Accounting Policies of Ankit Metal & Power Ltd. Company

Mar 31, 2023

1.2 Significant Accounting Policies

a) Operating Cycle

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 and Ind AS 1 - Presentation of Financial Statements based on the nature of products and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents.

b) Financial instruments

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

i. Financial Assets

Initial Recognition and Measurement

All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. Trade receivables are initially measured at transaction price. Regular way purchase and sale of financial assets are accounted for at trade date.

Subsequent Measurement

For purposes of subsequent measurement, financial assets are classified in three categories:

• Amortised cost

• Fair value through other comprehensive income (FVTOCI)

• Fair value through profit or loss (FVTPL)

Financial assets are not reclassified subsequent to their initial recognition, except if and in the period the Company changes its business model for managing financial assets.

Financial assets at amortised cost

A financial asset is measured at amortised cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. The effective interest rate (EIR) amortisation is included in finance income in the profit or loss.

Financial assets at FVTOCI

A financial asset is measured at FVTOCI if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognized in the other comprehensive income (OCI).

Financial assets at FVTPL

A financial asset which is not classified in any of the above categories are measured at FVTPL.

Financial assets included within the FVTPL category are measured at fair value with all changes recognised in the Statement of Profit & Loss.

Other Equity Investments

All other equity investments are measured at fair value, with value changes recognised in Statement of Profit and Loss, except for those equity investments for which the Company has elected to present the value changes in ''Other Comprehensive Income''. Derecognition

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for derecognition under Ind AS 109.

ii. Financial Liability

Initial Recognition and measurement

Financial liabilities are initially recognised at fair value plus any transaction cost that are attributable to the acquisition of the financial liabilities except financial liabilities at fair value through profit or loss which are intially measured at fair value.

Subsequent Measurement

For purposes of subsequent measurement, financial liabilities are classified in following categories:

• Financial liabilities through profit or loss (FVTPL)

• Financial liabilities at amortised cost Financial Liabilities through FVTPL

A financial liability is classified as at FVTPL if it is classified as held-for-trading, or it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognised in profit or loss.

Financial Liabilities at Amortised Cost

Other financial liabilities are subsequently measured at amortised cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognised in profit or loss. Any gain or loss on derecognition is also recognised in profit or loss.

Interest bearing loans and borrowings are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process. For trade and other payables maturing within one year from the balance sheet date, the carrying amounts approximates fair value due to the short maturity of these instruments.

Derecognition

A financial liability (or a part of a financial liability) is derecognized from the Company''s Balance Sheet when the obligation specified in the contract is discharged or cancelled or expires.

An exchange between an existing borrower and lender of debt instruments with substantially different terms shall be accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. Similarly, a substantial modification of the terms of an existing financial liability or a part of it (whether or not attributable to the financial difficulty of the debtor) shall be accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. The difference between the carrying amount of a financial liability (or part of a financial liability) extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, shall be recognised in profit or loss.

iii. Offsetting of Financial Instruments

Financial assets and financial liabilities are offset and the net amount presented in the balance sheet when, and only when, the Company currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realise the asset and settle the liability simultaneously.

c) Property, Plant and Equipment

i. Recognition and Measurement

Items of property, plant and equipment are measured at cost, which includes capitalised borrowing costs, less accumulated depreciation and accumulated impairment losses, if any. The cost of an item of property, plant and equipment comprises its purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates, any directly attributable cost of bringing the item to its working condition for its intended use and estimated costs of dismantling and removing the item and restoring the site on which it is located. Borrowing costs directly attributable to the acquisition or construction of those qualifying property, plant and equipment, which necessarily take a substantial period of time to get ready for their intended use, are capitalised.

A fixed asset is eliminated from the financial statements on disposal or when no further benefit is expected from its use and disposal. Any gain or loss on disposal of an item of property, plant and equipment is recognised in profit or loss.

Cost of the tangible assets not ready for their intended use at the Balance Sheet date together with all related expenses are shown as Capital Work-in-Progress.

ERP Software costs and Trademark costs are included in the the balance sheet as intangible assets. Intangible assets are valued at cost less accumulated amortisation and accumulated impairment losses..

ii. Subsequent Expenditure

Subsequent expenditure is capitalized only when it is probable that the future economic benefits associated with the expenditure will flow to the Company. Ongoing repairs and maintenance are expensed as incurred.

iii. Depreciation and Amortisation

Depreciation and amortisation for the year is recognised in the Statement of Profit and Loss. Depreciation on fixed assets are provided on straight line method over the useful lives of assets, at the rates and in the manner specified in Part C of Schedule II of the Act. The rates of depreciation as prescribed in Part C of Schedule II of the Act are considered as the minimum rates. Freehold land is not depreciated. Leasehold land (includes development cost) is amortised on a straight line basis over the period of respective lease. Depreciation methods, useful lives and residual values are reviewed at each financial year end and adjusted as appropriate.

d) Inventories

Inventories are valued at lower of cost and net realisable value. Cost of inventories comprise material cost on FIFO basis, labour and manufacturing overheads incurred in bringing the inventories to their present location and condition. The cost of Work-in-Progress and finished goods includes the cost of labour, material and a proportion of manufacturing overheads.

e) Impairment

i. Impairment of Financial Instruments : Financial Assets

Expected credit losses are recognized for all financial assets subsequent to initial recognition other than financials assets in FVTPL category. For financial assets other than trade receivables, as per Ind AS 109, the Company recognises 12 month expected credit losses for all originated or acquired financial assets if at the reporting date the credit risk of the financial asset has not increased significantly since its initial recognition. The expected credit losses are measured as lifetime expected credit losses if the credit risk on financial asset increases significantly since its initial recognition. The Company''s trade receivables do not contain significant financing component and loss allowance on trade receivables is measured at an amount equal to life time expected losses i.e. expected cash shortfall.

The impairment losses and reversals are recognised in Statement of Profit and Loss.

ii. Impairment of Non-Financial Assets

The Company''s non-financial assets are reviewed at each reporting date to determine whether there is any indication of impairment. For impairment testing, assets that do not generate independent cash inflows are grouped together into Cash-Generating Units (CGUs). Each CGU represents the smallest Company of assets that generates cash inflows that are largely independent of the cash inflows of other assets or CGUs. If any such indication exists the recoverable amount of an asset or CGU is estimated to determine the extent of impairment, if any. When it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the CGU to which the asset belongs. An impairment loss is recognised in the Statement of Profit and Loss to the extent, asset''s carrying amount exceeds its recoverable amount. The recoverable amount is higher of an asset''s fair value less cost of disposal and value in use. Value in use is based on the estimated future cash flows, discounted to their present value using pre-tax discount rate that reflects current market assessments of the time value of money and risk specific to the assets. The impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

f) Foreign Currency Transactions

Foreign currency transactions are accounted for at the exchange rates prevailing at the date of the transaction. Gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Profit and Loss except to the extent of exchange differences which are regarded as an adjustment to interest costs on foreign currency borrowings that are directly attributable to the acquisition or construction of qualifying assets, are capitalized as cost of assets. Additionally, exchange gains or losses on foreign currency borrowings taken prior to 1st April, 2016 which are related to the acquisition or construction of qualifying assets are adjusted in the carrying cost of such assets.

g) Government Grants

Government grants are recognized where there is reasonable assurance that the grant will be received and all attached conditions will be complied with. When the grant relates to an expense item, it is recognized as income on a systematic basis over the periods that the related costs, for which it is intended to compensate, are expensed. When the grant relates to an asset, it is recognized as income in equal amounts over the expected useful life of the related asset.

h) Employee Benefits Post-Employment Benefits

(i) Defined Benefit Plans

For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit credit metod, with actuarial valuations being carried out at the end of each annual reporting period. Re-measurement, comprising actuarial gains and losses , of defined benefit plans in respect of post- employment are charged to the Other Comprehensive Income. The Company has an Employee Gratuity Fund managed by the Life Insurance Corporation of India. Liability with regards to long term employee benefits is provided for on the basis of actuarial valuation at the Balance sheet date.

(ii) Defined Contribution Plans

Retirement benefit in the form of contribution to Provident Fund is a defined contribution scheme and is charged to profit & loss account in the year when they become due.

(iii) Short Term Employee Benefits

Short - term compensated absences are provided for on the basis of estimates.

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Mar 31, 2015

1.1 Basis of Preparation of Financial Statements

a) These Financial Statements have been prepared to comply in all material aspects with applicable accounting principles in India, the applicable Accounting Standards prescribed under Section 133 of the Companies Act, 2013 ('Act') read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act (to the extent notified) and other accounting principles generally accepted in India, to the extent applicable.

b) 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 acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current/non-current classification of assets and liabilities.

c) Transactions and balances with values below the rounding off norm adopted by the Company have been reflected as "0.00" in the relevant notes in these Financial Statements.

1.2 Tangible Assets, Intangible Assets and Capital Work-in-Progress

a) Tangible Assets are stated at cost of acquisition less accumulated depreciation and impairment losses, if any.

b) Expenditure which are of Capital in nature are capitalised which comprises of purchase price and all other expenditure directly attributable to bringing the assets to its working condition for the intended use. Assets under erection / installation are shown as Capital Work-in-Progress. Capital Work-in-Progress are net of CENVAT credit availed / available thereon.

c) Intangible Assets are stated at the consideration paid for acquisition of such assets and are carried at cost less accumulated amortisation and impairment losses, if any.

d) Interest on borrowing costs related to qualifying assets is worked out on the basis of actual utilisation of funds out of project specific loans and/or other borrowings to the extent identifiable with the qualifying assets and are capitalised with the cost of qualifying assets. Incidental indirect expenses relating to the project are apportioned amongst the Fixed Assets on the basis of their cost of erection / acquisition on commencement of commercial production.

e) Subsidy received / or crystallisation in respect of fixed assets are deducted from the cost of respective assets.

f) Variations of exchange rate attributable to fixed assets are capitalised.

1.3 Depreciation & Amortisation

a) Depreciation on Fixed Assets is calculated on the Straight Line Method at the rate prescribed under the Schedule II of Companies Act, 2013.

b) Intangible Assets are amortised over their respective individual estimated useful lives on a straight-line basis commencing from the date the assets is available to the Company for its use.

1.4 Inventories

Inventories are valued at lower of Cost and Net Realisable Value. Cost is computed on FIFO basis. Finished goods and Work-in-Progress include cost of conversion and other overheads incurred in bringing the inventories to their present location and condition.

1.5 Investments

Long Term Investment are valued at cost. Provision for diminution in value of these investments is made only if such a decline other than of temporary in nature.

1.6 Excise Duty

Excise duty on finished goods lying at the factory is accounted for at the point of manufacturing of goods and is accordingly considered for valuation of finished goods stock as on the Balance Sheet date.

1.7 Recognition of Income & Expenditures

a) Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

b) Sales are recognised net of trade discounts, rebates, sales tax and excise duties.

c) Export Incentives Income arising out of Export Sales are accounted for on accrual basis.

d) Purchases are inclusive of freight and the net of CENVAT/VAT Credit, Trade Discount and Claims.

e) Gain and losses from the remeasurement and settlement of financial instrument at fair value are reported in the financial result through profit and loss.

f) Interest income is recognised on a time proportion basis taking into account and the amount outstanding and the rate applicable.

g) Income from commission is recognised based on agreements/arrangements with the customers as the service is performed using the proportionate completion method, when no significant uncertainty exists regarding the amount of the consideration that will be derived from rendering the service.

1.8 Subsidy

a) The Company is registered under the West Bengal Incentive Scheme 2000 & 2004 of The Director of Industries, Government of West Bengal. Under the said scheme the Company is entitled to receive Capital Investment Subsidy, Interest Subsidy, Employment Generation Subsidy, Remission of Stamp Duty & Registration Fee. These shall be accounted for in the year of receipt and/or crystallisation.

b) The Company has been granted eligibility certificate under the West Bengal Incentives to Power Intensive Industries Scheme, 2005, promulgated by the Department of Commerce & Industries, Government of West Bengal, vide notification no. 276-CI/G/Incentive/052/05/i dt. 19.05.2005, effective from 1st April, 2004. Under the said scheme, the Company is entitled to receive incentive on energy charges, which has been accounted for in the books on accrual basis.

1.9 Foreign Currency Transaction

Foreign Currency Transactions are accounted for at the exchange rates prevailing at the date of the transaction. Gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Profit and Loss.

1.10 Taxation

a) Current Tax is determined at the amount of tax payable in respect of taxable income for the period, computed with relevant tax rules and tax laws. In case of tax payable as per provisions of MAT under Section 115JB of the Income Tax Act, 1961, Deferred MAT Credit Entitlement is separately recognised as advance.

b) Deferred Tax is recognised, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

1.11 Segment Reporting

The Company has identified Iron & Steel as the sole business segment and the same has been treated as primary business segment. The Company sells mostly within India and does not have operations in economic environments with different risks and returns, it is considered operating in single geographical segment. Hence, no further disclosure as required under the Accounting Standard - 17 " Segment Reporting" as issued by the 'The Institute of Chartered Accountants of India'.

1.12 Retirement Benefits

a) Liability with regards to long-term employee benefits is provided for on the basis of actuarial valuation at the Balance sheet date. Actuarial gain/ loss is recognised immediately in the statement of Profit & Loss Account. The Company has an Employee Gratuity Fund managed by the Life Insurance Corporation of India.

b) Retirement benefit in the form of contribution to Provident Fund is a defined contribution scheme and is charged to Profit & Loss Account in the year when they become due.

c) Short - term compensated absences are provided for on the basis of estimates.

1.13 Preliminary & Public Issue Expenses

As the future economic benefit of Preliminary & Public Issue Expenses is not ascertainable & thus the same is adjusted with the share premium.

1.14 Borrowing Costs

a) Borrowing costs and its related expenses that are directly att ributable to the acquisition, construction or production of a qualifying assets is capitalised as part of the cost of that asset. Other borrowing costs are recognised as an expenses in the period in which they are incurred.

b) Net exchange gain/loss on foreign currency borrowings to the extent considered as an adjustment to interest cost is attributable to the finance cost.

1.15 Impairment of Assets

At each Balance Sheet date the Company assesses whether there is any indication that assets may be impaired. If any such indication exists, the Company estimates the recoverable amount. If the carrying amount of the assets exceeds its recoverable amount, an impairment loss is charged to the statement of Profit & Loss to the extent the carrying amount exceeds the recoverable amount.

1.16 Provision, Contingent Liabilities and Contingent Assets -

Provision 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. Contingent Liabilities are not recognised but are disclosed in the Notes unless the possibility of outflow of resources is remote. Contingent Assets are neither recognised nor disclosed in the Financial Statements.

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Mar 31, 2014

1. Basis of Preparation of Financial Statements

a) These Financial Statements have been prepared in accordance with generally accepted accounting principle in India under the historical cost convention on accrual basis and comply in all material aspects with the accounting standards notifi ed under the Companies Act, 1956 (the "Act") read with the General Circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Aff airs in respect of Section 133 of the Companies Act, 2013.

(b) All the assets and liabilities have been classifi ed as current or non-current as per the Company''s normal operating cycle and other criteria set out in the Schedule VI to the Companies Act, 1956. Based on the nature of services and the time between acquisition of assets/inputs for processing and their realisation in cash and cash equivalents, the Company has ascertained its normal operating cycle as 12 months for the purpose of current/non-current classifi cation of assets and liabilities.

2. Use of Estimates

The preparation of Financial Statements in conformity with Generally Accepted Accounting Principles requires that the management makes estimates and assumptions that aff ect the reported amounts of assets and liabilities, disclosure of contingent liabilities as at the date of the Financial Statements, and the reported amounts of revenue and expenses during the reported year. Actual results could diff er from those estimates.

3. Fixed Assets, Intangible Assets and Capital Work-in-Progress

a) Fixed Assets are stated at cost of acquisition less accumulated depreciation.

b) Expenditure which are of Capital nature are capitalised at a cost which comprises of purchase price and all other expenditure directly attributable to the cost of bringing the assets to its working condition for the intended use. Assets under erection / installation are shown as Capital Work-in-Progress. Capital assets and Capital Work-in- Progress are net of CENVAT credit availed / available thereon.

c) Intangible assets are recorded at the consideration paid for acquisition of such assets and are carried at cost less accumulated amortisation and impairment.

d) Interest on borrowing costs related to qualifying assets is worked out on the basis of actual utilisation of funds out of project specifi c Loans and/or other borrowings to the extent identifi able with the qualifying assets and are capitalised with the cost of qualifying assets. Incidental indirect expenses relating to the project are apportioned amongst the Fixed Assets on the basis of their cost of erection / acquisition on commencement of commercial production.

e) Subsidy received / or crystallisation in respect of Fixed Assets are deducted from the cost of respective assets.

f) Variations of exchange rate attributable to Fixed Assets are capitalised.

4. Depreciation & Amortisation

a) Depreciation on Fixed Assets is calculated on Straight Line Method at the rates and in the manner prescribed in the Schedule XIV of Companies Act, 1956.

b) Intangible assets are amortised over their respective individual estimated useful lives on a straight-line basis commencing from the date the assets is available to the Company for its use.

5. Inventories

All inventories are valued at lower of Cost, computed on FIFO basis, and Net Realisable Value. Finished goods and Work- in-Progress include cost of conversion and other overheads incurred in bringing the inventories to their present location and condition.

6. Excise Duty

Excise duty on fi nished goods lying at the factory is accounted for at the point of manufacturing of goods and is accordingly considered for valuation of fi nished goods stock lying in the factory as on the Balance Sheet date.

7. Recognition of Income & Expenditures

a) Revenue is recognised to the extent that it is probable that the economic benefits will fl ow to the Company and the revenue can be reliably measured.

b) Sales are recognised when the signifi cant risks and rewards of ownership of the goods have passed to the buyer. Sales are inclusive of excise duty but net of trade discounts and VAT. However, excise duty relating to sales is reduced from gross turnover for disclosing net turnover. Domestic sales are recognised at the time of despatch of materials to the buyer. Export sales are recognised on the issue of bill of lading.

c) Export Incentives arising out of Export Sales are accounted for on accrual basis.

d) Purchases are inclusive of freight and the net of CENVAT/VAT Credit, Trade Discount and Claims.

e) Interest income is recognised on a time proportion basis taking into account and the amount outstanding and the rate applicable.

8. Subsidy

a) The Company is registered under the West Bengal Incentive Scheme 2000 & 2004 of The Director of Industries, Government of West Bengal. Under the said scheme the Company is entitled to receive Capital Investment Subsidy, Interest Subsidy, Employment Generation Subsidy, Remission of Stamp Duty & Registration Fee. These shall be accounted for in the year of receipt and/or crystallisation.

b) The Company has been granted eligibility certifi cate under the West Bengal Incentives to Power Intensive Industries Scheme, 2005, promulgated by the Department of Commerce & Industries, Government of West Bengal, vide notifi cation no. 276-CI/O/Incentive/052/05/i dt. 19.05.2005, eff ective from 1st April, 2004. under the said scheme, the Company is entitled to receive incentive on energy charges, which has been accounted for in the books on accrual basis.

9. Sales

Sales are recognised on despatch of goods to customers. It includes Excise Duty & Sales Tax.

10. Foreign Currency Transaction

Transactions denominated in foreign currencies are normally recorded at the exchange rates prevailing on the date of the transaction. Monetary items denominated in foreign currencies at the year end are restated at the year end rates. All exchange diff erences are dealt within Profit & Loss Account.

11. Taxation

a) Current Tax is determined at the amount of tax payable in respect of taxable income for the period, computed with relevant tax rules and tax laws. In case of tax payable as per provisions of MAT under Section 115JB of the Income Tax Act, 1961, Deferred MAT Credit Entitlement is separately recognised as advance.

b) Deferred Tax is recognised, subject to the consideration of prudence, on timing diff erences, being the diff erence between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

12. Segment Reporting

The Company has identifi ed Iron & Steel as the sole business segment and the same has been treated as primary business segment. The Company sells mostly within India and does not have operations in economic environments with diff erent risks and returns, it is considered operating in single geographical segment. Hence, no further disclosure as required under the Accounting Standard-17 "Segment Reporting" as issued by the ''The Institute of Chartered Accountants of India''.

13. Retirement Benefits

a) Liability with regards to long term employee benefits is provided for on the basis of actuarial valuation at the Balance sheet date. Actuarial gain/ oss is recognised immediately in the Statement of Profi t & Loss Account. The Company has an Employee Gratuity Fund managed by the Life Insurance Corporation of India.

b) Retirement benefit in the form of contribution to Provident Fund is a defi ned contribution scheme and is charged to Profit & Loss Account in the year when they become due.

c) Short-term compensated absences are provided for based on estimates.

14. Preliminary & Public Issue Expenses

As the future economic benefit of Preliminary & Public Issue Expenses is not ascertainable & thus the same is adjusted with the Share Premium.

15. Borrowing Costs

a) Borrowing costs and its related expenses that are directly attributable to the acquisition, construction or production of a qualifying asset is capitalised as part of the cost of that asset. Other borrowing costs are recognised as an expenses in the period in which they are incurred.

b) Net exchange gain/loss on foreign currency borrowings to the extent considered as an adjustment to interest cost attributable to the fi nance cost.

16. Impairment of Assets

At each Balance Sheet date the Company assesses whether there is any indication that assets may be impaired. If any such indication exists, the Company estimates the recoverable amount. If the carrying amount of the assets exceeds its recoverable amount, an impairment loss is recognised in the accounts to the extent the carrying amount exceeds the recoverable amount.

17. 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 nor disclosed in the fi nancial statements.

18. Investments

Investments are treated as long term investments and valued at cost less permanent diminution in value of such investments.

Terms/Rights attached to Equity Shares

The Company has only one class of Equity Shares having a par value of Rs. 10/- per share. On a show of hands, every member present in person or by proxy, is entitled to one vote and in case of poll, the voting rights of every member shall be in proportion to his shares of the paid-up equity share capital of the Company.

The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

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

During the year under review the Board of Directors has issued & alloted 267 lacs of Equiy Shares of Rs. 10/- each at a premium of Rs.20/- per share on preferential basis to working capital requirement of the Company, capital expenditure for expansion and modernisation activities and other corporate purposes. The entire proceeds received from the said issue during the year has been fully utilised towards the object of the issue.

A) Nature of Security

i) Term Loan are primary secured by

a) 1st pari-passu charge on fixed assets by way of equitable mortgage of the land & building / shed along with all movable and immovable plant & machinery and other fixed assets thereon at Chhatna Dist. Bankura & extension of second charge on the Company''s current assets on pari passu basis.

b) Collateral Security equitable mortgage on offi ce space at 35, C. R. Avenue, Kolkata on pari passu basis.

c) Personal guarantee of Promoters / Director - Mr. Suresh Kumar Patni, Mr. Rohit Patni, Mr. Ankit Patni & Mrs. Sarita Patni.

d) Corporate guarantee of four group companies - Vasupujaya Enterprises Pvt. Ltd., Poddar Mech Tech Services Pvt. Ltd., Suanvi Trading & Investment Co. Pvt. Ltd., Sarita Steel & Power Ltd. & pledge of 57,44,700 shares of Company in the name of promoters & group associates.

The Company is currently facing cash fl ow shortage, which resulted in defaults in repayment of dues. The Company has approached to the lenders for restructuring of debts under CDR route which is under process.

ii) Loans against Vehicle amounted toRs. 13.93 Lacs are repayable by way of Equated Monthly Installments subsequent to taking of such loan. The original period of such loans is 3 yrs.

iii) Unsecured Loan from Bodies Corporate from Related Parties Rs. NIL & others aggregating to Rs. 1568.57 Lacs. The said Loans are repayable at the option of the Company and are stated by the management to be in the nature of Long Term Borrowings. The average rate of interest is 13.79 %.

Details of Security

Working Capital including SLC are jointly secured by hypothecation of all the Current Assets on 1st Pari Passu Basis & 2nd pari- passu charge by way of extension of charge on the entire Fixed Assets of factory land, building/shed, etc. & along with equitable mortgage on offi ce space at 35, C. R. Avenue, Kolkata on pari passu basis & personal guarantee of Promoters/Directors & Corporate Guarantee of three group Companies - Vasupujaya Enterprises Pvt. Ltd., Poddar Mech Tech Services Pvt. Ltd., Suanvi Trading & Investment Co. Pvt. Ltd., Sarita Steel & Power Ltd. & pledge of 57,44,700 shares of Company in the name of promoters & group associates.

Working Capital Loan from Banks is secured by Personal Guarantee of Promoters/Director - Mr. Suresh Kumar Patni, Mr. Rohit Patni, Mr. Ankit Patni & Mrs. Sarita Patni and subservient charge on all moveable assets including stock and debtor.

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Mar 31, 2013

1. Basis of preparation of Financial Statements

a) The financial statements have been prepared as per Revised Schedule - VI under the Companies Act 1956.

b) The financial statements have been prepared under the historical cost convention, on going concern concept and in accordance with the generally accepted accounting principles & the provisions of the Companies Act 1956The Company follows mercantile system of accounting and is in compliance with the Accounting Standards issued by The Institute of Chartered Accountants of India''.

c) Accounting policies not specifically referred to otherwise are consistent with generally accepted accounting principles in India.

2. Fixed Assets, Intangible Assets and Capital Work-in-Progress

a) Fixed Assets are stated at cost of acquisition less accumulated depreciation.

b) Expenditure which are of Capital nature are capitalised at a cost which comprises of purchase price and all other expenditures directly attributable to the cost of bringing the assets to its working condition for the intended use. Assets under erection / installation are shown as Capital Work-in-Progress. Capital assets and Capital Work-in- Progress are net of CENVAT credit availed / available thereon.

c) Intangible assets are recorded at the consideration paid for acquisition of such assets and are carried at cost less accumulated amortisation and impairment.

d) Interest on borrowing costs related to qualifying assets is worked out on the basis of actual utilisation of funds out of project specific loans and/or other borrowings to the extent identifiable with the qualifying assets and are capitalised with the cost of qualifying assets. Incidental indirect expenses relating to the project are apportioned amongst the Fixed Assets on the basis of their cost of erection / acquisition on commencement of commercial production.

e) Subsidy received / or crystallisation in respect of fixed assets are deducted from the cost of respective assets.

f) Variations of exchange rate attributable to fixed assets are capitalised.

3. Depreciation & Amortisation

a) Depreciation on Fixed Assets is calculated on Straight Line Method at the rates and in the manner prescribed in the Schedule XIV of Companies Act 1956.

b) Intangible Assets are amortised over their respective individual estimated useful lives on a straight-line basis commencing from the date the assets is available to the Company for its use.

c) Leasehold land acquired on perpetual lease is not amortised.

4. Inventories

All inventories are valued at lower of Cost computed on FIFO basis, and Net Realisable Value. Finished Goods and Work-in-Progress include cost of conversion and other overheads incurred in bringing the inventories to their present location and condition.

5. Excise Duty

Excise duty on finished goods lying at the factory is accounted for at the point of manufacturing of goods and is accordingly considered for valuation of finished goods stock lying in the factory as on the Balance Sheet date.

6. Recognition of Income & Expenditures

a) Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

b) Sales are recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. Sales are inclusive of excise duty but net of trade discounts and VAT. However, excise duty relating to sales is reduced from gross turnover for disclosing net turnover. Domestic sales are recognised at the time of despatch of materials to the buyer. Export sales are recognised on the issue of bill of lading.

c) Export Incentives arising out of Export Sales are accounted for on accrual basis.

d) Purchases are inclusive of freight and the net of CENVAT/VAT Credit, Trade Discount and Claims.

e) Interest income is recognised on a time proportion basis taking into account and the amount outstanding and the rate applicable.

7. Subsidy

a) The Company is registered under the West Bengal Incentive Scheme 2000 & 2004 of The Director of Industries, Government of West Bengal. Under the said scheme the Company is entitled to receive Capital Investment Subsidy, Interest Subsidy, Employment Generation Subsidy, Remission of Stamp Duty & Registration Fee. These shall be accounted for in the year of receipt and/or crystallisation.

b) The Company has been granted eligibility certificate under the West Bengal Incentives to Power Intensive Industries Scheme, 2005, promulgated by the Department of Commerce & Industries, Government of West Bengal, vide notification no. 276-CI/O/lncentiveA)52/05/i dt. 19.05.2005, effective from 1st April 2004. Under the said scheme, the Company is entitled to receive incentive on energy charges, which has been accounted for in the books on accrual basis.

8. Foreign Currency Transaction

Transactions denominated in foreign currencies are normally recorded at the exchange rates prevailing on the date of the transaction. Monetary items denominated in foreign currencies at the year end are restated at the year end rates. All exchange differences are dealt in the Statement of Profit & Loss.

9. Taxation

a) Current Tax is determined at the amount of tax payable in respect of taxable income for the period, computed with relevant tax rules and tax laws. In case of tax payable as per provisions of MAT under Section 115JB of the Income Tax Act, 1961, Deferred MAT Credit Entitlement is separately recognised as advance.

b) Deferred Tax is recognised, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

10. Segment Reporting

The Company has identified Iron & Steel as the sole business segment and the same has been treated as primary business segment. The Company sells mostly within India and does not have operations in economic environments with different risks and returns, it is considered operating in single geographical segment. Hence, no further disclosure as required under the Accounting Standard - 17 "Segment Reporting" as issued by the ''The Institute of Chartered Accountants of India''.

11. Retirement Benefits

a) Liability with regards to long term employee benefits is provided for on the basis of actuarial valuation at the Balance Sheet date. Actuarial gain/ loss is recognised immediately in the Statement of Profit and Loss Account. The Company has an Employee Gratuity Fund managed by the Life Insurance Corporation of India.

b) Retirement benefit in the form of contribution to Provident Fund is a defined contribution scheme and is charged to Profit & Loss Account in the year when they become due.

c) Short-term compensated absences are provided for based on estimates.

12. Preliminary & Public Issue Expenses

As the future economic benefit of Preliminary & Public Issue Expenses is not ascertainable & thus the same is adjusted with the share premium.

13. Borrowing Costs

a) Borrowing costs and its related expenses that are directly attributable to the acquisition, construction or production of a qualifying assets is capitalised as part of the cost of that asset. Other borrowing costs are recognised as an expenses in the period in which they are incurred.

b) Net exchange gain/loss on foreign currency borrowings to the extent considered as an adjustment to interest cost attributable to the finance cost.

14. Impairment of Assets

At each Balance Sheet date the Company assesses whether there is any indication that assets may be impaired. If any such indication exists, the Company estimates the recoverable amount. If the carrying amount of the assets exceeds its recoverable amount, an impairment loss is recognised in the accounts to the extent the carrying amount exceeds the recoverable amount.

15. Provision, Contingent Liabilities and Contingent Assets

Provision 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. Contingent Liabilities are not recognised but are disclosed in the Notes. Contingent Assets are neither recognised nor disclosed in the financial statements.

16. Investments

Investments are treated as long term investments and valued at cost less permanent diminution in value of such investments.

---

Mar 31, 2012

1. Basis of preparation of financial statements :

a) The financial statements have been prepared as per Revised Schedule - VI under the Companies Act, 1956.

b) The financial statements have been prepared under the historical cost convention, on going concern concept and in accordance with the generally accepted accounting principles & the provisions of the Companies Act, 1956. The Company follows mercantile system of accounting and is in compliance with the Accounting Standards issued by 'The Institute of Chartered Accountants of India1.

c) Accounting policies not specifically referred to otherwise are consistent with generally accepted accounting principles in India.

2. Fixed Assets, Intangible Assets and Capital Work-in-Progress :

a) Fixed Assets are stated at cost of acquisition less accumulated depreciation.

b) Expenditure which are of Capital nature are capitalised at a cost which comprises of purchase price and all other expenditure directly attributable to the cost of bringing the assets to its working condition for the intended use. Assets under erection/ installation are shown as Capital Work-in-Progress. Capital Assets and Capital Work-in-Progress are net of CENVAT credit availed/available thereon.

c) Intangible Assets are recorded at the consideration paid for acquisition of such assets and are carried at cost less accumulated amortisation and impairment.

d) Interest on borrowing costs related to qualifying assets is worked out on the basis of actual utilisation of funds out of project specific loans and/or other borrowings to the extent identifiable with the qualifying assets and are capitalised with the cost of qualifying assets. Incidental indirect expenses relating to the project are apportioned amongst the Fixed Assets on the basis of their cost of erection/acquisition on commencement of commercial production.

e) Subsidy received/or crystallisation in respect of Fixed Assets are deducted from the cost of respective assets.

f) Variations of exchange rate attributable to Fixed Assets are capitalised.

3. Depreciation & Amortisation :

a) Depreciation on Fixed Assets is calculated on Straight Line Method at the rates and in the manner prescribed in the Schedule XIV of Companies Act,1956.

b) Intangible Assets are amortised over their respective individual estimated useful lives on a straight-line basis commencing from the date the assets is available to the Company for its use.

4. Inventories :

All inventories are valued at lower of Cost, computed on FIFO basis, and Net Realisable Value. Finished goods and Work-in-Progress include cost of conversion and other overheads incurred in bringing the inventories to their present location and condition.

5. Excise Duty :

Excise duty on finished goods lying at the factory is accounted for at the point of manufacturing of goods and is accordingly considered for valuation of finished goods stock lying in the factory as on the Balance Sheet date.

6. Recognition of Income & Expenditures:

Revenue/Income and Cost/Expenditures are generally accounted for on accrual basis as they are earned or incurred. Insurance & other claims to the extent considered recoverable, are accounted for in the year of claims. However claims and refunds whose recovery cannot be ascertained with reasonable certainty, are accounted for on acceptance basis.

7. Subsidy :

a) The Company is registered under the West Bengal Incentive Scheme 2000 & 2004 of The Director of Industries, Government of West Bengal. Under the said scheme the Company is entitled to receive Capital Investment Subsidy, Interest Subsidy, Employment Generation Subsidy, Remission of Stamp Duty & Registration Fee. These shall be accounted for in the year of receipt and/or crystallisation.

b) The Company has been granted eligibility certificate under the West Bengal Incentives to Power Intensive Industries Scheme, 2005, promulgated by the Department of Commerce & Industries, Government of West Bengal, vide notification no. 276-CI/O/Incentive/052/05/i dt. 19.05.2005, effective from 1st April, 2004. Under the said scheme, the Company is entitled to receive incentive on energy charges, which has been accounted for in the books on accrual basis.

8. Sales :

Sales are recognised on despatch of goods to customers. It includes Excise Duty & Sales Tax.

9. Foreign Currency Transaction :

Transactions denominated in foreign currencies are normally recorded at the exchange rates prevailing on the date of the transaction. Monetary items denominated in foreign currencies at the year end are restated at the year end rates. All exchange differences are dealt within Profit & Loss Account.

10. Taxation :

a) Current Tax is determined at the amount of tax payable in respect of taxable income for the period, computed with relevant tax rules and tax laws. In case of tax payable as per provisions of MAT under Section 115JB of the Income Tax Act, 1961, Deferred MAT Credit Entitlement is separately recognised as advance.

b) Deferred Tax is recognised, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

11. Segment Reporting :

The Company has identified Iron & Steel as the sole business segment and the same has been treated as primary business segment. The Company sells mostly within India and does not have operations in economic environments with different risks and returns, it is considered operating in single geographical segment. Hence, no further disclosure as required under the Accounting Standard-17 "Segment Reporting"as issued by the'The Institute of Chartered Accountants of India1.

12. Retirement Benefits:

a) Liability with regards to long-term employee benefits is provided for on the basis of actuarial valuation at the Balance Sheet date. Actuarial gain/loss is recognised immediately in the Statement of Profit and Loss Account. The Company has an Employee Gratuity Fund managed by the Life Insurance Corporation of India.

b) Retirement benefit in the form of contribution to Provident Fund is a defined contribution scheme and is charged to Profit & Loss Account in the year when they become due.

c) Short-term compensated absences are provided for based on estimates.

13. Preliminary & Public Issue Expenses :

As the future economic benefit of Preliminary & Public Issue Expenses is not ascertainable & thus the same is adjusted with the share premium.

14. Borrowing Costs :

a) Borrowing costs and its related expenses that are directly attributable to the acquisition, construction or production of qualifying assets is capitalised as part of the cost of that asset. Other borrowing costs are recognised as expenses in the period in which they are incurred.

b) Net exchange gain/loss on foreign currency borrowings to the extent considered as an adjustment to interest cost attributabe to the finance cost.

15. Impairment of Assets:

At each Balance Sheet date the Company assesses whether there is any indication that assets may be impaired. If any such indication exists, the Company estimates the recoverable amount. If the carrying amount of the assets exceeds its recoverable amount, an impairment loss is recognised in the accounts to the extent the carrying amount exceeds the recoverable amount.

16. Provision, Contingent Liabilities and Contingent Assets:

Provision 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. Contingent Liabilities are not recognised but are disclosed in the Notes. Contingent Assets are neither recognised nor disclosed in the financial statements.

17. Investments:

Investments are treated as long-term investments and valued at cost less permanent diminution in value of such investments.

---

Mar 31, 2011

1. Basis of preparation of financial statements

a) The financial statements have been prepared under the historical cost convention, on going concern concept and in accordance with the generally accepted accounting principles & the provisions of the Companies Act, 1956. The Company follows mercantile system of accounting and is in compliance with the Accounting Standards issued by The Institute of Chartered Accountants of India'.

b) Accounting polices not specifically referred to otherwise are consistent with generally accepted accounting principles in India.

2. Fixed Assets

a) Fixed Assets are stated at cost of acquisition less accumulated deprecation.

b) Expenditure which are of Capital nature are capitalised at a cost which comprises of purchase price and all other expenditure directly attributable to the cost of bringing the assets to its working condition for the intended use. Assets under erection/installation are shown as Capital work-in-progress. Capital assets and Capital work-in-progress are net of CENVAT credit availed/available thereon.

c) Interest on borrowing costs related to qualifying assets is worked out on the basis of actual utilisation of funds out of project specific loans and/or other borrowings to the extent identifiable with the qualifying assets and are capitalized with the cost of qualifying assets. Incidental indirect expenses relating to the project are apportioned amongst the Fixed Assets on the basis of their cost of erection/acquisition on commencement of commercial production.

d) Subsidy received/or crystallisation in respect of fixed assets are deducted from the cost of respective assets.

3. Depreciation

Deprecation on Fixed Assets is calculated on straight line method at the rates and in the manner prescribed in the Schedule XIV of the Companies Act, 1956.

4. Inventories

All inventories are valued at lower of cost, computed on FIFO basis and Net Realisable Value. Finished goods and work- in-progress include cost of conversion and other overheads incurred in bringing the inventories to their present location and condition.

5. Excise Duty

Excise duty on finished goods lying at the factory is accounted for at the point of manufacturing of goods and is accordingly considered for valuation of finished goods stock lying in the factory as on the Balance Sheet date.

6. Recognition of Income & Expenditures

Revenue/Income and Cost/Expenditures are generally accounted for on accrual basis as they are earned or incurred. Insurance & other claims to the extent considered recoverable, are accounted for in the year of claims. However claims and refunds whose recovery cannot be ascertained with reasonable certainty, are accounted for on acceptance basis.

7. Subsidy

a) The Company is registered under the West Bengal Incentive Scheme 2000 & 2004 of The Director of Industries, Government of West Bengal. Under the said scheme the Company is entitled to receive Capital Investment Subsidy, Interest Subsidy, Employment Generation Subsidy, Remission of Stamp Duty & Registration Fee. These shall be accounted for in the year of receipt and/or crystallisation.

b) The Company has been granted eligibility certificate under the West Bengal Incentives to Power Intensive Industries Scheme, 2005, promulgated by the Department of Commerce & Industries, Government of West Bengal, vide notification no. 276- CI/O/lncentive/052/05/i dt. 19th May, 2005, effective from 1st April, 2004. Under the said scheme, the Company is entitled to receive incentive on energy charges, which has been accounted for in the books on accrual basis.

8. Sales

Sales are recognised on despatch of goods to customers. It includes Excise Duty & Sales tax.

9. Foreign Currency Transaction

Transactions denominated in foreign currencies are normally recorded at the exchange rates prevailing on the date of the transaction. Monetary items denominated in foreign currencies at the year end are restated at the year end rates. All exchange differences are dealt within Profit & Loss Account.

10. Taxation

a) Current Tax is determined at the amount of tax payable in respect of taxable income for the period, computed with relevant tax rules and tax laws. In case of tax payable as per provisions of MAT under Section 115JB of the Income Tax Act, 1961, Deferred MAT Credit Entitlement is separately recognised as advance.

b) Deferred Tax is recognised, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

11. Segment Reporting

The Company has identified Iron & Steel as the sole business segment and the same has been treated as primary business segment. The Company sells mostly within India and does not have operations in economic environments with different risks and returns, it is considered operating in single geographical segment. Hence, no further disclosure as required under the Accounting Standard-17 "Segment Reporting" as issued by the The Institute of Chartered Accountants of India'.

12. Retirement Benefits

a) Liability with regards to long term employee benefits is provided for on the basis of actuarial valuation at the Balance Sheet date. Actuarial gain/loss is recognised immediately in the statement of Profit and Loss Account. The Company has an Employee Gratuity Fund managed by the Life Insurance Corporation of India.

b) Retirement benefit in the form of contribution to Provident Fund is a defined contribution scheme and is charged to Profit & Loss Account in the year when they become due.

c) Short-term compensated absences are provided for based on estimates.

13. Preliminary & Public Issue Expenses

As the future economic benefit of Preliminary & Public Issue Expenses is not ascertainable & thus the same is adjusted with the share premium.

14. Borrowing Costs

Borrowing costs and its related expenses that are directly attributable to the acquisition, construction or production of a qualifying assets is capitalised as part of the cost of that asset. Other borrowing costs are recognised as an expenses in the period in which they are incurred.

15. Impairment of Assets

At each Balance Sheet date the Company assesses whether there is any indication that assets may be impaired. If any such indication exists, the Company estimates the recoverable amount. If the carrying amount of the assets exceeds its recoverable amount, an impairment loss is recognised in the accounts to the extent the carrying amount exceeds the recoverable amount.

16. Provision, Contingent Liabilities and Contingent Assets

Provision 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. Contingent Liabilities are not recognised but are disclosed in the Notes. Contingent Assets are neither recognised nor disclosed in the financial statements.

17. Investments

Investments are treated as long term investments and valued at cost.

---

Mar 31, 2010

1. Basis of preparation of financial statements

a) The financial statements have been prepared under the historical cost convention, on Going Concern Concept and in accordance with the Generally Accepted Accounting Principles & the provisions of the Companies Act, 1956. The Company follows Mercantile System of accounting and is in compliance with the Accounting Standards issued by The Institute of Chartered Accountants of India.

b) Accounting policies not specifically referred to otherwise are consistent with Generally Accepted Accounting Principles in India.

2. Fixed Assets

a) Fixed Assets are stated at cost of acquisition less accumulated depreciation.

b) Expenditure which are of Capital nature are capitalized at a cost which comprises of purchase price and all other expenditure directly attributable to the cost of bringing the assets to its working condition for the intended use. Assets under erection/installation are shown as Capital Work-in-Progress. Capital Assets and Capital Work-in-Progress are net of CENVAT Credit availed/available thereon.

c) Interest on borrowing costs related to Qualifying assets is worked out on the basis of actual utilisation of funds out of project specific loans and/or other borrowings to the extent identifiable with the qualifying assets and are capitalized with the cost of Qualifying assets. Incidental indirect expenses relating to the project are apportioned amongst the Fixed Assets on the basis of their cost of erection/acquisition on commencement of commercial production.

d) Subsidy received/or crystallization in respect of fixed assets are deducted from the cost of respective assets.

3. Depreciation

Depreciation on Fixed Assests is calculated on Straight Line Method at the rates and in the manner prescribed in the Schedule XIV of Companies Act,1956.

4. Inventories

All inventories are valued at lower of Cost, computed on FIFO basis and Net Realisable Value. Finished Goods and Work-in-Progress include cost of conversion and other overheads incurred in bringing the inventories to their present location and condition.

5. Excise Duty

Excise duty on finished goods lying at the factory is accounted for at the point of manufacturing of goods and is accordingly considered for valuation of finished goods stock lying in the factory as on the Balance Sheet date.

6. Recognition of Income & Expenditures

Revenue/Income and Cost/Expenditures are generally accounted for on accrual basis as they are earned or incurred. Insurance & other claims to the extent considered recoverable, are accounted for in the year of claims. However, claims and refunds whose recovery cannot be ascertained with reasonable certainty, are accounted for on acceptance basis.

7. Subsidy

a) The Company is registered under the West Bengal Incentive Scheme 2000 & 2004 of The Director of Industries, Government of West Bengal. Under the said scheme, the Company is entitled to receive Capital Investment Subsidy, Interest Subsidy, Employment Generation Subsidy, Remission of Stamp Duty & Registration Fee. These shall be accounted for in the year of receipt and/or crystalisation.

b) The Company has been granted eligibility certificate under the West Bengal Incentives to Power Intensive Industries Scheme, 2005, promulgated by the Department of Commerce & Industries, Government of West Bengal, vide notification no. 276- CI/O/lncentive/052/05/i dt. 19.05.2005, effective from 1st April, 2004. Under the said scheme, the Company is entitled to receive incentive on energy charges, which has been accounted for in the books on accrual basis.

8. Sales

Sales are recognised on despatch of goods to customers. It includes Excise Duty & Sales Tax.

9. Foreign Currency Transaction

Transactions denominated in foreign currencies are normally recorded at the exchange rates prevailing on the date of the transaction. Monetary items denominated in foreign currencies at the year end are restated at the year end rates. All exchange differences are dealt within Profits Loss Account.

10. Taxation

a) Current Tax is determined at the amount of tax payable in respect of taxable income for the period, computed with relevant tax rules and tax laws. In case of tax payable as per provisions of MAT under Section 115JB of the Income Tax Act, 1961 Deferred MAT Credit Entitlement is separately recognised as advance.

b) Deferred Tax is recognised, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

11. Segment Reporting

The Company has identified Iron & Steel as the sole business segment and the same has been treated as primary business segment. The Company sells mostly within India and does not have operations in economic environments with different risks and returns, it is considered operating in single geographical segment. Hence, no further disclosure as required under the Accounting Standard -17" Segment Reporting" as issued by the The Institute of Chartered Accountants of India.

12. Retirement Benefits

a) Liability with regards to long term employee benefits is provided for on the basis of actuarial valuation at the Balance Sheet date. Actuarial gain/loss is recognised immediately in the statement of Profit & Loss Account. The Company has an Employee Gratuity Fund managed by the Life Insurance Corporation of India.

b) Retirement Benefit in the form of contribution to Provident Fund is a defined contribution scheme and is charged to Profit & Loss Account in the year when they become due.

c) Short-term compensated absences are provided for based on estimates.

13. Preliminary & Public Issue Expenses

As the future economic benefit of Preliminary & Public Issue Expenses is not ascertainable & thus the same is adjusted with the Share Premium.

14. Borrowing Costs

Borrowing Costs and its related expenses that are directly attributable to the acquisition, construction or production of a Qualifying assets is capitalised as part of the cost of that asset. Other borrowing costs are recognised as an expenses in the period in which they are incurred.

15. Impairment of Assets

At each Balance Sheet date the Company assesses whether there is any indication that assets may be impaired. If any such indication exists, the Company estimates the recoverable amount. If the carrying amount of the assets exceeds its recoverable amount, an impairment loss is recognised in the accounts to the extent the carrying amount exceeds the recoverable amount.

16. 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 nor disclosed in the financial statements.

17. Investments

Investments are treated as long term investments and valued at cost. B. NOTES ON ACCOUNTS

1. Contingent Liabilities not provided for in the books of Accounts:

a) In respect of Bills Discounted, outstanding as on 31.03.2010 amounting to Rs. 1259.02 Lacs (Previous year - Rs. 1951.46 Lacs).

b) In respect of Letter of Credit amounting to Rs. 508.92 Lacs (Previous year - Rs. 2254.26 Lacs) & Bank Guarantee amounting to Rs. 254.55 Lacs (Previous year - Rs. 275.55 Lacs).

c) Commitments against Capital Expenditure not provided in the accounts (Net of Advances) Rs. 1238.35 Lacs (Previous year - Rs. 180.00 Lacs).

d) Relating to assessment year 2006-07 & 2007-08, a demand of Rs. 21.11 Lacs & Rs. 3.54 Lacs was raised by the D. C. I. T. Circle -3, Kolkata against which the Company has filed an appeal. An amount of Rs. 11.11 Lacs was paid under protest relating to year 2006-07.

e) Relating to assessment year 2005-06 & 2006 -07, a demand of Rs. 318.99 Lacs & Rs. 1003.34 Lacs was raised by the department against which appeal has been filed by the Company.

f) Excise Duty Liability arising out of search operation by the Directorate General of Central Excise Intelligence. However, the Company has paid under protest a sum of Rs. 1.20 Crore pending issuance of any show cause notice.