Mitsu Chem Plast Ltd. कंपली की लेखा नीति

Mar 31, 2025

Material accounting policies
Statement of compliance

AS per para 16 of Ind AS 1, the financial statements comply in all material
aspects with Indian Accounting Standards (''Ind AS'') notified under
section 133 of the Companies Act, 2013 (''the Act'') read with Rule 3 of the
Companies (Indian Accounting Standards) Rules, 2015 and other relevant
provisions of the Act as amended.

2.1 Basis of Preparation of Financial Statements

Financial Statements have been prepared in accordance with the
accounting principles generally accepted in India including Indian
Accounting Standards (Ind AS) prescribed under the Section 133 of the
Companies Act, 2013 read with rule 3 of the Companies (Indian

Accounting Standards) Rules, 2015 as amended and relevant provisions
of the Companies Act, 2013 including presentation and disclosure
requirements of Division II of Schedule III of the Act as amended from
time to time.

Accordingly, the Company has prepared these Financial Statements
which comprise the Balance Sheet as at 31 March, 2025, the Statement
of Profit and Loss for the year ended 31 March 2025, the Statement of
Cash Flows for the year ended 31 March 2025 and the Statement of
Changes in Equity for the year ended as on that date, and accounting
policies and other explanatory information (together hereinafter referred
to as '' Financial Statements'').

Accounting policies have been consistently applied except where a newly
issued accounting standard is initially adopted or a revision to an existing
accounting standard requires a change in the accounting policy hitherto
in use.

The statement of cash flows have been prepared under indirect method.
The Financial Statements have been presented in Indian Rupees (INR),
which is the Company''s functional currency. All financial information
presented in INR has been rounded off to the nearest Lakh (INR 00,000)
upto two decimals rupee, unless otherwise stated.

The financial statements of the company are prepared in accordance
with Indian Accounting Standards (Ind AS), under the historical cost
convention on the accrual basis as per the provisions of the Companies
Act, 2013 ("the Act"), except for:

• Financial instruments - measured at fair value;

• Assets held for sale - measured at fair value less cost of sale;

• Plan assets under defined benefit plans - measured at fair value

• Employee share-based payments - measured at fair value

• Liability for cash settled - measured at fair value

• In addition, the carrying values of recognised assets and liabilities,
designated as hedged items in fair value hedges that would otherwise be
carried at cost, are adjusted to record changes in the fair values
attributable to the risks that are being hedged in effective hedge
relationship.

2.2 Current and non-current classification

The Company presents assets and liabilities in the balance sheet based
on current / non-current classification.

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

• It is expected to be realised in, or is intended for sale or consumption
in, the Company''s normal operating cycle.

• It is held primarily for the purpose of being traded.

• It is expected to be realised within 12 months after the reporting date;

or

• It is cash or cash equivalent unless it is restricted from being
exchanged or used to settle a liability for at least 12 months after the
reporting date.

• All other assets are classified as non-current.

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

• It is expected to be settled in the Company''s normal operating cycle.

• It is held primarily for the purpose of being traded

• It is due to be settled within 12 months after the reporting date; or the
Company does not have an unconditional right to defer settlement of the
liability for at least 12 months after the reporting date. Terms of a liability
that could, at the option of the counter party, result in its settlement by
the issue of equity instruments do not affect its classification.

• All other liabilities are classified as non-current.

Deferred tax assets and liabilities are classified as non-current only.

2.3 Use of estimates and judgments

The preparation of the financial statements in conformity with Ind AS
requires the Management to make estimates, judgments and
assumptions. These estimates, judgments and assumptions affect the
application of accounting policies and the reported amounts of assets
and liabilities, the disclosures of contingent assets and liabilities at the
date of the financial statements and reported amounts of revenues and
expenses during the period. Actual results could differ from those
estimates.

This note provides an overview of the areas where there is a higher
degree of judgment or complexity. Detailed information about each of
these estimates and judgments is included in relevant notes together
with information about the basis of calculation.

Estimates and judgments are regularly revisited. Estimates are based on
historical experience and other factors, including futuristic reasonable
information that may have a financial impact on the company.

The following are the areas involving critical estimates and judgements

• Measurement of defined benefit obligations - Note 34

• Recognition of Deferred tax assets/liabilities - Note 18

• Current Tax Expenses and Current Tax Payable - Note 18

• Useful life of Intangible Assets - Note 2.4 B

2.4 Material accounting policies

A summary of the Material accounting policies applied in the preparation
of the financial statements is as given below. These accounting policies
have been applied consistently to all the periods presented in the
financial statements.

(A) Property, Plant and Equipment

Property, plant and equipment except freehold land held for use in the
production, supply or administrative purposes, are stated in the balance
sheet at cost less accumulated depreciation and accumulated
impairment losses, if any. Freehold land held is stated in the balance
sheet at cost less accumulated impairment losses if any.

The Company has a regular program of verification of Property, Plant and
Equipment so to cover all the items over a period of 3 years.

The cost of acquired property, plant and equipment comprises its
purchase price net of any trade discounts and rebates, any import duties
and other taxes (other than those subsequently recoverable from the tax
authorities), any directly attributable expenditure on making the asset
ready for its intended use, including relevant borrowing costs for
qualifying assets including exchange differences arising from foreign
currency borrowings to the extent that they are regarded as an
adjustment to interest costs. Expenditure incurred after the property,
plant and equipment have been put into operation, such as repairs and
maintenance, are charged to the Statement of Profit and Loss in the year
in which the costs are incurred. Major shut-down and overhaul
expenditure is capitalised as the activities undertaken improves the
economic benefits expected to arise from the asset. It includes
professional fees and for qualifying assets, borrowing costs capitalized
in accordance with the Company''s accounting policy based on Ind AS 23-
Borrowing Costs. Such properties are classified to the appropriate
categories of PPE when completed and ready for intended use.

The cost of a self-constructed asset comprises the cost of materials and
direct labour, any other costs directly attributable to bringing the item to
working condition for its intended use, including relevant borrowing costs
for qualifying assets including exchange differences arising from foreign
currency borrowings to the extent that they are regarded as an
adjustment to interest costs and estimated costs of dismantling and
removing the item and restoring the site where it is located.

Property, plant and equipment which are not ready for intended use as
on the date of Balance Sheet are disclosed as "Capital work-in-progress".
Items of stores and spares that meet the definition of Property, plant and
equipment are capitalized at cost and depreciated over their useful life.
Otherwise, such items are classified as inventories.

The Company follows Cost Model for measurement of items of Property
Plant and Equipment and has not revalued any items of Property Plant
and Equipment.

Advances paid towards the acquisition of property, plant and equipment
outstanding at each balance sheet date is classified as capital advances
under "Other Non-Current Assets".

Subsequent expenditure and componentization

Parts of an item of PPE having different useful lives and significant value
and subsequent expenditure on Property, Plant and Equipment arising on
account of capital improvement or other factors are accounted for as
separate components only when it is probable that future economic
benefits associated with the item will flow to the Company and the cost
of the item can be measured reliably. The carrying amount of any
component accounted for as a separate asset is derecognised when
replaced. All other repairs and maintenance are charged to profit or loss
during the reporting period in which they are incurred.

Depreciation and useful life

Depreciation is provided on a pro-rata basis on the straight-line method
based on estimated useful life prescribed under Schedule II to the
Companies Act, 2013.

Freehold land is not depreciated.

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

Derecognition

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

(B) Intangible assets

Intangible assets acquired separately are measured on initial recognition
at cost. Following initial recognition, intangible assets are carried at cost
less any accumulated amortization and accumulated impairment losses,
if any. Cost include acquisition and other incidental cost related to
acquiring the intangible asset.

The useful lives of intangible assets are assessed as either finite or
indefinite. Intangible assets with finite lives are amortized over the useful
economic life and assessed for impairment whenever there is an
indication that the intangible asset may be impaired. The amortization
period and the amortization method for an intangible asset with a finite
useful life are reviewed at least at the end of each reporting period.
Changes in the expected useful life or the expected pattern of
consumption of future economic benefits embodied in the asset are
considered to modify the amortization period or method, as appropriate,
and are treated as changes in accounting estimates. The amortization
expense on intangible assets with finite lives is recognised in the
statement of profit and loss. Gains or losses arising from de-recognition
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
derecognized.

Intangible Assets which are not put into operations or which are not
ready for its intended use as on the Balance Sheet Date are disclosed as
"Intangible Assets under Development."

Subsequent Costs

Subsequent costs are included in the asset''s carrying amount or
recognised as a separate asset, as appropriate, only when it is probable
that future economic benefits associated with the item will flow to the
entity and the cost can be measured reliably.

Useful life and amortization

Intangible assets with finite useful lives that are acquired separately are
carried at cost less accumulated amortisation and impairment losses.
Amortisation of the asset begins when development is complete, and the
asset is available for use. Amortization is recognized on a straight-line
basis over the useful lives of the asset from the date of capitalization as
below:

• Computer software 5-10 years

• Brands/Trade Mark/ Patent - 10 years

The estimated useful life and amortization method is reviewed at the end
of each reporting period and the effect of any changes in estimate is
accounted for prospectively.

Derecognition

Intangible assets are derecognised on disposal, or when no future
economic benefits are expected from use or disposal. Gains or losses
arising from derecognition of an intangible asset are determined as the
difference between the net disposal proceeds and the carrying amount
and recognized in the Statement of Profit and Loss.

C) Impairment

At the end of each reporting year, the Company reviews the carrying
amounts of its tangible and intangible assets to determine whether there
is any indication that those assets have suffered an impairment loss.
If any such indication exists, the recoverable amount of the asset is
estimated in order to determine the extent of the impairment loss
(if any). Where it is not possible to estimate the recoverable amount of
an individual asset, the Company estimates the recoverable amount of
the cash-generating unit to which the asset belongs. Where a reasonable
and consistent basis of allocation can be identified, corporate assets are
also allocated to individual cash-generating units, or otherwise they are
allocated to the smallest group of cash-generating units for which a
reasonable and consistent allocation basis can be identified.

Intangible assets including Goodwill with indefinite useful lives and
intangible assets not yet available for use are tested for impairment at
least annually, and whenever there is an indication the asset may be
impaired.

Recoverable amount is the higher of fair value less costs to sell and
value in use. In assessing value in use, the estimated future cash flows
are discounted to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of money and the
risks specific to the asset for which the estimates of future cash flows
have not been adjusted.

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

If there is any indication that the impairment loss recognized in prior
periods for an asset other than goodwill may no longer exist or have
decreased, the Company shall estimate the recoverable value of such
asset and shall recognize such asset at the recoverable amount.
Any difference between the Current carrying value and recoverable
amount shall be recognized as Gain in Other Income in the Statement
of Profit and Loss.

(D) Inventories
Raw materials

Raw materials are stated at cost or Net Realizable Value whichever is
lower. Raw Material cost is computed on FIFO basis. Cost of raw
materials and traded goods comprises cost of purchases net of returns,
GST and duties and other recoverable taxes.

Raw materials are not written below cost if the finished goods in which
they will be incorporated are expected to be sold at or above cost.
However, when a decline in the price of raw materials indicates that the
cost of the finished products exceeds net realisable value, the raw
materials are written down to net realizable value. In such
circumstances, the replacement cost of the materials may be the best
available measure of their net realisable value.

Work in progress and finished goods

Work in Progress and Finished Goods are valued at lower of cost or net
realizable on FIFO basis.

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

Net realisable value represents the estimated selling price for inventories
less all estimated costs of completion and costs necessary to make
the sale.

Stores and spares, Accessories and Packing Material

Inventory of stores and spare parts, accessories and packing materials
are valued at cost or net realisable value, whichever is lower. The cost of
Stores and Spares, accessories and packing material is computed on
FIFO basis. Cost of stores and spares, accessories and packing material
comprises cost of purchases net of discounts, rebates received, returns,
GST and duties and other recoverable taxes.

Provisioning for Obsolete Items

Provisions are made for obsolete and non-moving inventories.
Unserviceable and scrap items, when determined, are valued at
estimated net realisable value.

(E) Non-current assets or disposal held for sale and discontinued
operations

Non-current assets or disposal held for sale

Non-current assets or disposal groups are classified as held for sale if
their carrying amounts will be recovered principally through a sale
transaction rather than through continuing use. Such assets or disposal
groups are classified only when both the conditions are satisfied -

• The sale is highly probable, and

• The asset or disposal group is available for immediate sale in its
present condition subject only to terms that are usual and customary for
sale of such assets.

Management must be committed to the sale, which should be expected
to qualify for recognition as a completed sale within one year from the
date of classification as held for sale, and actions required to complete
the plan of sale should indicate that it is unlikely that significant changes
to the plan will be made or that the plan will be withdrawn. Noncurrent
assets or disposal group are presented separately from the other assets
in the balance sheet. The liabilities of a disposal group classified as held
for sale are presented separately from other liabilities in the balance
sheet.

Upon classification, non-current assets or disposal group held for sale
are measured at the lower of carrying amount and fair value less costs to
sell. Non-current assets which are subject to depreciation are not
depreciated or amortized once those classified as held for sale.

Currently the Company does not have any Non-Current asset or Disposal
held for sale.

Discontinued Operation

A discontinued operation is a component of the entity that has been
disposed of or is classified as held for sale and that represents a
separate major line of business or geographical area of operations,

is part of a single co-ordinated plan to dispose of such a line of business
or area of operations, or is a subsidiary acquired exclusively with a view
to resale. The results of discontinued operations are presented
separately as a single amount as profit or loss after tax from
discontinued operational in the statement of profit and loss.

Currently, the Company does not have any discontinued operations.

(F) Revenue recognition

Revenue from sale of goods is recognised when control of the products
being sold is transferred to our customer and when there are no longer
any unfulfilled obligations. Export incentives are recognised as income as
per the terms of the scheme in respect of the exports made and included
as part of other operating revenue. Income from services rendered is
recognised based on agreements/arrangements with the customers as
the service is performed and there are no unfulfilled obligations.

The Company recognizes revenue from goods sold and services
rendered at Transaction Price which is the amount of consideration
Company expects to be entitled to in exchange for transferring promised
goods or services to a customer, excluding the amounts collected on
behalf of third party. The Transaction price is net of discounts, sales
incentives, rebates granted, returns, sales taxes, GST and duties and any
other recoverable taxes.

Contract Liability

A contract liability is the obligation to transfer goods or services to a
customer for which the Company has received consideration or is due
from the customer. If a customer pays consideration before the
Company transfers goods or services to the customer, a contract liability
is recognised when the payment is made, or the payment is due
(whichever is earlier). Contract liabilities are recognised as revenue when
the Company performs under the contract.

Dividend and interest income

Dividend income from investments is recognised when the Company''s
right to receive payment has been established (provided that it is
probable that the economic benefits will flow to the Company and the
amount of income can be measured reliably). Interest income is accrued
on a time basis, using the effective interest rate applicable, which is the
rate that exactly discounts estimated future cash receipts through the
expected life of the financial asset to that asset''s net carrying amount on
initial recognition.

Foreign exchange transaction and translation

The functional currency of the Company is Indian Rupees which
represents the currency of the primary economic environment in which it
operates.

Foreign currency transactions are recorded into the functional currency
using the exchange rates at the dates of the transactions. Monetary
balances arising from the transactions denominated in foreign currency
are translated to functional currency using the exchange rate as on the
reporting date. Foreign exchange gains and losses resulting from the
settlement of such transactions and any gains or loss on such
translation, are generally recognised in profit or loss except to the extent
of exchange differences which are regarded as an adjustment to the
interest cost on foreign currency borrowings that are directly attributable
to the acquisition or construction of the qualifying assets which are
capitalized as a part of the cost of the asset.

Exchange differences on monetary items are recognised in Statement of
Profit and Loss in the year in which they arise.

Non-monetary items that are measured in terms of historical cost in a
foreign currency are recorded using the exchange rates at the date of the
transaction and are not revalued. Non-monetary items measured at fair
value in a foreign currency are translated using the exchange rates at the

date when the fair value was measured. The gain or loss arising on
translation of non-monetary items measured at fair value is treated in
line with the recognition of the gain or loss on the change in fair value of
the item (i.e. translation differences on items whose fair value gain or
loss is recognised in Other Comprehensive Income or Statement of Profit
and Loss are also recognised in Other Comprehensive Income or
Statement of Profit and Loss, respectively). In case of an asset, expense
or income where a non-monetary advance is paid/received, the date of
transaction is the date on which the advance was initially recognised. If
there were multiple payments or receipts in advance, multiple dates of
transactions are determined for each payment or receipt of advance
consideration.

(G) Income taxes

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

Current tax

The tax currently payable is based on taxable profit for the year. Taxable
profit differs from ''profit before tax'' as reported in the Statement of Profit
and Loss because of items of income or expense that are taxable or
deductible in other years and items that are never taxable or deductible.

The Company''s current tax is calculated using tax rates and laws that
have been enacted or substantively enacted by the end of the reporting
period.

Current tax Assets or Liabilities are measured at the amount expected to
be recovered from or paid to Income Tax Authorities based on the tax
rates and laws that are enacted or substantially enacted as at the
balance sheet date.

Current tax assets and tax liabilities are offset where the entity has a
legally enforceable right to offset and intends either to settle on a net
basis, or to realise the asset and settle the liability simultaneously.

Deferred tax

Deferred tax is recognised on temporary differences between the
carrying amounts of assets and liabilities in the Financial Statements
and the corresponding tax bases used in the computation of taxable
profit. Deferred tax liabilities are generally recognised for all taxable
temporary differences. Deferred tax assets are generally recognised for
all deductible temporary differences to the extent that it is probable that
taxable profits will be available against which those deductible
temporary differences can be utilised. Such deferred tax assets and
liabilities are not recognised if the temporary difference arises from the
initial recognition (other than in a business combination) of assets and
liabilities in a transaction that affects neither the taxable profit nor the
accounting profit. In addition, deferred tax liabilities are not recognised if
the temporary difference arises from the initial recognition of goodwill.
The carrying amount of deferred tax assets is reviewed at each reporting
date and reduced to the extent that it is no longer probable that sufficient
taxable profit will be available to allow all or part of the deferred tax asset
to be utilised. Unrecognised deferred tax assets are re-assessed at each
reporting date and are recognised to the extent that it has become
probable that future taxable profits will allow the deferred tax asset to be
recovered.

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

Deferred tax relating to items recognised outside profit or loss is
recognised outside profit or loss (either in other comprehensive income
or in equity). Deferred tax items are recognised in correlation to the
underlying transaction either in Other Comprehensive Income or directly
in equity.

Deferred tax assets and liabilities are offset when there is a legally
enforceable right to offset current tax assets and liabilities and when the
deferred tax balances relate to the same taxation authority.

(H) Borrowing costs

Borrowing costs, general or specific, that are directly attributable to the
acquisition or construction of qualifying assets is capitalised as part of
such assets. A qualifying asset is one that necessarily takes substantial
period to get ready for intended use. All other borrowing costs are
charged to the Statement of Profit and Loss.

The Company determines the amount of borrowing costs eligible for
capitalisation as the actual borrowing costs incurred on that borrowing
during the year less any interest income earned on temporary investment
of specific borrowings pending their expenditure on qualifying assets, to
the extent that an entity borrows funds specifically for the purpose of
obtaining a qualifying asset. In case if the Company borrows generally
and uses the funds for obtaining a qualifying asset, borrowing costs
eligible for capitalisation are determined by applying a capitalisation rate
to the expenditures on that asset.

Borrowing cost includes exchange differences arising from foreign
currency borrowings to the extent they are regarded as an adjustment to
the finance cost.

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Mar 31, 2024

2.4 Material accounting policies

A summary of the Material accounting policies applied in the preparation of the financial statements is as given below. These accounting policies have been applied consistently to all the periods presented in the financial statements.

(A) Property, Plant and Equipment

Property, plant and equipment except freehold land held for use in the production, supply or administrative purposes, are stated in the balance sheet at cost less accumulated depreciation and accumulated impairment losses, if any. Freehold land held is stated in the balance sheet at cost less accumulated impairment losses if any.

The company has a regular program of verification of property, plant and equipment so to cover all the items over a period of 3 years.

The cost of acquired property, plant and equipment comprises its purchase price net of any trade discounts and rebates, any import duties and other taxes (other than those subsequently recoverable from the tax authorities), any directly attributable expenditure on making the asset ready for its intended use, including relevant borrowing costs for qualifying assets including exchange differences arising from foreign currency borrowings to the extent that they are regarded as an adjustment to interest costs. Expenditure incurred after the property, plant and equipment have been put into operation, such as repairs and maintenance, are charged to the Statement of Profit and Loss in the year in which the costs are incurred. Major shut-down and overhaul expenditure is capitalised as the activities undertaken improves the economic benefits expected to arise from the asset. It includes professional fees and for qualifying assets, borrowing costs capitalized in accordance with the Company’s accounting policy based on Ind AS 23-Borrowing Costs. Such properties are classified to the appropriate categories of PPE when completed and ready for intended use.

The cost of a self-constructed asset comprises the cost of materials and direct labour, any other costs directly attributable to bringing the item to working condition for its intended use, including relevant borrowing costs for qualifying assets including exchange differences arising from foreign currency borrowings to the extent that they are regarded as an adjustment to interest costs and estimated costs of dismantling and removing the item and restoring the site where it is located.

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

Items of stores and spares that meet the definition of Property, plant and equipment are capitalized at cost and depreciated over their useful life. Otherwise, such items are classified as inventories.

The Company follows Cost Model for measurement of items of Property Plant and Equipment and has not revalued any items of Property Plant and Equipment.

Advances paid towards the acquisition of property, plant and equipment outstanding at each balance sheet date is classified as capital advances under "Other Non-Current Assets Subsequent expenditure and componentisation

Parts of an item of PPE having different useful lives and significant value and subsequent expenditure on Property, Plant and Equipment arising on account of capital improvement or other factors are accounted for as separate components only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they are incurred.

Depreciation and useful life

Depreciation is provided on a pro-rata basis on the straight-line method based on estimated useful life prescribed under Schedule II to the Companies Act, 2013

Freehold land is not depreciated.

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

An item of PPE is de-recognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and

equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in Statement of Profit and Loss.

(B) Intangible assets

Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses, if any. Cost include acquisition and other incidental cost related to acquiring the intangible asset.

The useful lives of intangible assets are assessed as either finite or indefinite. Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the statement of profit and loss. Gains or losses arising from de-recognition 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 derecognised.

Intangible Assets which are not put into operations or which are not ready for its intended use as on the Balance Sheet Date are disclosed as "Intangible Assets under Development.

Subsequent Costs

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the entity and the cost can be measured reliably.

Useful life and amortisation

Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated amortisation and impairment losses. Amortisation of the asset begins when development is complete, and the asset is available for use. Amortisation is recognised on a straight-line basis over the useful lives of the asset from the date of capitalisation as below:

> Computer software 5-10 years

The estimated useful life and amortisation method is reviewed at the end of each reporting period and the effect of any changes in estimate is accounted for prospectively.

Derecognition

Intangible assets are derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset are determined as the difference between the net disposal proceeds and the carrying amount and recognised in the Statement of Profit and Loss.

(C) Impairment

At the end of each reporting year, the Company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. Where a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified. Intangible assets including Goodwill with indefinite useful lives and intangible assets not yet available for use are tested for impairment at least annually, and whenever there is an indication the asset may be impaired.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

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

If there is any indication that the impairment loss recognised in prior periods for an asset other than goodwill may no longer exist or have decreased, the Company shall estimate the recoverable value of such asset and shall recognise such asset at the recoverable amount. Any difference between the Current carrying value and recoverable amount shall be recognised as Gain in Other Income in the Statement of Profit and Loss.

(D) Inventories Raw materials

Raw materials are stated at cost or Net Realisable Value whichever is lower. Raw Material cost is computed on FIFO basis. Cost of raw materials and traded goods comprises cost of purchases net of returns, GST and duties and other recoverable taxes.

Raw materials are not written below cost if the finished goods in which they will be incorporated are expected to be sold at or above cost. However, when a decline in the price of raw materials indicates that the cost of the finished products exceeds net realisable value, the raw materials are written down to net realisable value. In such circumstances, the replacement cost of the materials may be the best available measure of their net realisable value. Work in progress and finished goods

Work in Progress and Finished Goods are valued at lower of cost or net realisable on FIFO basis.

Cost of work-in-progress and finished goods comprises direct materials, direct labour and an appropriate proportion of variable and fixed overhead

expenditure net of recoverable taxes. Fixed overheads are allocated on the basis of production of finished goods and semi-finished goods. Cost of inventories also include all other costs incurred in bringing the inventories to their present location and condition. Costs of purchased inventory are determined after deducting rebates and discounts. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.

Net realisable value represents the estimated selling price for inventories less all estimated costs of completion and costs necessary to make the sale. Stores and spares, Accessories and Packing Material Inventory of stores and spare parts, accessories and packing materials are valued at cost or net realisable value, whichever is lower. The cost of Stores and Spares, accessories and packing material is computed on FIFO basis. Cost of stores and spares, accessories and packing material comprises cost of purchases net of discounts, rebates received, returns, GST and duties and other recoverable taxes.

Provisioning for Obsolete Items

Provisions are made for obsolete and non-moving inventories. Unserviceable and scrap items, when determined, are valued at estimated net realisable value.

(E) Non-current assets or disposal held for sale and discontinued operations Non-current assets or disposal held for sale

Non-current assets or disposal groups are classified as held for sale if their carrying amounts will be recovered principally through a sale transaction rather than through continuing use. Such assets or disposal groups are classified only when both the conditions are satisfied -

> The sale is highly probable, and

> The asset or disposal group is available for immediate sale in its present condition subject only to terms that are usual and customary for sale of such assets.

Management must be committed to the sale, which should be expected to

qualify for recognition as a completed sale within one year from the date of classification as held for sale, and actions required to complete the plan of sale should indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. Noncurrent assets or disposal group are presented separately from the other assets in the balance sheet. The liabilities of a disposal group classified as held for sale are presented separately from other liabilities in the balance sheet.

Upon classification, non-current assets or disposal group held for sale are measured at the lower of carrying amount and fair value less costs to sell. Non-current assets which are subject to depreciation are not depreciated or amortised once those classified as held for sale.

Currently the Company does not have any Non-Current asset or Disposal held for sale

Discontinued Operation

A discontinued operation is a component of the entity that has been disposed of or is classified as held for sale and that represents a separate major line of business or geographical area of operations, is part of a single coordinated plan to dispose of such a line of business or area of operations, or is a subsidiary acquired exclusively with a view to resale. The results of discontinued operations are presented separately as a single amount as profit or loss after tax from discontinued operational in the statement of profit and loss.

Currently, the Company does not have any discontinued operations.

(F) Revenue recognition

Revenue from sale of goods is recognised when control of the products being sold is transferred to our customer and when there are no longer any unfulfilled obligations. Export incentives are recognised as income as per the terms of the scheme in respect of the exports made and included as part of other operating revenue. Income from services rendered is recognised based on agreements/arrangements with the customers as the service is performed and there are no unfulfilled obligations.

The Company recognises revenue from goods sold and services rendered at Transaction Price which is the amount of consideration Company expects to be entitled to in exchange for transferring promised goods or services to a customer, excluding the amounts collected on behalf of third party. The Transaction price is net of discounts, sales incentives, rebates granted, returns, sales taxes, GST and duties and any other recoverable taxes. Contract Liability

A contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration or is due from the customer. If a customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognised when the payment is made, or the payment is due (whichever is earlier). Contract liabilities are recognised as revenue when the Company performs under the contract.

Dividend and interest income

Dividend income from investments is recognised when the Company’s right to receive payment has been established (provided that it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably). Interest income is accrued on a time basis, using the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount on initial recognition.

Foreign exchange transaction and translation

The functional currency of the Company is Indian Rupees which represents the currency of the primary economic environment in which it operates. Foreign currency transactions are recorded into the functional currency using the exchange rates at the dates of the transactions. Monetary balances arising from the transactions denominated in foreign currency are translated to functional currency using the exchange rate as on the reporting date. Foreign exchange gains and losses resulting from the settlement of such transactions and any gains or loss on such translation, are generally recognised in profit or loss except to the extent of exchange differences which are regarded as

an adjustment to the interest cost on foreign currency borrowings that are directly attributable to the acquisition or construction of the qualifying assets which are capitalised as a part of the cost of the asset.

Exchange differences on monetary items are recognised in Statement of Profit and Loss in the year in which they arise.

Non-monetary items that are measured in terms of historical cost in a foreign currency are recorded using the exchange rates at the date of the transaction and are not revalued. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was measured. The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in fair value of the item (i.e. translation differences on items whose fair value gain or loss is recognised in Other Comprehensive Income or Statement of Profit and Loss are also recognised in Other Comprehensive Income or Statement of Profit and Loss, respectively). In case of an asset, expense or income where a non-monetary advance is paid/received, the date of transaction is the date on which the advance was initially recognised. If there were multiple payments or receipts in advance, multiple dates of transactions are determined for each payment or receipt of advance consideration.

(G) Income taxes

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

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from ''profit before tax’ as reported in the Statement of Profit and Loss because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The Company’s current tax is calculated using tax rates and laws that have been enacted or substantively enacted by the end of the reporting period.

Current tax Assets or Liabilities are measured at the amount expected to be

recovered from or paid to Income Tax Authorities based on the tax rates and laws that are enacted or substantially enacted as at the balance sheet date. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Deferred tax

Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the Financial Statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilised. Such deferred tax assets and liabilities are not recognised if the temporary difference arises from the initial recognition (other than in a business combination) of assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit. In addition, deferred tax liabilities are not recognised if the temporary difference arises from the initial recognition of goodwill.

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

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

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive income or in equity). Deferred tax items are recognised in correlation to the underlying transaction

either in Other Comprehensive Income or directly in equity.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority.

(H) Borrowing costs

Borrowing costs, general or specific, that are directly attributable to the acquisition or construction of qualifying assets is capitalised as part of such assets. A qualifying asset is one that necessarily takes substantial period to get ready for intended use. All other borrowing costs are charged to the Statement of Profit and Loss.

The Company determines the amount of borrowing costs eligible for capitalisation as the actual borrowing costs incurred on that borrowing during the year less any interest income earned on temporary investment of specific borrowings pending their expenditure on qualifying assets, to the extent that an entity borrows funds specifically for the purpose of obtaining a qualifying asset. In case if the Company borrows generally and uses the funds for obtaining a qualifying asset, borrowing costs eligible for capitalisation are determined by applying a capitalisation rate to the expenditures on that asset. Borrowing cost includes exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the finance cost.

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Mar 31, 2018

SIGNIFICANT ACCOUNTING POLICIES

1. Basis of Presentation of Financial

Statements: The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards applicable under Section 133 of the Companies Act, 2013, read with Paragraph 7 of the Companies (Accounts) Rules, 2014 (as amended) and the relevant provisions of the Companies Act, 2013 (“the 2013 Act”) as applicable. 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. Use of Estimates: The preparation of financial statements in conformity with Indian GAAP requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Although, these estimates are based upon 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 amount of assets & liabilities in future period.

3. Inventories: Raw material is valued at cost. Finished goods are valued at cost or net realisable value, whichever is lower. The cost is determined on FIFO basis, and includes all costs incurred in bringing the inventories to their present location and condition. In the case of work-in-progress and finished goods, cost also include costs of conversion.

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

4. Cash Flow Statement: The Company reports cash flow from operating activities using Indirect Method, where by net profit or loss is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments, and items of income or expense associated with investing or financing cash flows. Cash & cash equivalents for the purpose of cash flow statement comprise cash at bank and cheques in hand and deposits with original maturity of less than 3 months.

5. Depreciation: Depreciation has been charged on Fixed Assets on Straight Line Method over useful lives of respective assets in the manner as prescribed in Schedule II of the Companies Act, 201 3. Depreciation is charged on pro-rata basis for assets acquired or disposed of during the year. Assets purchased specifically for projects are depreciated over the life of the projects.

6. Revenue Recognition: Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received net of discounts, rebates, and sales taxes or duty. Export Sales are booked at the rate on the date of transaction and the resultant gain or loss on realisation or on translation is accounted as “Foreign Exchange Rate Fluctuation” and is dealt with in the statement of Profit and Loss Account. Other Income is accounted on accrual basis except where receipt of income is uncertain.

7. Property, Plant & Equipment: The initial cost of an assets comprises its purchase price and directly attributable cost of bringing the asset to its working condition for its intended use. All costs, including borrowing costs incurred till commencement of commercial production or use are capitalised to the cost of qualifying assets. Gains & losses arising from derecognition of fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of the assets and are recognised in the Statement of Profit & Loss when the asset is derecognised. The cost of Fixed Asset is reduced by the amount of Subsidy received during the year.

8. Foreign Exchange Fluctuation:

Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction. Monetary items denominated in foreign currencies at the year-end are restated at year end rates. Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Profit and Loss account except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets.

9. Investment Accounting: Investments are classified as Non-Current and Current Investments. Non-Current Investments are stated at its cost. Investments, which are readily realisable and intended to be held for not more than 1 year from the date on which investments are made, are classified as Current Investments. All other investments are classified as Non-current investments. Non-current investments are carried at cost. However, provision is made for any diminution in the value of the Non-Current Investments, if such decline is other than temporary.

10. Employee Benefits:

Defined Contribution plans and short term employee benefits such as salary, bonus, provident fund, etc. are charged to Profit & Loss account as incurred.

The present value of the obligations under defined benefit plans is determined based on an actuarial valuation using the Projected Unit Credit Method. Actuarial gains and losses arising on such valuation are recognised immediately in the Profit & Loss Account. In case of funded defined benefit plans, the fair value of the plan assets is reduced from gross obligation under the defined benefit plan to recognise the obligation on a net basis.

11. Borrowing Cost: Borrowing cost consists of interest and other costs incurred in connection with the borrowing of funds. Borrowing costs directly attributable to the acquisition or construction of an asset that necessarily takes a substantial period of time to get ready for its intended use are capitalised as part of the cost of the asset till the month in which the asset is ready for intended use. All other borrowing costs are expensed in the period in which they are incurred.

12. Earnings per Share: Basic earnings per share is computed by dividing the profit/ (loss) after tax and preference dividend (including the post-tax effect of extra ordinary items, if any) by the weighted average number of equity shares outstanding during the period.

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

13. Accounting for Taxes: Provision for current tax is made and retained in the accounts on the basis of estimated tax liability as per the applicable provisions of the Income Tax Act, 1961. As required by “Accounting Standard 22 - Accounting for Taxes on Income”, the Company has provided for Deferred Taxes. The tax effect of timing differences originating and reversing during the year has been reflected in the current year’s Profit & Loss A/c. MAT credit is not recognised on prudence basis.

14. Intangible Assets: Intangible assets acquired separately are measured on initial recognition at cost. Intangible assets are amortised on the Straight Lines basis over the estimated useful economic life. The amortisation period & the amortisation method are reviewed at least at each financial year end. Gains & losses arising from derecognition of fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of the assets and are recognised in the Statement of Profit & Loss when the asset is derecognised.

15. Impairment of Assets: Consideration is given at each Balance Sheet date to determine whether there is any indication of impairment of the carrying amounts of the Company’s assets. An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

16. Provisions, Contingent Liabilities & Contingent Assets: A provision is recognised when the Company has a present obligation as a result of past event, it is probable that an outflow of resources embodying benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources embodying economic benefits. Where no reliable estimate can be made, a disclosure is made as Contingent Liability. A disclosure for contingent liability is also made when there is a possible obligation or a present obligation that may, but probably will not; require an out flow of resources. Contingent Assets are neither recognised nor disclosed in the financial statements. When there is a possible or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.