certain financial assets and liabilities that are measured at fair value;

b. defined benefit plans - plan assets measured at fair value;

The Financial Statements are presented in Indian Rupees (’INR’) which is the functional and presentational currency and all values are rounded to the nearest Lakh, except otherwise indicated,

Summary of significant accounting policies

1.2 Property, plant and equipment:

AH items of property plant and equipment are stated at acquisition cost net of accumulated depreciation and accumulated impairment losses, if any. Historical cost includes expenditure that is directly attributable to the acquisition of the items. The Company follows cost model for subsequent measurement for all classes and items of property, plant and equipment.

Subsequent costs are included in the carrying amount of asset or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. All other repairs and maintenance expenses are charged to the Statement of Profit and Loss during the period in which they are incurred Gains or losses arising on retirement or disposal of assets are

recognised in the Profit or Loss.

Spare parts, stand-by equipment and servicing equipment are recognised as property, plant and equipment if they meet the definition of property, plant and equipment.

Property, plant and equipment which are not ready for intended use as on the date of Balance Sheet are disclosed as Capital work-in-progress''

Depreciation on Tangible Fixed Assets is provided on Written Down Value (WDV) on the basis of useful life of assets specified in Part C of Schedule II of the Companies Act, 2013

Property, plant and equipment which are added / disposed off during the year, depreciation is provided on pro-rata basis with reference to the day of addition / deletion

Gains and losses on disposals are determined by comparing the proceeds with the carrying method The residual values are not more than 5% of the original cost of the asset, wherever applicable

The residual values, useful lives and method of depreciation of property, plant and equipment are reviewed at each financial year end and any changes there-m arc considered as change in estimate and accounted prospectively.

Depreciation and useful life

Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value. Depreciation is recognised so as to write off the cost of assets (other than freehold land and properties under construction) less their residual values over their useful lives, using straight-line method as per the useful life prescribed in Schedule II to the Companies Act, 2013.

Derecognition

An item of PPE is de-recognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in Statement of Profit and Loss

1.3 Investment properties:

Property that is held for long-term rental yields or for capital appreciation or both, and that is not in use by the Company, is classified as investment property Land held for a currently undetermined future use is also classified as an investment property

Investment property is measured initially at its acquisition cost, including related transaction costs and where applicable borrowing costs and arc earned at cost less accumulated impairment losses

Investment properties are subsequently measured at cost less depreciation Investment properties are depreciated using the straight-line method over their estimated useful lives. Investment properties generally have a useful life of 35-50 years The useful life has been determined based on technical evaluation performed by the management’s expert.

1.4 Impairment of fixed assets

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

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset In determining fair value less costs of disposal, recent market transactions are taken into account If no such transactions can be identified, an appropriate valuation model is used Impairment losses arc recognised in statement of profit and loss.

1.5 Inventories:

Inventories are carried in the balance sheet as follows:

(i) Raw materials, components, stores and spares :

Raw materials, components, stores and spares are valued at lower of cost or net realisable value The Raw material is valued at Net Realisable Value in the year under consideration

(ii) Work-in-progress and Finished goods:

Cost of work-in-progress and finished goods comprises direct materials, direct labour and an appropriate proportion of variable and fixed overhead expenditure Fixed overheads are allocated on the basis of normal operating capacity Cost of inventories also include all other costs incurred in bringing the inventories to their present location and condition Costs arc assigned to the individual items in a group of inventories on the basis of First in first out basis Costs of purchased inventory are determined after deducting rebates and discounts Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale

The devaluation of the stock is due to the following factors and reasons and hence, Net Realisable Value is reported

1 Cancellation of orders There were various orders that were received from government companies during the COVID-19 pandemic period Due to operational issues, the manufacturing of these orders got delayed, which resulted in cancellation of various high value orders from customers These materials were madc-to-ordcr and hence once the chemical composition for the required customer is made, it cannot be diverted or sold to any other customer Due to this reason, the valuation of the product has to be revalued as scrap

2 Obsolete stock There was various stock manufactured for supply of material to distributors During the pandemic, these distributors had cash flow troub le due to which their payments to our company got very delayed The company decided to stop this line of business in this financial year Hence, the stock manufactured for these customers also need to be revalued accordingly

The stock issues were discussed in the board meeting dated 13/12/22 and the revaluation was accepted by the board on 14/02/2023 The devaluation to net realisable value was implemented once the management was clear of the fact that there is no market otherwise for the products and the quality over the period has also depleted

The diminished value of the inventory is reported under the exceptional item which has increased the loss of the company. The total value reduces is of Rs. 8883.70 (in lakhs) which consists of Rs. In lakhs - Rs. 741.16 in case of Finished Goods, Rs. 6321.14 in case of Raw Material and Rs. 1821.40 in case of Work in Progress.

¹⁶ C«Tfl^lw^Iport^Tus''ng the "indirect method", whereby profit for the period is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows The cash flows from operating, investing and financing activities of the C ompany arc segregated

(i) Cash and cash equivalents:

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value

The Balance with banks includes Rs I 67 Crores which has been appropriated by Bank of India daring Holding On Operations However, we are not able to determine the corresponding impact of the same and is therefore appearing as cash and cash equivalents.

1.7 Foreign currency transactions:

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

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

1.8 Revenue recognition:

(i) Sale of goods

Revenue is measured at the fair value of the consideration received or receivable The Company recognises revenues on sale of products, net of discounts, sales incentives, rebates granted, returns, sales taxes/GST and duties when the products are delivered to customer or when delivered to a earner for export sale, which is when title and risk and rew ards of ownership pass to the customer Export incentives are recognised as income as per the terms of the scheme ifl respect of the exports made and included as part of export turnover

Revenue from sales is recognised when control of the products has transfened, being when the products are delivered to the customer, the customer has full discretion over the channel and price to sell / consume the products, and there is no unfulfilled obligation that could affect the customer’s acceptance of the products Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract or the acceptance provisions have lapsed.

(ii) Accounting for Claims

Claims are accounted as income in the period of receipt of arbitration award or acceptance by client or evidence of acceptance received

(iii) Interest income

Interest income is recognised on a rime proportion basis taking into account the amount outstanding using the effective interest rate method

(iv) Dividend income

Revenue is recognised when the company''s right to receive the payment is established

(v) Rental Income

Revenue is recognised at the start of the period for which the property is rented The company is receiving rent from Commerical property commencing from 21st Oct 2022. Taxes are levied over and above the rental which is charged

1.9 Leases

The company has applied Ind AS 116 using the modified retrospective approach Ind AS 116 is applicable for annual reporting period beginning on or after 1 Apnl 2019 The Company has adopted Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs with effect from 1st April. 2020, with a transition date of 1 st April, 2019.This lease ended as on 31 st October 2021 and later again continued for further 3 years.

The company lias applied Ind AS 116 using the futher discounted cash flow approach The company has renewed the lease for futher 3 years The Company has adopted Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs with effect from 1st Apnl, 2020, and renewed the lease from I st November 2021 which ends on 31st October 2024

~ • - — - ~ -----— •- - - - ----- — ¦ --------------- ''" ~^

(i) Company as a lesser:

The company recognises a nght-of-use asset anti a lease liability at the lease commencement date The nghi-of-tise asset is initially measured at cost comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date plus an initial d * ''^C incurred and an estimate of costs to dismantle ami remove the underlying asset or to restore the underlying asset or the site on which it iTtacated? ***** lease incentives received ^<>Ca '' ^{655 any}

The nght-of-t.se asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the nght-of-use asset or the end of the lease term The estimated useful lives of right-of-usc assets arc determined on the same basis as those of property and equipment In addition, the nght-of-use asset is periodically reduced by impairment losses, if any. and adjusted for certain re-measurements of the lease liabihts

The lease liability is initially measured at the present value ofthe lease payments that arc not paid at the commencement date, discounted using the interest rate implicit in the lease or. if that rate cannot be readily determined, company''s incremental borrowing rale Generally, the company uses its incremental borrowing rate as the discount rate

Uasc payments included in the measurement of the lease liability comprise the following * Fixed payments, including in-substance fixed payments.

- Variable lease payments that depend on an index or a rale, initially measured using the index or rale as at the commencement date.

- Amounts expected to be payable under a residual value guarantee, and

^on?hK^C,!^^{PnCe IMKlCr 8 JHirchasc 0ptk>n ,ha1 ,he} company is reasonably certain to exercise, lease payments in an optional renewal period if the company is early '' ° "^,n *° ^{cxcrc,sc an ex,ens}''^on option, and penalties for early termination of a lease unless the company is reasonably certain not to terminate

from a ^ ^m^^{asurcd a}* ^anK>rt,scd cost using the effective interest method It is remeasured when there is a change in future lease payments arising

commnv chT ^m ^ ^{0 C}* °^{r ra,C}'' ''* ^dlCre *^{S a cfian}^^{c ,n l}^^e company''s estimate of the amount expected to be payable under a residual value guarantee, or if company changes its assessment of whether it will excrc.se a purchase, extension or termination option

or ^l''^ab,l,ty ''^{S rernc}*^{sured m} »h.s way. a corresponding adjustment is made to the carrying amount of the nght-of-use asset, or is recorded in profit

or loss if the carrying amount ofthe nght-of-usc asset has been reduced to zero

(ii) Short-term leases and leases of low-value assets Company as a lessee:

^C.^{1 n,}P^an'' *^ias elec¹⁶** ^not to recognise right-of-use assets and lease liabilities for short term leases of real estate properties that have a lease term of 12 months The company recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term

(iii) Company as a lessor:

^™^efr0m “T ^{WherC C}°^{mpany ,S 3 ,CSSOr ,S recot?n,scd in} ''"^{come on a str}aigh_t-line basis over the lease term unless the receipts are

LTT^{856 m},. ^Ck^W,t^ ^eXPT ^{general ,nfla,lon 10 com}P^{cnsa,e for ,hc} expected inflationary cost increases The respective leased assets are included in the balance sheet based on their nature

Leases are class,f.ed as finance leases when substantially all ofthe nsks and rewards ofownersh.p ttansfer from the company to the lessee Amounts due from

lessees under finance leases are recorded as receivables Finance lease income is allocated to accounting periods to reflect i constant n,w_rifMi,_r at r

the net investment outstanding in respect ofthe lease ⁸ **^{8 C}°^{nS,am penod,c ra,e of re,urn on}

1.10 Employee Benefits

(i) Short term employee benefits

All employee benefits payable wholly within twelve months of rendering the service arc classified as short term emolovee h™.r,.c

the period in which the employee renders the related service The Company recognizes the undiscounted amount of short term emnlnvr* *

be paid in exchange for services rendered as a liability (accrued expense) after deducting any amount already paid ^{P Y} ^ *^{Xpected ,0}

(ii) Post-Employment Benefits

The company operates the following post-employment schemes:

(i) defined benefit plans and

(ii) defined contribution plans

Defined benefit plans - Gratuity obligations

The liability or asset recognised in the balance sheet in respect of defined benefit pension and gratuity plans is the n

obligation at the end of the reporting period less the fair value of plan assets The defined benefit obligation is ^ ^ *** ^{dcf,IKd bencf,t}

projected unit credit method calculated annually by actuaries using the

_Thl - inlcfest cos, ,sclcu„,cd by .pplysng ,bc d.coun, n,,e ,o UK nc, bshnc. of,be dcf.ncU bc^fi, obbgsbon and ,he f.„ v,,„c of plan assCs TTns cos, ,s Idudcd tn employee bcncf.I expense ,n ,he slmcmcn, of prof,, and loss

«. _ari,_inc fryn, experience adjustments and changes in actuarial assumptions arc recognised in the period in which they occur, dZrrr^^rb Jsoe mcsm,e Tbe, arc mdnded in eannnps ,n U,c s.a.cmcn, of changes ,n eqndy and in ,bc balance shee,

Changes in Uk presen, value of ,he defined benefi, obhgafion resnlfing from plan an,end,nen,s o, curia,lmen,_S are recoded ,n,mcd,alely ,n p,of„ o, loss as past service cost

[>cfincd contribution plans - Provident fund

The company pays provuien, fund con,„bu„ons ,o pubhely adnnn.s.cred prov.dcn, funds as per local regulafions ^ ^

obligations once ,he conmbufions have been _Pa,d The con.r.bufions are account for as defined eon,r.bufion plans and ^ employee benefit expense when they are due Prepaid contributions arc recognised as an asset to the extent that a cash refund or payments is available

.11 Borrowing Costs:

Borrow ing costs attributable to the acquisition or construction of qualifying assets Borrowing costs are capitalized as part of the cost of such asset up to t e date when the asset is ready for its intended use. All other borrowing costs arc expensed as incurred Borrowing costs consist o interest an ot er cos a a entity incurs in connection with the borrowing of funds Borrowing cost includes exchange differences to the extent regarded as an a justrnen o le borrowing costs The company has not provided for accrued interest, charges, penalty or any other charges from the date of becoming classi i as Performing Assets and the impact of the same on the financial result and statement remain unaccounted for

12 Earnings Per Share:

Basic earnings per share are calculated by dividing the net profit or loss for the year attributable to equity shareholders 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 bonus issue, bonus element in a rights issue, share split, and reverse share split (consolidation of shares).

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period arc adjusted for the effects of all dilutive potential equity shares.

3 Taxes on Income:

Income tax expense comprises current and deferred tax It is recognised in the statement of profit and loss except to the extent that it relates to a business combination, or items recognised directly in equity or in OCI.

i Current income tax

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

Current income tax relating to items recognised outside profit or loss is (either in other comprehensive income or in equity) Current tax items are recognised in correlation to the underlying transaction cither in OCI (Other Comprehensive Income) or directly in equity Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations arc subject to interpretation and establishes provisions where appropriate

Deferred tax

Deferred tax is provided using the liability method on temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date

Deferred tax liabilities are recognised for all taxable temporary differences, except:

- When the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss

- Taxable temporary differences arising on the initial recognition of goodwill.

Deferred tax assets are recognised for all deductible temporary differences, the cany forward of unused tax credits and any unused tax losses Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised, except:

- When the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered

Deferred tax assets and liabilities arc measured at the tax rates tliat are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date

Deferred lax assets and deferred lax liabilities arc offset if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss Deferred tax items are recognised in correlation to the underly ing transaction cither in OCI or directly in equity

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Mar 31, 2018

SIGNIFICANT ACCOUNTING POLICIES:

The financial statements are prepared to comply in all material aspects with the applicable accounting principles in India, the accounting standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 2013.

25.1 Basis of Preparation:

The financial statements have been prepared and presented under the historical cost convention on the accrual basis of accounting and comply with the Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 2013, to the extent applicable. The financial statements are presented in Rupees, unless otherwise stated. During the year, balances of the previous financial year are regrouped in the current financial statement to show the more appropriate financial statement.

25.2 Use of Estimates:

The preparation of the financial statements in conformity with generally accepted accounting principles (''GAAP'') in India requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements. Management believes that the estimates made in the preparation of financial statements are prudent and reasonable. Actual future period''s results could differ from those estimates. Any revision to accounting estimates is recognized prospectively in current and future periods.

25.3 Revenue Recognition:

Revenue is recognized to the extent it is probable that the economic benefits will flow to the company and the revenue can be reliably measured.

Revenue from Operations

Sale of Manufactured and Traded Goods

Sale of traded goods/material is recognized as revenue when significant risk and rewards of ownership relating to the goods are transferred to the buyer.

Revenue from Other Sources Other Incomes have been recognized on accrual basis.

25.4 Fixed Assets, Capital Work-in-Progress & Depreciation:

Fixed Assets are stated at cost of acquisition, including any attributable cost for bringing the asset to its working condition for its intended use, less accumulated depreciation.

Depreciation has been provided on W.D.V. method at the rates and in the manner prescribed as per Part "C" of Schedule II of The Companies Act 2013. Depreciation @ 100% is charged on the individual assets costing less than Rs. 5000. Depreciation is not provided on the Assets, which are fully depreciated.

25.5 Impairment of Assets:

In accordance with AS 28 ''Impairment of Assets'' issued by the Institute of Chartered Accountants of India, the carrying amounts of the Company''s assets are reviewed at each balance sheet date to determine whether there is any impairment. The recoverable amount of the assets (or where applicable, that of the cash generating unit to which the asset belongs) is estimated as the higher of its net selling price and its value in use. An impairment loss is recognized whenever the carrying amount of an asset or a cash generating unit exceeds its recoverable amount. Impairment loss is recognized in the Profit and Loss Account or against revaluation surplus where applicable.

25.6 Inventories:

In general, all inventories of finished goods, work-in-progress etc., are stated at lower of cost and net realisable value. Cost of inventories comprise of all cost of purchase, cost of conversion and other cost incurred in bringing the inventory to their present location and condition. Raw material and stores and spares are stated at lower of cost and net realisable value. However, materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. The cost is determined on FIFO Method on average cost basis. Scrap and trial run products are valued at estimated net realisable value

25.7 Retirement Benefits:

Defined Contribution Plan

The Company''s contribution paid / payable during the year to the Provident fund and ESIC is charged to the Profit & Loss account for the year when the contribution to the fund is due. The Company makes a contribution of 12% towards provident fund, which is charged to the profit and loss account. All unutilized leave is encashed at the end of the year. Hence there is no provision required in the books.

25.8 Taxation:

Income tax expenses comprises of Current Income Tax and Deferred Tax.

Current Taxes:

Provision for current income-tax is recognized in accordance with the provisions of Indian Income Tax Act, 1961 and is made annually based on the tax liability after taking credit for tax allowances and exemptions.

Deferred Taxes:

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to timing differences that result between the profits offered for income taxes and the profits as per the financial statements. Deferred tax assets and liabilities are measured using the tax rates and the tax laws that have been enacted or substantively enacted at the balance sheet date. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the period that includes the enactment date.

Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in the future, however, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognized only if there is virtual certainty, supported by convincing evidence of recognition of such assets. Deferred tax assets are reassessed for the appropriateness of their respective carrying values at each balance sheet date.

25.9 Cash Flow Statement

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the Company are segregated.

25.10 Foreign Currency Transactions:

Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction. Monetary assets and liabilities are translated at the year-end rate. The difference between the rate prevailing on the date of the transaction and on the date of settlement, as also on the translation of monetary assets and liabilities at the end of the year is recognized as income or expense as the case may be for the year.

25.11 Earnings per Share:

The basic earnings per equity share are computed by dividing the net profit attributable to the equity shareholders for the period by the weighted average number of equity shares outstanding during the reporting period. The number of shares used in computing diluted earnings per share comprises the weighted average number of shares considered for deriving basic earnings per share, and also the weighted average number of equity shares, which may be issued on the conversion of all dilutive potential shares, unless the results would be anti dilutive.

25.12 Provisions& Contingencies:

The Company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources embodying economic benefits and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the Likelihood of outflow of resources is remote, no provision or disclosure is made.

25.13 lnvestments:

Current investments are carried at the lower of cost or unquoted /fair value, computed category wise. Long Term Investments are stated at cost. Provision for diminution in the value of long-term investments is made only if such a decline is other than temporary in the opinion of the management.

25.14 Amortization of Research and Development Expenses

Research and Development Expenses incurred on product development are written off over the period of 15 years.