Accounting Policies of Aditya Forge Ltd. Company

Mar 31, 2024

2 Summary of Significant Accounting Policies

The accounting policies set out below have been applied consistently to all periods presented in the financial statements unless
otherwise stated.

i Property, Plant and Equipment (PPE)

Property, Plant and Equipment are stated at cost, net of recoverable taxes, trade discount and rebates less accumulated depreciation
and impairment loss, if any. Such cost include purchase price, borrowing cost and any cost directly attributable to bringing assets to its
location and working condition or its intended use. Depreciation on Tangible Assets, PPE is charged on WDV method as per the useful
life prescribed in Part C of Schedule: it of the Companies Act, 2013 and in the manner specified therein. The residual values, useful
lives and methods of depreciation of property plant and equipment are reviewed at each financial year end and adjusted prospectively,
if any. Depreciation on fixed assets added/ disposed off/ discarded during the year is provided on a pro-rata basis with reference to the
month of addition/disposal/discarding.

ii Inventories

Inventories are valued at lower of cost and net realisable value. Cost is determined on a First in First out (FIFO). Cost includes cost of
conversion and other costs incurred in bringing the inventories to their present location and condition. Obsolete, slow moving and
defective inventories are identified and provided for.

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

iii Finance Cost

Borrowing Costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such
assets. A Qualifying asset is one that necessarily takes a substantial periost of time to get ready for its intended use or sale.AII other
borrowing costs are charged to the Statement of Profit and Loss for the period for which they are incurred._^_

_iv Revenue Recognition

Revenue is recognised to the extent it is probable that the economic benefits will flow to the Company and the revenue can be reliably
measured, regardless of when the payment is being made. Revenue is measured at the fair value of the consideration received or
receivable, taking into account contractually defined terms of payment and excluding taxes or duties collected on behalf of the
government. The Company has concluded that it is the principal in all of its revenue arrangements since it is the primary obligor in all
the revenue arrangements as it has pricing latitude and is also exposed to inventory and credit risks.

However, Goods and Service Tax (GST) is not received by the Company on its own account. Rather, it is tax collected on value added
to the commodity by the seller on behalf of the government. Accordingly, it is excluded from revenue.

Sale of products

Revenue from the sale of products is recognised when the significant risks and rewards of ownership of the products have passed to
the buyer, usually on delivery of the products. Revenue from the sale of products is measured at the fair value of the consideration
received or receivable, net of returns and allowances, trade discounts and volume rebates.

Interest Income

For all financial assets measured either at amortised cost or at fair value through other comprehensive income, interest income is
recorded using the effective interest rate (EIR). EIR is the rate that exactly discounts the estimated future cash payments or receipts
over the expected life of the financial instrument or a shorter period, where appropriate, to the gross carrying amount of the financial
asset or to the amortised cost of a financial liability. When calculating the effective interest rate, the Company estimates the expected
cash flows by considering all the contractual terms of the financial instrument but does not consider the expected credit losses.

v Employee Benefit
Expenses

Short Term Employee Benefits

The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees
are recognised as an expense during the period when the employees render the services.

vi Foreign currencies

Company has not made any foreign transaction during the year.

vii Taxes on Income

Tax on Income comprises current tax. It is recognised in statement of profit and loss except to the extent that it relates to a business
combination, or items recognised directly in equity or in other comprehensive income.

Current tax

Tax on income for the current period is determined on the basis on estimated taxable income and tax credits computed in accordance
with the provisions of the relevant tax laws and based on the expected outcome of assessments / appeals. Current income tax assets
and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws
used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Management periodically
evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation
and establishes provisions where appropriate.

Deferred tax

Deferred tax is recognized for the future tax consequences of deductible temporary differences between the carrying values of assets
and liabilities and their respective tax bases at the reporting date, using the tax rates and laws that are enacted or substantively
enacted as on reporting date. Deferred tax liability are generally recorded for all temporary timing differences.

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Mar 31, 2013

1.1 Basis of Preparation :

The Financial statements have been prepared to comply in at! material respects with the notified Accounting standards issued by the Institute of Chartered Accountants of India and the relevant provisions of Ihe Companies Act, 1956. The Financial Statements have been prepared tinder the historical cost convention on an accrual basis. The accounting policies have been consistently applied by ihe Company and are consistent with those applied in She previous year.

1.2 Fixed assets :

Fixed assets are stated ai Cost less accumulated depreciation, if any. Cost comprises purchase price and any other attributable cost of bringing (he assets to its working condition tor its intended use.

1.3 Depreciation :

Depreciation is provided on straight line method at the rates prescribed in schedule XIV of the Companies Act. 1956. While providing depreciation it is assumed that on day of the receipt of assets ihey are put to use.

1.4 Inventories :

Stock in Frade comprising of Raw Material, Component and Semi-finished goods are stated at cost (arrived at on the first in first out method with the inclusion of appropriate manufacturing overheads where applicable) or net realizable value whichever is less. Finished Goods are valued at cost or market value whichever is lower.

1.5 Unsecured Loans :

It comprises of Business. Loans taken Jrom members The said loans are as such not secured hence the same are shown under the head Unsecured Loans.

1.6 Revenue Recognition ;

Revenue is recognized to ihe extent that it is portable lhat the economies benefits will flow to the company and the revenue can be reliably measured.

1.7 Retirement and other Employee benefits:

a. Retirement Benefits in the form of Provident Fund are charged to the profit and loss account of the period when the contributions to the respective funds are due and thereafter ihe same are deposited under the scheme framed under the Employees Provident Fund and .Misc. Provision Act, 1952. There are no obligations other then contribution payable to the respective fund.

b. Gratuity- the company follows cash system of accounting of gratuity and leave encashment and has not obtained actuarial valuation ot the present value of gratuity liability & unutilized leave benefit, I lence Liability for the same is not quantified and provided for.

1.8 Income Taxes :

i i) Income Tax: Tax expenses comprise of Current Tax and are measured at the amount expected to be paid to The las authorities in accordance with the income Tax Act. J 961.

fii) Deferred Taxes : As per the requirements of the Accounting Standard 22 on "Accounting for Taxes, on income" issued by the Institute of Chartered Accountants of India, the Asset is created for the excess amount to be deferred. Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years, if any.

1.9 Provisions :

A. provision is recognized when an enterprise has a obligation as a result of past events and its probable that an outflow of resources wili be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its present values and are determined based on best estimate required to settle the obligations at the balance sheet date. These are reviewed at each balance sheer date and adjusted to reflect the current management estimates.

1.10 Contingent Liabilities:

We have been informed by the management that, their banker namely Madhavpura Mercantile Co- operative Bank Ltd. has gone into liquidation. TheMMCB Ltd had offered the settlement under OTS for an amount of Rs.4.75 Crores {against outstanding of the Term. Loan facility amounting to Rs. 4J9 Ci. and Cash Credit facility of Rs. 2.22 Cr.i The matter is under re-consideration by the bank. The management has provided for interest based on communication iram Bank dated 04/01/2012. Based on legal opinions taken by the Company''s Lr. Solicitors the Company believes that it has good cases in respect of the settlement of account under OTS offered in 2008-2009. To the extent of un-providcd interest the Losses arc under stated. The portion of un-providcd interest Liability shall stand as contingent liability.

1.11 Cash and Cash Equivalents :

Cash and Cash Equivalent comprises of Cash on hand. Cash at Bank and Cheques in Hand.

1.12 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 :

Micro, Small
1.13 Secured loans;

We have been informed by the management that, their bankers namely Madhavpura Mercantile Co- operative bank ltd lias gone into liquidation. Due to hod - availability of foreign L.C, facilities and additional working capital facility from this bank, the company had incurred huge losses oa account of cancellation of export sales. Company had filed suit against the Rank. The management has requested to revalidate earlier offered OTS Scheme. The matter is under consideration by the bank, The management has provided for interest partly taking the base of communication received from Bank as referred in Audit Report.

The accounts have been prepared «n "Going concern Concept". Since, the company do not have intention, to.,su*>pcrtC the operational activities.

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Mar 31, 2012

1.1 Baste of Preparation:

The Financial statements have been prepared to comply in all material respects with the notified Accounting standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956. The Financial Statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Company and are consistent with those applied in the previous year.

1.2 Fixed assets:

Fixed assets are stated at Cost less accumulated depreciation, if any. Cost comprises purchase price and any other attributable cost of bringing the assets to its working condition for its intended use.

1.3 Depreciation :

Depreciation is provided on straight line method at the rates prescribed in schedule XIV of the Companies Act, 1956. While providing depreciation it is assumed that on day of the receipt of assets they are put to use.

1.4 Inventories:

Stock in Trade comprising of Raw Material, Component and Semi-finished goods are stated at cost (arrived at on the first in first out method with the inclusion of appropriate manufacturing overheads where applicable) or net realizable value whichever is less. Finished Goods are valued at cost or market value whichever is lower.

1.5 Unsecured Loans:

It comprises of Business, Loans taken from members The said loans are as such not secured hence die same are shown under the head Unsecured Loans.

1.6 Revenue Recognition :

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

1.7 Retirement and other Employee benefits :

a. Retirement Benefits in the form of Provident Fund are charged to the profit and loss account of the period when the contributions to the respective funds are due and thereafter the same are deposited under the scheme framed under the Employees Provident Fund and Misc. Provision Act, 1952. There are no obligations other then contribution payable to the respective fund.

b. Gratuity- the company follows cash system of accounting of gratuity and leave encashment and has not obtained actuarial valuation of the present value of gratuity liability & unutilized leave benefit Hence Liability for the same is not quantified and provided for.

1.8 Income Taxes:

(i) Income Tax.: Tax expenses comprise of Cuirent Tax and are measured at the amount expected to be paid to the tax authorities in accordance with the income Tax Act, 1961.

(ii) Deferred Taxes : As per the requirements of the Accounting Standard 22 on "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, the Asset is created for the excess amount to be deferred. Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years, if any.

1.9 Provisions :

A provision is recognized when an enterprise has a obligation as a result of past events and its probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its present values and are determined based on best estimate required to settle the obligations at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current management estimates.

1.10 Contingent Liabilities:

We have been informed by the management that, their banker namely Madhavpura Mercantile Co- operative Bank Ltd.is Non - Functioning since, March, 2001. The MMCB Ltd had offered the settlement under OTS for an amount of Rs.4.75 Crores (against outstanding of the Term Loan facility amounting to Rs. 4.19 Cr.and Cash Credit facility of Rs. 2.22 Cr.) The matter is under consideration by the bank. The management has not provided for interest since 1999-2000. Based on legal opinions taken by the Company's Lr. Solicitors the Company believes that it has good cases in respect of the settlement of account under OTS offered in 2008-2009. The portion of unprovided Liability shall stand as contingent liability.

1.11 Cash and Cash Equivalents :

Cash and Cash Equivalent comprises of Cash on hand. Cash at Bank and Cheques in Hand.

1.12 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006:

Micro, Small & Medium Enterprise on Terms & Section 22 of the Micro, Small and Medium enterprise development Act, 2006 have been determined to the exiting parties have been identified on the basis of information available with the company and relied upon by the auditors, the company has not received information from the suppliers regarding the status under the Micro, Small and Medium Enterprise Development Act 2006 and hence Disclosure if any relating to amount unpaid as the year and together with interest payable as required under the said act hence not been given.

1.13 Secured loans;

We have been informed by the management that, their bankers namely Madhavpura Mercantile Co- operative bank ltd. is facing severe financial crisis and it is not functioning since March, 2001. The said bank is seeking assistance of fellow Co-operative banks, State Government & Central Government. Due to non - availability of foreign L.C. facilities and additional working capital facility from this bank, the company had incurred huge losses on account of cancellation of export sales. The management have offered to settle the account under OTS Scheme. The matter is under consideration by the bank. The management has not provided for interest since 1999-2000.

The accounts have been prepared on "Going concern Concept". Since, the company do not have intention to suspend the operational activities.