Accounting Policies of Tinna Rubber and Infrastructure Ltd. Company

Mar 31, 2016

1 CORPORATE INFORMATION

Tinna Rubber And Infrastructure Limited (the company) was incorporated on 4th March 1987. The Company is a public limited company incorporated and domiciled in India and has its registered office at Delhi, India. The Company is listed on BSE Limited . The Company is primarily engaged in the conversion of used Tyres into Crumb Rubber and Steel wires obtained in the process. The company manufacture Crumb Rubber Modifier (CRM), Crumb Rubber Modified Bitumen (CRMB), Polymer Modified Bitumen (PMB), Bitumen Emulsion, Reclaimed Rubber/ Ultra fine Crumb Rubber compound, Cut Wire Shots etc. The products are primarily used for making / repair of road, tyres and auto part industry. The Company''s manufacturing units are located at Panipat in Haryana, Wada in Maharashtra, Haldia in West Bengal, Gummidipundi in Tamil Nadu, Kalamb in Himachal Pradesh. The Company is also engaged in the activity of making holding & nurturing its investment in various businesses over the past years. The company has nurtured its investment in the business of Trading in Agro commodity and Agro warehousing, Construction Chemicals, Real Estate, Wine etc.

2 SIGNIFICANT ACCOUNTING POLICIES

2.01 Basis of preparation of Financial Statements

The financial statements of the Company have been prepared and presented in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply with all material respects with the accounting standards specified under section 133 of the Companies Act, 2013, read together with Rule 7 of the Companies (Accounts) Rules, 2014. The financial statements have been prepared on an accrual basis and under the historical cost convention. The accounting policies adopted in the preparation of financial statements are consistent with those of previous year except for the change in accounting policy explained below.

All assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle and other criteria set out in Schedule III of the Companies Act, 2013. Based on the nature of products and the time between acquisition of assets for processing and their realization 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.

2.02 Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles in India requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, as at the end of the reporting period. Although these estimates are based on the management’s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods. Changes in estimates are reflected in the financial statements in the period in which changes are made and if material, their effects are disclosed in the notes to the Financial Statements.

Change in Estimates

During the year 2015-16, depreciation on Plant and machinery and Electrical Fittings located at Crumb Rubber, steel Wire and Cut Wire Shots manufacturing units has been provided considering the revised useful life as 12 years based on technical re-assessment conducted by the company as against earlier estimated useful life of 8 years.

2.03 Tangible fixed assets

a) Tangible assets are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. The cost comprises purchase price, taxes, duties, freight and other incidental expenses related to acquisition and installation of the concerned assets are further adjusted by the amount of CENVAT credit and VAT credit availed wherever applicable and subsidy directly attributable to the cost of fixed asset. Interest and other borrowing costs during construction period to finance qualifying fixed assets is capitalized if capitalization criteria are met.

b) The Company identifies and determines cost of each component/ part of the asset separately, if the component/ part has a cost which is significant to the total cost of the asset and has useful life that is materially different from that of the remaining asset. Similarly, when significant parts of plant and equipment are required to be replaced at intervals or when a major inspection/overhauling is required to be performed, such cost of replacement or inspection is capitalized (if the recognition criteria is satisfied) in the carrying amount of plant and equipment as a replacement cost or cost of major inspection/overhauling, as the case may be and depreciated separately based on their specific useful life.

c) Subsequent expenditure related to an item of tangible asset is added to its book value only if it increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other expenses on existing fixed assets, including day to day repair and maintenance expenditure are charged to the statement of profit and loss for the period during which such expenses are incurred.

d) Capital work-in- progress comprises cost of fixed assets that are not yet ready for their intended use at the balance sheet date and are carried at cost comprising direct cost , related incidental expenses and interest on borrowings their against.

e) Preoperative expenditure and trial run expenditure accumulated as capital work in progress is allocated on the basis of prime cost of fixed assets in the year of commencement of commercial production.

f) Gains or losses arising from disposal of fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is disposed off.

2.04 Intangible assets

a) Acquired intangible assets

Intangible assets including software licenses of enduring nature and contractual rights acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less accumulated amortization and accumulated impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

b) Research and development cost

Research costs are expensed as incurred. Development expenditure incurred on an individual project is recognized as an intangible asset when it is probable that the future economic benefits that are attributable to the asset will flow to the Company and cost of the assets can be measured reliably.

c) Gains or losses arising from disposal of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is disposed off.

2.05 Depreciation and amortization

a) Depreciation on tangible assets is provided on prorata basis on straight line method over the useful lives of assets and in the manner prescribed in Schedule II of The Companies Act, 2013.

b) Plant and Machinery, Tools and Equipment and Electrical fittings and installations in Crumb Rubber Plant, Steel Plant and Cut Wire Shot Plant are depreciated over the estimated useful life of 12 years, which are different than those indicated in Schedule II of Companies Act, 2013. Based on technical assessment, the Management believes that the useful lives as given above best represent the period over which the Management expects to use these assets.

c) Leasehold buildings are depreciated over their useful life of Ten years based upon their respective lease agreement.

d) Amortization of intangible Assets :

Intangible assets are amortized on a straight line basis over their estimated useful life of six years.

2.06 Investments

"Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments.

On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Current investments are carried in the financial statements at the lower of cost and fair value of each investment individually. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize any decline, other than temporary, in the carrying value of each investment.

On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

2.07 Inventories

i) Raw Materials, Stores and Spare parts are valued at cost. Materials and other items held for use in the production of inventories are not written down below cost, if the finished products in which they will be incorporated are expected to be sold at or above cost. Raw Material, Stores and Spares & and Raw Material contents of work in progress are valued by using the first in first out (FIFO) method.

ii) Finished goods are valued at cost plus excise duty or net realizable value whichever is lower. The finished goods are valued by using weighted average cost method. Cost of finished goods includes direct Raw Material, labour cost, allocable overhead manufacturing expenses and excise duty.

iii) Work-in-progress are valued at lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity.

iv) The stocks of scrap materials have been taken at net realizable value.

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

2.08 Foreign currency transactions

Foreign currency transactions and balances

i) Initial recognition

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

ii) Conversion

Foreign currency monetary items are retranslated using the exchange rate prevailing at the reporting date. Nonmonetary items, which are measured in terms of historical cost denominated in a foreign currency, are reported using the exchange rate at the date of the transaction.

iii) Exchange differences

Exchange differences arising on conversion / settlement of foreign currency monetary items and on foreign currency liabilities relating to fixed assets acquisition are recognized as income or expense in the year in which they arise.

iv) Bank Guarantee And Letter of Credit

Bank Guarantee And Letter of Credits are recognized at the point of negotiation with Banks and converted at the rates prevailing on the date of Negotiation. However, Outstanding at the period end are recognized at the rate prevailing as on that date and total sum is considered as contingent liability.

2.09 Retirement Benefits To Employees

i) Provident fund

Retirement benefit in the form of provident fund is a defined contribution scheme. The contributions to provident fund are made in accordance with the relevant scheme and are charged to the statement of profit and loss for the year when the contributions are due. The Company has no obligation, other than the contribution payable to the provident fund.

ii) Gratuity

The Company''s gratuity scheme is a defined benefit plan. The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the projected unit credit method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation is measured at the present value of the estimated future cash flows. The discount rate used for determining the present value of the obligation under defined benefit plan, is based on the market yields on government securities as at the balance sheet date. Actuarial gains and losses arising from experience adjustment and changes in actuarial assumptions are recognized immediately in the Statement of Profit and Loss in the period in which they arise.

iii) Leave Encashment

Accrual for leave encashment benefit is based on actuarial valuation using projected unit credit method as on the balance sheet date in pursuance of the company''s leave rules.

2.10 Revenue Recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized:

i) Sale of Goods:

Revenue from sale of Goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, and are recorded net of returns and trade discount. The Company collects sales taxes and value added taxes (VAT) on behalf of the government and, therefore, these are not economics benefits flowing to the company and therefore are excluded from revenue. Excise Duty is deducted from revenue(Gross) to arrive at revenue from operations (net). sales do not include inter-divisional transfers.

ii) Job Work

In case of Job works, the system of accounting in financial books are to consider net effect of material received and dispatched whereas in excise records complete details of input/ output quantity and excise duty is accounted for.

iii) Composite Services

In respect of Mobile blending unit where company has got composite price of material consumed & equipment rental, the rate for equipment rental is calculated on the basis of charge received under similar job work arrangements with government refineries and the remaining portion of income is considered as sale price of material

iv) Interest:

Interest income is recognized on a time proportion basis, except on doubtful or sticky loans and advances which is accounted on receipt basis.

v) Dividend from investment in Shares :

Dividend income is recognized when the right to receive the payment is established.

vi) Claims

Claims are recognized when there exists reasonable certainty with regard to the amounts to be realized and the ultimate collection thereof.

vii) Export Incentive

Export incentives under various schemes notified by the Government have been recognized on the basis of their entitlement rates in accordance with the Foreign Trade Policy 2015-20. Benefits in respect of advance licenses are recognized when there is reasonable assurance that the Company will comply with the conditions attached to them and incentive will be received.

2.11 Future Contracts

Profit / Loss on contracts for future settled during the year are recognized in the Statement of Profit and Loss. Future contracts outstanding at year-end are marked to market at fair value. Any losses arising on that account are recognized in the Statement of Profit and Loss for the year.

2.12 Prior Period Items/ Extraordinary Items

Prior Period expenses/incomes, are shown as prior period items in the profit and loss account as per the provision of Accounting Standard-5 "Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies" notified under the Companies (Accounting Standards) Rules ,2006 (as amended). Items of income or expenses that arise from events or transactions that are distinct from ordinary activities of the enterprise and are not expected to recurr frequently or regularly are treated as extraordinary items.

2.13 Segment reporting Identification of segments

The Company''s operating businesses are organized and managed separately according to the nature of products manufactured, with each segment representing a strategic business unit that offers different products. Allocation of common costs Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs.

Unallocated items

Unallocated items include general corporate income and expense items which are not allocated to any business segment.

Segment accounting policies

The Company prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the financial statements of the Company as a whole."

2.14 Taxes on Income

Tax expense for the year comprises of direct taxes and indirect taxes.

DIRECT TAXES

i) Current income-tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income-tax Act, 1961 enacted in India. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current income tax relating to items recognized directly in equity is recognized in equity and not in the statement of profit and loss.

ii) Deferred income taxes reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted at the reporting date.

Deferred tax liabilities are recognized for all taxable timing differences. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits.

The carrying amount of deferred tax assets are reviewed at each reporting date. The company writes-down the carrying amount of deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realized. Any such write-down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available.

iii) Minimum Alternate Tax (MAT) paid in a year is charged to the Statement of Profit and Loss as Current Tax. The Company recognizes MAT Credit available as an asset only to the extent that there is convincing evidence that the company will pay normal income tax during the specified period, i.e., the period for which MAT Credit is allowed to be carried forward. In the year in which the company recognizes MAT credit as an asset in accordance with the Guidance Note on accounting for Credit Available in respect of Minimum Alternative Tax under the Income Tax Acts, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as "MAT Credit Entitlement". The company reviews the "MAT Credit Entitlement" asset at each reporting date and writes down the asset to the extent the company does not have convincing evidence that it will pay normal tax during the specified period.

INDIRECT TAXES

i) Excise duty (including education cess) has been accounted for in respect of the goods cleared. The company is providing excise duty liability in respect of finished products

ii) Service Tax has been accounted for in respect of services rendered.

iii) Final sales tax / Value added tax liability is ascertained on the finalization of assessments in accordance to provisions of sales tax / value added tax laws of respective states where the company is having offices/works.

2.15 Impairment of assets

"The Management periodically assesses, using external and internal sources, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the company estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) net selling price and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining net selling price, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used.

Impairment losses of continuing operations, including impairment on inventories, are recognized in the statement of profit and loss. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

2.16 Leases

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased item, are classified as operating leases. Operating lease payments are recognized as an expense in the statement of profit and loss on a straight-line basis over the lease term.

2.17 Borrowing costs

Borrowing cost includes interest and ancillary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective asset. All other borrowing costs are expensed in the period they occur.

2.18 Earning per share

Basic earning per share is computed by dividing the profit/(loss) after tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year. Diluted earning per share is computed by dividing the profit/(loss) after tax (including the post tax effect of extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income (net of any attributable taxes) relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earning per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease the net profit per share from continuing ordinary operations. Potential equity shares are deemed to be converted as at the beginning of the period, unless they have been issued at a later date. The dilutive potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value (i.e. average market value of the outstanding shares). Dilutive potential equity shares are determined independently for each period presented.

2.19 Provisions and Contingent Liabilities Provisions

A provision is recognized when the company has a present obligation as a result of past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of obligation. Provisions are not discounted to their present value and are determined based on the best estimates required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.

Contingent Liabilities

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements.

2.20 Cash and cash equivalents

Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

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Mar 31, 2015

2.01 Basis of preparation

The financial statements of the Company have been prepared and presented in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply with all material respects with the accounting standards specified under section 133 of the Companies Act, 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014. The financial statements have been prepared on an accrual basis and under the historical cost convention. The accounting policies adopted in the preparation of financial statements are consistent with those of previous year except for the change in accounting policy explained below.

All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle and other criteria set out in Schedule III of the Companies Act, 2013. Based on the nature of products and the time between 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.

2.02 Change in Accounting Policies

(i) Depreciation on fixed assets

From the current year Schedule XIV of the Companies Act, 1956 has been replaced by Schedule II of the Companies Act, 2013. Due to such change, depreciation is being provided as given below.

a) Useful Lives / Depreciation Rates

Schedule II of the Companies Act, 2013 prescribes useful lives of the assets and the depreciation is being provided on the straight line method as per their useful lives prescribed in Schedule II of the Companies Act, 2013. However, Schedule II allows companies to use higher/ lower useful lives and residual values ; if such useful lives and residual values can be technically supported and justification for difference is disclosed in the financial statements. The management believes that depreciation rates currently used fairly reflect its estimate of the useful lives and residual values of fixed assets, though these rates in certain cases are different from lives prescribed under Schedule II of the Companies Act, 2013. Unless stated otherwise, the impact of such change in policy for the current year is likely to hold good for future years also.

b) Assets for a value not exceeding Rs. 5000/-

The depreciation on assets for a value not exceeding Rs. 5000/- which were written off in the year of purchase as per erstwhile Companies Act, 1956, are being charged on the basis of their useful lives prescribed in the Schedule II of the Companies Act, 2013.

2.03 Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles in India requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management's best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods. Changes in estimates are reflected in the financial statements in the period in which changes are made and if material, their effects are disclosed in notes to accounts.

2.04 Tangible fixed assets

a) Tangible assets are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. The cost comprises purchase price, taxes, duties, freight and other incidental expenses related to acquisition and installation of the concerned assets are further adjusted by the amount of CENVAT credit and VAT credit availed wherever applicable and subsidy directly attributable to the cost of fixed asset. Interest and other borrowing costs during construction period to finance qualifying fixed assets is capitalised if capitalisation criteria are met.

b) Subsequent expenditure related to an item of tangible asset is added to its book value only if it increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other expenses on existing fixed assets, including day to day repair and maintenance expenditure are charged to the statement of profit and loss for the period during which such expenses are incurred.

c) Capital work-in- progress comprises cost of fixed assets that are not yet ready for their intended use at the balance sheet date and are carried at cost comprising direct cost , related incidental expenses and interest on borrowings their against.

d) Preoperative expenditure and trial run expenditure accumulated as capital work in progress is allocated on the basis of prime cost of fixed assets in the year of commencement of commercial production.

e) Gains or losses arising from disposal of fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is disposed off.

2.05 Intangible assets

a) Acquired intangible assets

Intangible assets including software licenses of enduring nature and contractual rights acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less accumulated amortisation and accumulated impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

b) Research and development cost

Research costs are expensed as incurred. Development expenditure incurred on an individual project is recognized as an intangible asset when it is probable that the future economic benefits that are attributable to the asset will flow to the Company and cost of the assets can be measured reliably.

c) Gains or losses arising from disposal of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss when the asset is disposed off.

2.06 Depreciation and amortization

a) Depreciation on fixed assets is provided on prorata basis on straight line method using the useful lives of assets and in the manner prescribed in Schedule II of The Companies Act, 2013.

b) Plant and Machinery, Tools and Equipment and Electrical fittings and installations in Crumb Rubber Plant, Steel Plant and Cut Wire Shot Plant are depreciatied over the estimated useful life of 8 years, which are lower than those indicated in Schedule II. On the basis of technical assessment, management believes that the useful lives as given above best represent the period over which the assets are expected to be used.

c) Leasehold buildings are depreciated over their useful life of 10 year based upon their respective lease agreement.

d) Amortisation of intangible Assets :

Intangible assets are amortised on a straight line basis over their estimated useful life of six years.

2.07 Investments

"Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments.

On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Current investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments. "

On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

2.08 Inventories

i) Raw Materials, Stores and Spare parts are valued at cost. Materials and other items held for use in the production of inventories are not written down below cost, if the finished products in which they will be incorporated are expected to be sold at or above cost. Raw Material, Stores and Spares & and Raw Material contents of work in progress are valued by using the first in first out (FIFO) method.

ii) Finished goods are valued at cost plus excise duty or net realizable value whichever is lower. The finished goods are valued by using weighted average cost method. Cost of finished goods includes direct Raw Material, labour cost, allocable overhead manufacturing expenses and excise duty.

iii) Work-in-progress are valued at lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity.

iv) The stocks of scrap materials have been taken at net realisable value.

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

2.09 Foreign currency transactions

Foreign currency transactions and balances

i) Initial recognition

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

ii) Conversion

Foreign currency monetary items are retranslated using the exchange rate prevailing at the reporting date. Non- monetary items, which are measured in terms of historical cost denominated in a foreign currency, are reported using the exchange rate at the date of the transaction.

iii) Exchange differences

Exchange differences arising on conversion / settlement of foreign currency monetary items and on foreign currency liabilities relating to fixed assets acquisition are recognised as income or expense in the year in which they arise.

iv) Bank Guarantee And Letter of Credit

Bank Guarantee And Letter of Credits are recognized at the point of negotiation with Banks and converted at the rates prevailing on the date of Negotiation, However, Outstanding at the period end are recognized at the rate prevailing as on that date and total sum is considered as contingent liability.

2.10 Retirement Benefits

i) Provident fund

Retirement benefit in the form of provident fund is a defined contribution scheme. The contributions to provident fund are made in accordance with the relevant scheme and are charged to the statement of profit and loss for the year when the contributions are due. The Company has no obligation, other than the contribution payable to the provident fund.

ii) The Company's gratuity scheme is a defined benefit plan. The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the projected unit credit method, which recognises each period of service as giving rise to additional unit of employee benefit etitlement and measures each unit separately to build up the final obligation. The obligation is measured at the present value of the estimated future cash flows. The discount rate used for determining the present value of the obligation under defined benefit plan, is based on the market yields on government securities as at the balance sheet date. Actuarial gains and lossses are recognised immidiately in the Statement of Profit and Loss.

iii) Leave Encashment

Accrual for leave encashment benefit is based on acturial valuation as on the balance sheet date in pursuance of the company's leave rules.

2.11 Revenue Recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized:

i) Sale of Goods:

Revenue from sale of Goods is recognised when all the significant risks and rewards of ownership of the goods have been passed to the buyer, and are recorded net of returns and trade discount. The Company collects sales taxes and value added taxes (VAT) on behalf of the government and, therefore, these are not economics benefits flowing to the company and therefore are excluded from revenue. Excise Duty is deducted from revenue(Gross) to arrive at revenue from operations (net). sales do not include inter-divisional transfers.

ii) Job Work

In case of Job works, the system of accounting in financial books are to consider net effect of material received and dispatched whereas in excise records complete details of input/ output quantity and excise duty is accounted for.

iii) Composite Services

In respect of Mobile blending unit where company has got composite price of material consumed & equipment rental, the rate for equipment rental is calculated on the basis of charge received under similar job work arrangements with government refineries and the remaining portion of income is considered as sale price of material

iv) Interest:

Interest income is recognized on a time proportion basis, except on doubtful or sticky loans and advances which is accounted on receipt basis.

v) Dividend from investment in Shares :

Dividend income is recognized when the right to receive the payment is established.

vi) Claims

Claims are recognised when there exists reasonable certainty with regard to the amounts to be realised and the ultimate collection thereof.

2.12 Future Contracts

Profit/ Loss on contracts for future settled during the year are recognised in the Statement of Profit and Loss. Future contracts outstanding at year-end are marked to market at fair value. Any losses arising on that account are recognised in the Statement of Profit and Loss for the year.

2.13 Prior Period Items/ Extraordinary Items

Prior Period expenses/incomes, are shown as prior period items in the profit and loss account as per the provision of Accounting Standard-5 "Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies" notified under the Companies (Accounting Standards) Rules ,2006 (as amended). Items of income or expenses that arise from events or transactions that are distinct from ordinary activities of the enterprise and are not expected to recurr frequently or regularly are treated as extraordinary items.

2.14 Segment reporting

"Identification of segments The Company's operating businesses are organized and managed separately according to the nature of products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. The Company is operating in a single reportable segment namely Crumb Rubber, Crumb Rubber Modifier, Modified Bitumen and Emulsion Bitumen etc. It also operates in other non- reportable segments of Investment in companies engaged in Trading of Agro commodity and Agro warehousing, Constructions Chemicals, Real Estate, Wine etc.

Secondary segment: Geographical Segment The analysis of geographical segment is not applicable since all the works are situated within India including exports executed from India."

2.15 Taxes on Income

Tax expense for the year comprises of direct taxes and indirect taxes.

DIRECT TAXES

i) Current income-tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income- tax Act, 1961 enacted in India. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current income tax relating to items recognized directly in equity is recognized in equity and not in the statement of profit and loss.

ii) Deferred income taxes reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted at the reporting date.

Deferred tax liabilities are recognized for all taxable timing differences. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits.

The carrying amount of deferred tax assets are reviewed at each reporting date. The company writes-down the carrying amount of deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realized. Any such write- down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available.

iii) Minimum Alternate Tax (MAT) paid in a year is charged to the Statement of Profit and Loss as Current Tax. The Company recognizes MAT Credit available as an asset only to the extent that there is convincing evidence that the company will pay normal income tax during the specified period, i.e., the period for which MAT Credit is allowed to be carried forward. In the year in which the company recognizes MAT credit as an asset in accordance with the Guidance Note on accounting for Credit Available in respect of Minimum Alternative Tax under the Income Tax Acts, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as "MAT Credit Entitlement". The company reviews the "MAT Credit Entitlement" asset at each reporting date and writes down the asset to the extent the company does not have convincing evidence that it will pay normal tax during the specified period.

iv) Wealth tax is ascertained in accordance with the provisions of the Wealth Tax Act 1957.

INDIRECT TAXES

i) Excise duty (including education cess) has been accounted for in respect of the goods cleared. The company is providing excise duty liability in respect of finished products

ii) Service Tax has been accounted for in respect of services rendered.

iii) Final sales tax / Value added tax liability is ascertained on the finalization of assessments in accordance to provisions of sales tax / value added tax laws of respective states where the company is having offices/works.

2.16 Impairment of assets

"The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the company estimates the asset's recoverable amount. An asset's recoverable amount is the higher of an asset's or cash-generating unit's (CGU) net selling price and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining net selling price, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used.

Impairment losses of continuing operations, including impairment on inventories, are recognized in the statement of profit and loss. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life."

2.17 Leases

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased item, are classified as operating leases. Operating lease payments are recognized as an expense in the statement of profit and loss on a straight-line basis over the lease term.

2.18 Borrowing costs

"Borrowing cost includes interest and ancillary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost. Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective asset. All other borrowing costs are expensed in the period they occur."

2.19 Earning per share

Basic earning per share is computed by dividing the profit/(loss) aster tax (including the post tax effect of extraordinary

items, if any) by the weighted average number of equity shares outstanding during the year. Diluted earning per share is computed by dividing the profit/(loss) after tax (including the post tax effect of extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income (net of any attributable taxes) relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earning per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease the net profit per share from continuing ordinary operations. Potential equity shares are deemed to be converted as at the beginning of the period, unless they have been issued at a later date. The dilutuve potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value (i.e. average market value of the outstanding shares). Dilutive potential equity shares are determined independently for each period presented.

2.19 Provisions and Contingent Liabilities Provisions

A provision is recognized when the companyhas a present obligation as a result of past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of obligation. Provisions are not discounted to their present value and are determined based on the best estimates required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.

Contingent Liabilities

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements.

2.20 Cash and cash equivalents

Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

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Mar 31, 2014

1.01 BASIS OF PREPARATION

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP).The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies accounting Standards) Rules, 2006, (as amended), relevant provisions of the Companies Act,1956,read with general circular 8/2014 dated 4th April,2014 issued by Ministry of Corporate Affairs. The financial statements have been prepared on an accrual basis and under the historical cost convention. The accounting policies adopted in the preparation of financial statements are consistent with those of previous year.

2.02 USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted accounting principles in India requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods. Changes in estimates are reflected in the financial statements in the period in which changes are made and if material, their effects are disclosed in notes to accounts.

2.03 TANGIBLE FIXED ASSETS

a) Tangible assets are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. The cost comprises purchase price, taxes, duties, freight and other incidental expenses related to acquisition and installation of the concerned assets are further adjusted by the amount of CENVAT credit and VAT credit availed wherever applicable and subsidy directly attributable to the cost of fixed asset. Interest and other borrowing costs during construction period to finance qualifying fixed assets is capitalised if capitalisation criteria are met.

b) Subsequent expenditure related to an item of tangible asset is added to its book value only if it increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other expenses on existing fixed assets, including day to day repair and maintenance expenditure are charged to the statement of profit and loss for the period during which such expenses are incurred.

c) Capital work-in- progress comprises cost of fixed assets that are not yet ready for their intended use at the balance sheet date and are carried at cost comprising direct cost , related incidental expenses and interest on borrowings their against.

d) Preoperative expenditure and trial run expenditure accumulated as capital work in progress is allocated on the basis of prime cost of fixed assets in the year of commencement of commercial production.

e) Gains or losses arising from disposal of fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is disposed off.

2.04 INTANGIBLEASSETS

a) Acquired intangible assets

Intangible assets including software licenses of enduring nature and contractual rights acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less accumulated amortisation and accumulated impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

b) Research and development cost

Research costs are expensed as incurred. Development expenditure incurred on an individual project is recognized as an intangible asset when it is probable that the future economic benefits that are attributable to the asset will flow to the Company and cost of the assets can be measured reliably.

c) Gains or losses arising from disposal of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss when the asset is disposed off.

2.05 DEPRECIATIONAND AMORTIZATION

a) Depreciation on tangible fixed assets is provided on straight line basis using the rates and in the manner as prescribed in Schedule XIV of the Companies Act, 1956, which approximates the useful lives of the assets estimated by the management. Depreciation on Crumb Rubber Plant has been provided at 11.875% per annum considering the useful life of the Plant as 8 years on straight line method. Depreciation on other Plant and Machinery has been provided on Straight line Method on rates as per Schedule XIV of the Companies Act, 1956

b) Depreciation on mobile phones has been provided @ 16.21% p.a on straight line method.

c) Depreciation on leasehold building has been provided @ 10% p.a on the basis of straight line method.

d) Computer Software are amortized over a period of 5 years.

e) Assets costing not more than 5,000/- each individually are depreciated at 100%.

2.06 INVESTMENTS

Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments.

On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Current investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

2.07 INVENTORIES

i) Raw Materials, Stores and Spare parts are valued at cost. Materials and other items held for use in the production of inventories are not written down below cost, if the finished products in which they will be incorporated are expected to be sold at or above cost. Raw Material, Stores and Spares and Raw Material contents of work in progress are valued by using the first in first out (FIFO) method.

ii) Finished goods are valued at cost plus excise duty or net realizable value whichever is lower. The finished goods are valued by using weighted average cost method. Cost of finished goods includes direct Raw Material, labour cost, allocable overhead manufacturing expenses and excise duty.

iii) Work-in-progress are valued at lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity.

iv) The stocks of scrap materials have been taken at net realisable value.

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

2.08 FOREIGN CURRENCY TRANSACTIONS

Foreign currency transactions and balances

i) Initial recognition

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

ii) Conversion

Foreign currency monetary items are retranslated using the exchange rate prevailing at the reporting date. Non-monetary items, which are measured in terms of historical cost denominated in a foreign currency, are reported using the exchange rate at the date of the transaction.

iii) Exchange differences

Exchange differences arising on conversion / settlement of foreign currency monetary items and on foreign currency liabilities relating to fixed assets acquisition are recognised as income or expense in the year in which they arise.

iv) Bank Guarantee And Letter of Credit

Bank guarantee and letter of credits are recognized at the point of negotiation with Banks and converted at the rates prevailing on the date of negotiation, however, outstanding at the period end are recognized at the rate prevailing as on that date and total sum is considered as contingent liability.

2.09 RETIREMENT BENEFITS

i) Provident fund

Retirement benefit in the form of provident fund is a defined contribution scheme. The contributions to provident fund are made in accordance with the relevant scheme and are charged to the statement of profit and loss for the year when the contributions are due. The Company has no obligation, other than the contribution payable to the provident fund.

ii) The Company''s gratuity scheme is a defined benefit plan. The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the projected unit credit method, which recognises each period of service as giving rise to additional unit of employee benefit etitlement and measures each unit separately to build up the final obligation. The obligation is measured at the present value of the estimated future cash flows. The discount rate used for determining the present value of the obligation under defined benefit plan, is based on the market yields on government securities as at the balance sheet date. Actuarial gains and lossses are recognised immidiately in the Statement of Profit and Loss.

iii) Leave Encashment

Accrual for leave encashment benefit is based on acturial valuation as on the balance sheet date in pursuance of the company''s leave rules.

2.10 REVENUERECOGNITION

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized:

i) Sale of Goods:

Revenue from sale of Goods is recognised when all the significant risks and rewards of ownership of the goods have been passed to the buyer, and are recorded net of returns and trade discount. The Company collects sales taxes and value added taxes (VAT) on behalf of the government and, therefore, these are

not economics benefits flowing to the company and therefore are excluded from revenue. Excise Duty is deducted from revenue(Gross) to arrive at revenue from operations (net). sales do not include inter- divisional transfe''

ii) Job Work

In case of Job works, the system of accounting in financial books are to consider net effect of material received and dispatched whereas in excise records complete details of input/ output quantity and excise duty is accounted for.

iii) Composite Services

In respect of Mobile blending unit where company has got composite price of material consumed & equipment rental, the rate for equipment rental is calculated on the basis of charge received under similar job work arrangements with government refineries and the remaining portion of income is considered as sale price of material.

iv) Interest

Interest income is recognized on a time proportion basis, except on doubtful or sticky loans and advances which is accounted on receipt basis.

v) Dividend from investment in Shares

Dividend income is recognized when the right to receive the payment is established.

vi) Claims

Claims are recognised when there exists reasonable certainty with regard to the amounts to be realised and the ultimate collection thereof.

2.11 FUTURE CONTRACTS

Profit/ Loss on contracts for future settled during the year are recognised in the Statement of Profit and Loss. Future contracts outstanding at year-end are marked to market at fair value. Any losses arising on that account are recognised in the Statement of Profit and Loss for the year.

2.12 PRIOR PERIOD ITEMS/EXTRAORDINARY ITEMS

Prior Period expenses/incomes, are shown as prior period items in the profit and loss account as per the provision of Accounting Standard-5 "Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies" notified under the Companies (Accounting Standards) Rules ,2006 (as amended). Items of income or expenses that arise from events or transactions that are distinct from ordinary activities of the enterprise and are not expected to recurr frequently or regularly are treated as extraordinary items.

2.13 SEGMENTREPORTING Identification of segments

The Company''s operating businesses are organized and managed separately according to the nature of products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. The Compnay is operating in a single segment namely Crumb Rubber, Crumb Rubber Modifier, Modified Bitumen and Emulsion Bitumen.

Secondary segment: Geographical Segment

The analysis of geographical segment is not applicable since all the works are situated within India including exports executed from India.

2.14 TAXES ON INCOME

Tax expense for the year comprises of direct taxes and indirect taxes.

DIRECT TAXES

i) Current income-tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income-tax Act, 1961 enacted in India. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current income tax relating to items recognized directly in equity is recognized in equity and not in the statement of profit and loss.

ii) Deferred income taxes reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier year Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted at the reporting date.

Deferred tax liabilities are recognized for all taxable timing differences. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits.

The carrying amount of deferred tax assets are reviewed at each reporting date. The company writes- down the carrying amount of deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realized. Any such write-down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available.

iii) Minimum Alternate Tax (MAT) paid in a year is charged to the Statement of Profit and Loss as Current Tax. The Company recognizes MAT Credit available as an asset only to the extent that there is convincing evidence that the company will pay normal income tax during the specified period, i.e., the period for which MAT Credit is allowed to be carried forward. In the year in which the company recognizes MAT credit as an asset in accordance with the Guidance Note on accounting for Credit Available in respect of Minimum Alternative Tax under the Income Tax Acts, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as "MAT Credit Entitlement". The company reviews the "MAT Credit Entitlement" asset at each reporting date and writes down the asset to the extent the company does not have convincing evidence that it will pay normal tax during the specified period.

iv) Wealth tax is ascertained in accordance with the provisions of the Wealth Tax Act 1957.

INDIRECT TAXES

i) Excise duty (including education cess) has been accounted for in respect of the goods cleared. The company is providing excise duty liability in respect of finished products.

ii) Service Tax has been accounted for in respect of services rendered.

iii) Final sales tax / Value added tax liability is ascertained on the finalization of assessments in accordance to provisions of sales tax / value added tax laws of respective states where the company is having offices/ works.

2.15 IMPAIRMENT OFASSETS

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating unit''s (CGU) net selling price and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining net selling price,

recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used.

Impairment losses of continuing operations, including impairment on inventories, are recognized in the statement of profit and loss. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

2.16 LEASES

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased item, are classified as operating leases. Operating lease payments are recognized as an expense in the statement of profit and loss on a straight-line basis over the lease term.

2.17 BORROWING COSTS

Borrowing cost includes interest and ancillary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective asset. All other borrowing costs are expensed in the period they occur.

2.18 EARNINGPER SHARE

Basic earning per share is computed by dividing the profit/(loss) aster tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year. Diluted earning per share is computed by dividing the profit/(loss) after tax (including the post tax effect of extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income (net of any attributable taxes) relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earning per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease the net profit per share from continuing ordinary operations. Potential equity shares are deemed to be converted as at the beginning of the period, unless they have been issued at a later date. The dilutuve potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value (i.e. average market value of the outstanding shares). Dilutive potential equity shares are determined independently for each period presented.

2.19 PROVISIONS AND CONTINGENTLIABILITIES Provisions

A provision is recognized when the company has a present obligation as a result of past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of obligation. Provisions are not discounted to their present value and are determined based on the best estimates required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.

Contingent Liabilities

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements.

2.20 CASH AND CASH EQUIVALENTS

Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

c) Terms/rights attached to equity shares

(i) The Company has only one class of equity shares having a par value of Rs. 10/- per share. Each holder of Equity share is entitled to one vote per share.

(ii) In the event of liquidation of the Company ,the holders of equity share will be entitled to receive remaining assets of the Company after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

In earlier year, the Company had forfeited 78,800 equity shares of Rs.10/- each in respect of which calls remained in arrears. Accordingly a sum of Rs.5,24,333/- being the amount originally paid up on shares forfeited and Rs.45,48,667/- being the amount of share premium on such shares were shown in share capital account and Capital reserve respectively in the financial year 2012-13. During the year, the Company has reissued 78800 forfeited equity shares of Rs.10/- each at a premium of Rs.36/- per equity share to the existing shareholders. Accordingly share capital has increased by Rs.7,88,000/-, share premium account by Rs.28,36,800/- and a sum of Rs.5,24,333/- being surplus on re-issue of, forfeited shares has been transferred to capital reserve.

a) Term Loan from Bank (Secured)

I. The Company has been sanctioned a term loan of Rs.14,00,00,000/- by Syndicate Bank for the purpose of setting of new machineries, buildings etc. for production of crumb rubber mainly for their own consumption.

II. Primary security

The term loan is secured by way of hypothecation of plant and machinery furniture fixture,generator,office equipment and computers and work in progress at Panipat, Wada, Haldia and Chennai (Gummidipundi) plants of the Company and Unregistered equitable mortgage (UREM) of land and building at Wada and Chennai (Gummidipundi) plants of the Company.

Collateral securities

A. The term loan is further secured by way of equitable mortgage of land and building at:

i) Land and Building located at Refinery Road, Village Rajapur, Tehsil and District Panipat - 132103

ii) Land and Building located at Tirlokpur Road, Village Rampur Jattan, Industrial Estate ,Kala- Amb,Nahan District Sirmour (H.P)

iii) Farm House at No.6, Sultanpur, Mandi Road, Mehrauli, New Delhi- 110030

vi) Land and Building located at Village Pali,Taluka Wada,District-Thane, Maharashtra

v) Land and Building located at No. 17 Chithur Natham Village, Gummidipundi Taluk,Thiruvallur Dist,Tamilnadu

B. Other Properties

i) Building at CRMB Plant at Mangalore Refinery and Petrochemicals Ltd. Kuthethur Post, Via Katipalla, Mangalore- 575030

ii) Plant and Machinery ,Furniture and Fixture,Generator,office equipment,computers and work in progress.

1. a) The Company has availed working capital limits of Rs.1200 lacs (previous year Rs.1200 lacs) from Syndicate

Bank which is secured by hypothecation of stocks and book debts of the Company. The working capital limit is further secured by collateral securities as mentioned under term loan from Syndicate Bank. (Refer point 5(a) above).

b) Aggregate amount of Working capital limits secured by way of 179,019,484 121,891,232

personal guarantees of Shri Bhupinder Kumar and Shri Kapil Sekhri,

Directors of the Company and Shri Gaurav Sekhri (Relative of Director).

c) Working capital limits from bank include cheques issued but not presented as on the Balance Sheet date amounting to Rs.6,08,30,778/-(Previous year Rs.8,27,233)

2. Unsecured loans from directors and companies are repayable on demand. Repayment of interest has been made as per stipulations.

15. OTHER NON CURRENT ASSETS

Long term trade receivable include claim receivable of Rs. 2,75,44,112/- from Food Corporation of India Limited (F.C.I) and Project and Equipment Corporation of India Limited (P.E.C) for which the Company has filed suits for recovery. However, as per order of Company Law Board dated 9th June, 2009, if any amount is received, the amount to the extent of 50% will be paid to separated group. A provision of Rs.137,72,056/- has been made as per CLB order. The Company has filed an appeal pending before the Hon''ble High Court of India on 06/02/2013 and is hopeful of recovering the amount due from Food Corporation of India (F.C.I ) and Project and Equipment Corporation Of India Limited (P.E.C), Hence no provision has been considered necessary in respect of the aforesaid receivables.

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Mar 31, 2013

2.01 BASIS OF PREPARATION

The financial statements of the Company have been prepared on historical cost convention as a going concern on accrual basis, in accordance with the requirements of the Companies Act, 1956 and in accordance with generally accepted accounting principles in India (Indian GAAP) and comply with Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) to the extent applicable. Accounting policies have been consistently applied and where a newly issued accounting standard is initially adopted or where an existing accounting policy requires a change due to more appropriate presentation of financial statements, such changes are suitably incorporated. The management evaluates all recently issued or revised accounting standards on an ongoing basis.

2.02 PRESENTATION AND DISCLOSURE OF FINANCIAL STATEMENTS

The presentation and disclosure of the financial statements have been made in accordance with the revised Schedule VI notified by the Central Government vide notification no. S.O 447(E), dated 28th February 2011 (as amended by notification no. F No. 2/6/2008-CL-V, dated 30th March 2011) which has become effective for accounting periods commencing on or after 1st April 2011.

2.03 USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted accounting principles in India requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods. Changes in estimates are reflected in the financial statements in the period in which changes are made and if material, their effects are disclosed in notes to accounts.

2.04 TANGIBLE FIXEDASSETS

a) Tangible assets are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. The cost comprises purchase price, taxes, duties, freight and other incidental expenses related to acquisition and installation of the concerned assets are further adjusted by the amount of CENVAT credit and VAT credit availed wherever applicable and subsidy directly attributable to the cost of fixed asset. Interest and other borrowing costs during construction period to finance qualifying fixed assets is capitalised if capitalisation criteria are met.

b) Subsequent expenditure related to an item of tangible asset is added to its book value only if it increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other expenses on existing fixed assets, including day to day repair and maintenance expenditure are charged to the statement of profit and loss for the period during which such expenses are incurred.

c) Capital work-in- progress comprises cost of fixed assets that are not yet ready for their intended use at the balance sheet date and are carried at cost comprising direct cost , related incidental expenses and interest on borrowings their against.

d) Preoperative expenditure and trial run expenditure accumulated as capital work in progress is allocated on the basis of prime cost of fixed assets in the year of commencement of commercial production.

e) Gains or losses arising from disposal of fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is disposed off.

2.05 INTANGIBLEASSETS

a) Acquired intangible assets

Intangible assets including software licenses of enduring nature and contractual rights acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less accumulated amortisation and accumulated impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

b) Research and development cost

Research costs are expensed as incurred. Development expenditure incurred on an individual project is recognized as an intangible asset when it is probable that the future economic benefits that are attributable to the asset will flow to the Company and cost of the assets can be measured reliably.

c) Gains or losses arising from disposal of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss when the asset is disposed off.

2.06 DEPRECIATION AND AMORTIZATION

a) Depreciation on tangible fixed assets is provided on straight line basis using the rates and in the manner as prescribed in Schedule XIV of the Companies Act, 1956, which approximates the useful lives of the assets estimated by the management. Depreciation on Crumb Rubber Plant has been provided at 11.875% per annum considering the useful life of the Plant as 8 years on straight line method. Depreciation on other Plant and Machinery has been provided on Straight line Method on rates as per Schedule XIV of the Companies Act, 1956

b) Computer Software are amortized over a period of 5 years.

c) Assets costing not more than 5,000/- each individually are depreciated at 100%.

2.07 INVESTMENTS

Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments.

On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Current investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

2.08 INVENTORIES

i) Raw Materials, Stores And Spare parts are valued at cost. Materials and other items held for use in the production of inventories are not written down below cost, if the finished products in which they will be incorporated are expected to be sold at or above cost. Raw Material, Stores & Spares & Raw Material contents of work in progress are valued by using the first in first out (FIFO) method.

ii) Finished goods are valued at cost plus excise duty or net realizable value whichever is lower. The finished goods are valued by using weighted average cost method. Cost of finished goods includes direct Raw Material, labour cost, allocable overhead manufacturing expenses and excise duty.

iii) Work-in-progress are valued at lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity.

iv) The stocks of scrap materials have been taken at net realisable value.

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

2.09 FOREIGN CURRENCY TRANSACTIONS

Foreign currency transactions and balances

i) Initial recognition

Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

ii) Conversion

Foreign currency monetary items are retranslated using the exchange rate prevailing at the reporting date. Non-monetary items, which are measured in terms of historical cost denominated in a foreign currency, are reported using the exchange rate at the date of the transaction.

iii) Exchange differences

Exchange differences arising on conversion / settlement of foreign currency monetary items and on foreign currency liabilities relating to fixed assets acquisition are recognised as income or expense in the year in which they arise.

iv) Bank Guarantee And Letter of Credit

Bank Guarantee And Letter of Credits are recognized at the point of negotiation with Banks and converted at the rates prevailing on the date of Negotiation, However, Outstanding at the period end are recognized at the rate prevailing as on that date and total sum is considered as contingent liability.

2.10 RETTREMENTBENEFTTS

i) Provident fund

Retirement benefit in the form of provident fund is a defined contribution scheme. The contributions to provident fund are made in accordance with the relevant scheme and are charged to the statement of profit and loss for the year when the contributions are due. The Company has no obligation, other than the contribution payable to the provident fund.

ii) The Company''s gratuity scheme is a defined benefit plan. The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the projected unit credit method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation is measured at the present value of the estimated future cash flows. The discount rate used for determining the present value of the obligation under defined benefit plan, is based on the market yields on government securities as at the balance sheet date. Actuarial gains and losses are recognised immediately in the Statement of Profit and Loss.

iii) Leave Encashment

Accrual for leave encashment benefit is based on actuarial valuation as on the balance sheet date in pursuance of the company''s leave rules.

2.11 REVENUE RECOGNITION

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized:

i) Sale Of Goods:

Revenue from sale of Goods is recognised when all the significant risks and rewards of ownership of the goods have been passed to the buyer, and are recorded net of returns and trade discount. The Company collects sales taxes and value added taxes (VAT) on behalf of the government and, therefore, these are not economics benefits flowing to the company and therefore are excluded from revenue. Excise Duty is deducted from revenue(Gross) to arrive at revenue from operations (net). sales do not include inter- divisional transfers.

ii) Job Work

In case of Job works, the system of accounting in financial books are to consider net effect of material received and dispatched whereas in excise records complete details of input/ output quantity and excise duty is accounted for.

iii) Composite Services

In respect of Mobile blending unit where company has got composite price of material consumed & equipment rental, the rate for equipment rental is calculated on the basis of charge received under similar job work arrangements with government refineries and the remaining portion of income is considered as sale price of material

iv) Interest:

Interest income is recognized on a time proportion basis, except on doubtful or sticky loans and advances which is accounted on receipt basis.

v) Dividend from investment in Shares :

Dividend income is recognized when the right to receive the payment is established.

2.12 FUTURE CONTRACTS

Profit/ Loss on contracts for future settled during the year are recognised in the Statement of Profit and Loss. Future contracts outstanding at year-end are marked to market at fair value. Any losses arising on that account are recognised in the Statement of Profit and Loss for the year.

2.13 PRIOR PERIOD ITEMS/ EXTRAORDINARY ITEMS

Prior Period expenses/incomes, are shown as prior period items in the profit and loss account as per the provision of Accounting Standard-5 "Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies" notified under the Companies (Accounting Standards) Rules ,2006 (as amended). Items of income or expenses that arise from events or transactions that are distinct from ordinary activities of the enterprise and are not expected to recurr frequently or regularly are treated as extraordinary items.

2.14 SEGMENT REPORTING Identification of segments

The Company''s operating businesses are organized and managed separately according to the nature of products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. The Company is operating in a single segment namely Crumb Rubber, Crumb Rubber Modifier, Modified Bitumen and Emulsion Bitumen.

Secondary segment:

Geographical Segment “The analysis of geographical segment is not applicable since all the works are situated within India including exports executed from India.

2.15 TAXES ON INCOME

Tax expense for the year comprises of direct taxes and indirect taxes.

DIRECTTAXES

i) Current income-tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income-tax Act, 1961 enacted in India. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current income tax relating to items recognized directly in equity is recognized in equity and not in the statement of profit and loss.

ii) Deferred income taxes reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier yea'' Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted at the reporting date.

Deferred tax liabilities are recognized for all taxable timing differences. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits.

The carrying amount of deferred tax assets are reviewed at each reporting date. The company writes- down the carrying amount of deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realized. Any such write-down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available.

iii) Minimum Alternate Tax (MAT) paid in a year is charged to the Statement of Profit and Loss as Current Tax. The Company recognizes MAT Credit available as an asset only to the extent that there is convincing evidence that the company will pay normal income tax during the specified period, i.e., the period for which MAT Credit is allowed to be carried forward. In the year in which the company recognizes MAT credit as an asset in accordance with the Guidance Note on accounting for Credit Available in respect of Minimum Alternative Tax under the Income Tax Acts, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as "MAT Credit Entitlement". The company reviews the "MAT Credit Entitlement" asset at each reporting date and writes down the asset to the extent the company does not have convincing evidence that it will pay normal tax during the specified period.

iv) Wealth tax is ascertained in accordance with the provisions of the Wealth Tax Act 1957.

INDIRECTTAXES

i) Excise duty (including education cess) has been accounted for in respect of the goods cleared. The company is providing excise duty liability in respect of finished products.

ii) Service Tax has been accounted for in respect of services rendered.

iii) Final sales tax / Value added tax liability is ascertained on the finalization of assessments in accordance to provisions of sales tax / value added tax laws of respective states where the company is having offices/works.

2.16 IMPAIRMENT OFASSETS

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating unit''s (CGU) net selling price and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining net selling price, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used.

Impairment losses of continuing operations, including impairment on inventories, are recognized in the statement of profit and loss. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

2.17 LEASES

Leases, where the lesser effectively retains substantially all the risks and benefits of ownership of the leased item, are classified as operating leases. Operating lease payments are recognized as an expense in the statement of profit and loss on a straight-line basis over the lease term.

2.18 BORROWING COSTS

Borrowing cost includes interest and ancillary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective asset. All other borrowing costs are expensed in the period they occur.

2.19 EARNING PER SHARE

Basic earnings per share is computed by dividing the profit/(loss) aster tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the profit/(loss) after tax (including the post tax effect of extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income (net of any attributable taxes) relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease the net profit per share from continuing ordinary operations. Potential equity shares are deemed to be converted as at the beginning of the period, unless they have been issued at a later date. The dilutive potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value (i.e. average market value of the outstanding shares). Dilutive potential equity shares are determined independently for each period presented.

2.20 PROVISIONS AND CONTINGENT LIABILITIES Provisions

A provision is recognized when the company has a present obligation as a result of past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of obligation. Provisions are not discounted to their present value and are determined based on the best estimates required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.

Contingent Liabilities

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements.

2.21 CASH AND CASH EQUIVALENTS

Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

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Mar 31, 2012

I. GENERAL

The financial statements are prepared under historical cost convention using the accrual system of accounting in accordance with the accounting principles generally accepted in India and the requirements of the Companies Act, 1956,including the mandatory Accounting Standards as prescribed by the Companies (Accounting Standards) Rules,2006.

II. USE OF ESTIMATES :

The presentation of financial statements in conformity with the generally accepted accounting principles requires estimates and assumptions to be made that effect reportable amount of assets and liabilities on the date of financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the year in which the results are known / materialized.

III. FIXED ASSETS:

a) Fixed assets are stated at cost of acquisition net of cenvat credit of excise duty / countervailing duty or of construction, including preoperative financial and incidental expenses attributable to acquisition or construction of fixed assets less depreciation.

b) Capital work in progress are carried at cost, comprising direct costs and related incidental expenses.

c) Expenses of revenue nature, which are related to project setup are transferred to capital work in progress pending capitalization. These expenses are to be allocated to fixed assets in the year of commencement of the related projects.

d) Intangible assets are stated at cost of acquisition less accumulated amortization.

IV. DEPRECIATION:

a) Fixed assets have been depreciated on straight line method in accordance with the rates as prescribed in Schedule XIV and provisions of the Companies Act, 1956 on such assets put to use.

b) Computer Software are amortized over a period of 5 years.

c) Assets costing not more than Rs. 5,000/- each individually are depreciated at 100%.

d) Buildings on the leasehold/ rental premises are amortised over the lease period.

V INVESTMENTS:

a) Non-current investments are valued at cost after appropriate adjustment, if necessary for permanent diminution in their value.

b) Current investments are stated at lower of cost and fair value on the date of Balance sheet.

VI. INVENTORIES:

a) The raw materials, stores & spare parts are valued at cost. The raw material, stores & spares & raw material contents of work in progress are valued by using the first in first out (FIFO) method while the finished goods are valued by using weighted average cost method. Cost relating to finished goods means direct raw material, labour cost & allocable overhead manufacturing expenses.

b) Work in progress and material in progress are valued at raw material cost & additionally any specific cost attributable to such WIP.

c) Finished goods are valued at cost plus excise duty or net realizable value whichever is lower. The policy of valuation of inventories is in accordance with Accounting Standard-2 (Revised) of the Institute of Chartered Accountants of India.

d) Damaged goods / scrap stocks are valued at net realizable value.

VII. TAXES:

a) DIRECT TAXES:

i) CURRENT TAX :

Provision for income tax, is based on assessable / assessed profits / losses computed in accordance with the provisions of the Income Tax Act, 1961.

ii) DEFERRED TAX :

Deferred income tax, expense or benefit is recognized on timing differences, being the difference between the accounting income and the taxable income that originate in one period & are capable of reversal in one or more subsequent periods. Deferred tax assets or liabilities are measured using the tax rates and laws enacted or substantively enacted as on balance sheet date.

Deferred tax assets are recognized and carried forward to the extent there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. j

iii) WEALTH TAX :

Wealth tax is ascertained in accordance with the provisions of the Wealth Tax Act 1957.

b) INDIRECT TAXES:

i) EXCISE DUTY:

Excise duty (including education cess) has been accounted for in respect of the goods cleared. The company is providing excise duty liability in respect of finished products.

ii) SERVICE TAX:

Service Tax has been accounted for in respect of services rendered.

iii) SALES TAX / VALUE ADDED TAX:

Final sales tax / Value added tax liability is ascertained on the finalization of assessments in accordance to provisions of sales tax / value added tax laws of respective states where the company is having offices/works.

VIII. REVENUE RECOGNITION:

a) SALE :

i. Export sale is recognized as on the date of shipment and accounted for on the rates prevailing on the date of transaction. The revenue in respect of export benefit is recognized on post exports basis, at the rate at which the entitlement accrues

ii. Domestic sales are inclusive of excise duty.

iii. In case of Job works, the system of accounting in financial books are to consider net effect of material received and dispatched whereas in excise records complete details of input/ output quantity and excise duty is accounted for.

iv. In respect of Mobile blending unit where company has got composite price of material consumed & equipment rental, the rate for equipment rental is calculated on the basis of charge received under similar job work arrangements with government refineries and the remaining portion of income is considered as sale price of material.

b) INTEREST INCOME:

Interest income is recognized on accrual basis, except on doubtful or sticky loans and advances which is accounted on receipt basis.

c) DIVIDEND FROM INVESTMENT IN SHARES:

Dividend income is recognized when the right to receive the payment is established.

IX. GRATUITY / RETIREMENTS BENEFITS:

a) Company's contribution to provident fund are charged to profit & loss account.

b) The company is following the Accounting Standard-15 (Revised) issued by The Institute of Chartered Accountants of India for gratuity and leave encashment and the same is valued on the basis of actuarial valuation.

X. RESEARCH AND DEVELOPMENT:

Net of revenue expenditure on research and development is charged to profit and loss account in the year in which it is incurred. Capital expenditure on research and development is shown as fixed assets and depreciation is considered as per Schedule XIV of the Companies Act, 1956.

XI. FOREIGN EXCHANGE TRANSACTIONS:

a) Foreign currency transactions are accounted for at equivalent rupee value converted at the exchange rates prevailing at the time of such transaction.

b) Monetary Assets & Liabilities in foreign currency are translated at the year end rate through exchange fluctuation account to the respective accounts as per the guidance issued by The Institute of Chartered Accountants of India.

c) Short / excess payments received for export on account of difference in foreign exchange are accounted through exchange fluctuation account.

d) Bank guarantee and letter of credits are recognized at the point of negotiation with banks and converted at the rates prevailing on the date of negotiation, however, outstanding at the period end are recognized at the rate prevailing as on that date and total sum is considered as contingent liability.

e) Short / excess payments for import/ export on account of difference in foreign exchange are charged to the profit & loss account.

XII. BORROWING COST:

Borrowing costs that are directly attributable to the acquisition and construction of qualifying assets are capitalized as part of the cost of such asset. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue in the period in which they are incurred.

XIII. IMPAIRMENT OF ASSETS:

An asset is treated as impaired when the carrying cost of the asset exceeds its recoverable value. Recoverable value is the higher of an asset's net selling price and value in use. An impairment loss is charged to the profit & loss account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

XIV. LEASES:

Leases of assets under which the lessor effectively retains all the risks and benefits of ownership are classified as operating lease. Payments made under operating lease are charged to profit and loss account over the period of lease.

XV. SEGMENT REPORTING:

(a) Primary Segment: Business Segment

The company's operating business are organized and managed separately according to the nature of products, with each segment representing a strategic business unit that offers different products. The identified segments are bitumen division, trading in poultry feed, trading in construction chemicals & agricultural activity division.

(b) Secondary segment: Geographical Segment

The analysis of geographical segment is not applicable since all the works are situated within India including exports executed from India.

(c) Unallocated items:

All common income, expenses, assets and liabilities where so ever are not possible to be allocated to different segments are treated as unallocated items.

XVI. OPERATING EXPENSES:

For works performed at the site of customers and deduction made by them for expenses - electricity and steam charges etc. are accounted for on accrual basis.

XVII. PRIOR PERIOD ITEMS:

Significant items of income & expenditure which relate to prior accounting period, other than those occasioned by events occurring during or after the close of year and which is treated as relatable by the current year are accounted in the profit & loss account under respective head of account.

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Mar 31, 2010

1. GENERAL :

a) The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting standards and relevant provisions of the Companies Act 1956 adopted consistently by the company.

b) The company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis, except that certain transactions are accounted on cash basis,since it is possible to ascertain with reasonable accuracy the quantum to be providedl for, such is (i) bank commission / charges on foreign transactions, (:i) insurance claims, (Ml) export demurrage: or claims, (iv) interest on calls in arrears / doubtful loans & advances, (v) income tax sales tax , wealth tax / service tax / excise duty / cess.

i. USE OF ESTIMATES:

The presentation of financial statements in conformity with the generally accepte accounting principles requnes estimates and assumptions to be made that effect reportable amount of assets and liablities on the date of financial statements and the reported amount of revenues and expenses during the reporting period Difference between the actual results and estimates are recognized in the year in which are known / materlializad

3. FIXED ASSETS:

a) Fixed assets are stated at cast of acquisition net of medvat (cenvet) credit of excise duty/ countervating duty or of construction, including preoperative, financial and incidental & expenses attributable to acquisition or construction of fixed assets less depreciation.

b) Capital work in progress are carried at cost, comprising direct costs, related Incidental expenses & attributable interest

c) Expenses of revenue nature, which are related to project setup are transferred to capital work in progress pending capitalisation.These expenses are to be allocated to fixed assets in the year of commencement of the related projects.

4. DEPRECIATION:

(a) Fixed assets have been depreciated on straight line method in accordance with the rates as prescribed in Schedule XIV and provisions of the Companies Act. 1956 on such assets put to use.

(b) Assets costing not more than ? 5,000/- each individually are depreciated at 100*4.

5. INVESTMENTS:

(a) Long term investments are valued at cost after appropriate adjustment, ii necessary for permanent diminution in their value,

(b) Current investments are stated at lower of cost and fair value on the date of Balance sheet.

6. INVENTORIES:

a) The raw materials, stores & spare parts are valued it cost. The raw material, stores & scares & raw matenal contents of work in progress are valued by using the first in first out (FIFO) method while the finished goods are valued by using weighted average cost method. Cost relating to finished goods mean direct raw material, labour cost &. allocable overhead manufacturing expenses.

b) Work in progress and material in progress are valued at raw material cost plus 20% of raw materia! cost or 50 % of conversion cost whichever is lower.

c) Finished goods are valued at cost plus excise duty or realizable value whichever is lower. The policy of valuation of inventories is in accordance with Accounting Standard-2 (Revised) of the Institute of Chartered Accountants of India.

d) Damaged goods / scrap stocks are valued at expected realizable value.

7. EXCISE DUTY :

Excise duly (including education cess) has been accounted for in respect of the goods cleared. The company is providing excise duty liability in respect of finished products

8. SERVICE TAX :

Service Tax has been accounted for in respect of services rendered.

9. REVENUE RECOGNITION:

a) SALE :

i. Export sale is recognized as on the date of shipment and accounted on the rates prevailing on the

date of negotiations of documents. The revenue in respect of export benefit is recognized on post exports basis, at the rate at which the entitlement accrues

ii. Domestic sales are inclusive of excise duty

iii. In case of Job works at Mumbai unit the system of accounting in financial books are to consider net effect of material received and dispatched whereas in excise records complete details of input / output quantity and excise duty is accounted for.

b) INTEREST INCOME :

Interest income is recognised on accrual basis, except on doubtful or sticky loans and advances.

c) DIVIDEND FROM INVESTMENT IN SHARES :

Dividend income is recognized when the right to receive the payment is established.

10. GRATUITY/RETIREMENTS BENEFITS:

i) Companys contribution to provident fund are charged to profit & loss account.

ii) The company is following the Accounting Standard-15 (Revised) issued by The Institute of Chartered Accountants of India for gratuity and leave encashment and the same is valued on the basis of actuarial valuation.

11. RESEARCH AND DEVELOPMENT:

Net of revenue expenditure on research and development is charged to profit and loss account in the year in which it is incurred. Capital expenditure on research and development is shown as fixed assets and depreciation is considered.

12. FOREIGN EXCHANGE TRANSACTIONS:

a) Foreign currency transactions are accounted for at equivalent rupee value converted at the rates prevailing at the time of such transaction.

b) Export on collection / import on payment basis, as on the close of the year are finally adjusted on the basis of exchange rates prevailing as on that date through exchange fluctuation account to the respective accounts as per the guidance issued by The Institute of Chartered Accountants of India.

c) Short / excess payment received for export on account of difference in foreign exchange are accounted through exchange fluctuation account.

d) Bank guarantee and letter of credits are recognized at the point of negotiation with banks and converted at the rates prevailing on the date of negotiation, however, outstanding at the period end are recognized at the rate prevailing as on that date and total sum is considered as contingent liability.

e) Short / excess payment for import of assets on account of difference in foreign exchange are accounted for as the cost of respective asset.

f) Short / excess payment for import of raw material and consumable expenses on account of difference in foreign exchange are accounted for as the cost of respective material.

13. DIRECT TAXES

a) INCOME TAX / WEALTH TAX:

Provision for income tax. if any, is based on assessable / assessed profits / losses computed In accordance with the previsions of the Income Tax Act, 1961. Wealth tax is ascertained in accordance with the provisions of the Wealth Tax Act

b) DEFERRED TAX:

Deferred income tax, expanse or benefit is recognized on timing differences, being the difference between the acoounting income and the taxable income that originate in one period & are capable of reversal in one or more subsequent period. Deferred tax assets of liabilities are measured using the tax rates and laws enacted or substantively enacted as on balance sheet date.

Deterred tax assets are recognized and carried forward to the extent there is a reasonable certainly that sufficient future taxable income will be available against which such deferred tax assets can be realized.

c) SALES TAX/VALUE ADDED TAX.

Final sates tax hability value added tax liability is ascertained on the finalisation of assessments in accordance to provisions of sales tax laws / value added tax laws at respective states where the company i.e having office/Works.

14. BORROWING COST:

Borrowing costs that are directly attributable to the acquisition and construction of qualifying assets are capitalized as part of the cost of such asset. A - qua!ifying aset is one that necessarly takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revunue in the period in .which they are Incurred.

15 IMPAIRMENT OF ASSETS:

An asset is treated as Impaired when the carring cost of the asset exceeds its recoverable value. Recoverable value is the higher of an assets net selling price and value in use. An impairment Ioss is charged to the profit & loss account In the year In which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed If there has been a change in the estimate of recoverable amount.

16. LEASES:

Laeses of assets under which the lessor effectively retains all the ricks and hens-tits of ownership are classified as operating lease Payment made under operating lease are charged 10 profit and lose account over the period of lease.

17. SEGMENT REPORTING:

(a) Primary Segment: Business Segmenl

The companys operatlng business. are organized and managed separately according to the nature of products with each segment represeenting a strategic business unit that offers different products. The identified segments are bitumen division, trading in poultry seeds and agricultural activity division.

(b) Secondary segment: Geographical Segment

The analysis of geographical segment is not applicable since alt the works are situated within India including exports executed from India

(c) Unallocated Items:

All common income, expenses, assets and Iiabilities where so ever are not possible to be allocated to different segments are treated as unallowed terns.

18. OPERATING EXPENSES:

For works performed at the site of refineries and deduction made by them for expenses - electricity and steam charges etc. are accounted for on estimated basis.

19. PRIOR PERIOD ITEMS:

Significant items of income & expenditure which relate to prior accounting period, other than those occasioned by events occurring during or after the close of year and which is treated as relatable by the current year are accounted in the profit & loss account under respective head of nominal account.

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Mar 31, 2009

1. GENERAL:

a) The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting standards and relevant provisions of the Companies Act, 1956 as adopted consistently by the company.

b) The company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis, except that certain transactions are accounted on cash basis, since it is not possible to ascertain with reasonable accuracy the quantum to be provided for, such as (i) bank commission / charges on foreign transactions, (ii) insurance claims, (Hi) export demurrages or claims, (iv) interest on calls in arrears / doubtful loans & advances, (v) income tax / sales tax / wealth tax / service tax / excise duty / cess.

2. USE OF ESTIMATES:

The presentation of financial statements in conformity with the generally accepted accounting principles requires estimates and assumptions to be made that effect reportable amount of assets and liabilities on the date of financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the year in which the results are known / materialized.

3. FIXED ASSETS:

(a) Fixed assets are stated at cost of acquisition, net of modvat (cenvet) credit of excise duty/ countervailing duty or of construction, including preoperative, financial and incidental expenses attributable to acquisition or construction of fixed assets less depreciation.

(b) Capital work in progress are carried at cost, comprising direct costs, related incidental expenses & attributable interest.

(c) Expenses of revenue nature, which are related to project setup are transferred to capital work in progress pending capitalisation.These expenses are to be allocated to fixed assets in the year of commencement of the related projects.

4. DEPRECIATION:

(a) Fixed assets have been depreciated on straight line method in accordance with the rates as prescribed in Schedule XIV and provisions of the Companies Act, 1956 on such assets put to use.

(b) Assets costing not more than Rs.5,0007- each individually are depreciated at 100%.

5. INVESTMENTS:

(a) Long term investments are valued at cost after appropriate adjustment, if necessary for permanent diminution in their value.

(b) Current investments are stated at lower of cost and fair value on the date of Balance sheet.

6. INVENTORIES

a) The raw materials, stores & spare parts are valued at cost. The raw material, stores & spares & raw material contents of work in progress are valued by using the first in first out (FIFO) method while the finished goods are valued by using weighted average cost method. Cost relating to finished goods _mean direct raw material, labour cost & allocable overhead manufacturing expenses.

b) Work in progress and material in progress are valued at raw material cost plus 20% of raw material cost or 50 % of conversion cost whichever is lower.

c) Finished goods are valued at cost plus excise duty or realizable value whichever is lower. The policy of valuation of inventories is in accordance with Accounting Standard-2 (Revised) of the Institute of Chartered Accountants of India.

d) Damaged goods / scrap stocks are valued at expected realizable value.

7. EXCISE DUTY:

Excise duty (including education cess) has been accounted for in respect of the goods cleared. The company is providing excise duty liability in respect of finished products

8. SERVICETAX

Service Tax has been accounted for in respect of services rendered.

9. REVENUE RECOGNITION a) SALE:

i) Export sale is recognized as on the date of shipment and accounted on the rates prevailing on the date of negotiations of documents. The revenue in respect of export benefit is recognized on post exports basis, at the rate at which the entitlement accrues

i) Domestic sales are inclusive of sales tax / vat and inclusive of excise duty.

Mi) In case of Job works at Mumbai unit the system of accounting in financial books are to consider net effect of material received and dispatched whereas in excise records complete details of input / output quantity and excise duty is accounted for.

b) INTEREST INCOME.

Interest income is recognised on accrual basis, except on doubtful or sticky loans and advances.

c) DIVIDEND FROM INVESTMENT IN SHARES:

Dividend income is recognized when the right to receive the payment is established.

d) EXPORTS BENEFITS:

Export benefits are recognized on accrual basis. In the case of licenses, premium is accounted for at the estimated market rate prevailing on the balance sheet date and finally adjusted in the year of transfer or utilization.

10. GRATUITY/RETIREMENTS BENEFITS:

i) Companys contribution to provident fund are charged to profit & loss account.

i) The company is following the Accounting Standard-15 (Revised) issued by The Institute of Chartered Accountants of India for gratuity and leave encashment and the same is valued on the basis of actuarial valuation.

11. RESEARCH AND DEVELOPMENT:

Net of revenue expenditure on research and development is charged to profit and loss account in the year in which it is incurred. Capital expenditure on research and development is shown as fixed assets and depreciation is considered.

12. FOREIGN EXCHANGETRANSACTIONS:

a) Foreign currency transactions are accounted for at equivalent rupee value converted at the rates prevailing at the time of such transaction.

b) Export on collection / import on payment basis, as on the close of the year are finally adjusted on the basis of exchange rates prevailing as on that date through exchange fluctuation account to the respective accounts as per the guidance issued by The Institute of Chartered Accountants of India.

c) Short / excess payment received for export on account of difference in foreign exchange are accounted through exchange fluctuation account.

d) Bank guarantee and letter of credits are recognized at the point of negotiation with banks and converted at the rates prevailing on the date of negotiation, however, outstanding at the period end are recognized at the rate prevailing as on that date and total sum is considered as contingent liability.

e) Short / excess payment for import of assets on account of difference in foreign exchange are accounted for as the cost of respective asset.

f) Short / excess payment for import of raw material and consumable expenses on account of difference in foreign exchange are accounted for as the cost of respective material.

13. DIRECTTAXES:

a) INCOME TAX / WEALTH TAX / FRINGE BENEFIT TAX:

Provision for income tax, if any, is based on assessable / assessed profits / losses computed in accordance with the provisions of the Income Tax Act, 1961. Wealth tax and fringe benefit tax is ascertained in accordance with the provisions of the Wealth Tax Act and Fringe benefit tax respectively.

b) DEFERRED TAX:

Deferred income tax, expense or benefit is recognized on timing differences, being the difference between the accounting income and the taxable income that originate in one period & are capable of reversal in one or more subsequent period. Deferred tax assets or liabilities are measured using the tax rates and laws enacted or substantively enacted as on balance sheet date.

Deferred tax assets are recognized and earned forward to the extent there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

c) SALES TAX / VALUE ADDED TAX:

Final sales tax liability /Value added tax liability is ascertained on the finalisation of assessments in accordance to provisions of sales tax laws / value added tax laws of respective states where the company is having offices/works.

14. BORROWING COST:

Borrowing costs that are directly attributable to the acquisition and construction of qualifying assets are capitalized as part of the cost of such asset. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue in the period in which they are incurred.

15. IMPAIRMENT OF ASSETS.

An asset is treated as impaired when the carrying cost of the asset exceeds its recoverable value. Recoverable value is the higher of an assets net selling price and value in use. An impairment loss is charged to the profit & loss account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

16. LEASES:

Leases of assets under which the lessor effectively retains all the risks and benefits of ownership are classified as operating lease. Payments made under operating lease are charged to profit and loss account over the period of lease.

17. SEGMENT REPORTING:

(a) Primary Segment: Business Segment

The companys operating business are organized and managed separately according to the nature of products, with each segment representing a strategic business unit that offers different products. The identified segments are bitumen division, commissioning of plants, and agricultural activity division.

(b) Secondary Segment: Geographical Segment

The analysis of geographical segment is not applicable since all the works are situated within India including exports executed from India.

(c) Unallocated items

All common income, expenses, assets and liabilities where so ever are not possible to be allocated to different segments are treated as unallocated items.

18. OPERATING EXPENSES:

For works performed at the site of refineries and deduction made by them for expenses - electricity and steam charges etc. are accounted for on estimated basis.

19. PRIOR PERIOD ITEMS:

Significant items of income & expenditure which relate to prior accounting period, other than those occasioned by events occurring during or after the close of year and which is treated as relatable by the current year are accounted in the profit & loss account under respective head of nominal account.