Sangal Papers Ltd. कंपली की लेखा नीति

Mar 31, 2025

1. Material Accounting Policies Background

Sangal Papers Limited is a Company domiciled in India, incorporated on 22 November 1980 with its registered office situated at Village Bhainsa, 22 km Stone, Mawana Road Meerut U.P, the Company has been incorporated under Indian Companies Act and its equity shares are listed on the Bombay Stock Exchange (BSE). "The financial statements are approved for issuance by the Comapny''s board of directors on May 30, 2025"

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

(a) Basis of preparation

(i) Compliance with Ind AS

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) [Companies (Indian Accounting Standards) Rules, 2015] and as amended from time to time and other relevant provisions of the Act.

(ii) Historical Cost Convention

The financial statement have been prepared on a historical cost basis, except for the following:

- certain financial assets and liabilities are measured at fair value; and

- defined benefit plans and their liabilites are measured at fair value.

(b) Use of Estimates

The preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities as at the date of the financial statements and the reported amount of revenues and expenses during the reporting year. The difference between the actual results and estimates are recognised in the year in which the results are known/materialize.

All Assets and liabilities have been classified as current or non-current as per the Company''s normal operating cycle and other criteria set out in the schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realisation in cash and cash equivalent, the Company has ascertained its operating cycle as 12 months for the purpose of current/non-current classification of assets and liabilities.

(c) Segment Reporting

The Company is engaged in the business of Paper Manufacturing considering the nature of company''s business and operations, there are no other reportable segments in accordance with Ind AS 108 Operating segments and hence, there are no additional disclosures required.

(d) Foreign Currency Transactions and Translations

Transactions in foreign currencies arc initially recorded by the company''s entities at their respective functional currency spot rates at the date the transaction first qualifies for recognition.

Monetary assets and liabilities denominated in foreign currencies arc translated at the functional currency spot rates of exchange at the reporting date.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined. 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 OCI or profit or loss are also recognised in OCI or profit and loss, respectively).

(e) Financial instruments - Initial recognition, subsequent measurement and impairment

A financial instrument is any contract that gives use to a financial asset of one entity and a financial liability or equity instrument of another entity.

Financial Assets

Financial assets are measured at amortised cost or fair value through other comprehensive income or fair value through profit or loss depending on its business model for managing those financial assets and the assets contractual cash flow characteristics.

Subsequent measurements of financial assets are dependent on initial categorisation. For impairment purposes significant financial assets are tested on an individual basis, other financial assets are assessed collectively that share similar credit risk characteristics.

Derecognition of financial assets

A financial asset is derecognised only when the Company has transferred the rights to receive cash flows from the financial asset or retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients.

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

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

Financial Liabilities

At initial recognition, all financial liabilities other than fair valued through profit and loss are recognised initially at fair value less transaction costs that are attributable to the issue of financial liability. Transaction costs of financial liability carried at fair value through profit or loss is expensed in profit or loss.

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading. The Company has not designated any financial liabilities upon initial measurement recognition at fair value through profit or loss. Financial liabilities at fair value through profit or loss are at each reporting date at fair value with all the changes recognized in the Statement of Profit and Loss.

Financial liabilities measured at amortised cost

After initial recognition, interest bearing loans and borrowings are subsequently measured at amortised cost using the effective interest rate method (''EIR'') except for those designated in an effective hedging relationship. The carrying value of borrowings that are designated as hedged items in fair value hedges that would otherwise be carried at amortised cost are adjusted to record changes in fair values attributable to the risks that are hedged in effective hedging relationship.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fee or costs that are an integral part of the EIR. The EIR amortisation is included in finance costs in the Statement of Profit and Loss.

After initial recognition, interest-bearing borrowings are subsequently measured at amortised cost using the effective interest method. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the year of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down.

Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting year.

De-recognition of financial liability

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss as other income or finance costs.

Offsetting financial instruments

Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.

Subsequent recoveries of amounts previously written off are credited to other income.

(f) Trade and other payables

A payable is classified as ''trade payable'' if it is in respect of the amount due on account of goods purchased or services received in the normal course of business. These amounts represent liabilities for goods and services provided to the Company prior to the end of financial year which are unpaid. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after the reporting year. They are recognised initially at their fair value and subsequently measured at amortised cost using the effective interest method.

(g) Cash Flow statements

Cash flows are reported using the Indirect Method, where by profit/(loss) before tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the company are segregate based on the available information.

(h) Cash and Cash Equivalents

Cash and cash equivalents comprise cash and cash on deposit with banks and corporations. The Company considers all highly liquid investments with a remaining maturity at the date of purchase of three months or less and that are readily convertible to known amounts of cash to be cash equivalents.

(i) Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from the proceeds.

Par value of the equity share is recorded as share capital and the amount received in excess of the par value is classified as security premium.

(j) Revenue recognition Sale of goods

For sale of goods, revenue is recognised when control of the goods has transferred at a point in time i.e. when the goods have been dispatched to the location of customer. Following dispatch, the customer has full discretion over the responsibility, manner of distribution, price to sell the goods and bears the risks of obsolescence and loss in relation to the goods. A receivable is recognised by the Company when the goods are dispatched to the customer as this represents the point in time at which the right to consideration becomes unconditional, as only the passage of time is required before payment is due.The Company considers the effects of variable consideration, non-cash consideration, and consideration payable to the customer (if any).

Interest income

Interest income from financial instrument is recognised using the effective interest rate (EIR) method. Variable consideration

If the consideration in a contract includes a variable amount, estimates the amount of consideration to which it will be entitled in exchange for transferring the goods to the customer. The variable consideration is estimated at contract inception and constrained until it is highly probable that a significant revenue reversal in the amount of cumulative revenue recognised will not occur when the associated uncertainty with the variable consideration is subsequently resolved. The Company recognizes changes in the estimated amount of variable consideration in the period in which the change occurs. Some contracts for the sale of goods provide customers with volume rebates and pricing incentives, which give rise to variable consideration.

Rebates are offset against amounts payable by the customer. To estimate the variable consideration for the expected future rebates, the Company applies the most likely amount method for contracts with a single-volume threshold. The selected method that best predicts the amount of variable consideration is primarily driven by the number of volume thresholds contained in the contract. The Company then applies the requirements on constraining estimates of variable consideration and recognises a refund liability for the expected future rebates.

Contract balances Trade receivables

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

Contract liabilities (which the Company refer to as advance from customer)

A contract liability is the obligation to transfer goods or services to a customer for which the company has received consideration (or an amount of consideration 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.

The Company presents revenues net of indirect taxes in its Statement of Profit and Loss.

Cost to obtain a contract

The company pays sales commission to its selling agents for each contract that they obtain for the company. The company has elected to apply the optional practical expedient for costs to obtain a contract which allows the Company to immediately expense sales commissions (included in ''commission on sales'' under other expenses) because the amortization period of the asset that the company otherwise would have used is one year or less.

Costs to fulfil a contract i.e. freight, insurance and other selling expenses are recognized as an expense in the period in which related revenue is recognised.

Financing components

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

(k) Provisions, contingent liabilites and assets

Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation, and the amount has been reliably estimated. Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present obligation at the end of the reporting period.

Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.

Contingent assets are disclosed where an inflow of an economic benefit is probable.

(l) Earning Per Share

Basic and diluted earnings per share are calculated by dividing the net profit or loss for the year attributable to the equity shareholders by the weighted average number of equity shares outstanding

(m) Taxation

Provision for tax consists of current tax and deferred tax. Current tax provision is computed for current income based on the tax liability after considering allowances and exemptions. Deferred tax assets and liabilities are computed on the basis of timing differences at the Balance Sheet date between the carrying amount of assets and liabilities and their respective tax basis. Deferred tax assets are recognized based on management estimates of available future taxable income and assessing its certainty.

(i) Current Income Tax

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

(ii) Deferred Tax

Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period.

Ind AS 12, "Income Taxes" requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12, has resulted in recognition of deferred tax on new temporary differences, which was not required under Indian GAAP, if applicable.

In addition, the various transitional adjustments lead to additional temporary differences. According to the accounting policies, the Company has to account for such differences. Tax impact on Deferred tax adjustments are recognized in reserves for opening balance sheet and statement of profit and loss in subsequent years.

(iii) GST paid on acquisition of assets or on incurring expenses

Expenses and assets are recognised net of the amount of GST paid, except:

- When the tax incurred on a purchase of assets of services is not recoverable from the taxation authority, in which case, the tax paid is recognized as part of the cost of acquisition of the assets or as part of the expenses item, as applicable

- When receivables and payables are stated with the amount of tax included the net amount of tax recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet.

(n) Trade Receivables

Trade Receivables are recognized initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment.

(o) Inventories

Raw materials and stores, work in progress, traded and finished goods are stated at the lower of cost and net realisable value. Cost of raw materials and traded goods comprises cost of purchases. Cost of work-inprogress and finished goods comprises direct materials, direct labour and an appropriate proportion of variable and fixed overhead expenditure, the latter being allocated on the basis of normal operating capacity. Cost of inventories also include all other costs incurred in bringing the inventories to their present location and condition. Costs are assigned to individual items of inventory on the basis of weighted average / first-in first-out basis. Costs of purchased inventory are determined after deducting rebates and discounts. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.

(p) Property, plant and equipment

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

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

The above cost of the assets includes the revaluation of assets carried out in the previous years'' and the accumulated amount of revaluation forms part of the Other Equity in Shareholders'' Funds with name of "Revaluation Reserve"

Depreciation methods, estimated useful lives and residual value

Depreciation is calculated using the straight-line method to allocate their cost, net of their residual values, over their estimated useful lives.

The useful lives have been determined as per those specified by Schedule II to the Companies Act; 2013. The residual values are not more than 5% of the original cost of the asset. The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss within other gains/(losses).

(q) Borrowings

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

Borrowings are de-recogized in the balance sheet when the obligation specified in the contract is discharged, cancelled or expired.

Borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period.

(r) Borrowing sosts

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

(s) Employee benefits

(i) Short-term obligations

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

(ii) Post-employment obligations

The group operates the following post-employment schemes:

(a) defined benefit plan viz. gratuity; and

(b) defined contribution plans such as provident fund.

(a) Defined benefit plan

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

The present value of the defined benefit obligation denominated in INR is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation. The benefits which are denominated in currency other than INR, the cash flows are discounted using market yields determined by reference to high-quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms approximating to the terms of the related obligation.

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

Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in the period in which they occur, directly in other comprehensive income. They are included in retained earnings in the statement of changes in equity and in the balance sheet. Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are recognised immediately in profit or loss as past service cost.

(b) Defined contribution plans

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

(iii) Leave encashment

Entitlement of annual leave is recognised when they accrue to employees. Anuual leave can either be availed or encashed subject to a restriction on the maximum number of accumulation of leaves.

(t) Exceptional items

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

(u) Rounding of amounts

All amounts disclosed in the financial statements and notes have been rounded off to the nearest lakhs as per the requirement of Schedule III, unless otherwise stated.

2. CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS

The company makes estimates and judgments that affect the reporting amounts of assets and liabilities within the next year. Estimates and judgments are continually evaluated and are based on historical experience and other factor, including expectations of future events that are believed to be reasonable under the circumstance.

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

This note provides an overview of the areas that involved a higher degree of judgement or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed. Detailed information about each of these estimates and judgements is included in relevant notes together with information about the basis of calculation for each affected line item in the financial statements.

Recent accounting developments

The Ministry of Corporate Affairs notified new standards or amendment to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. The Company applied following amendments for the first-time during the current year which are effective from April 1, 2024:

Amendments to Ind AS 116 -Lease liability in a sale and leaseback

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

Introduction of Ind AS 117

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

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

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Mar 31, 2015

1) Basis of Preparation of Financial Statements:

(i) The financial statements are prepared on the historical cost convention basis (except for certain fixed assets which have been revalued) in accordance with the generally accepted accounting principles.

(ii) The Company generally follows mercantile system of accounting and recognises significant items of income and expenditure on accrual basis.

2) Use of Estimates:

The preparation of financial statements requires management to make certain estimates and assumptions that affect the amount reported in the financial statement and notes there to. Differences between actual and estimates are recognized in the period in which the results are known/materialized.

3) Valuation of Inventories:

- Inventories are valued at the lower of the cost and estimated net realisable value. The basis of determining of cost for various categories of in ventories are as follows:

- Raw Material, Chemicals, Fuels, Store & Spares and packing Material. On weighted Average/FIFO basis.

- Finished Goods and Work in process includes Raw Material Cost, Cost of conversion and other costs in bringing the inventories to their present location and conditions.

4) Sales:

Sales are inclusive of Excise Duty.

5) Excise Duty:

Excise Duty has been accounted for on the basis of payment made in respect of goods cleared Amount of Excise Duty deducted from sale in relatable to the sale made during the year. Amount of Cenvat Credits in respect of material consumed is deducted from cost of material.

6) Fixed Assets:

(i) Fixed Assets are stated at cost. Cost includes installation charges and expenditure during construction period wherever applicable.

(ii) All pre-operative expenditure accumulated as capital work in progress and is allocated to the relevant fixed assets on a pro-rata basis.

7) Depreciation:

Depreciation on fixed assets has been provided on straight line method (SLM). Depreciation is provied based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013.

8) Foreign Currency Transactions: -

Foreign Currency transactions are accounted at the exchange rates prevailing on the date of transactions. Foreign Currency assets and current liabilities outstanding at the Balance Sheet date are translated at the exchange rate prevailing on that date and the resultant gain or loss is recognized in the Statement of Profit & Loss. In cases where they relate to the acquisition / construction of fixed assets, they are adjusted to the carrying cost of fixed assets.

9) Employee retirement benefit :

i) Retirement benefit in the form of provident fund and super an nation /pension schemes whether in pursuance of any law or otherwise is accounted on accrual basis and charged to the Statement of profit & loss of the year.

ii) The provision for gratuity has been made on the basis of formula prescribed for the payment of gratuity act, 1972.

10) Borrowing cost

Borrowing cost directs attributable to the acquisition or construction of fixed assets are capitalised as part of the cost of assets, up to the date of assets is put to use. Other borrowing costs are charged to the statement of profit and loss in which they are incurred.

11) TAX ON INCOME:

(a) Current Tax

Provision for Income Tax is determined in, accordance with the provision of Income Tax Act, 1961

(b) Deferred Tax

Deferred Tax is recognised on timing differences being the differences between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent period (s).

12) Provision. Contingent Liabilities and Contingent Assets:

Provision involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized not disclosed in the financial statement.

13) Printing & Stationery, Postage & Telephone are accounted on cash basis.

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Mar 31, 2014

1) Basis of Preparation of Financial Statements:

(i) The financial statements are prepared on the historical cost convention basis (except forcertain fixed assets which have been revalued) in accordance with thegenerally accepted ! accounting principles.

(ii) The Company generally follows mercantile system of accounting and recognises significant ;items of income and expenditure on accrual basis.

2) Use of Estimates:

The preparation of financial statements requires management to make certain estimates and [assumptions that affect the amount reported in the financial statement and notes there to. Differences !between actual and estimates are recognized in the period in which the results are known/materialized.

3) Valuation of Inventories:

- Inventories are valued at the lower of the cost and estimated net realisable value. The |basis of determining of cost for various categories of inventories areas follows: - Raw Material, Chemicals, Fuels, Store & Spares and packing Material. On weighted !

Average/FIFO basis.

- Finished Goods and Work in process includes Raw Material Cost, Cost of conversion and |

other costs in bringing the inventories to their present location and conditions''. [

4) Sales: Sales are inclusive of Excise Duty.

5) Excise Duty:

Excise Duty has been accounted for on the basis of payment made in respect of goods cleared Amount of Excise Duty deducted from sale in relatable to the sale madeduring the year. Amount of Cenvat Credits in respect of material consumed isdeductedfrom costof material.

6) Fixed Assets:

(i) Fixed Assets are stated at cost. Cost includes installation charges and expenditure during construction period wherever applicable.

(ii) All pre-operative expenditure accumulated as capital work in progress and is allocated to the relevant fixed assets on a pro-rata basis.

7) Depreciation:

Depreciation on fixed assets has been provided on straight line method at the rates as > prescribed in Schedule XIV of the Companies Act, 1956 on monthly pro-rata basis.

8) Impairment of Assets:

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An Impairment loss is charged to the Statement of Profit and Loss 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.

9) Government Grants:

Value of Government grants related to specific Fixed assets are adjusted with the fixed assets.

10) Foreign Currency Transactions:

Foreign Currency transactions are accounted at the exchange rates prevailing on the date of transactions. Foreign Currency assets and current liabilitiesoutstanding at the Balance Sheet date are 1 translated at the exchange rate prevailing on that date and the resultant gain or loss is recognized In the |Statement of Profit & Loss. In cases where they relate to theacquisition / construction of fixed assets,they are adjusted to the carrying cost of fixed assets.

11) Exployee retirement benefit:

(i) Retirement benefit in the form of provident fund and superannuation/pension schemes whether in pursuance of any law or otherwise is accounted on accrual basis and charged to the Statement of profit & loss of the year.

(ii) The provision for gratuity has been made on the basis of formula prescribed for the payment of gratuity act 1972.

12) Borrowing Cost:

Borrowing cost directs attributable to the acquisition or construction of fixed assets are capitalised as part of the cost of assets, up to the date of assets is put to use. Other borrowing costs are charged to the statement of profit and loss in which they are incurred.

13) TAX ON INCOME:

(a) CurrentTax

Provision for Income Tax is determined in, accordance with the provision of Income TaxAct, 1961

(b) Deferred Tax

Deferred Tax is recognised on timing differences being the differences between taxable income and accounting income that originate in one period and are capable of reversal In one or more subsequent period (s).

14) Provision, Contingent Liabiiities and Contingent Assets:

Provision involving substantial degree of estimation In measurement are recognized when there Is a present obligation as a result of past events and it Is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized notdisclosed in the financial statement.

15) Printing & Stionery, Postage & Telephone are accounted on cash basis:

The company has only equity shares having a par value of Rs. 10 per share. Each shareholder is eligible for one vote per share. In the event of liquidation of the company, the holders of shares shall be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. The amount distributed will be in proportion to the number of equity shares held by the shareholders.

Term Loan from Axis Bank is secured by way of equitable mortgage of land & building and hypothecation of Plant & Machinery and personal guarantee by Directors of the Company. From Axis Bank (for term loan of Rs. 108480000)

At the rate of 3.25% above base rate. Present effective rate is 13.25% p.a. (Previous year 13.25% p.a.). Repayble in 96 Monthly installment of Rs. 11,30,000 each starting from July 2007. From Axis Bank (forterm loan of Rs. 9420000)

At the rate of 3.25% above base rate. Present effective rate is 13.25% p.a. (Previous year 13.25% p.a.). Repayble in 60 Monthly installment of Rs. 1,57,000 each starting from July 2011. From Axis Bank (forterm loan of Rs. 13500000)

At the rate of 3.25% above base rate Present effective rate is 13.25% p.a. (Previous year 13.25% p.a.) Repayable in 60 Monthly installments of Rs. 2,25,000 each starting from April 2013

Vehicle Loan is secured by hypothecation of respective vehicles and guaranteed by Deirectors of the Company. From State Bank of India (forterm loan of Rs. 1000000)

At the Present effective rate is 12% p.a. (Previous year 12% p.a.) Repayable in 60 monthly EMI of Rs. 21,867 each starting from May 2011. From Axis Bank (forterm loan of Rs. 1500000)

At the Present effective rate is 10.70% p.a. (Previous year NIL) Repayable in 36 monthly EMI of Rs. 48.898 each starting from Jan 2013. From Axis Bank (forterm loan of Rs. 3500000)

At the Present effective rate is 8.86% p.a. (Priviousyear Nil) Repayable in 60 monthly EMI of Rs. 71886 each

Working Capital Loans from Axis Bank is secured by way of Stock of Raw Material, Stores & spares, work in process, finished goods, semi finished goods, bills and Book Debts of the Company and personal guarantee by Directors of the Company.

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Mar 31, 2013

1) Basis of Preparation of Financial Statements:

(i) The financial statements are prepared on the historical cost convention basis (except for certain fixed assets which have been revalued) in accordance with the generally accepted accounting principles.

(ii) The Company generally follows mercantile system of accounting and recognises significant items of income and expenditure on accrual basis.

2) Use of Estimates:

The preparation of financial statements requires management to make certain estimates and assumptions that affect the amount reported in the financial statement and notes there to. Differences between actual and estimates are recognized in the period in which the results are known/materialized.

3) Valuation of Inventories:

- Inventories are valued at the lower of the cost and estimated net realisable value. The basis of determining of cost for various categories of inventories are as follows:

- Raw Material, Chemicals, Fuels, Store & Spares and packing Material. On weighted Average/FIFO basis.

- Finished Goods and Work in process includes Raw Material Cost, Cost of conversion and other costs in bringing the inventories to their present location and conditions.

4) Sales:

Sales are inclusive of Excise Duty.

5) Excise Duty:

Excise Duty has been accounted for on the basis of payment made In respect of goods cleared Amount of Excise Duty deducted from sale in relatable to the sale made during the year. Amount of Cenvat Credits in respect of material consumed is deducted from cost of material.

6) Fixed Assets:

(i) Fixed Assets are stated at cost. Cost includes installation charges and expenditure during construction period wherever applicable.

(ii) All pre-operative expenditure accumulated as capital work in progress and is allocated to the relevantfixed assets on a pro-rata basis.

7) Depreciation:

Depreciation on fixed assets has been provided on straight line method at the rates as prescribed in Schedule XI Vof the Companies Act, 1956 on monthly pro-rata basis.

8) Impairment of Assets:

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Statement of Profit and Loss 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.

9) Government Grants:

Value of Government grants related to specific Fixed assets are adjusted with the fixed assets.

10) Foreign Currency Transactions:

Foreign Currency transactions are accounted at the exchange rates prevailing on the date of transactions. Foreign Currency assets and current liabilities outstanding at the Balance Sheet date are translated at the exchange rate prevailing on that date and the resultant gain or loss Is recognized in the Statement of Profit & Loss. In cases where they relate to the acquisition / construction of fixed assets, they are adjusted to the carrying cost of fixed assets.

11) Exployee retirement benefit:

(i) Retirement benefit in the form of provident fund and superannuation/pension schemes whether in pursuance of any law or otherwise is accounted on accrual basis and charged to the Statement of profit & loss of the year.

(ii) The provision for gratuity has been made on the basis of formula prescribed for the payment of gratuity act 1972.

12) Borrowing Cost:

Borrowing cost directs attributable to the acquisition or construction of fixed assets are capitalised as part of the cost of assets, up to the date of assets is put to use. Other borrowing costs are charged to the statement of profit and loss in which they are incurred.

13) TAX ON INCOME:

(a) CurrentTax

Provision for Income Tax is determined In, accordance with the provision of Income Tax Act, 1961

(b) Deferred Tax

Deferred Tax Is recognised on timing differences being the differences between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent period (s).

14) Provision, Contingent Liabilities and Contingent Assets:

Provision involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized not disclosed in the financial statement.

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Mar 31, 2012

1) Basis of Preparation of Financial Statements:

(i) The financial statements are prepared on the historical cost convention basis (except for certain fixed assets which have been revalued) in accordance with the generally accepted accounting principles.

(ii) The Company generally follows mercantile system of accounting and recognises significant items of income and expenditure on accrual basis.

2) Use of Estimates :

The preparation of financial statements requires management ot make certain estimates and assumptions that affect the amount reported in the financial statement and notes therto. Differences between actual and estimates are recognized in the period in which the results are known/materialized.

3) Valuation of Inventories :

- Inventories are valued at the lower of the cost and estimated net realisable value. The bases of determining of cost for various categories of inventories are as follows:

- Raw Material. Chemicals, Fuels, Store & Spares and packing Material On weighted Average/FIFO basis,

- Finished Goods and Work in process includes Raw Material Cost, Cost of conversion and other costs in bringing the inventories to their present location and conditions,

4) Sales:

Sales are inclusive of Excise Duty.

5) Excise Duty:

Excise Duty has been accounted for on the basis of in payment made in respect of goods cteared as original also provision made for the goods lying in the bonded warehouses. Amount of Excise Duty deducted from sate rn re la table to the sale made during the year. Amount of Cenvai Credits in respect of material consumed is deducted from cost of material.

6) Fixed Assets:

(i) Fixed Assets are stated at cost. Cost includes Installation charges and expenditure during construction period wherever applicable.

(ii) All pre-operative expenditure accumulated as capital work in progress and is allocated to the relevant fixed assets on a pro-rata basis.

7) Depreciation:

Depreciation on fixed assets has been provided on straight line method at the rates as prescribed in Schedule XIV of the Companies Act. 1956 on monthly pro-rata basts.

8) Impairment of 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 recognized 3n prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

9) Government Grants:

Value of Government grants related to specific Fixed assets are adjusted with the fixed assets.

10) Foreign Currency Transactions :

Foreign Currency transactions are accounted at the exchange rates prevailing on the date of transactions. Foreign Currency assets and current liabilities outstanding at the Balance Sheet date are translated at the exchange rate prevailing on that the and the resultant gain or loss is recognized in the Statement of Profit & Loss, In cases where they relate to the acquisition / construction of fixed assets, they are adjusted to the carrying cost of fixed assets.

11) Exployee retirement benefit:

(i) Retirement benefit in the form of provident fund and superannuation/pension schemes whether in pursuance of any law or otherwise is accounted on accrual basis and charged to the Statement of profit & loss of the year.

(ii) The provision for gratuity has been made on the basis of formula prescribed for the payment of gratuity and leave encashment provision has been made on encashment vatue of earned leave at the year end.

12) Borrowing Cost:

Borrowing cost directs attributable to the acquisition or construction of fixed assets are capitalised as part of the cost of assets, up to the date of assets is put to use. Other borrowing costs are charged to the statement of profit and loss in which they are incurred.

13) TAX ON INCOME:

(a) Current Tax

Provision for Income Tax is determined in, accordance with the provision of Income Tax Act, 1961

(b) Deferred Tax

Deferred Tax is recognised on timing differences being the differences between taxable income and accounting fncome that originate in one period and are capable of reversal in one or more subsequent period (s).

14) Provision, Contingent Liabilities and Contingent Assets :

Provision involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources, Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized not disclosed in the financial statement.

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Mar 31, 2010

1) Basis of Preparation of Financial Statements:

(i) The financial statements are prepared on the historical cost convention basis (except for certain fixed assets which have been revalued) in accordance with the generally accepted accounting principles.

(ii)The Company generally follows mercantile system of accounting and recognises significant items of income and expenditure on accrual basis.

2) Valuation of Inventories:

(i) Inventories are valued at the lower of the cost and estimated net realisable value. The bases of determining of cost for various categories of inventories are as follows:

- Raw Material, Chemicals, Fuels, Store & Spares and packing Material. On weighted Average/FIFO basis.

- Finished Goods and Work in process includes Raw Material Cost, Cost of conversion and other costs in bringing the inventories to their present location and conditions.

3) Sales:

Sales are inclusive of Excise Duty.

4) Excise Duty:

Excise Duty has been accounted for on the basis of both payment made in respect of goods cleared as also provision made for the goods lying in the bonded warehouses. Amount of Excise Duty deducted from sale in relatable to the sale made during the year. Amount of Cenvat Credits in respect of material consumed is deducted from cost of material.

5) Fixed Assets:

(i) Fixed Assets are stated at cost. Cost includes installation charges and expenditure during construction period wherever applicable.

(ii) All pre-operative expenditure accumulated as capital work in progress and is allocated to the relevant fixed assets on a pro-rata basis.

6) Depreciation:

Depreciation on fixed assets has been provided on straight line method at the rates as prescribed in Schedule XIV of the Companies Act, 1956 on monthly pro-rata basis.

7) Employees Retirement Benefit:

(i) Retirement benefit in the form of provident fund and superannuation / pension schemes whether in pursuance of any law or otherwise is accounted on accural basis and charged to the profit & loss account of the year.

(ii) The provision for gratuity has been made on the basis of formula prescribed for the payment of gratuity and leave encashment provision has been made on encashment value of earned leave at the year end.

8) Borrowing Cost:

Borrowing cost directs attributable to the acquisition or construction of fixed assets are captalised as part of the cost of assets, up to the date of assets is put to use. Other borrowing costs are charged to the profit and loss account in which they are incurred.

9) TAX INCOME:

(a) Current Tax:

Provision for Income Tax is determined in, accordance with the provision of Income Tax Act, 1961,

(b) Deferred Tax:

Deferred Tax is recognised on timing differences being the differences between taxable Income and accounting Income that originate in one period and are capable of reversal in one or more subsequent period (s).

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Mar 31, 2009

1) Basis of Preparation of Financial Statements :

(i) The financial statements are prepared on the historical cost convention basis (except for certain fixed assets which have been revalued) in accordance with the generally accepted accounting principles.

(ii) The Company generally follows mercantile system of accounting and recognises significant items of income and expenditure on accrual basis.

2) Valuation of Inventories :

(i) Inventories are valued at the lower of the cost and estimated net realisable value. The bases of determining of cost for various categories of inventories are as follows : - Raw Material, Chemicals, Fuels, Store & Spares and Packing Material. On weighted Average /FIFO basis. - Finished Goods and Work in process includes Raw Material Cost, Cost of conversion and other costs in bringing the inventories to their present location and conditions.

3) Sales :

Sales are inclusive of Excise Duty.

4) Excise Duty :

Excise Duty has been accounted for on the basis of both payment made in respect of goods cleared as also provision made for the goods lying in the bonded warehouses. Amount of Excise Duty deducted from sale is relatable to the sale made during the year. Amount of Cenvat Credits in respect of material consumed is deducted from cost of material.

5) Fixed Assets :

(i Fixed Assets are stated at cost Cost includes installation charges and expenditure during construction period wherever applicable.

(ii) All pre-operative expenditure accumulated as capital work in progress and is allocated to the relevant fixed assets on pro-rata basis.

6) Depreciation :

Depreciation on fixed assets has been provided on straight line method at the rates as prescribed in Schedule XIV of the Companies Act, 1956 on monthly pro-rata basis.

7) Employees Retirement Benefit :

(i) Retirement benefit in the form of provident fund and superannuation / pension schemes whether in pursuance of any law or otherwise is accounted on accural basis and charged to the profit & loss account of the year.

(ii) The provision for gratuity has been made on the basis of formula prescribed for the payment of gratuity and leave encashment provision has been made on encashment value of earned leave at the year end.

8) Borrowing Cost :

Borrowing cost directly attributable to the acquisition or construction of fixed assets are capitalised as part of the cost of assets, up to the date of assets is put to use. Other borrowing cost are charged to the profit and loss account in which they are incurred.

9) TAX ON INCOME :

(a) Current Tax :

Provision for Income Tax is determined in, accordance with the provision of Income Tax Act, 1961.

(b) Deferred Tax :

Deferred Tax is recognised on timing differences being the differences between taxable Income and accounting Income that originate in one period and are capable of reversal in one or more subsequent period(s).