Accounting Policies of Tega Industries Ltd. Company

Mar 31, 2025

2. Summary of Material
Accounting Policies

This note provides a list of the material accounting policies
adopted in the preparation of these standalone financial
statements. These policies have been consistently applied to
all the years presented, unless otherwise stated.

2.1 Basis Of Preparation

(i) Compliance With Ind As

These standalone financial statements have been
prepared to comply in all material aspects with Indian
Accounting Standards (Ind AS) notified under Section
133 of the Companies Act, 2013 (the Act) [Companies
(Indian Accounting Standards) Rules, 2015 and
Companies (Indian Accounting Standards) Amendment
Rules, 2016] and other relevant provisions of the Act.

(ii) Historical Cost Convention

The standalone financial statements have been
prepared as going concern on accrual basis and under
the historical cost convention except for the following
assets and liabilities which have been measured at fair
value or revalued amount:

- certain financial assets and liabilities measured
at fair value (refer accounting policy regarding
financial instruments);

- defined benefit plans - plan assets

measured at fair value;

- share-based payments

(iii)Current Versus Non Current

Classification

All assets and liabilities have been classified as current
or non-current as per the Companyâs operating cycle
and other criteria set out in the Indian Accounting
Standards (Ind AS) and Schedule III to the Companies
Act, 2013. Based on the nature of products and the
time between the acquisition of assets for processing
and their realisation in cash and cash equivalents, the
Company has ascertained its operating cycle as 12
months for the purpose of current - non-current
classification of assets and liabilities.

2.2New And Amended Standards
Adopted By The Company

The Ministry of Corporate Affairs notified new standards or
amendment to existing standards under Companies (Indian
Accounting Standards) Rules as issued from time to time.

The Company applied following amendments for the first-time
during the current year which are effective from 1 April 2024:

Amendments To Ind As 1 16-Lease
Liability In A Sale And Leaseback

The amendments require an entity to recognise lease liability
including variable lease payments which are not linked to
index or a rate in a way it does not result into gain on Right
of Use asset it retains.

Notification Of Ind As 117

MCA notified Ind AS 1 17, a comprehensive standard
that prescribe, recognition, measurement and disclosure
requirements, to avoid diversities in practice for accounting
insurance contracts and it applies to all companies i.e., to all
"insurance contracts" regardless of the issuer. However, Ind
AS 117 is not applicable to the entities which are insurance
companies registered with IRDAI.

The Company has reviewed the new pronouncements
and based on its evaluation has determined that these
amendments do not have a significant impact on the
Standalone Financial Statements.

2.3Property, Plant And Equipment

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

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

An asset''s carrying amount is written down immediately
to its recoverable amount if the asset''s carrying amount is
greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing
proceeds with carrying amount. These are included in the
statement of profit and loss.

Depreciation

i) Depreciation is calculated using a straight-line method
to allocate the cost of the assets, net of their residual
values, over their estimated useful lives as specified
by Schedule II to the Act, wherever applicable. The
estimated useful lives of the property, plant and
equipment have been presented below:
*For these class of assets, based on internal assessment and independent
technical evaluation carried out by external valuers, the Company
believes that the useful lives as given above best represent the year over
which Company expects to use these assets. Hence, the useful lives for
these assets are different from the useful lives as prescribed under Part
C of Schedule II to the Act.

ii) Leasehold improvements are depreciated over the
shorter of their useful life or the lease term, unless the
entity expects to use the assets beyond the lease term.

The assets'' residual values and useful lives are reviewed
by the management, and adjusted if appropriate, at the
end of each reporting period.

2.4 Intangible Assets

Intangible assets are stated at cost of acquisition net of
accumulated amortisation and accumulated impairment, if
any. Costs associated with maintaining software programs are
recognised as an expense as incurred.

An asset''s carrying amount is written down immediately
to its recoverable amount if the asset''s carrying amount is
greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing
proceeds with carrying amount. These are included in the
statement of profit and loss.

Research and Development Expenditure

Research expenditure and development expenditure that
do not meet the criterias mentioned below are recognised
as an expense as incurred. Development costs previously
recognised as an expense are not recognised as an asset in
a subsequent period. Property, plant and equipment used in
Research and Development are capitalised.

Development costs are recognised as intangible assets when
the following criteria are met:

1. it is technically feasible to complete the intangible asset
so that it will be available for use

2. management intends to complete the intangible asset
and use or sell it

3. there is an ability to use or sell the intangible asset

4. it can be demonstrated how the intangible asset will
generate probable future economic benefits

5. adequate technical, financial and other resources
to complete the development and to use or sell the
intangible asset are available, and

6. the expenditure attributable to the intangible asset
during its development can be reliably measured.â

Capitalised development costs are recorded as intangible
assets and amortised from the point at which the asset is
available for use.

2.5 Impairment

At each balance sheet date, the Company reviews the carrying
values of its property, plant and equipment and intangible
assets to determine whether there is any indication that the
carrying value of those assets may not be recoverable through
continuing use. If any such indication exists, the recoverable
amount of the asset is reviewed in order to determine
the extent of impairment, if any. Where the asset does not
generate cash flows that are independent from other assets,
the Company estimates the recoverable amount of the cash
generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to
sell and value in use. 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 for which the estimates of future cash flows have
not been adjusted. An impairment loss is recognised in the
statement of profit and loss as and when the carrying value
of an asset exceeds its recoverable amount.

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

2.6Investments In Subsidiaries And
Joint Venture

Investments in subsidiaries and joint venture are carried at
cost less accumulated impairment, if any. Where an indication
of impairment exists, the carrying amount of the investment
is assessed and written down immediately to its recoverable
amount. On disposal of investments in subsidiaries and joint
venture, the difference between net disposal proceeds and
the carrying amounts are recognised in the statement of
profit and loss.

2.7Financial Instruments

The financial assets are classified in the following categories:

(i) financial assets measured at amortised cost,

(ii) financial assets measured at fair value through profit or
loss (FVTPL), and

(iii) financial assets at fair value through other comprehensive
income (FVOCI).â

The classification of financial assets depends on the
Companyâs business model for managing financial assets and
the contractual terms of the cash flow. For assets measured
at fair value, gains and losses will either be recorded in
statement of profit and loss and other comprehensive income.
The Company reclassifies debt investments when and only
when its business model for managing those assets changes.

Regular purchases and sales of financial assets are recognised
on trade-date, being the date on which the Company
commits to purchase or sale the financial asset.

At initial recognition, the Company measures a financial
asset (excluding trade receivables which do not contain a
significant financing component) at its fair value plus, in the
case of a financial asset not at fair value through profit or
loss, transaction costs that are directly attributable to the
acquisition of the financial asset. Transaction costs of financial
assets carried at fair value through profit or loss are expensed
in statement of profit and loss.

Investment in debt instruments

Subsequent measurement of debt instruments depends
on the Companyâs model of managing the assets and the
cash flow characteristics of the asset. There are three
measurement categories in which the Company classifies its
debt instruments.

Financial assets measured at amortised
cost

Assets that are held for collection of contractual cash flows
where those cash flows represent solely payments of principal
and interest are measured at amortised cost. Interest income
from these financial assets are included in Other Income using
the effective interest rate method. After initial recognition,
such financial assets are subsequently measured at amortised
cost using the effective interest rate method. Any gain or
loss arising on derecognition is recognised directly in the
statement of profit and loss and presented in other gains/
(losses). The losses arising from impairment are recognised
in the statement of profit and loss.

Financial assets at fair value through
other comprehensive income (FVOCI)

Financial assets are measured at fair value through other
comprehensive income if these financial assets are held
within a business model whose objective is achieved by both
collecting contractual cash flows and selling financial assets
and the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
Movements in the carrying amount are taken through OCI,
except for the recognition of impairment gains or losses,
interest income and foreign exchange gains and losses which
are recognised in statement of profit and loss. When the
financial asset is derecognised, the cumulative gain or loss
previously recognised in OCI is reclassified from equity to
profit and loss and recognised in other gains/ (losses). Interest
income from these financial assets is included in other income
using the effective interest rate method. Foreign exchange
gains and losses are presented in other gains/ (losses) and
impairment expenses are presented as separate line item in
the statement of profit and loss.

Financial assets measured at fair value
through profit or loss (FVTPL)

Assets that do not meet the criteria for amortised cost or
FVOCI are measured at fair value through profit or loss.
A gain or loss on a debt investment that is subsequently
measured at fair value through profit or loss is recognised
in the statement of profit and loss in the period in which
it arises. Interest income from these financial assets are
included in other income.

Investments in units of mutual funds are subsequently
measured at FVTPL and the changes in fair value are
recognised in the statement of profit and loss.

De-recognition of financial asset

A financial asset is derecognised only when

â¢ The Company has transferred the rights to receive cash
flows from the financial asset or

â¢ Retains the contractual rights to receive the cash flows of
the financial asset, but assumes a contractual obligation
to pay the cash flows to one or more recipients.

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

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

Impairment of financial assets

For trade receivables only, the Company applies the simplified
approach required by Ind AS 109, which requires expected
lifetime losses to be recognised from initial recognition of
the receivables.

Trade receivables

Trade receivables are amounts due from customers for goods
sold or services rendered in the ordinary course of business and
reflects Companyâs unconditional right to consideration (that is,
payment is due only on the passage of time).Trade receivables are
recognised initially at the transaction price as they do not contain
significant financing component. The Company holds the trade
receivables with the objective of collecting the contractual cash
flows and therefore measures them subsequently at amortised
cost using the effective interest rate method, less loss allowance.

Cash and cash equivalents

For the purpose of presentation in the statement of cash
flows, cash and cash equivalents include cash on hand,
demand deposits with banks, other short term highly liquid
investments, if any, with original maturities of three months
or less that are readily convertible to known amount of cash
and subject to an insignificant change in value.

Financial liabilities
Borrowings

Borrowings are initially recognised at fair value, net of
transaction costs incurred. Borrowings are subsequently
measured at amortised cost using the effective interest
rate method. Any difference between the proceeds (net of
transaction costs) and the redemption amount is recognised
in the statement of profit and loss over the period of the
borrowings using the effective interest rate method. Fees
paid on the establishment of loan facilities are recognised as
transaction costs of the loan to the extent that it is probable
that some or all of the facility will be drawn down.

Borrowings are removed from the balance sheet when the
obligation specified in the contract is discharged, cancelled
or expired. The difference between the carrying amount of a
financial liability that has been extinguished or transferred to
another party and the consideration paid, including any nonÂ¬
cash assets transferred or liabilities assumed, is recognised in
the statement of profit and loss as other gains/ (losses).

Borrowings are classified as current liabilities unless the
Company has an unconditional right to defer settlement of
the liability for at least 12 months after the reporting period.
Where there is a breach of a material provision of a longÂ¬
term loan arrangement on or before the end of the reporting
period with the effect that the liability becomes payable on
demand on the reporting date, the entity does not classify
the liability as current, if the lender agreed, after the reporting
period and before the approval of the financial statements for
issue, not to demand payment as a consequence of the breach.

Trade and other payables

Trade and other payables represent current liabilities for
goods and services provided to the Company prior to the
end of the financial year which are unpaid. The amount
are unsecured and are usually paid within 30-90 days of
recognition. Trade and other payables are presented as
current liabilities unless payment is not due within 12 months
after the reporting period. They are recognised initially at
their fair value and subsequently measured at amortised cost
using the effective interest rate method.

De-recognition of financial liabilities

A financial liability (or a part of financial liability) is deÂ¬
recognised from Company''s balance sheet when obligation
specified in the contract is discharged, or cancelled, or expired.

Derivative instruments and hedge
accounting

Derivatives are only used for economic hedging purposes
and not as speculative investments. The Company uses
certain derivative financial instruments to reduce business
risks which arise from its exposure to foreign exchange
and interest rate fluctuations. The instruments are confined
principally to forward foreign exchange contracts and
interest rate swaps and options.

Derivatives are initially recognised at fair value on the date
a derivative contract is entered into and are subsequently
re-measured to their fair value at the end of each reporting
period. Net mark to market gains/ losses on derivatives
taken by the Company are recorded in other income/
expenses respectively.

The Company adopts hedge accounting for forward foreign
exchange contracts wherever possible. At inception of each
hedge, there is a formal, documented designation of the
hedging relationship. This documentation includes, inter alia,
items such as identification of the hedged item and transaction
and nature of the risk being hedged. At inception, each hedge
is expected to be highly effective in achieving an offset of
changes in fair value or cash flows attributable to the hedged
risk. The effectiveness of hedge instruments to reduce the
risk associated with the exposure being hedged is assessed
and measured at the inception and on an ongoing basis.
The ineffective portion of designated hedges is recognised
immediately in the statement of profit and loss.

When hedge accounting is applied:

â¢ for fair value hedges of recognised assets and liabilities,
changes in fair value of the hedged assets and liabilities
attributable to the risk being hedged, are recognised in
the statement of profit and loss and compensate for
the effective portion of symmetrical changes in the fair
value of the derivatives.

â¢ for cash flow hedges, the effective portion of the change
in the fair value of the derivative is recognised directly
in other comprehensive income and the ineffective
portion is recognised in the statement of profit and
loss. If the cash flow hedge of a firm commitment or
forecasted transaction results in the recognition of a
non-financial asset or liability, then, at the time the asset
or liability is recognised, the associated gains or losses
on the derivative that had previously been recognised
in equity are included in the initial measurement of the
asset or liability. For hedges that do not result in the
recognition of a non-financial asset or a liability, amounts
deferred in equity are recognised in the statement of
profit and loss in the same period in which the hedged
item affects the statement of profit and loss.

Hedge accounting is discontinued when the hedging
instrument expires or is sold, terminated, or exercised, or
no longer qualifies for hedge accounting. At that time, any
cumulative gain or loss on the hedging instrument recognised
in equity is retained in equity until the forecasted transaction
occurs. If a hedged transaction is no longer expected to
occur, the net cumulative gain or loss recognised in equity is
transferred to the statement of profit and loss for the period.

2.8 Offsetting Financial Instruments

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.

2.9 Inventories

Inventories are valued at lower of cost and net realisable
value. Cost of raw materials and traded goods comprises cost
of purchases. Cost of work-in-progress and finished goods
comprises direct materials, direct labours and an appropriate
proportion of variable and fixed overhead expenditure,
the latter being 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 individual items of
inventory on the basis of weighted-average cost method. 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.

2.10 Revenue Recognition

Revenue shall be recognised to depict the transfer of
promised goods or services to customers in an amount that
reflects the consideration to which the entity expects to be
entitled in exchange for those goods and services.

Sale of goods

Sales are recognised when control of the products has been
transferred to the buyer being when the products are dispatched/
delivered to the customer depending on the contract terms.
This occurs when the products have been shipped or delivered
to the specific location as the case may be, the risk of loss
has been transferred, and either the customer has accepted
the products in accordance with the sales contract, or the
Company has objective evidence that all criteria for acceptance
has been satisfied. Revenue from contract with customers is
primarily recorded at a point in time. Revenue is recognised
based on the price specified in the contract.

No element of financing is deemed present as the sales are
generally made with a credit term upto 180 days which is
consistent with market practice.

Sale of services

Revenue from service contracts are recognised in the
accounting period in which the services are rendered.

accounted for as a separate performance obligation. Where
the contracts include multiple performance obligations,
the transaction price is allocated to each performance
obligation based on the stand-alone selling prices. Where
these are not directly observable, they are estimated based
on the expected cost plus margin. If contracts include the
installation of product, revenue for the product is recognized
at a point in time when the product is delivered, the legal title
has passed and the customer has accepted the product.

A receivable is recognised when the goods are dispatched
or delivered, depending on the contract terms, as this is the
point in time that the consideration is unconditional because
only the passage of time is required before the payment is due.

A contract asset is recognised in respect of those
performance obligations where the control of the goods
has been transferred to the buyer, and only delivery of the
goods is pending. In these cases the consideration is due
after the shipping obligation is complete, accordingly these
are classified as contract assets as the consideration is
conditional on something other than passage of time.

The Company does not have any contracts where the period
between the transfer of the promised goods or services to
the customer and payment by the customer exceeds one
year. As a consequence, the Company does not adjust any of
the transaction prices for the time value of money.

The Company generally provides for warranties which
are assurance-type warranties under Ind AS 115, and are
accounted for under In AS 37 Provisions, Contingent
Liabilities and Contingent Assets.

2.11 Other Income

Interest: Interest income from financial assets at fair
value through profit or loss is disclosed as interest income
within other income. Interest income on financial assets at
amortised cost and financial assets at FVOCI is calculated
using the effective interest rate method and recognised in the
statement of profit and loss as part of other income.

Interest income is calculated by applying the effective interest
rate to the gross carrying amount of a financial asset except
for financial assets that subsequently become credit-impaired.
For credit-impaired financial assets the effective interest rate
is applied to the net carrying amount of the financial asset
(after deduction of the loss allowance).

Dividend: Dividends are received from financial assets at
fair value through profit or loss and at FVOCI. Dividends are
recognised as other income in the statement of profit and
loss when the right to receive payment is established.

2.12 Government Grants

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

(ii) Government grants relating to income are deferred and
recognised in the statement of profit and loss over the
period necessary to match them with the costs that
they are intended to compensate and presented within
other operating revenue.

2.13 Borrowing Costs

Borrowing costs include interest, other costs incurred in
connection with borrowing and exchange differences arising
from foreign currency borrowings to the extent that they are
regarded as an adjustment to the interest cost.

General and specific borrowing costs directly attributable to
the acquisition,construction or production of qualifying assets,
are capitalised during the period of time that is required to
complete and prepare the assets for its intended use or sale.
Qualifying assets are assets that necessarily take a substantial
period of time to get ready for their intended use or sale.
Investment income earned on the temporary investment of
specific borrowings pending their expenditure on qualifying
assets is deducted from the borrowing costs eligible for
capitalisation.

All other borrowing costs are expensed in the period in
which they are incurred.

2.14 Foreign Currencies Translation

Functional and presentation currency

Items included in the financial statements are measured using
the currency of the primary economic environment in which
the entity operates (âthe functional currency^. The financial
statements are presented in Indian rupee (INR), which is Tega
Industries Limitedâs functional and presentation currency.

Initial Recognition: On initial recognition, all foreign currency
transactions are recorded by applying to the foreign currency
amount the exchange rate between the reporting currency
and the foreign currency at the date of the transaction.

of profit and loss. Non-monetary assets and non-monetary
liabilities denominated in a foreign currency and measured
at fair value are translated at the exchange rate prevalent
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. Non-monetary
assets and non-monetary liabilities denominated in a foreign
currency and measured at historical cost are translated at
the exchange rate prevalent at the date of transaction.

2.15 Employee Benefits

a) Short-term employee benefits:

Short-term Employee Benefits (i.e. benefits payable
within one year) are recognised in the period in which
employee services are rendered.

b) Defined contribution plans
Provident fund

This is a defined contribution plan for certain
employees and contributions are remitted to Provident
Fund authorities in accordance with relevant statute
and charged to the statement of profit and loss in the
period in which the related employee services are
rendered. The Company has no further obligations
for future Provident Fund benefits other than its
monthly contributions.

Superannuation fund

This is a defined contribution plan. The Company
contributes a certain percentage of the eligible salary
for employees covered under the scheme towards
superannuation fund administered by the Trustees.
The Company has no further obligations for future
superannuation benefits other than its contributions and
recognizes such contributions as expense in the period
in which the related employee services are rendered.

c) Defined benefit plans
Gratuity

For defined benefit retirement schemes the cost of
providing benefits is determined using the Projected
Unit Credit Method, with actuarial valuation being
carried out at each balance sheet date. Re-measurement
gains and losses of the net defined benefit liability/(asset)
are recognised immediately in other comprehensive
income. The service cost and net interest on the
net defined benefit liability/(asset) is treated as a net
expense within employment costs.

Past service cost is recognised as an expense when the
plan amendment or curtailment occurs or when any
related restructuring costs or termination benefits are
recognised, whichever is earlier.

The retirement benefit obligation recognised in the
balance sheet represents the present value of the
defined-benefit obligation as reduced by the fair
value plan assets.

d) Other long-term employee benefits:
Compensated absences

Accumulated compensated absences which are
expected to be availed or encashed within twelve months
from the year end are treated as short term employee
benefits. The obligation towards the same is measured
at the expected cost of accumulating compensated
absences as the additional amount expected to be paid
as a result of the unused entitlements as at the year end.

Accumulated compensated absences which are
expected to be availed or encashed beyond twelve
months from the year end are treated as other long
term employee benefits. The Companyâs liability is
actuarially determined (using the Projected Unit Credit
method) at the end of each year. Actuarial loss/gains are
recognised in the statement of profit and loss in the
year in which they arise.

e) Share based payments

Share-based compensation benefits are provided to
employees via the Tega Industries Limited Employee
Stock Option Scheme namely ESOP Scheme 2011.
Employees of the Company receive remuneration in
the form of share-based payments, whereby employees
render services as consideration for equity instruments
(equity-settled transactions).

of awards, but the likelihood of the conditions being met
is assessed as part of the Companyâs best estimate of the
number of equity instruments that will ultimately vest.
Market performance conditions are reflected within the
grant date fair value. The dilutive effect of outstanding
options is reflected as additional share dilution in the
computation of diluted earnings per share.

2.16 Current and Deferred Tax

The income tax expense or credit for the period is the tax
payable on the current periodâs taxable income based on
the applicable income tax rate for each jurisdiction adjusted
by changes in deferred tax assets and liabilities attributable
to temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis
of the tax laws enacted or substantively enacted at the end
of the reporting period. Management periodically evaluates
positions taken in tax returns with respect to situations in
which applicable tax regulation is subject to interpretation.
It establishes provisions where appropriate on the basis of
amounts expected to be paid to the tax authorities.

Deferred income tax is provided in full, using the liability
method, on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in
the financial statements. Deferred income tax is also not
accounted for if it arises from initial recognition of an asset
or liability in a transaction other than a business combination
that at the time of the transaction affects neither accounting
profit nor taxable profit (tax loss). Deferred income tax is
determined using tax rates (and laws) that have been enacted
or substantially enacted by the end of the reporting period
and are expected to apply when the related deferred income
tax asset is realised or the deferred income tax liability is
settled. Deferred tax assets are recognised for all deductible
temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to
utilise those temporary differences and losses.

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

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

Mar 31, 2024

1. Company Information

Tega Industries Limited ("Tega" or "Company") is a public limited company incorporated in India with its registered office at Godrej Waterside, Tower-II, Office No. 807, 8^thFloor, Block DP-5, Salt Lake Sector V, Bidhannagar, Kolkata - 700 091 West Bengal, India and engaged in the business of manufacturing and distribution of specialized ''critical to operate'' and recurring consumable products for the global mineral beneficiation, mining and bulk solids handling industry. It was promoted by Mohanka Family in 1976 in technical and financial collaboration with Skega AB, Sweden.

The Company''s equity shares are listed on the Bombay Stock Exchange Limited (BSE) and the National Stock Exchange of India Limited (NSE).

The standalone financial statements as at 31 March 2024 present the financial position of the Company.

The standalone financial statements for the year ended 31 March 2024 were approved by the Board of Directors and authorised for issue on 23 May 2024.

2. Summary of material accounting policies

This note provides a list of the material accounting policies adopted in the preparation of these standalone financial statements. These policies have been consistently applied to all the years presented, unless otherwise stated.

2.1 Basis of Preparation

(i) Compliance with Ind AS

These standalone financial statements have been prepared to comply in all material aspects with Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (the Act) [Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016] and other relevant provisions of the Act.

(ii) Historical Cost Convention

The standalone financial statements have been prepared as going concern on accrual basis and under the historical cost convention except for the following assets and liabilities which have been measured at fair value or revalued amount:

- certain financial assets and liabilities measured at fair value (refer accounting policy regarding financial instruments);

- defined benefit plans - plan assets

measured at fair value;

- share-based payments

(iii) Current versus Non Current Classification

All assets and liabilities have been classified as current or non-current as per the Company''s operating cycle and other criteria set out in the Indian Accounting Standards (Ind AS) and Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current - non-current classification of assets and liabilities.

(iv) New and amended standards adopted by the Company

The Ministry of Corporate Affairs vide notification dated 31 March 2023 notified the Companies (Indian Accounting Standards) Amendment Rules, 2023, which amended certain accounting standards (see below), and are effective 1 April 2023:

- Disclosure of accounting policies â

amendments to Ind AS 1

- Definition of accounting estimates â

amendments to Ind AS 8

- Deferred tax related to assets and liabilities arising from a single transaction â amendments to Ind AS 12

The other amendments to Ind AS notified by these rules are primarily in the nature of clarifications.

These amendments did not have any material impact on the amounts recognized in prior periods and are not expected to significantly affect the current or future periods. Specifically, no changes would be necessary as a consequence of amendments made to Ind AS 12 as the Company''s accounting policy already complies with the now mandatory treatment.

2.2 Use of Estimates

The preparation of standalone financial statements requires the use of accounting estimates which, by definition, will seldom equal the actual results. Estimates are continually evaluated. They are based on historical experience and other factors, including expectations of future events that may have a financial impact on the company and that are believed to be reasonable under the circumstances.

2.3 Property, plant and equipment

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

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

An asset''s carrying amount is written down immediately to its recoverable amount if the asset''s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the statement of profit and loss.

On transition to Ind AS, the Company has elected to continue with the carrying value of its property, plant and equipment measured at the previous GAAP and use that carrying value as the deemed cost of property, plant and equipment.

Depreciation

Class of Assets	Estimated useful life (in years)
Buildings	30 - 60 years
Plant and equipments*	3 - 15 years
Furniture and fixtures	10 years
Vehicles	5-8 years
Office equipments	5 years
Electrical installations	10 years

*For these class of assets, based on internal assessment and independent technical evaluation carried out by external valuers, the Company believes that the useful lives as given above best represent the year over which Company expects to use these assets. Hence, the useful lives for these assets are different from the useful lives as prescribed under Part C of Schedule II to the Act.

ii) Leasehold improvements are depreciated over the shorter of their useful life or the lease term, unless the entity expects to use the assets beyond the lease term.

The assets'' residual values and useful lives are reviewed by the management, and adjusted if appropriate, at the end of each reporting period.

2.4 Intangible assets

Intangible assets are stated at cost of acquisition net of accumulated amortisation and accumulated impairment, if any. Costs associated with maintaining software programs are recognized as an expense as incurred.

An asset''s carrying amount is written down immediately to its recoverable amount if the asset''s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the statement of profit and loss.

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

Amortisation

The company amortises computer software using straightline method over the following period:

Class of Assets	Estimated useful life (in years)
Software	3 Years

Research and Development Expenditure

Research expenditure and development expenditure that do not meet the criterias mentioned below are recognized as an expense as incurred. Development costs previously recognized as an expense are not recognized as an asset in a subsequent period. Property, plant and equipment used in Research and Development are capitalised.

Development costs are recognized as intangible assets when the following criteria are met:

1. it is technically feasible to complete the intangible asset so that it will be available for use

2. management intends to complete the intangible asset and use or sell it

3. there is an ability to use or sell the intangible asset

4. it can be demonstrated how the intangible asset will generate probable future economic benefits

5. adequate technical, financial and other resources to complete the development and to use or sell the intangible asset are available, and

6. the expenditure attributable to the intangible asset during its development can be reliably measured.

Capitalised development costs are recorded as intangible assets and amortised from the point at which the asset is available for use.

2.5 Impairment

At each balance sheet date, the Company reviews the carrying values of its property, plant and equipment and intangible assets to determine whether there is any indication that the carrying value of those assets may not be recoverable through continuing use. If any such indication exists, the recoverable amount of the asset is reviewed in order to determine the extent of impairment, if any. Where the asset does not generate cash flows that are independent from other assets, the Company estimates the recoverable amount of the cash generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. 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 for which the estimates of future cash flows have not been adjusted. An impairment loss is recognized in the statement of profit and loss as and when the carrying value of an asset exceeds its recoverable amount.

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

2.6 Investments in subsidiaries and joint venture

to its recoverable amount. On disposal of investments in subsidiaries and joint venture, the difference between net disposal proceeds and the carrying amounts are recognized in the statement of profit and loss.

2.7 Financial Instruments

The financial assets are classified in the following categories:

(i) financial assets measured at amortised cost,

(ii) financial assets measured at fair value through profit or loss (FVTPL), and

(iii) financial assets at fair value through other comprehensive income (FVOCI).

The classification of financial assets depends on the Company''s business model for managing financial assets and the contractual terms of the cash flow. For assets measured at fair value, gains and losses will either be recorded in statement of profit and loss and other comprehensive income. The Company reclassifies debt investments when and only when its business model for managing those assets changes.

Regular purchases and sales of financial assets are recognized on trade-date, being the date on which the Company commits to purchase or sale the financial asset.

At initial recognition, the Company measures a financial asset (excluding trade receivables which do not contain a significant financing component) at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in statement of profit and loss.

Investment in debt instruments

Subsequent measurement of debt instruments depends on the Company''s model of managing the assets and the cash flow characteristics of the asset. There are three measurement categories in which the Company classifies its debt instruments.

Financial assets measured at amortised cost

rate method. Any gain or loss arising on derecognition is recognized directly in the statement of profit and loss and presented in other gains/(losses). The losses arising from impairment are recognized in the statement of profit and loss.

Financial assets at fair value through other comprehensive income (FVOCI)

Financial assets are measured at fair value through other comprehensive income if these financial assets are held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest income and foreign exchange gains and losses which are recognized in statement of profit and loss. When the financial asset is derecognized, the cumulative gain or loss previously recognized in OCI is reclassified from equity to profit and loss and recognized in other gains/ (losses). Interest income from these financial assets is included in other income using the effective interest rate method. Foreign exchange gains and losses are presented in other gains/ (losses) and impairment expenses are presented as separate line item in the statement of profit and loss.

Financial assets measured at fair value through profit or loss (FVTPL)

Assets that do not meet the criteria for amortised cost or FVOCI are measured at fair value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss is recognized in the statement of profit and loss in the period in which it arises. Interest income from these financial assets are included in other income.

Investments in units of mutual funds are subsequently measured at FVTPL and the changes in fair value are recognized in the statement of profit and loss.

De-recognition of financial asset

A financial asset is derecognized only when

â¢ The Company has transferred the rights to receive cash flows from the financial asset or

â¢ Retains the contractual rights to receive the cash flows of the financial asset, but assumes a

contractual obligation to pay the cash flows to one or more recipients.

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

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

Impairment of financial assets

For trade receivables only, the Company applies the simplified approach required by Ind AS 109, which requires expected lifetime losses to be recognized from initial recognition of the receivables.

Trade Receivables

Trade receivables are amounts due from customers for goods sold or services rendered in the ordinary course of business and reflects Company''s unconditional right to consideration (that is, payment is due only on the passage of time). Trade receivables are recognized initially at the transaction price as they do not contain significant financing component. The Company holds the trade receivables with the objective of collecting the contractual cash flows and therefore measures them subsequently at amortised cost using the effective interest rate method, less loss allowance.

Cash and Cash Equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents include cash on hand, demand deposits with banks, other short term highly liquid investments, if any, with original maturities of three months or less that are readily convertible to known amount of cash and subject to an insignificant change in value.

Financial Liabilities Borrowings

Borrowings are initially recognized at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost using the effective interest rate method. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in the statement of profit and loss over the period of the borrowings using the effective interest rate method. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down.

Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in the statement of profit and loss as other gains/ (losses).

Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period. Where there is a breach of a material provision of a long-term loan arrangement on or before the end of the reporting period with the effect that the liability becomes payable on demand on the reporting date, the entity does not classify the liability as current, if the lender agreed, after the reporting period and before the approval of the financial statements for issue, not to demand payment as a consequence of the breach.

Trade and other payables

Trade and other payables represent current liabilities for goods and services provided to the Company prior to the end of the financial year which are unpaid. The amount are unsecured and are usually paid within 30-90 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after the reporting period. They are recognized initially at their fair value and subsequently measured at amortised cost using the effective interest rate method.

De-recognition of financial liabilities

A financial liability (or a part of financial liability) is de-recognized from Company''s balance sheet when obligation specified in the contract is discharged, or cancelled, or expired.

Derivative Instruments and hedge accounting

Derivatives are only used for economic hedging purposes and not as speculative investments. The Company uses certain derivative financial instruments to reduce business risks which arise from its exposure to foreign exchange and interest rate fluctuations. The instruments are confined principally to forward foreign exchange contracts and interest rate swaps and options.

Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are subsequently re-measured to their fair value at the end of each reporting period. Net mark to market gains/ losses on derivatives taken by the Company are recorded in other income/ expenses respectively.

The Company adopts hedge accounting for forward foreign exchange contracts wherever possible. At inception of each hedge, there is a formal, documented designation of the hedging relationship. This documentation includes, inter alia, items such as identification of the hedged item and transaction and nature of the risk being hedged. At inception, each hedge is expected to be highly effective in achieving an offset of changes in fair value or cash flows attributable to the hedged risk. The effectiveness of hedge instruments to reduce the risk associated with the exposure being hedged is assessed and measured at the inception and on an ongoing basis. The ineffective portion of designated hedges is recognized immediately in the statement of profit and loss.

When hedge accounting is applied:

â¢ for fair value hedges of recognized assets and liabilities, changes in fair value of the hedged assets and liabilities attributable to the risk being hedged, are recognized in the statement of profit and loss and compensate for the effective portion of symmetrical changes in the fair value of the derivatives.

â¢ for cash flow hedges, the effective portion of the change in the fair value of the derivative is recognized directly in other comprehensive income and the ineffective portion is recognized in the statement of profit and loss. If the cash flow hedge of a firm commitment or forecasted transaction results in the recognition of a non-financial asset or liability, then, at the time the asset or liability is recognized, the associated gains or losses on the derivative that had previously been recognized in equity are included in the initial measurement of the asset or liability. For hedges that do not result in the recognition of a nonfinancial asset or a liability, amounts deferred in equity

are recognized in the statement of profit and loss in the same period in which the hedged item affects the statement of profit and loss.

Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, or exercised, or no longer qualifies for hedge accounting. At that time, any cumulative gain or loss on the hedging instrument recognized in equity is retained in equity until the forecasted transaction occurs. If a hedged transaction is no longer expected to occur, the net cumulative gain or loss recognized in equity is transferred to the statement of profit and loss for the period.

2.8 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.

2.9 Inventories

Inventories are valued at lower of cost and net realisable value. Cost of raw materials and traded goods comprises cost of purchases. Cost of work-in-progress and finished goods comprises direct materials, direct labours and an appropriate proportion of variable and fixed overhead expenditure, the latter being 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 individual items of inventory on the basis of weighted-average cost method. 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.

2.10 Revenue Recognition

Revenue shall be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services.

Sale of goods

Sales are recognized when control of the products has been transferred to the buyer, being when the products are dispatched/ delivered to the customer depending on the contract terms. This occurs when the products have been shipped or delivered to the specific location as the case may be,

the risk of loss has been transferred, and either the customer has accepted the products in accordance with the sales contract, or the Company has objective evidence that all criteria for acceptance has been satisfied. Revenue from contract with customers is primarily recorded at a point in time. Revenue is recognized based on the price specified in the contract.

No element of financing is deemed present as the sales are generally made with a credit term upto 180 days which is consistent with market practice.

Sale of services

Revenue from service contracts are recognized in the accounting period in which the services are rendered.

Some contracts include multiple performance obligations, such as sale of product and certain related services. However, the services are simple, does not include an integration service and could be performed by another party. It is therefore accounted for as a separate performance obligation. Where the contracts include multiple performance obligations, the transaction price is allocated to each performance obligation based on the stand-alone selling prices. Where these are not directly observable, they are estimated based on the expected cost plus margin. If contracts include the installation of product, revenue for the product is recognized at a point in time when the product is delivered, the legal title has passed and the customer has accepted the product.

A receivable is recognized when the goods are dispatched or delivered, depending on the contract terms, as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

A contract asset is recognized in respect of those performance obligations where the control of the goods has been transferred to the buyer, and only delivery of the goods is pending. In these cases the consideration is due after the shipping obligation is complete, accordingly these are classified as contract assets as the consideration is conditional on something other than passage of time.

The Company does not have any contracts where the period between the transfer of the promised goods or services to the customer and payment by the customer exceeds one year. As a consequence, the Company does not adjust any of the transaction prices for the time value of money.

The Company generally provides for warranties which are assurance-type warranties under Ind AS 115, and are accounted for under In AS 37 Provisions, Contingent Liabilities and Contingent Assets.

2.11 Other Income

Interest: Interest income from financial assets at fair value through profit or loss is disclosed as interest income within other income. Interest income on financial assets at amortised cost and financial assets at FVOCI is calculated using the effective interest rate method and recognized in the statement of profit and loss as part of other income.

Interest income is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for financial assets that subsequently become credit-impaired. For credit-impaired financial assets the effective interest rate is applied to the net carrying amount of the financial asset (after deduction of the loss allowance).

Dividend: Dividends are received from financial assets at fair value through profit or loss and at FVOCI. Dividends are recognized as other income in the statement of profit and loss when the right to receive payment is established.

2.12 Government Grants

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

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

2.13 Borrowing Costs

Borrowing costs include interest, other costs incurred in connection with borrowing and exchange differences arising from foreign currency borrowings to the extent that they are regarded as an adjustment to the interest cost.

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

All other borrowing costs are expensed in the period in which they are incurred.

2.14 Foreign Currencies Translation Functional and presentation currency

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

Initial Recognition: On initial recognition, all foreign currency transactions are recorded by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

Subsequent Recognition: Foreign currency denominated monetary assets and liabilities are translated into the relevant functional currency at exchange rates in effect at the balance sheet date. The gains or losses resulting from such translations are included in net profit in the statement of profit and loss. Non-monetary assets and non-monetary liabilities denominated in a foreign currency and measured at fair value are translated at the exchange rate prevalent 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. Non-monetary assets and non-monetary liabilities denominated in a foreign currency and measured at historical cost are translated at the exchange rate prevalent at the date of transaction.

2.15 Employee Benefits

a) Short-term Employee Benefits:

Short-term Employee Benefits (i.e. benefits payable within one year) are recognized in the period in which employee services are rendered.

b) Defined contribution plans Provident Fund

This is a defined contribution plan for certain employees and contributions are remitted to Provident Fund authorities in accordance with relevant statute and charged to the statement of profit and loss in the period in which the related employee services are rendered. The Company has no further obligations for future Provident Fund benefits other than its monthly contributions.

Superannuation Fund

This is a defined contribution plan. The Company contributes a certain percentage of the eligible

salary for employees covered under the scheme towards superannuation fund administered by the Trustees. The Company has no further obligations for future superannuation benefits other than its contributions and recognizes such contributions as expense in the period in which the related employee services are rendered.

c) Defined benefit plans Gratuity

For defined benefit retirement schemes the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuation being carried out at each balance sheet date. Remeasurement gains and losses of the net defined benefit liability/(asset) are recognized immediately in other comprehensive income. The service cost and net interest on the net defined benefit liability/(asset) is treated as a net expense within employment costs.

Past service cost is recognized as an expense when the plan amendment or curtailment occurs or when any related restructuring costs or termination benefits are recognized, whichever is earlier.

The retirement benefit obligation recognized in the balance sheet represents the present value of the defined-benefit obligation as reduced by the fair value plan assets.

d) Other long-term employee benefits:

Compensated absences

Accumulated compensated absences which are expected to be availed or encashed within twelve months from the year end are treated as short term employee benefits. The obligation towards the same is measured at the expected cost of accumulating compensated absences as the additional amount expected to be paid as a result of the unused entitlements as at the year end.

Accumulated compensated absences which are expected to be availed or encashed beyond twelve months from the year end are treated as other long term employee benefits. The Company''s liability is actuarially determined (using the Projected Unit Credit method) at the end of each year. Actuarial loss/gains are recognized in the statement of profit and loss in the year in which they arise.

e) Share based payments

Share-based compensation benefits are provided to employees via the Tega Industries Limited Employee Stock Option Scheme namely ESOP Scheme 2011. Employees of the Company receive remuneration in the form of share-based payments, whereby employees render services as consideration for equity instruments (equity-settled transactions).

The cost of equity-settled transactions is determined by the fair value at the date when the grant is made using an appropriate valuation model. That cost is recognized, together with a corresponding increase in Employee Stock Options Outstanding Account in equity, over the period in which the performance and/or service conditions are fulfilled, in Employee Benefit Expense. The cumulative expense recognized for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Company''s best estimate of the number of equity instruments that will ultimately vest. Service and non-market performance conditions are not taken into account when determining the grant date fair value of awards, but the likelihood of the conditions being met is assessed as part of the Company''s best estimate of the number of equity instruments that will ultimately vest. Market performance conditions are reflected within the grant date fair value. The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

2.16 Current and Deferred Tax

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

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax

bases of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting profit nor taxable profit (tax loss). Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax assets are recognized for all deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

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

Current and deferred tax is recognized in the statement of profit and loss, except to the extent that it relates to items recognized in other comprehensive income or directly in equity. In this case, the tax is also recognized in other comprehensive income or directly in equity, respectively.

2.17 Provision and Contingent Liabilities

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognized even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.

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 or there is a present obligation, reliable estimate of the amount of which cannot be made. Where there is a possible obligation or a present obligation and the likelihood of outflow of resources is remote, no provision or disclosure for contingent liability is made.

Provisions are measured at the present value of management''s best estimate of the expenditure required to settle the present obligation at the end of the reporting period. The discount rate used to determine the present value is a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage of time is recognized as interest expense.

Provision for warranty

The estimated liability for warranty is recorded when products are sold. These estimates are established using historical information on the nature, frequency and average cost of obligations and management estimates regarding possible future incidence based on corrective actions on product failure.

2.18 Earnings per Share

Basic earnings per share is calculated by dividing net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. Earnings considered in ascertaining the Company''s earnings per share is the net profit or loss for the period. The weighted average number of equity shares outstanding during the period and for all periods presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares, if any, that have changed the number of equity shares outstanding, without a corresponding change in resources. For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

2.19 Segment Reporting

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

The executive committee (which consist of Chairman, Managing Director & Chief Executive Officer, Head Product Management Group and Global Marketing, Head Global Operations, Head Global Finance (Chief Financial Officer), Head Human Resource and Company Secretary) has been identified as the chief operating decision maker (''CODM'') (Refer note 42).

2.20 Leases

The Company as lessee

The Company accounts for each lease component within the contract as a lease separately from non-lease components of the contract and allocates the consideration in the contract to each lease component on the basis of the relative stand-alone price of the lease component and the aggregate stand-alone price of the non-lease components. The Company recognizes right-of-use asset representing its right to use the underlying asset for the lease term at the lease commencement date. The cost of the right of-use asset measured at inception comprises of the amount of initial measurement of the lease liability adjusted for any lease payments made at or before the commencement date less any lease incentive received, any initial direct costs and restoration costs.

Certain lease arrangements include options to extend or terminate the lease before the end of the lease term. The right-of-use assets and lease liabilities include these options when it is reasonably certain that such options would be exercised.

The right-of-use assets is subsequently measured at cost less any accumulated depreciation, accumulated impairment losses, if any and adjusted for any re-measurement of the lease liability. The right-of-use assets is depreciated using the straight-line method from the commencement date over the shorter of lease term or useful life of right-of-use asset.

Right-of-use assets are tested for impairment whenever there is any indication that their carrying amounts may not be recoverable. Impairment loss, if any, is recognized in the statement of profit and loss.

Lease liability is measured at the present value of the following lease payments:

â¢ fixed payments (including in-substance fixed payments), less any lease incentives receivable

â¢ variable lease payment that are based on an index or a rate, initially measured using the index or rate as at the commencement date

â¢ amounts expected to be payable by the Company under residual value guarantees

â¢ the exercise price of a purchase option if the Company is reasonably certain to exercise that option, and

â¢ payments of penalties for terminating the lease, if the lease term reflects the Company exercising that option.

Lease payments to be made under reasonably certain extension options are also included in the measurement of the liability. The lease payments are discounted using the interest rate implicit in the lease, if that rate can be readily determined. If that rate cannot be readily determined, the Company uses incremental borrowing rate.

To determine the incremental borrowing rate, the Company:

â¢ where possible, uses recent third-party financing received by the individual lessee as a starting point, adjusted to reflect changes in financing conditions since third party financing was received

â¢ uses a build-up approach that starts with a risk-free interest rate adjusted for credit risk for leases held by Tega Industries Limited, which does not have recent third party financing

â¢ makes adjustments specific to the lease, e.g. term, country, currency and security

If a readily observable amortising loan rate is available to the individual lessee (through recent financing or market data) which has a similar payment profile to the lease, then the Company uses that rate as a starting point to determine the incremental borrowing rate. The Company is exposed to potential future increases in variable lease payments based on an index or rate, which are not included in the lease liability until they take effect. When adjustments to lease payments based on an index or rate take effect, the lease liability is reassessed and adjusted against the right-of-use asset. Lease payments are allocated between principal and finance cost. The finance cost is charged to the statement of profit and loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. Variable lease payments that depend on sales are recognized in the statement of profit and loss in the period in which the condition that triggers those payments occurs.

recognises the amount of the re-measurement of lease liability as an adjustment to the right-of-use asset. Where the carrying amount of the right-of-use asset is reduced to zero and there is a further reduction in the measurement of the lease liability, the Company recognises any remaining amount of the re-measurement in the statement of profit and loss.

Payment made towards leases for which non-cancellable term is 12 months or lesser (short-term leases) and low value leases are recognized in the statement of profit and loss as rental expenses over the tenor of such leases.

Variable lease payments not included in the measurement of the lease liabilities are expensed to the statement of profit and loss in the period in which the events or conditions which trigger those payments occur.

2.21 Dividends

Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the entity, on or before the end of the reporting period but not distributed at the end of the reporting period.

2A Critical estimates and judgements

The preparation of financial statements requires the use of accounting estimates which, by definition, will seldom equal the actual results. Management also needs to exercise judgement in applying the Company''s accounting policies.

This note provides an overview of the areas that involved a higher degree of judgement or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed.

(i) Estimation of defined benefit obligation - Note 32.1

The estimate requires the Company to make assumptions regarding variable such as discount rate and salary growth rate. Change in these key assumptions can have significant impact on the defined benefit obligation.

(ii) Impairment of investments in subsidiaries - Note 4

Determining whether the investments in subsidiaries are impaired requires an estimate of the value in use of investments. In considering the value in use, the management estimates the future cash flows, operating margins, growth rates, discount rates of the underlying business/ operations of the subsidiaries to determine the value using the discounted cash flow model.

(iii) Impairment of property, plant and equipment and intangible assets - Note 2.5, 3(a) and 3(d)

The Company estimates the value in use of the cash generating unit (CGU) based on future cash flows after considering current economic conditions and trends, estimated future operating results and growth rates and anticipated future economic and regulatory conditions. The estimated cash flows are developed using internal forecasts. The cash flows are discounted using a suitable discount rate in order to calculate the present value which involve estimates and judgements.

(iv) Useful lives of property, plant and equipment and intangible assets - Note 2.3, 3(a) and 3(d)

The Company reviews the useful life of property, plant and equipment and intangible assets at the end of each reporting period. Uncertainties in these estimates relates to technical and economic obsolescence that may change the useful life of property, plant and equipment and intangible assets. This reassessment may result in change in depreciation and amortisation expense in future periods.

(v) Fair value measurements of financial instruments -Note 38

This includes financial assets and liabilities, measured using inputs other than quoted prices that are observable for assets and liability, either directly as prices or indirectly derived from prices which involves estimates and judgements. This majorly includes derivative contracts.

(vi) Expected credit loss for trade receivables

Refer note 2.7, 10(a) and 39A(i) for details of critical estimates in expected credit loss for financial instruments carried at amortised cost.

(vii) Critical judgement in determining the lease term -Note 3(b)

The Company determines the lease term on the basis of termination and renewal options in various lease contracts where the Company applies its judgement.

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

Mar 31, 2023

1. Company Information

Tega Industries Limited ("Tega" or "Company") is a public limited company incorporated in India with its registered office at Godrej Waterside, Tower-II, Office No. 807, 8^th Floor, Block DP-5, Salt Lake Sector V, Bidhannagar, Kolkata - 700 091 West Bengal, India and engaged in the business of manufacturing and distribution of specialized ''critical to operate'' and recurring consumable products for the global mineral beneficiation, mining and bulk solids handling industry. It was promoted by Mohanka Family in 1976 in technical and financial collaboration with Skega AB, Sweden.

The Company''s equity shares are listed on the Bombay Stock Exchange Limited (BSE) and the National Stock Exchange of India Limited (NSE).

The standalone financial statements as at 31 March 2023 present the financial position of the Company.

The standalone financials statements for the year ended 31 March 2023 were approved by the Board of Directors and authorised for issue on 30 May 2023.

2. Summary of significant accounting policies

This note provides a list of the significant accounting policies adopted in the preparation of these standalone financial statements. These policies have been consistently applied to all the years presented, unless otherwise stated.

2.1 Basis of Preparation

(i) Compliance with Ind AS

These standalone financial statements have been prepared to comply in all material aspects with Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (the Act) [Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016] and other relevant provisions of the Act.

(ii) Historical Cost Convention

The standalone financial statements have been prepared as going concern on accrual basis and under the historical cost convention except for the following assets and liabilities which have been measured at fair value or revalued amount:

- Certain financial assets and liabilities measured at fair value (refer accounting policy regarding financial instruments);

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

- share-based payments

(iii) Current versus Non Current Classification

(iv) New and amended standards adopted by the Company

The Ministry of Corporate Affairs had vide notification dated 23 March 2022 notified Companies (Indian Accounting Standards) Amendment Rules, 2022 which amended certain accounting standards, and are effective 1 April 2022.

These amendments did not have any impact on the amounts recognised in prior periods and are not expected to significantly affect the current or future periods.

(v) New amendments issued but not effective

The Ministry of Corporate Affairs has vide notification dated 31 March 2023 notified Companies (Indian Accounting Standards) Amendment Rules, 2023 (the ''Rules'') which amends certain accounting standards, and are effective 1 April 2023.

The Rules predominantly amend Ind AS 12, Income taxes, and Ind AS 1, Presentation of financial statements

The other amendments to Ind AS notified by these rules are primarily in the nature of clarifications.

These amendments are not expected to have a material impact on the Company in the current or future reporting periods and on foreseeable future transactions. Specifically, no changes would be necessary as a consequence of amendments made to Ind AS 12 as the Company''s accounting policy already complies with the now mandatory treatment.

2.2 Use of Estimates

2.3 Property, plant and equipment

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

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

An asset''s carrying amount is written down immediately to its recoverable amount if the asset''s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the statement of profit and loss.

Depreciation

Class of assets	Estimated useful life (in years)
Buildings	30 - 60 years
Plant and Equipment*	3 - 15 years
Furniture and Fixtures	10 years
Vehicles	5-10 years
Office equipment	5 years
Electrical installation	10 years

ii) Leasehold improvements are depreciated over the shorter of their useful life or the lease term, unless the entity expects to use the assets beyond the lease term.

The assets residual values and useful lives are reviewed by the management , and adjusted if appropriate , at the end of each reporting period.

2.4 Intangible assets

Intangible assets are stated at cost of acquisition net of accumulated amortisation and accumulated impairment, if any. Costs associated with maintaining software programs are recognised as an expense as incurred.

An asset''s carrying amount is written down immediately to its recoverable amount if the asset''s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the statement of profit and loss.

Amortisation

The company amortises computer software using straight- line method over the following periods:

Class of assets	Estimated useful life (in years)
Software	3 years

Research and Development Expenditure

Research expenditure and development expenditure that do not meet the criterias mentioned below are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period. Property, plant and equipment used in Research and Development are capitalised.

Development costs are recognised as intangible assets when the following criteria are met:

1. it is technically feasible to complete the intangible asset so that it will be available for use

2. management intends to complete the intangible asset and use or sell it

3. there is an ability to use or sell the intangible asset

4. it can be demonstrated how the intangible asset will generate probable future economic benefits

5. adequate technical, financial and other resources to complete the development and to use or sell the intangible asset are available, and

6. the expenditure attributable to the intangible asset during its development can be reliably measured.

Capitalised development costs are recorded as intangible assets and amortised from the point at which the asset is available for use.

2.5 Impairment

At each balance sheet date, the Company reviews the carrying values of its property, plant and equipment and intangible assets to determine whether there is any indication that the carrying value of those assets may not be recoverable through continuing use. If any such indication exists, the recoverable amount of the asset is reviewed in order to determine the extent of impairment, if any. Where the asset does not generate cash flows that are independent from other assets, the Company estimates the recoverable amount of the cash generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. 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 for which the estimates of future cash flows have not been adjusted. An impairment loss is recognised in the statement of profit and loss as and when the carrying value of an asset exceeds its recoverable amount.

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

2.6 Investments in subsidiaries and joint venture

Investments in subsidiaries and joint venture are carried at cost less accumulated impairment, if any. Where an indication of impairment exists, the carrying amount of the investment is assessed and written down immediately to its recoverable amount. On disposal of investments in subsidiaries and joint venture the difference between net disposal proceeds and the carrying amounts are recognised in the statement of profit and loss.

2.7 Financial Instruments

The financial assets are classified in the following categories:

1. financial assets measured at amortised cost,

2. financial assets measured at fair value through profit or loss (FVTPL), and

3. financial assets at fair value through other comprehensive income (FVOCI).

Regular purchases and sales of financial assets are recognised on trade-date, being the date on which the Company commits to purchase or sale the financial asset.

At initial recognition, the Company measures a financial asset (excluding trade receivables which do not contain a significant financing component) at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in statement of profit and loss.

Investment in debt instruments

Financial assets measured at amortised cost

Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. Interest income from these financial assets is included in Other Income using the effective interest rate method. After initial recognition, such financial assets are subsequently measured at amortised cost using the effective interest rate method. Any gain or loss arising on derecognition is recognised directly in statement of profit and loss and presented in other gains/(losses). The losses arising from impairment are recognised in the statement of profit and loss.

Financial assets at fair value through other comprehensive income (FVOCI)

Financial assets are measured at fair value through other comprehensive income if these financial assets are held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest income and foreign exchange gains and losses which are recognised in statement of profit and loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss and recognised in other gains/ (losses). Interest income from these financial assets is included in other income using the effective interest rate method. Foreign exchange gains and losses are presented in other gains/ (losses) and impairment expenses are presented as separate line item in statement of profit and loss.

Financial assets measured at fair value through profit or loss (FVTPL)

Assets that do not meet the criteria for amortised cost or FVOCI are measured at fair value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss is recognised in the statement of profit and loss in the period in which it arises. Interest income from these financial assets is included in other income.

Investments in units of mutual funds are subsequently measured at FVTPL and the changes in fair value are recognised in the statement of profit and loss.

De-recognition of financial asset

A financial asset is derecognised only when

â¢ The Company has transferred the rights to receive cash flows from the financial asset or

â¢ Retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients.

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

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

Impairment of financial assets

The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortised cost and FVOCI debt instruments. The impairment methodology applied depends on whether there has been a significant increase in credit risk. For trade receivables only, the Company applies the simplified approach required by Ind AS 109, which requires expected lifetime losses to be recognised from initial recognition of the receivables.

Trade Receivables

Trade receivables are amounts due from customers for goods sold or services performed in the ordinary course of business and reflects Company''s unconditional right to consideration (that is, payment is due only on the passage of time). Trade receivables are recognised initially at the transaction price as they do not contain significant financing components. The Company holds the trade receivables with the objective of collecting the contractual cash flows and therefore measures them subsequently at amortised cost using the effective interest method, less loss allowance.

Cash and Cash Equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents include cash on hand, demand deposits with banks, other short term highly liquid investments, if any, with original maturities of three months or less that are readily convertible to known amount of cash and subject to an insignificant change in value.

Financial Liabilities Borrowings

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost using the effective interest rate method. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in statement of profit and loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down.

Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in statement of profit and loss as other gains/ (losses).

Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period. Where there is a breach of a material provision of a long-term loan arrangement on or before the end of the reporting period with the effect that the liability becomes payable on demand on the reporting date, the entity does not classify the liability as current, if the lender agreed, after the reporting period and before the approval of the financial statements for issue, not to demand payment as a consequence of the breach.

Trade and other payables

other payables are presented as current liabilities unless payment is not due within 12 months after the reporting period. They are recognised initially at their fair value and subsequently measured at amortised cost using the effective interest method.

De-recognition of financial liabilities

A financial liability (or a part of financial liability) is de-recognised from Company''s balance sheet when obligation specified in the contract is discharged or cancelled or expired.

Derivative Instruments

Derivatives are only used for economic hedging purposes and not as speculative investments. The Company uses certain derivative financial instruments to reduce business risks which arise from its exposure to foreign exchange and interest rate fluctuations. The instruments are confined principally to forward foreign exchange contracts and interest rate swaps and options. The derivative contracts to hedge risks are not designated as hedges .

Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured to their fair value at the end of each reporting period. Net mark to market gains/ losses on derivatives taken by the Company are recorded in other income/ expenses respectively.

2.8 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 recognised 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.

2.9 Inventories

Inventories are valued at lower of cost and net realisable value. Cost of raw materials and traded goods comprises cost of purchases. Cost of work-in-progress and finished goods comprises direct materials, direct labours and an appropriate proportion of variable and fixed overhead expenditure, the latter being 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 individual items of inventory on the basis of weighted-average cost method. 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.

2.10 Revenue Recognition

Revenue shall be recognised to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services.

Sale of goods

Sales are recognised when control of the products has been transferred to the buyer, being when the products are dispatched/ delivered to the customer depending on the contract terms. This occurs when the products have been shipped or delivered to the specific location as the case may be, the risk of loss has been transferred, and either the customer has accepted the products in accordance with the sales contract, or the Company has objective evidence that all criteria for acceptance have been satisfied. Revenue from contract with customers is primarily recorded at a point in time. In few contracts the Company performance does not create an asset with alternative use to the Company and the Company has concluded that it has an enforceable right to payment for performance completed to date. In the said cases, the Company transfers control of a good or service over time and, therefore, satisfies a performance obligation and recognises revenue over time. The Company uses the input method to recognise revenue.

The Company has determined that the input method is the best method for measuring progress for these contracts because there is a direct relationship between the costs incurred by the Company and the transfer of goods and services to the customer.

No element of financing is deemed present as the sales are generally made with a credit term upto 180 days which is consistent with the market practice.

Revenue is recognised based on the price specified in the contract.

Sale of services

Revenue from service contracts are recognised in the accounting period in which the services are rendered.

Some contracts include multiple deliverables, such as sale of product and certain related services. However, the services are simple, does not include an integration service and could be performed by another party. It is therefore accounted for as a separate performance obligation. Where the contracts include multiple performance obligations, the transaction price will be allocated to each performance obligation based on the stand-alone selling prices. Where these are not directly observable, they are estimated based on the expected cost plus margin. If contracts include the installation of product, revenue for the product is recognized at a point in time when the product is delivered, the legal title has passed and the customer has accepted the product.

A receivable is recognised when the goods are dispatched or delivered, depending on the contract terms, as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

A contract asset is recognised in respect of those performance obligations where the control of the goods has been transferred to the buyer, and only delivery of the goods is pending. In these cases the consideration is due after the shipping obligation is complete, accordingly these are classified as contract assets as the consideration is conditioned on something other than passage of time.

The Company does not have any contracts where the period between the transfer of the promised goods or services to the customer and payment by the customer exceeds one year. As a consequence, the Company does not adjust any of the transaction prices for the time value of money.

The Company generally provides for warranties which are assurance-type warranties under Ind AS 115, and are accounted for under Ind AS 37, Contingent Liabilities and Contingent Assets.

2.11Other Income

Interest: Interest income from financial assets at fair value through profit or loss is disclosed as interest income within other income. Interest income on financial assets at amortised cost and financial assets at FVOCI is calculated using the effective interest method is recognised in the statement of profit and loss as part of other income.

Interest income is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for financial assets that subsequently become credit-impaired. For credit-impaired financial assets the effective interest rate is applied to the net carrying amount of the financial asset (after deduction of the loss allowance).

Dividend: Dividends are received from financial assets at fair value through profit or loss and at FVOCI. Dividends are recognised as other income in statement of profit and loss when the right to receive payment is established.

2.12 Government Grants

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

(ii) Government grants relating to income are deferred and recognised in the statement of profit and loss over the period necessary to match them with the costs that they are intended to compensate and presented within other operating revenue.

2.13 Borrowing Costs

Borrowing costs include interest, other costs incurred in connection with borrowing and exchange differences arising from foreign currency borrowings to the extent that they are regarded as an adjustment to the interest cost.

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

All other borrowing costs are expensed in the period in which they are incurred.

2.14 Foreign Currencies Translation Functional and presentation currency

Initial Recognition: On initial recognition, all foreign currency transactions are recorded by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

2.15 Employee Benefits

a) Short-term Employee Benefits:

Short-term Employee Benefits (i.e. benefits payable within one year) are recognised in the period in which employee services are rendered.

b) Defined contribution plans Provident Fund

This is a defined contribution plan for certain employees and contributions are remitted to Provident Fund authorities in accordance with relevant statute and charged to the statement of profit and loss in the period in which the related employee services are rendered. The Company has no further obligations for future Provident Fund benefits other than its monthly contributions.

Superannuation Fund

This is a defined contribution plan. The Company contributes a certain percentage of the eligible salary for employees covered under the scheme towards superannuation fund administered by the Trustees. The Company has no further obligations for future superannuation benefits other than its contributions and recognizes such contributions as expense in the period in which the related employee services are rendered.

c) Defined benefit plans Gratuity

For defined benefit retirement schemes the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuation being carried out at each balance sheet date. Re-measurement gains and losses of the net defined benefit liability/(asset) are recognised immediately in other comprehensive income. The service cost and net interest on the net defined benefit liability/(asset) is treated as a net expense within employment costs.

Past service cost is recognised as an expense when the plan amendment or curtailment occurs or when any related restructuring costs or termination benefits are recognised, whichever is earlier.

The retirement benefit obligation recognised in the balance sheet represents the present value of the defined-benefit obligation as reduced by the fair value plan assets.

d) Other long-term employee benefits:

Compensated absences

Accumulated compensated absences which are expected to be availed or encashed within twelve months from the year end are treated as short term employee benefits. The obligation towards the same is measured at the expected cost of accumulating compensated absences as the additional amount expected to be paid as a result of the unused entitlements as at the year end.

Accumulated compensated absences which are expected to be availed or encashed beyond twelve months from the year end are treated as other long term employee benefits. The Company''s liability is actuarially determined (using the Projected Unit Credit method) at the end of each year. Actuarial loss/gains are recognised in the Statement of Profit and Loss in the year in which they arise.

e) Share based payments

Share-based compensation benefits are provided to employees via the Tega Industries Limited Employee Stock Option Scheme namely ESOP Scheme 2011. Employees of the Company receive remuneration in the form of share based payments, whereby employees render services as consideration for equity instruments (equity-settled transactions).

The cost of equity-settled transactions is determined by the fair value at the date when the grant is made using an appropriate valuation model. That cost is recognised, together with a corresponding increase in Employee Stock Options Outstanding Account in equity, over the period in which the performance and/or service conditions are fulfilled, in Employee Benefit Expense. The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Company''s best estimate of the number of equity instruments that will ultimately vest. Service and non-market performance conditions are not taken into account when determining the grant date fair value of awards, but the likelihood of the conditions being met is assessed as part of the Company''s best estimate of the number of equity instruments that will ultimately vest. Market performance conditions are reflected within the grant date fair value. The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

2.16 Current and Deferred Tax

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting profit nor taxable profit (tax loss). Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax assets are recognised for all deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

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

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

2.17 Provision and Contingent Liabilities

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.

Provision for warranty

2.18 Earnings per Share

2.19 Segment Reporting

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

2.20 Leases

The Company as lessee

Lease liability is measured at the present value of the following lease payments.

â¢ fixed payments (including in-substance fixed payments), less any lease incentives receivable

â¢ variable lease payment that are based on an index or a rate, initially measured using the index or rate as at the commencement date

â¢ amounts expected to be payable by the Company under residual value guarantees

â¢ the exercise price of a purchase option if the Company is reasonably certain to exercise that option, and

â¢ payments of penalties for terminating the lease, if the lease term reflects the Company exercising that option.

To determine the incremental borrowing rate, the Company:

â¢ uses a build-up approach that starts with a risk-free interest rate adjusted for credit risk for leases held by Tega Industries Limited, which does not have recent third party financing

â¢ makes adjustments specific to the lease, e.g. term, country, currency and security

The Company is exposed to potential future increases in variable lease payments based on an index or rate, which are not included in the lease liability until they take effect. When adjustments to lease payments based on an index or rate take effect, the lease liability is reassessed and adjusted against the right-of-use asset.

Lease payments are allocated between principal and finance cost. The finance cost is charged to statement of profit and loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

Variable lease payments that depend on sales are recognised in profit or loss in the period in which the condition that triggers those payments occurs.

The lease liability is subsequently remeasured by increasing the carrying amount to reflect interest on the lease liability, reducing the carrying amount to reflect the lease payments made and remeasuring the carrying amount to reflect any reassessment or lease modifications. The Company recognizes the amount of the re-measurement of lease liability as an adjustment to the right-of-use asset. Where the carrying amount of the right-of-use asset is reduced to zero and there is a further reduction in the measurement of the lease liability, the Company recognizes any remaining amount of the re-measurement in statement of profit and loss.

Payment made towards leases for which non-cancellable term is 12 months or lesser (short-term leases) and low value leases are recognised in the statement of Profit and Loss as rental expenses over the tenor of such leases.

2.21 Dividends

2.22 Exceptional items

When items of income and expenses within statement of profit and loss from ordinary activities are of as such size, nature and or incidence that there disclosure is relevant to explain the performance of the enterprise for the period, the nature and amount of such material items are disclosed separately as exceptional items.

2.23 Rounding of Amounts

All amounts disclosed in the Financial Statements and notes have been rounded off to the nearest millions (with two places of decimal) as per the requirement of Schedule III, unless otherwise stated.

2A Critical estimates and judgements

(i) Estimation of defined benefit obligation - Note 32.1

(ii) Impairment of Investments in Subsidiaries - Note 4

(iii) Impairment of Property, Plant and Equipment - Note 2.5, 3(a) and 3(d)

(iv) Useful lives of property, plant and equipment and intangible assets - Note 2.3, 3(a) and 3(d)

(v) Fair value measurements of financial instruments - Note 38

(vi) Expected credit loss for trade receivables

Refer note 2.7, 10(a) and 39A(i) for details of critical estimates in expected credit loss for financial instruments carried at amortised cost.

(vii) Critical judgement in determining the lease term - Note 3(b)

The Company determines the lease term on the basis of termination and renewal options in various lease contracts where the Company applies its judgement.

Mar 31, 2022

1. Company Information

Tega Industries Limited ("Tega" or "Company") incorporated in India is engaged in the activity of designing, manufacturing and installation of process equipment and accessories to cater the mineral processing, mining, material handling and environment industries. It was promoted by Mohanka Family in 1976 in technical and financial collaboration with Skega AB, Sweden.

The Company''s equity shares are listed on the Bombay Stock Exchange Limited (BSE) and the National Stock Exchange of India Limited (NSE).

The financial statements as at 31 March 2022 present the financial position of the Company.

The financials statements for the year ended 31 March 2022 were approved by the Board of Directors and authorised for issue on 24 May 2022.

2. Summary of significant accounting policies

2.1 Basis of Preparation

(i) Compliance with Ind AS

These financial statements have been prepared to comply in all material aspects with Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (the Act) [Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016] and other relevant provisions of the Act.

(ii) Historical Cost Convention

The financial statements have been prepared as going concern on accrual basis and under the historical cost convention except for the following assets and liabilities which have been measured at fair value or revalued amount:

- Certain financial assets and liabilities measured at fair value (refer accounting policy regarding financial instruments); and

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

- share-based payments

(iii) Current versus Non Current Classification

(iv) New and amended standards adopted by the Company

The Company has applied the following amendments to Ind AS for the first time for their annual reporting period commencing 1 April 2021:

â¢ Extension of COVID-19 related concessions - amendments to Ind AS 116

â¢ Interest rate benchmark reform - amendments to Ind AS 109, Financial Instruments, Ind AS 107, Financial Instruments: Disclosures, Ind AS 104, Insurance Contracts and Ind AS 116, Leases.

The amendments listed above did not have any impact on the amounts recognised in prior periods and are not expected to significantly affect the current or future periods.

(v) New amendments issued but not effective

The Ministry of Corporate Affairs (MCA) notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. On March 23, 2022, MCA amended the Companies (Indian Accounting Standards) Amendment Rules, 2022, as below:

Ind AS 16, Property Plant and equipment - The amendment clarifies that excess of net sale proceeds of items produced over the cost of testing, if any, shall not be recognized in the profit or loss but deducted from the directly attributable costs considered as part of cost of an item of property, plant, and equipment. The effective date for adoption of this amendment is annual periods beginning on or after April 1,2022. The Company has evaluated the amendment and there is no impact on its Standalone financial statements.

Ind AS 37, Provisions, Contingent Liabilities and Contingent Assets - The amendment specifies that the ''cost of fulfilling'' a contract comprises the ''costs that relate directly to the contract. Costs that relate directly to a contract can either be incremental costs of fulfilling that contract (examples would be direct labour, materials) or an allocation of other costs that relate directly to fulfilling contracts (an example would be the allocation of the depreciation charge for an item of property, plant and equipment used in fulfilling the contract). The effective date for adoption of this amendment is annual periods beginning on or after April 1,2022, although early adoption is permitted. The Company has evaluated the amendment and the impact is not expected to be material.

(v) Reclassifications consequent to amendments to Schedule III

The Ministry of Corporate Affairs amended the Schedule III to the Companies Act, 2013 on 24 March 2021 to increase the transparency and provide additional disclosures to users of financial statements. These amendments are effective from 1 April 2021.

Consequent to above, the Company has changed the classification/ presentation of current maturities of long-term borrowings in the current year.

The current maturities of long-term borrowings has now been included in the "Current borrowings" line item. Previously, current maturities of long-term borrowings were included in ''other financial liabilities'' line item.

Investments in subsidiaries and joint venture have been reclassified from Non-current non financial assets to Non-current financial assets

The Company has reclassified comparative amounts to conform with current year presentation as per the requirements of Ind AS 1 The impact of such classifications is summarised below

Balance Sheet (extract)	As at 31 March 2021 (as previously reported)	Increase/ Decrease	As at 31 March 2021 (restated)
Investment in subsidiaries and joint ventures - Non current	167.18	(167.18)	-
Financial assets - investment in others	4,533.73	(4,351.88)	181.85
Financial assets - investment in subsidiaries and joint venture	-	4,519.06	4,519.06
Other current financial liabilities	262.54	(163.47)	99.07
Current borrowings	626.00	163.47	789.47

2.2 Use of Estimates

The preparation of financial statements requires the use of accounting estimates which, by definition, will seldom equal the actual results. Estimates are continually evaluated. They are based on historical experience and other factors, including expectations of future events that may have a financial impact on the company and that are believed to be reasonable under the circumstances.

2.3 Property plant and equipment

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

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

An asset''s carrying amount is written down immediately to its recoverable amount if the asset''s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the statement of profit and loss.

On transition to Ind AS, the Company has elected to continue with the carrying value of its property plant and equipment measured at the previous GAAP and use that carrying value as the deemed cost of property plant and equipment.

Depreciation

Class of assets	Estimated useful life (i n years)
Buildings	30-60 years
Plant and Equipment*	3-8 years
Furniture and Fixtures	10 years
Vehicles	5-8 years
Office equipment	5 years
Electrical installation	10 years

ii) Leasehold improvements are depreciated over the shorter of their useful life or the lease term, unless the entity expects to use the assets beyond the lease term.

The assets residual values and useful lives are reviewed by the management , and adjusted if appropriate , at the end of each reporting period.

2.4 Intangible assets

Intangible Assets are stated at cost of acquisition net of accumulated amortisation and accumulated impairment, if any. Costs associated with maintaining software programmes are recognised as an expense as incurred.

An asset''s carrying amount is written down immediately to its recoverable amount if the asset''s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the statement of profit and loss.

Amortisation

The company amortises computer software using straight- line method over the following periods:

Class of assets	Estimated useful life (in years)
Software	3 years

Research and Development Expenditure

Research expenditure and development expenditure that do not meet the criterias mentioned below are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period. Property, plant and equipment used in Research and Development are capitalised.

Development costs are recognised as intangible assets when the following criteria are met:

1. it is technically feasible to complete the intangible asset so that it will be available for use

2. management intends to complete the intangible asset and use or sell it

3. there is an ability to use or sell the intangible asset

4. it can be demonstrated how the intangible asset will generate probable future economic benefits

5. adequate technical, financial and other resources to complete the development and to use or sell the intangible asset are available, and

6. the expenditure attributable to the intangible asset during its development can be reliably measured.

Capitalised development costs are recorded as intangible assets and amortised from the point at which the asset is available for use.

2.5 Impairment

At each balance sheet date, the Company reviews the carrying values of its property, plant and equipment and intangible assets to determine whether there is any indication that the carrying value of those assets may not be recoverable through continuing use. If any such indication exists, the recoverable amount of the asset is reviewed in order to determine the extent of impairment, if any. Where the asset does not generate cash flows that are independent from other assets, the Company estimates the recoverable amount of the cash generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. 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 for which the estimates of future cash flows have not been adjusted. An impairment loss is recognised in the statement of profit and loss as and when the carrying value of an asset exceeds its recoverable amount.

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

2.6 Investments in subsidiaries and joint venture

Investments in subsidiaries and joint venture are carried at cost less accumulated impairment, if any. Where an indication of impairment exists, the carrying amount of the investment is assessed and written down immediately to its recoverable amount. On disposal of investments in subsidiaries and joint venture the difference between net disposal proceeds and the carrying amounts are recognised in the statement of profit and loss.

2.7 Financial Instruments Investment in debt instruments

The financial assets are classified in the following categories:

1. financial assets measured at amortised cost,

2. financial assets measured at fair value through profit and loss (FVTPL), and

3. financial assets at fair value through other comprehensive income (FVOQ)."

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

At initial recognition, the financial assets are measured at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit and loss are expensed in the statement of profit and loss.

Financial assets measured at amortised cost

Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. After initial recognition, such financial assets are subsequently measured at amortised cost using the effective interest rate method. The losses arising from impairment are recognised in the statement of profit and loss.

Financial assets at fair value through other comprehensive income (FVOCI)

Financial assets measured at fair value through profit and loss (FVTPL)

Assets that do not meet the criteria for amortised cost or FVOCI are measured at fair value through profit and loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit and loss is recognised in the statement of profit and loss in the period in which it arises.

Investments in units of mutual funds are subsequently measured at FVTPL and the changes in fair value are recognised in the statement of Profit and Loss.

De-recognition of financial asset

A financial asset is derecognised only when

â¢ The Company has transferred the rights to receive cash flows from the financial asset or

â¢ Retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients.

Impairment of financial assets

For trade receivables only, the Company applies the simplified approach required by Ind AS 109, which requires expected lifetime losses to be recognised from initial recognition of the receivables.

Financial Liabilities

Borrowings are initially recognised at fair value, net of transaction costs incurred. Financial liabilities are subsequently measured at amortised cost using the effective interest rate method. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the period of the borrowings using the effective interest method. Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period. Where there is a breach of a material provision of a long-term loan arrangement on or before the end of the reporting period with the effect that the liability becomes payable on demand on the reporting date, the entity does not classify the liability as current, if the lender agreed, after the reporting period and before the approval of the financial statements for issue, not to demand payment as a consequence of the breach.

Trade and other payables represents as current liabilities for goods and services provided to the Company prior to the end of the financial year which are unpaid. The amount are unsecured and are usually paid within 30~90 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after the reporting period. They are recognised initially at their fair value and subsequently measured at amortised cost using the effective interest method.

De-recognition of financial liabilities:

A financial liability (or a part of financial liability) is de-recognised from Company''s balance sheet when obligation specified in the contract is discharged or cancelled or expired.

Derivative Instruments

Derivatives are only used for economic hedging purposes and not as speculative investments. The Company uses certain derivative financial instruments to reduce business risks which arise from its exposure to foreign exchange and interest rate fluctuations. The instruments are confined principally to forward foreign exchange contracts and interest rate swaps and options. The derivative contracts to hedge risks are not designated as hedges .

Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured to their fair value at the end of each reporting period. Net mark to market gains/ losses on derivatives taken by the Company are recorded in other income/ expenses respectively.

Cash and Cash Equivalents

For the purpose of presentation in the statement of Cash flows, cash and cash equivalents include cash on hand, demand deposits with banks, other short term highly liquid investments, if any, with original maturities of three months or less that are readily convertible to known amount of cash and subject to an insignificant change in value.

2.8 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 recognised 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.

2.9 Inventories

Inventories are valued at lower of cost and net realisable value. Cost of raw materials and traded goods comprises cost of purchases. Cost of work-in-progress and finished goods comprises direct materials, direct labours and an appropriate proportion of variable and fixed overhead expenditure, the latter being 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 individual items of inventory on the basis of weighted-average cost method. 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.

2.10 Revenue Recognition

Revenue shall be recognised to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services.

Sale of goods

No element of financing is deemed present as the sales are generally made with a credit term upto 180 days which is consistent with the market practice.

Revenue is recognised based on the price specified in the contract.

A receivable is recognised when the goods are dispatched or delivered, depending on the contract terms, as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

A contract asset is recognised in respect of those performance obligations where the control of the goods has been transferred to the buyer, and only delivery of the goods is pending. In these cases the consideration is due after the shipping obligation is complete, accordingly these are classified as contract assets as the consideration is conditioned on something other than passage of time.

The Company does not have any contracts where the period between the transfer of the promised goods or services to the customer and payment by the customer exceeds one year. As a consequence, the Company does not adjust any of the transaction prices for the time value of money.

The Company generally provides for warranties which are assurance-type warranties under Ind AS 115, and are accounted for under IND AS 37 Provisions, Contingent Liabilities and Contingent Assets.

2.11 Other Income

Interest: Interest income is calculated by applying the effective interest rate to the gross carrying amount of a financial asset. Dividend: Dividend income from investments is recognised when the shareholder''s rights to receive payment is established.

2.12 Government Grants

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

(ii) Government grants relating to income are deferred and recognised in the statement of profit and loss over the period necessary to match them with the costs that they are intended to compensate and presented within other operating revenue.

2.13 Borrowing Costs

Borrowing costs include interest, other costs incurred in connection with borrowing and exchange differences arising from foreign currency borrowings to the extent that they are regarded as an adjustment to the interest cost.

All other borrowing costs are expensed in the period in which they are incurred.

2.14 Foreign Currencies Transaction and balances Functional and presentation currency

These Financial statements of the Company is presented in Indian rupees (H), which is the functional currency of the Company and the presentation currency for the financial statements.

Transaction and Balances

Transactions in foreign currencies are translated into the functional currency at exchange rates prevailing on the date of the transaction. Foreign exchange gains and losses resulting from the settlement of such transactions are generally recognised in the Statement of Profit and Loss.

Monetary assets and liabilities related to such foreign currency transactions at the end of the year are translated at year end exchange rates and are generally recognised in the Statement of Profit and Loss. Non-monetary assets and non-monetary liabilities denominated in a foreign currency and measured at fair value are translated at the exchange rate prevalent at the date when the fair value was determined. Non-monetary assets and non-monetary liabilities denominated in a foreign currency and measured at historical cost are translated at the exchange rate prevalent at the date of transaction

2.15 Employee Benefits

a) Short-term Employee Benefits:

Short-term Employee Benefits (i.e. benefits payable within one year) are recognised in the period in which employee services are rendered.

b) Defined contribution plans:

Payments to defined contribution plans are charged as an expense as they fall due. Payments made to state managed retirement benefit schemes are dealt with as payments to defined contribution schemes as the Company has no further payment obligations once the contributions have been paid .

c) Defined benefit plans:

For defined benefit retirement schemes the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuation being carried out at each balance sheet date. Re-measurement gains and losses of the net defined benefit liability/(asset) are recognised immediately in other comprehensive income. The service cost and net interest on the net defined benefit liability/(asset) is treated as a net expense within employment costs.

Past service cost is recognised as an expense when the plan amendment or curtailment occurs or when any related restructuring costs or termination benefits are recognised, whichever is earlier.

The retirement benefit obligation recognised in the balance sheet represents the present value of the defined-benefit obligation as reduced by the fair value plan assets.

d) Other Long-term Employee Benefits:

Compensated absences:

Accumulated compensated absences which are expected to be availed or encashed within twelve months from the year end are treated as short term employee benefits. The obligation towards the same is measured at the expected cost of accumulating compensated absences as the additional amount expected to be paid as a result of the unused entitlements as at the year end.

Accumulated compensated absences which are expected to be availed or encashed beyond twelve months from the year end are treated as other long term employee benefits. The Company''s liability is actuarially determined (using the Projected Unit Credit method) at the end of each year. Actuarial loss/gains are recognised in the Statement of Profit and Loss in the year in which they arise.

e) Share based payments:

Share-based compensation benefits are provided to employees via the Tega Industries Limited Employee Stock Option Scheme namely ESOP Scheme 2011. Employees of the Company receive remuneration in the form of share-based payments, whereby employees render services as consideration for equity instruments (equity-settled transactions).

2.16 Current and Deferred Tax

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting profit nor taxable profit (tax loss). Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax assets are recognised for all deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

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

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

2.17 Provision and Contingent Liabilities

The Company recognises a provision where there is a present obligation as a result of a past event that probably requires an outflow of resources 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 or there is a present obligation, reliable estimate of the amount of which cannot be made. Where there is a possible obligation or a present obligation and the likelihood of outflow of resources is remote, no provision or disclosure for contingent liability is made.

Provision for warranty

2.18 Earnings per Share

2.19 Segment Reporting

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

2.20 Leases

The Company as lessee

Lease liability is measured at the present value of the lease payments that are not paid at the commencement date of the lease. The lease payments are discounted using the interest rate implicit in the lease, if that rate can be readily determined. If that rate

cannot be readily determined, the Company uses incremental borrowing rate. The lease liability is subsequently remeasured by increasing the carrying amount to reflect interest on the lease liability, reducing the carrying amount to reflect the lease payments made and remeasuring the carrying amount to reflect any reassessment or lease modifications. The Company recognizes the amount of the re-measurement of lease liability as an adjustment to the right-of-use asset. Where the carrying amount of the right-of-use asset is reduced to zero and there is a further reduction in the measurement of the lease liability, the Company recognizes any remaining amount of the re-measurement in statement of profit and loss.

2.21 IPO Expenses

The transaction costs incurred by the Company on behalf of the selling shareholders, with respect to the Initial Public Offer (IPO) is recognized as an asset in the balance sheet as they are recoverable from the selling shareholders.

2.22 Exceptional items

2.23 Rounding of Amounts

All amounts disclosed in the Financial Statements and notes have been rounded off to the nearest millions (with two places of decimal) as per the requirement of Schedule III, unless otherwise stated.

2A Critical estimates and judgements

(i) Estimation of defined benefit obligation

Refer note 32.1 for details of critical estimates in computation of defined benefit obligation.

(ii) Impairment of Investments in Subsidiaries and Joint Venture

(iii) Fair Valuation of Investments

When the fair value of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including Discounted Cash Flow Model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair value. The Company makes judgements regarding various assumptions that are mainly based on the market conditions existing at the end of each reporting period which is detailed in note 38. Changes in assumptions about these factors could affect the reported fair value of financial instruments.

(iv) Deferred Taxes

The Company reviews the carrying amount of deferred tax assets at the end of each reporting period. The policy has been detailed in note 2.16 and judgements related to deferred taxes is set out in note 36.

(v) Critical judgement in determining the lease term

The Company determines the lease term on the basis of termination and renewal options in various lease contracts where the Company applies its judgement. Refer note 3(b) for details.

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Accounting Policies of Tega Industries Ltd. Company

2. Summary of MaterialAccounting Policies

(i) Compliance With Ind As

(ii) Historical Cost Convention

(iii)Current Versus Non Current

Classification

Amendments To Ind As 1 16-LeaseLiability In A Sale And Leaseback

Notification Of Ind As 117

Depreciation

Research and Development Expenditure

Investment in debt instruments

Financial assets measured at amortisedcost

Financial assets at fair value throughother comprehensive income (FVOCI)

Financial assets measured at fair valuethrough profit or loss (FVTPL)

De-recognition of financial asset

Impairment of financial assets

Trade receivables

Cash and cash equivalents

Financial liabilitiesBorrowings

Trade and other payables

De-recognition of financial liabilities

Derivative instruments and hedgeaccounting

Sale of goods

Sale of services

Functional and presentation currency

a) Short-term employee benefits:

b) Defined contribution plansProvident fund

Superannuation fund

c) Defined benefit plansGratuity

d) Other long-term employee benefits:Compensated absences

e) Share based payments

2.1 Basis of Preparation

(i) Compliance with Ind AS

(iii) Current versus Non Current Classification

(iv) New and amended standards adopted by the Company

(v) New amendments issued but not effective

2.2 Use of Estimates

2.3 Property, plant and equipment

Depreciation

2.4 Intangible assets

Amortisation

Research and Development Expenditure

2.5 Impairment

2.6 Investments in subsidiaries and joint venture

2.7 Financial Instruments

Investment in debt instruments

Financial assets measured at amortised cost

Financial assets at fair value through other comprehensive income (FVOCI)

Financial assets measured at fair value through profit or loss (FVTPL)

De-recognition of financial asset

Impairment of financial assets

Trade Receivables

Cash and Cash Equivalents

Financial Liabilities Borrowings

De-recognition of financial liabilities

Derivative Instruments

2.8 Offsetting Financial Instruments

2.9 Inventories

2.10 Revenue Recognition

Sale of goods

Sale of services

2.11Other Income

2.12 Government Grants

2.13 Borrowing Costs

2.14 Foreign Currencies Translation Functional and presentation currency

2.15 Employee Benefits

a) Short-term Employee Benefits:

b) Defined contribution plans Provident Fund

Superannuation Fund

c) Defined benefit plans Gratuity

d) Other long-term employee benefits:

Compensated absences

e) Share based payments

2.16 Current and Deferred Tax

2.17 Provision and Contingent Liabilities

2.18 Earnings per Share

2.19 Segment Reporting

2.20 Leases

The Company as lessee

2.21 Dividends

2. Summary of Material
Accounting Policies

Amendments To Ind As 1 16-Lease
Liability In A Sale And Leaseback

Financial assets measured at amortised
cost

Financial assets at fair value through
other comprehensive income (FVOCI)

Financial assets measured at fair value
through profit or loss (FVTPL)

Financial liabilities
Borrowings

Derivative instruments and hedge
accounting

b) Defined contribution plans
Provident fund

c) Defined benefit plans
Gratuity

d) Other long-term employee benefits:
Compensated absences