Accounting Policies of Envair Electrodyne Ltd. Company

Mar 31, 2024

2 Material Accounting Policies

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

2.1 Basis Of Preparation Of Financial Statement

i) Compliance with Ind AS

These financial statements Complies in all material aspects with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended and notified under Section 133 of the Companies Act, 2013 (the "Act") and other relevant provisions of the Act and other accounting principles generally accepted in India.

The financial statements were authorized for issue by the Company''s Board of Directors on 27th May, 2024

ii) Historical cost convention

The Company follows the mercantile system of accounting and recognizes income and expenditure on an accrual basis. The financial statements are prepared under the historical cost convention, except in case of significant uncertainties and except for the following:

(a) Certain financial assets and liabilities (Including Derivative Instruments) that are measured at fair value;

(b) Defined benefit plans where plan assets are measured at fair value.

(c) Investments are measured at fair value.

iii) Current and Non Current Classification.

All assets and liabilities have been classified as current or non-current as per the Company''s 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 equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current — non-current classification of assets and liabilities.

2.2 Use of estimates and judgements

The preparation of financial statements requires management to make judgments, estimates and assumptions in the application of accounting policies that affect the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Continuous evaluation is done on the estimation and judgments based on historical experience and other factors, including expectations of future events that are believed to be reasonable. Revisions to accounting estimates are recognised prospectively.

2.3 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

(i) Classification

The Company classifies its financial assets in the following measurement categories:

(a) at fair value (either through other comprehensive income, or through profit or loss); and

(b) at amortised cost.

The classification depends on the entity’s business model for managing the financial assets and the contractual terms of the cash flows.

(a) For assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive income.

(b) For investments in debt instruments, this will depend on the business model in which the investment is held.

(c) For investments in equity instruments, this will depend on whether the Company has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through other comprehensive income.

The Company reclassifies debt investments when and only when its business model for managing those assets changes.

(ii) Measurement

At initial recognition, the Company measures a financial asset at its fair value plus, in the case of a financial asset not measured at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.

(a) Debt instruments

Subsequent measurement of debt instruments depends on the Company’s business model for managing the asset and the cash flow characteristics of the asset. There are three measurement categories into which the Company classifies its debt instruments:

Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. A gain or loss on a debt investment that is subsequently measured at amortised cost and is not part of a hedging relationship is recognised in profit or loss when the asset is derecognised or impaired. Interest income from these financial assets is included in other income using the effective interest rate method.

Fair value through other comprehensive income (FVOCI): Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets’ cash flows represent solely payments of principal and interest, are measured at fair value through other comprehensive income (FVOCI). Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest income and foreign exchange gains and losses which are recognised in profit and loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss and recognised in other income or other expenses (as applicable). Interest income from these financial assets is included in other income using the effective interest rate method.

Fair value through profit or loss (FVTPL): Assets that do not meet the criteria for amortised cost or FVOCI are measured at fair value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss and is not part of a hedging relationship is recognised in profit or loss and presented net in the statement of profit and loss within other income or other expenses (as applicable) in the period in which it arises. Interest income from these financial assets is included in other income or other expenses, as applicable.

(b) Equity instruments

The Company subsequently measures all equity investments at fair value. Where the Company’s management has selected to present fair value gains and losses on equity investments in other comprehensive income and there is no subsequent reclassification of fair value gains and losses to profit or loss. Dividends from such investments are recognised in profit or loss as other income when the Company’s right to receive payments is established.

Changes in the fair value of financial assets at fair value through profit or loss are recognised in other income or other expenses, as applicable in the statement of profit and loss. Impairment losses (and reversal of impairment losses) on equity investments measured at FVOCI are not reported separately from other changes in fair value.

(iii) Impairment of financial assets

The Company assesses on a forward looking basis the expected credit losses (ECL) associated with its assets carried at amortised cost and FVOCI debt instruments. The impairment methodology applied depends on whether there has been a significant increase in credit risk.

For trade receivables only, the Company applies the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime credit losses (ECL) to be recognised from initial recognition of the receivables. The Company uses historical default rates to determine impairment loss on the portfolio of trade receivables. At every reporting date these historical default rates are reviewed and changes in the forward looking estimates are analysed.

The Company uses 12 month ECL to provide for impairment loss where there is no significant increase in credit risk. If there is significant increase in credit risk full lifetime ECL is used.

(iv) Derecognition of financial assets

A financial asset is derecognised only when -

(a) The Company has transferred the rights to receive cash flows from the financial asset or

(b) 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 Company 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 Company 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 Company 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.

(II) Financial Liabilities

(i) Measurement

Financial liabilities are initially recognised at fair value, reduced by transaction costs (in case of financial liability not at fair value through profit or loss), that are directly attributable to the issue of financial liability. After initial recognition, financial liabilities are measured at amortised cost using effective interest method. The effective interest rate is the rate that exactly discounts estimated future cash outflow (including all fees paid, transaction cost, and other premiums or discounts) through the expected life of the financial liability, or, where appropriate, a shorter period, to the net carrying amount on initial recognition. At the time of initial recognition, there is no financial liability irrevocably designated as measured at fair value through profit or loss.

(ii) Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the de-recognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or loss.

2.4 Financial guarantee contracts

Financial guarantee contracts are recognised as a financial liability at the time the guarantee is issued. The liability is initially measured at fair value and subsequently at the higher of the amount determined in accordance with Ind AS 37 Provisions, Contingent Liabilities and Contingent Assets and the amount initially recognised less cumulative amortization, where appropriate.

2.5 Inventories Valuation

Inventories are valued at lower of Cost and Net Realisable Value. Cost of traded goods is arrived at on FIFO basis.

There were no inventories during the year.

2.6 Cash and cash equivalents

Cash and cash equivalents includes cash in hand, deposits with banks, other short term highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes outstanding bank overdraft shown within current liabilities in statement of financial balance sheet and which are considered as integral part of company’s cash management policy.

2.7 Income tax and deferred tax

The Income tax expense or credit for the year is the tax payable on the current year’s taxable income based on the applicable income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses. Current and deferred tax is recognised in the profit and loss except to the extent it relates to items recognised directly in equity or other comprehensive income, in which case it is recognised in equity or other comprehensive income respectively.

(i) Current income tax

Current tax charge is based on taxable profit for the year. The tax rates and tax laws used to compute the amount are those that are enacted orsubstantively enacted, at the reporting date where the Company operates and generates taxable income. 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. Current tax assets and tax liabilities are offset when there is a legally enforceable right to set offcurrent tax assets against current tax liabilities and Company intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

(ii) Deferred tax

Deferred tax is provided using the liability method on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements at the reporting date. Deferred tax assets are recognised to the extent that it is probable that future taxable income will be available against which the deductible temporary differences, unused tax losses, depreciation carry-forwards and unused tax credits could be utilised.

Deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting profit nor taxable profit (tax loss).

Deferred tax assets and liabilities are measured based on the tax rates that are expected to apply in the period when the asset is realised or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

The carrying amount of deferred tax assets is reviewed at each reporting date and adjusted to reflect changes in probability that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred income tax assets and liabilities are off-set against each other and the resultant net amount is presented in the Balance Sheet, if and only when, (a) the Company has a legally enforceable right to set-off the current income tax assets and liabilities, and (b) the deferred income tax assets and liabilities relate to income tax levied by the same taxation authority.

Defered Tax: In the absence of virtual certainity of future taxable profits against which the net deferred tax assets can be realised, the Company has considered it prudent not to recognise the deferred tax asset in the books of account.

2.8 Property, plant and equipment

(i) All property, plant and equipment are stated at cost less accumulated depreciation. Cost includes expenditure that is directly attributable tothe acquisition of the items.

(ii) Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable thatfuture economic benefits associated with the item will flow to the company and the cost of the item can be measured reliably. The carryingamount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged toprofit or loss during the reporting period in which they are incurred.

(iii) Cost of Capital Work in Progress (‘CWIP’) comprises amount paid towards acquisition of property, plant and equipment outstanding as of eachbalance sheet date and construction expenditures, other expenditures necessary for the purpose of preparing the CWIP for it intended use andborrowing cost incurred before the qualifying asset is ready for intended use. CWIP is not depreciated until such time as the relevant asset iscompleted and ready for its intended use.

(iv) Depreciation methods, estimated useful lives and residual value.

(a) Property, plant and equipment are stated at cost less accumulated depreciation.

(b) Depreciation is provided on a pro rata basis on the writen down method over the estimated useful lives of the assets which is as prescribedunder Schedule II to the Companies Act, 2013. The depreciation charge for each period is recognised in the Statement of Profit and Loss, unless itis included in the carrying amount of any other asset. The useful life, residual value and the depreciation method are reviewed atleast at eachfinancial year end. If the expectations differ from previous estimates, the changes are accounted for prospectively as a change in accounting estimate.

(v) Property, plant and equipment which are not ready for their intended use on reporting date are carried as capital work-in-progress

(vi) The residual values are not more than 5% of the original cost of the asset.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

Estimated useful lives, residual values and depreciation methods are reviewed annually, taking into account commercial and technologicalobsolescence as well as normal wear and tear and adjusted prospectively, if appropriate.Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss within otherexpenses or other income as applicable

2.9 Intangible assets

(i) An intangible asset shall be recognised if, and only if: (a) it is probable that the expected future economic benefits that are attributable to theasset will flow to the Company and (b) the cost of the asset can be measured reliably(ii) Computer software is capitalised where it is expected to provide future enduring economic benefits. Capitalisation costs include licence feesand costs of implementation / system integration services. The costs are capitalised in the year in which the relevant software is implemented foruse. The same is amortised over a period of 3 years on straight-line method.

2.10 Leases

The Company evaluates if an arrangement qualifies to be a lease as per the requirements of Ind AS 116. Identification of a lease requires significant judgment. The Company uses significant judgement in assessing the lease term (including anticipated renewals) and the applicable discount rate. The Company determines the lease term as the non-cancellable period of a lease, together with both periods covered by an option to extend the lease if the company is reasonably certain to exercise that option; and periods covered by an option to terminate the lease if the Company is reasonably certain not to exercise that option. In assessing whether the Company is reasonably certain to exercise an option to extend a lease, or not to exercise an option to terminate a lease, it considers all relevant facts and circumstances that create an economic incentive for the Company to exercise the option to extend the lease, or not to exercise the option to terminate the lease. The Company revises the lease term if there is a change in the non-cancellable period of a lease. The discount rate is generally based on the incremental borrowing rate specific to the lease being evaluated or for a portfolio of leases with similar characteristics.

2.11 Revenue Recognition

a) Domestic Sales are accounted for when dispatched from the point of sale, consequent to property in goods being transferred.

b) Export Sales are accounted on the basis on the dates of Bill of Lading/ Other delivering documents as per terms of contract.

(I) Sales

(i) The Company recognizes revenue from sale of goods when:

(a) The significant risks and rewards of ownership in the goods are transferred to the buyer as per the terms of the contract, which coincides withthe delivery of goods.

(b) The Company retains neither continuing managerial involvement to the degree usually associated with the ownership nor effective controlover the goods sold.

(c) The amount of revenue can be reliably measured.

(d) It is probable that future economic benefits associated with the transaction will flow to the Company.

(e) The cost incurred or to be incurred in respect of the transaction can be measured reliably.

(f) The company bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specificsof each arrangement.

(II) Other Income

(i) Interest Income

Interest income from debt instruments is recognised using the effective interest rate method. The effective interest rate is the rate that exactlydiscounts estimated future cash receipts through the expected life of the financial asset to the gross carrying amount of a financial asset. Whencalculating the effective interest rate, the group estimates the expected cash flows by considering all the contractual terms of the financialinstrument (for example, prepayment, extension, call and similar options) but does not consider the expected credit losses.

(ii) Dividend Income

Dividends are recognised in profit or loss only when the right to receive payment is established, it is probable that the economic benefits associated with the dividend will flow to the group, and the amount of the dividend can be measured reliably.

(ii) Income from Indenting Services:

(a) The amount of revenue can be measured reliably.

(b) It is probable that future economic benefits associated with the transaction will flow to the Company.

(c) The stage of completion of the transaction at the end of the reporting period can be measured reliably.

(d) The cost incurred for transaction and the cost to complete the transaction can be measured reliably.

2.12 Employee Benefit

(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) Other long-term employee benefit obligations

There is no long term employee Benefit Obligation as the company had only 1 employee during the Previous Year and the same employee has been charged for committing fraud.

The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to defer settlement for at least twelve months after the reporting period, regardless of when the actual settlement is expected to occur.

(iii) Defined Contribution plan:

Contribution payable to recognised provident fund and superannuation scheme which is defined contribution scheme is charged to Statement of Profit & Loss. The company has not paid the contribution towards provident fund, as the former employee has committed fraud against the company. Company has only one employee during the year.

(iv) The Company has one employee in the payroll of the company. Employee has committed fraud during the year against the company.

2.13 Foreign currency translation

(i) Functional and presentation currency

Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the Company operates (‘the functional currency⁵). The financial statements are presented in Indian rupee (INR), which is Company’s functional and presentation currency.

(ii) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognised in profit or loss. All the foreign exchange gains and losses are presented in the statement of Profit and Loss on a net basis within other expenses or other income as applicable.

2.14 Borrowing Cost

(i) Borrowings are initially recognised at fair value, 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 tothe 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. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates.

(ii) Borrowings are classified as current financial liabilities unless the group has an unconditional right to defer settlement of the liability for atleast 12 months after the reporting period. Where there is a breach of a material provision of a long-term loan arrangement on or before the endof the reporting period with the effect that the liability becomes payable on demand on the reporting date, the entity does not classify theliability as current, if the lender agreed, after the reporting period and before the approval of the financial statements for issue, not to demand payment as a consequence of the breach.

2.15 Earnings per share

(i) Basic earnings per share

Basic earnings per share is calculated by dividing

- the profit attributable to owners of the Company; and

- by the weighted average number of equity shares outstanding during the financial year, adjusted for bonus elements in equity shares issued during the year

(ii) Diluted earnings per share

Diluted earnings per share adjust the figures used in the determination of basic earnings per share to take into account:

- the after income tax effect of interest and other financing costs associated with dilutive potential equity shares; and

- the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares.

2.16 Impairment of Assets

Intangible assets that have an indefinite useful life are not subject to amortization and are tested annually for impairment or more frequently if events or changes in circumstances indicate that they might be impaired. Other assets are tested for impairment whenever events or changes incircumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the assedscarrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and value inuse. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets that suffered impairment are reviewed for possible reversal of the impairment at the end of each reporting period.

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Mar 31, 2023

2 Significant Accounting Policies

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

2.1 Basis Of Preparation Of Financial Statement

i) Compliance with Ind AS

The financial statements Complies in all material aspects with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended and notified under Section 133 of the Companies Act, 2013 (the "Act") and other relevant provisions of the Act and other accounting principles generally accepted in India.

The financial statements up to year ended March 31, 2017 were prepared in accordance with the accounting standards notified under Companies (Accounting Standard) Rules, 2006 (as amended) notified under Section 133 of the Act and other relevant provisions of the Act ("Previous GAAP").

The financial statements were authorized for issue by the Company''s Board of Directors on 31st August,2023.

These financial statements are presented in Indian Rupees (INR), which is also the functional currency. All the amounts have been rounded off to the nearest lacs, unless otherwise indicated.

ii) Historical cost convention

The Company follows the mercantile system of accounting and recognizes income and expenditure on an accrual basis. The financial statements are prepared under the historical cost convention, except in case of significant uncertainties and except for the following:

(a) Certain financial assets and liabilities (Including Derivative Instruments) that are measured at fair value;

(b) Defined benefit plans where plan assets are measured at fair value.

(c) Investments are measured at fair value.

iii) Current and Non Current Classification.

All assets and liabilities have been classified as current or non-current as per the Company''s 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 equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current - non-current classification of assets and liabilities.

2.2 Use of estimates and judgements

The preparation of financial statements requires management to make judgments, estimates and assumptions in the application of accounting policies that affect the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Continuous evaluation is done on the estimation and judgments based on historical experience and other factors, including expectations of future events that are believed to be reasonable. Revisions to accounting estimates are recognised prospectively.

2.3 Segment Report

The Company is operating in a single segment of "Industrial Machinery"

2.4 Inventories Valuation

Inventories are valued at lower of Cost and Net Realisable Value. Cost of traded goods is arrived at on FIFO basis.

During the year, the Company has Closing inventories valued at Rs. 38.28 Lakhs/- as on 31.03.2023 which includes Net Realizable Value of Opening inventories amounting to Rs. 8.48 Lakhs (Cost Rs. 45.69 Lakhs)

2.5 Cash and cash equivalents

Cash and cash equivalents includes cash in hand, deposits with banks, other short term highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes outstanding bank overdraft shown within current liabilities in statement of financial balance sheet and which are considered as integral part of company''s cash management policy.

During the year, the Accountant of the Company had siphoned Cash amounting to Rs. 0.15 Lakhs

2.6 Income tax, deferred tax and dividend distribution tax

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

Current and deferred tax is recognised in the profit and loss except to the extent it relates to items recognised directly in equity or other comprehensive income, in which case it is recognised in equity or other comprehensive income respectively.

(i) Current income tax

Current tax charge is based on taxable profit for the year. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date where the Company operates and generates taxable income. 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.

Current tax assets and tax liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and Company intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

(ii) Deferred tax

Deferred tax is provided using the liability method on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements at the reporting date. Deferred tax assets are recognised to the extent that it is probable that future taxable income will be available against which the deductible temporary differences, unused tax losses, depreciation carry-forwards and unused tax credits could be utilised.

Deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business

combination that at the time of the transaction affects neither accounting profit nor taxable profit (tax loss).

Deferred tax assets and liabilities are measured based on the tax rates that are expected to apply in the period when the asset is realised or the

liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

The carrying amount of deferred tax assets is reviewed at each reporting date and adjusted to reflect changes in probability that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred income tax assets and liabilities are off-set against each other and the resultant net amount is presented in the Balance Sheet, if and only when, (a) the Company has a legally enforceable right to set-off the current income tax assets and liabilities, and (b) the deferred income tax assets and liabilities relate to income tax levied by the same taxation authority.

Defered Tax: In the absence of virtual certainity of future taxable profits against which the net deferred tax assets can be realised, the Company has considered it prudent not to recognise the deferred tax asset in the books of account.

2.7 Property, plant and equipment

(i) All property, plant and equipment are stated at cost less accumulated depreciation. Cost includes expenditure that is directly attributable to the acquisition of the items.

(ii) 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 company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they are incurred.

(iii) Cost of Capital Work in Progress (''CWIP'') comprises amount paid towards acquisition of property, plant and equipment outstanding as of each balance sheet date and construction expenditures, other expenditures necessary for the purpose of preparing the CWIP for it intended use and borrowing cost incurred before the qualifying asset is ready for intended use. CWIP is not depreciated until such time as the relevant asset is completed and ready for its intended use.

(iv) Depreciation methods, estimated useful lives and residual value.

(a) Fixed assets are stated at cost less accumulated depreciation.

(b) Depreciation is provided on a pro rata basis on the writen down method over the estimated useful lives of the assets which is as prescribed under Schedule II to the Companies Act, 2013. The depreciation charge for each period is recognised in the Statement of Profit and Loss, unless it is included in the carrying amount of any other asset. The useful life, residual value and the depreciation method are reviewed atleast at each financial year end. If the expectations differ from previous estimates, the changes are accounted for prospectively as a change in accounting estimate.

(v) Tangible assets which are not ready for their intended use on reporting date are carried as capital work-in-progress.

(vi) The residual values are not more than 5% of the original cost of the asset.

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.

Estimated useful lives, residual values and depreciation methods are reviewed annually, taking into account commercial and technological obsolescence as well as normal wear and tear and adjusted prospectively, if appropriate.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss within other expenses or other income as applicable.

(vii) Tangible Asset consist of Leasehold Land & Building, Plant and Machinery, Factory & Office Equipment, Furniture and Fixtures.

Leashold land and Building has been sold in FY 2022-23 for an amount of 1,150 Lakhs resulting in exceptional gains on sale amounting to Rs. 1,101.54 Lakhs shown in Profit and loss statement.

Plant & Machinery - The Managment has decided to sale of its Plant & Machinery , the said property has been disclosed as "Held for Sale" in Other Current Financial Assets. Management has decided in the begining of the period that the PPE has been disposed of as Non Current Assets held for sale.In Books, grouping has been done in the month of Jan''23 and balance has been written off to the extent of Rs. 8.78 Lakhs. The Plant & machinery has been subsequently sold off in FY 2023-24 as scrap.

(ix) During the year, Net block of Vehicle amounting to Rs. 2 was written off as the same had been sold prior to 2018 2.7.1 Deprecaition

(i) Depreciation for the year has been booked for the first 9 months only (April 2022 to December 2022) as subsequently all the Fixed Assets were transferred to Non Current Assets held for sale.

2.8 Intangible assets

(i) An intangible asset shall be recognised if, and only if: (a) it is probable that the expected future economic benefits that are attributable to the asset will flow to the Company and (b) the cost of the asset can be measured reliably.

(ii) Computer software is capitalised where it is expected to provide future enduring economic benefits. Capitalisation costs include licence fees and costs of implementation / system integration services. The costs are capitalised in the year in which the relevant software is implemented for use. The same is amortised over a period of 3 years on straight-line method.

(iii) During the year, Intangible Assets amounting to Rs. 1.77 Lakhs has been written off.

2.9 Revenue Recognition

a) Domestic Sales are accounted for when dispatched from the point of sale, consequent to property in goods being transferred.

b) Export Sales are accounted on the basis on the dates of Bill of Lading/Other delivering documents as per terms of contract.

Sales

(i) The Company recognizes revenue from sale of goods when:

(a) The significant risks and rewards of ownership in the goods are transferred to the buyer as per the terms of the contract, which coincides with the delivery of goods.

(b) The Company retains neither continuing managerial involvement to the degree usually associated with the ownership nor effective control over the goods sold.

(c) The amount of revenue can be reliably measured.

(d) It is probable that future economic benefits associated with the transaction will flow to the Company.

(e) The cost incurred or to be incurred in respect of the transaction can be measured reliably.

(f) The company bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.

2.10 Other Income

(i) Interest Income

Interest income from debt instruments is recognised using the effective interest rate method. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the gross carrying amount of a financial asset. When calculating the effective interest rate, the group estimates the expected cash flows by considering all the contractual terms of the financial instrument (for example, prepayment, extension, call and similar options) but does not consider the expected credit losses.

(ii) Income from Indenting Services:

(a) The amount of revenue can be measured reliably.

(b) It is probable that future economic benefits associated with the transaction will flow to the Company.

(c) The stage of completion of the transaction at the end of the reporting period can be measured reliably.

(d) The cost incurred for transaction and the cost to complect the transaction can be measured reliably.

2.11 Employee Benefit

(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) Other long-term employee benefit obligations

There is no long term employee Benefit Obligation as the company had only 1 employee during the Previous Year and the same employee has been charged for committing fraud.

The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to defer settlement for at least twelve months after the reporting period, regardless of when the actual settlement is expected to occur.

No Provision for Employee Benfit has been made as the Company had only 1 Employee and the same person had committed fraud during the year.

(iii) Defined Contribution plan:

Contribution payable to recognised provident fund and superannuation scheme which is defined contribution scheme is charged to Statement of Profit & Loss. The company has not paid the contribution towards provident fund, as the former employee has committed fraud against the company. Company has only one employee during the year.

(iv) The Company has one employee in the payroll of the company. Employee has committed fraud during the year against the company.

2.12 Foreign currency translation

(i) Functional and presentation currency

Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the Company operates (''the functional currency''). The financial statements are presented in Indian rupee (INR), which is Company''s functional and presentation currency.

(ii) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognised in profit or loss. All the foreign exchange gains and losses are presented in the statement of Profit and Loss on a net basis within other expenses or other income as applicable.

(iii) During the year under review, the Company had incurred Foreign Currency loss amounting to Rs. 1.35 Lakhs

2.13 Borrowing Cost

(i) Borrowings are initially recognised at fair value, 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. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates.

(ii) Borrowings are classified as current financial liabilities unless the group has an unconditional right to defer settlement of the liability forat least 12 months after the reporting period. Where there is a breach of a material provision of a long-term loan arrangement on or before the end of the reporting period with the effect that the liability becomes payable on demand on the reporting date, the entity does not classify the liability as current, if the lender agreed, after the reporting period and before the approval of the financial statements for issue, not to demand payment as a consequence of the breach.

2.14 Earnings per share

(i) Basic earnings per share

Basic earnings per share is calculated by dividing:

- the profit attributable to owners of the Company; and

- by the weighted average number of equity shares outstanding during the financial year, adjusted for bonus elements in equity shares issued during the year.

(ii) Diluted earnings per share

Diluted earnings per share adjust the figures used in the determination of basic earnings per share to take into account:

- the after income tax effect of interest and other financing costs associated with dilutive potential equity shares; and

- the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares.

2.15 Impairment of Assets

Intangible assets that have an indefinite useful life are not subject to amortization and are tested annually for impairment or more frequently if events or changes in circumstances indicate that they might be impaired. Other assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset''s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset''s fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets that suffered impairment are reviewed for possible reversal of the impairment at the end of each reporting period.

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Mar 31, 2015

1) SYSTEM OF ACCOUNTING :

The Company maintains its books of account on accrual basis.

2) METHOD OF ACCOUNTING :

a) For sales and services -

The sale of goods is recognised on despatch to customers, sales exclude amounts recovered towards excise duty and sales tax.

b) Export sales are accounted for in accordance with Accounting standard

11 . Exchange gain or loss on realisation of foreign exchange is included in exchange fluctuation account.

3) FOREIGN EXCHANGE TRANSACTIONS :

Transactions in foreign currencies during the year are converted at the rates prevailing on the transaction date. All current assets and current liabilities in foreign currency are revalued at the exchange rate prevailing as at the Balance Sheet date. All exchange differences arising from convesion are included in Profit & Loss Account.

4) FIXED ASSETS :

a. Tangible Assets :

Fixed Assets are capitalised at cost of acquisition or at manufacturing cost in case of company manufactured assets. Depreciation is charged on Straight Line Method on all assets in accordance with the useful life given in Schedule II of the Companies Act 2013.

b. Intangible Assets :

Intangible assets acquired in Financial year 2008-09 are amortised in 7 equal annual installments.

5) CURRENT ASSETS :

a. Balances of Sundry Debtors, Loans, Advances & Deposits given or taken &

& sundry creditors are subject to confirmations. Effect of any variation will be accounted in the year of such variation.

b. INVENTORY :

Inventories are valued at lower of the cost or estimated net realisable value after providing for cost of obsolescence. Cost of Raw Materials is arrived at on first in first out method to comply with the provisions of As2 Work in process and finished goods include cost of materials, direct labour and overheads.

6) INVESTMENTS :

Investments are stated at cost of acquisition or net realisable value whichever is lower.

7) RESEARCH AND DEVELOPMENT :

Revenue expenditure on Research and Development is charged as an expense against the profits for the year in which it is incurred and Capital Expenditure is grouped with Fixed Assets under appropriate heads and depreciation is provided as per rates applicable.

8) EMPLOYEE RETIREMENT BENEFITS :

Retirement benefits to employees comprise of payments of Gratuity, Provident funds under the approved schemes of the Company, and also provision for Leave encashment. The Company has not made any contribution to the Gratuity Fund during the year. Provision for gratuity & leave encashment had been made on accrual basis instead of actuary valuation.

9) IMPAIRMENT OF ASSET :

Asset forming part of any cash generating units are tested for impairment when an indication exists that such assets may be impaired and impairment loss is recognised in profit & loss when recoverable amount of such asset is less than its carrying value.

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Mar 31, 2014

1) SYSTEM OF ACCOUNTING :

The Company maintains its books of account on accrual basis.

2) METHOD OF ACCOUNTING :

a) For sales and services -

The sale of goods is recognised on despatch to customers, sales exclude amounts recovered towards excise duty and sales tax.

b) Export sales are accounted for in accordance with Accounting standard

11 . Exchange gain or loss on realisation of foreign exchange is included in exchange fluctuation account.

3) FOREIGN EXCHANGE TRANSACTIONS :

Transactions in foreign currencies during the year are converted at the rates prevailing on the transaction date. All current assets and current liabilities in foreign currency are revalued at the exchange rate prevailing as at the Balance Sheet date. All exchange differences arising from convesion are included in Profit & Loss Account.

4) FIXED ASSETS :

a. Tangible Assets :

Fixed Assets are capitalised at cost of acquisition or at manufacturing cost in case of company manufactured assets. The revalued portion of the revalued assets has been added to the gross block of the respective assets. Depreciation is charged on Straight Line Method on all assets in accordance with the rates given in Schedule XIV of the Companies Act 1956.

Depreciation on revalued portion of the assets has been charged on straight liine method over the remaining life of the assets & adjusted against the revaluation reserves.

b. Intangible Assets :

Intangible assets acquired in Financial year 2008-09 are amortised in 7 equal annual installments.

5) CURRENT ASSETS :

a. Balances of Sundry Debtors, Loans, Advances & Deposits given or taken & sundry creditors are subject to confirmations. Effect of any variation will be accounted in the year of such variation.

b. INVENTORY :

Inventories are valued at lower of the cost or estimated net realisable value after providing for cost of obsolescence. Cost of Raw Materials is arrived at on first in first out method to comply with the provisions of As2 Work in process and finished goods include cost of materials, direct labour and overheads.

6) INVESTMENTS :

Investments are stated at cost of acquisition or net realisable value whichever is lower.

7) RESEARCH AND DEVELOPMENT :

Revenue expenditure on Research and Development is charged as an expense against the profits for the year in which it is incurred and Capital Expenditure is grouped with Fixed Assets under appropriate heads and depreciation is provided as per rates applicable.

8) EMPLOYEE RETIREMENT BENEFITS :

Retirement benefits to employees comprise of payments of Gratuity, Provident funds under the approved schemes of the Company, and also provision for Leave encashment. The Company has not made any contribution to the Gratuity Fund during the year. Provision for gratuity & leave encashment had been made on accrual basis instead of actuary valuation.

9) IMPAIRMENT OF ASSET :

Asset forming part of any cash generating units are tested for impairment when an indication exists that such assets may be impaired and impairment loss is recognised in profit & loss when recoverable amount of such asset is less than its carrying value.

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Mar 31, 2013

1) SYSTEM OF ACCOUNTING :

The Company maintains its books of account on accrual basis.

2) METHOD OF ACCOUNTING :

a) For sales and services -

The sale of goods is recognised on despatch to customers, sales exclude amounts recovered towards excise duty and sales tax.

b) Export sales are accounted for in accordance with Accounting standard 11 . Exchange gain or loss on realisation of foreign exchange is included in exchange fluctuation account.

3) FOREIGN EXCHANGE TRANSACTIONS :

Transactions in foreign currencies during the year are converted at the rates prevailing on the transaction date. All current assets and current liabilities in foreign currency are revalued at the exchange rate prevailing as at the Balance Sheet date. All exchange differences arising from convesion are included in Profit & Loss Account.

4) FIXED ASSETS:

a. Tangible Assets:

Fixed Assets are capitalised at cost of acquisition or at manufacturing cost in case of company manufactured assets. The revalued portion of the revalued assets has been added to the gross block of the respective assets. Depreciation is charged on Straight Line Method on all assets in accordance with the rates given in Schedule XIV of the Companies Act 1956.

Depreciation on revalued portion of the assets has been charged on straight liine method over the remaining life of the assets & adjusted against the revaluation reserves.

b. Intangible Assets:

Intangible assets acquired in Financial year 2008-09 are amortised in 7 equal annual installments.

5) CURRENT ASSETS:

a. Balances of Sundry Debtors, Loans, Advances & Deposits given or taken & sundry creditors are subject to confirmations. Effect of any variation will be accounted in the year of such variation.

b. INVENTORY:

Inventories are valued at lower of the cost or estimated net realisable value after providing for cost of obsolescence. Cost of Raw Materials is arrived at on first in first out method to comply with the provisions of As2 Work in process and finished goods include cost of materials, direct labour and overheads.

6) INVESTMENTS:

Investments are stated at cost of acquisition or net realisable value whichever is lower.

7) RESEARCH AND DEVELOPMENT :

Revenue expenditure on Research and Development is charged as an expense against the profits for the year in which it is incurred and Capital Expenditure is grouped with Fixed Assets under appropriate heads and depreciation is provided as per rates applicable.

8) EMPLOYEE RETIREMENT BENEFITS :

Retirement benefits to employees comprise of payments of Gratuity, Provident funds under the approved schemes of the Company, and also provision for Leave encashment. The Company has not made any contribution to the Gratuity Fund during the year. Provision for gratuity & leave encashment had been made on accrual basis instead of actuary valuation

9) IMPAIRMENT OF ASSET :

Asset forming part of any cash generating units are tested for impairment when an indication exists that such assets may be impaired and impairment loss is recognised in profit & loss when recoverable amount of such asset is less than its carrying value.

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Mar 31, 2012

1) SYSTEM OF ACCOUNTING:

The Company maintains its books of account on accrual basis.

2) METHOD OF ACCOUNTING:

a) For sales and services

The sale of goods is recognised on despatch to customers, sales exclude amounts recovered towards excise duty and sales tax.

b) Export sales are accounted for in accordance with Accounting standard 11. Exchange gain or loss on realisation of foreign exchange is included in exchange fluctuation account.

3) FOREIGN EXCHANGE TRANSACTIONS :

Transactions in foreign currencies during the year are converted at the rates prevailing on the transaction date. All current assets and current liabilities in foreign currency are revalued at the exchange rate prevailing as at the Balance Sheet date. All exchange differences arising from conversion are included in Profit & Loss Account.

4) FIXED ASSETS:

a. Tangible Assets:

Fixed Assets are capitalised at cost of acquisition or at manufacturing cost in case of company manufactured assets. The revalued portion of the revalued assets has been added to the gross block of the respective assets. Depreciation is charged on Straight Line Method on all assets in accordance with the rates given in Schedule XIV of the Companies Act 1956. Depreciation on revalued portion of the assets has been charged on straight line method over the remaining life of the assets & adjusted against the revaluation reserves.

b. Intangible Assets:

Intangible Assets acquired prior to 2000 have been depreciated at 4.75% (SLM) per year. Intangible assets acquired thereafter are amortised in 7 equal annual installments.

5) CURRENT ASSETS:

a. Balances of Sundry Debtors, Loans, Advances & Deposits given or taken & sundry creditors are subject to confirmations. Effect of any variation will be accounted in the year of such variation.

b. INVENTORY:

Inventories are valued at lower of the cost or estimated net realisable value after providing for cost of obsolescence. Cost of Raw Materials is arrived at on first in first out method to comply with the provisions of AS2 Work in process and finished goods include cost of materials, direct labour and overheads.

6) INVESTMENTS:

Investments are stated at cost of acquisition or net realisable value whichever is lower.

7) RESEARCH AND DEVELOPMENT :

Revenue expenditure on Research and Development is charged as an expense against the profits for the year in which it is incurred and Capital Expenditure is grouped with Fixed Assets under appropriate heads and depreciation is provided as per rates applicable.

8) EMPLOYEE RETIREMENT BENEFITS :

Retirement benefits to employees comprise of payments of Gratuity, Provident funds under the approved schemes of the Company, and also provision for Leave encashment. The Company has not made any contribution to the Gratuity Fund during the year. Although the company has provided for gratuity liability on the basis of actuary valuation obtained from Actuary.

9) IMPAIRMENT OF ASSET :

Asset forming part of any cash generating units are tested for impairment when an indication exists that such assets may be impaired and impairment loss is recognised in profit & loss when recoverable amount of such asset is less than its carrying value.

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Mar 31, 2011

1) SYSTEM OF ACCOUNTING:

The Company maintains its books of account on accrual basis.

2) METHOD OF ACCOUNTING:

a) For sales and services -

The sale of goods is recognised on despatch to customers, sales exclude amounts recovered towards excise duty and sales tax.

b) Export sales are accounted for in accordance with Accounting standard

11. Exchange gain or loss on realisation of foreign exchange is included in exchange fluctuation account.

3) FOREIGN EXCHANGE TRANSACTIONS:

Transactions in foreign currencies during the year are converted at the rates prevailing on the transaction date. All current assets and current liabilities in foreign currency are revalued at the exchange rate prevailing as at the Balance Sheet date. All exchange differences arising from convesion are included in Profit & Loss Account.

4) FIXEDASSETS:

a. Tangible Assets:

Fixed Assets are capitalised at cost of acquisition or at manufacturing cost in case of company manufactured assets. The revalued portion of the revalued assets has been added to the gross block of the respective assets. Depreciation is charged on Straight Line Method on all assets in accordance with the rates given in Schedule XIV of the Companies Act 1956. Depreciation on revalued portion of the assets has been charged on straight line method over the remaining life of the assets & adjusted against the revaluation reserves.

Till the year ended 31st March, 2010, the Company had been accounting for depreciation on the Written Down Value Method.Commencing from the current year, the Company has revised its accounting policy of providing for depreciation from Writen Down value method to Straight Line method. Accordingly in compliance with Accounting Standard (AS6) on "Depreciation Accounting" , the depreciation has been recalculated with retrospective effect from the date of the asset coming into use.

The above change in Accounting Policy has resulted in a credit to Profit & Loss Account of Rs.74,09,119/- on account of the adjustment of depreciation relating to previous years and a higher charge of depreciation for the current year amounting to Rs.8,04,300/-. Consequently, the profit before tax and profit after tax for the current year are higher by Rs.66,04,8171- and Rs.66,04,8171- respectively.

Further, the net Fixed assets and the Reserves as on 31st March, 2011 are higher by Rs.66,04,817/- and Rs .66,04,8171- respectively.

b. Intangible Assets:

Intangible Assets acquired prior to 2000 are being depreciated at 4.75% (SLM) per year. Intangible assets acquired thereafter are amortised in 7 equal annual installments.

5) CURRENT ASSETS:

a. Balances of Sundry Debtors, Loans, Advances & Deposits given or taken & sundry creditors are subject to confirmations. Effect of any variation will be accounted in the year of such variation.

b. INVENTORY:

Inventories are valued at lower of the cost or estimated net realisable value after providing for cost of obsolescence. Cost of Raw Materials is arrived at on first in first out method to comply with the provisions of AS2 Work in process and finished goods include cost of materials, direct labour and overheads.

6) INVESTMENTS:

Investments are stated at cost of acquisition or net realisable value whichever is lower.

7) RESEARCH AND DEVELOPMENT:

Revenue expenditure on Research and Development is charged as an expense against the profits for the year in which it is incurred and Capital Expenditure is grouped with Fixed Assets under appropriate heads and depreciation is provided as per rates applicable.

8) EMPLOYEE RETIREMENT BENEFITS:

Retirement benefits to employees comprise of payments of Gratuity, Provident funds under the approved schemes of the Company, and also provision for Leave encashment. The Company has not made any contribution to the Gratuity Fund during the year. Although the company has provided for gratuity liability on the basis of actuary valuation obtained from Actuary.

9) IMPAIRMENT OF ASSET:

Asset forming part of any cash generating units are tested for impairment when an indication exists that such assets may be impaired and impairment loss is recognised in profit & loss when recoverable amount of such asset is less than its carrying value.

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Mar 31, 2010

1) SYSTEM OF ACCOUNTING :

The Company maintains its books of account on accrual basis.

2) METHOD OF ACCOUNTING :

a) For sales and services -

The sale of goods is recognised on despatch to customers, sales exclude amounts recovered towards excise duty and sales tax.

b) Export sales are accounted for in accordance with Accounting standard 11 . Exchange gain or loss on realisation of foreign exchange is included in exchange fluctuation account.

3) FOREIGN EXCHANGE TRANSACTIONS :

Transactions in foreign currencies during the year are converted at the rates prevailing on the transaction date. All current assets and current liabilities in foreign currency are revalued at the exchange rate prevailing as at the Balance Sheet date. All exchange differences arising from convesion are included in Profit & Loss Account.

4) FIXED ASSETS :

a. Tangible Assets :

Fixed Assets are capitalised at cost of acquisition or at manufacturing cost in case of company manufactured assets. The revalued portion of the revalued assets has been added to the gross block of the respective assets.

Till the year ended 31st March, 2009, the Company had been accounting for depreciation on the Straight Line Method. Commencing from the current year, the Company has revised its accounting policy of providing for depreciation from straight line method to written down value method. Accordingly in compliance with Accounting Standard (AS6) on “Depreciation Accounting” , the depreciation has been recalculated with retrospective effect from the date of the asset coming into use.

The above change in Accounting Policy has resulted in a debit to Profit & Loss Account of Rs.80,32,720/- on account of the adjustment of depreciation relating to previous years and a lower charge of depreciation for the current year amounting to Rs.6,23,601/-. Consequently, the profit before tax and profit after tax for the current year are lower by Rs.74,09,119/- and Rs74,09,119/- respectively.

Further, the net Fixed assets and the Reserves as on 31st March, 2010 are lower by Rs.74,09,119/- and Rs.74,09,119/- respectively.

b. Intangible Assets :

Intangible Assets acquired prior to 2000 is been being depreciated at 4.75% (SLM) per year. Intangible assets acquired thereafter are amortised in 7 equal annual installments.

5) CURRENT ASSETS :

a. Balances of Sundry Debtors, Loans, Advances & Deposits given or taken & & sundry creditors are subject to confirmations. Effect of any variation will be accounted in the year of such variation.

b. INVENTORY :

Inventories are valued at lower of the cost or estimated net realisable value after providing for cost of obsolescence. Cost of Raw Materials is arrived at on first in first out method to comply with the provisions of AS2 Work in process and finished goods include cost of materials, direct labour and overheads.

6) INVESTMENTS :

Investments are stated at cost of acquisition or net realisable value whichever is lower.

7) RESEARCH AND DEVELOPMENT :

Revenue expenditure on Research and Development is charged as an expense against the profits for the year in which it is incurred and Capital Expenditure is grouped with Fixed Assets under appropriate heads and depreciation is provided as per rates applicable.

8) EMPLOYEE RETIREMENT BENEFITS :

Retirement benefits to employees comprise of payments of Gratuity, Provident funds under the approved schemes of the Company, and also provision for Leave encashment. The Company has not made any contribution to the Gratuity Fund during the year. Although the company has provided for gratuity liability on the basis of actuary valuation obtained from Actuary.

9) IMPAIRMENT OF ASSET :

Asset forming part of any cash generating units are tested for impairment when an indication exists that such assets may be impaired and impairment loss is recognised in profit & loss when recoverable amount of such asset is less than its carrying value.