Accounting Policies of India Lease Development Ltd. Company

Mar 31, 2024

3. SUMMARY OF MATERIAL ACCOUNTING POLICIES

The Financial Statements have been prepared using the Accounting Policies and measurement basis summarized below.

3.1 RECOGNITION OF INTEREST INCOME

Under Ind AS 109, interest income is recorded using the effective interest rate method for all financial instruments
measured at amortised cost and financial instrument measured at FVOCI. The EIR is the rate that exactly discounts
estimated future cash receipts through the expected life of the financial instrument or, when appropriate, a shorter period,
to the net carrying amount of the financial asset.

The EIR (and therefore, the amortised cost of the asset) is calculated by taking into account any discount or premium on
acquisition, fees and costs that are an integral part of the EIR. The Company recognises interest income using a rate of
return that represents the best estimate of a constant rate of return over the expected life of the financial instrument.

If expectations regarding the cash flows on the financial asset are revised for reasons other than credit risk, the adjustment
is booked as a positive or negative adjustment to the carrying amount of the asset in the balance sheet with an increase or
reduction in interest income. The adjustment is subsequently amortised through Interest income in the statement of profit
and loss.

When a financial asset becomes credit impaired and is, therefore, regarded as ‘stage 3’, the Company calculates interest
income on the net basis. If the financial asset cures and is no longer credit impaired, the Company reverts to calculating
interest income on a gross basis.

Other interest income is recognised on a time proportionate basis.

3.2 FINANCIAL INSTRUMENTS

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

3.2.1 FINANCIAL ASSETS

3.2.1.1 INITIAL RECOGNITION AND MEASUREMENT

Financial Assets are recognised when the Company becomes a party to the contractual provisions of the Financial
Instrument and are measured initially at fair value adjusted for transaction costs that are attributable to the acquisition of
the financial asset.

3.2.1.2 SUBSEQUENT MEASUREMENT

Debt Instruments at Amortised Cost- A ‘debt instrument’ is measured at the amortised cost if both the following
conditions are met:

• The asset is held within a business model whose objective is to hold assets for collecting contractual cash flows,
and

• Contractual terms of the asset give rise on specified dates to cash flows that are solely payments of principal and
interest (SPPI) on the principal amount outstanding.

After initial measurement, such Financial Assets are subsequently measured at amortised cost using the Effective Interest
Rate (EIR) method. All other debt instruments are measured are Fair Value through Other Comprehensive Income
(FVOCI) or Fair value through Profit and Loss (FVTPL) based on Company’s business model.

• Equity Investments - All equity investments in scope of Ind-AS 109 are measured at fair value. Equity
instruments which are held for trading are classified as at Fair Value through Profit and Loss (FVTPL). For all other
equity instruments, the Company decides to classify the same either as at fair value through Other Comprehensive
Income (FVOCI) or Fair Value through Profit and Loss (FVTPL) on an instrument to instrument basis. Investments
in Equity Instruments of other companies are classified as Investments at Fair Value through OCI, as these
investments are held with the objective of collection of contractual cash flows and subsequent selling of these
investments.

• Other Investments - All Other Investments in scope of Ind-AS 109 are measured at Fair Value through Profit and
Loss (FVTPL).

3.2.1.3 IMPAIRMENT OF FINANCIAL ASSETS

In accordance with Ind AS 109, the Company applies Expected Credit Loss (ECL) model for measurement and recognition
of impairment loss on the financial assets that are debt instruments, and are measured at amortised cost e.g., Loans, Debt
Securities, Deposits and Trade Receivables or any contractual right to receive cash or another financial asset that result
from transactions that are within the scope of Ind AS 115.

The Company follows ‘Simplified Approach’ for recognition of impairment loss allowance on trade receivables. The
application of simplified recognises impairment loss allowance based on lifetime ECL at each reporting date, right from its
initial recognition.

• Financial Assets measured as at amortised cost: ECL is presented as an allowance, i.e., as an integral part of
the measurement of those assets in the balance sheet. The allowance reduces the net carrying amount. Until the
asset meets write-off criteria, the Company does not reduce impairment allowance from the gross carrying
amount.

• Debt instruments measured at FVTPL: Since financial assets are already reflected at fair value, impairment
allowance is not further reduced from its value. The change in fair value is taken to the statement of Profit and Loss.

• Debt instruments measured at FVTOCI: Since financial assets are already reflected at fair value, impairment
allowance is not further reduced from its value. Rather, ECL amount is presented as ‘Accumulated Impairment
Amount’ in the OCI. The Company does not have any Purchased or Originated Credit Impaired (POCI) financial
assets, i.e., financial assets which are credit impaired on purchase/ origination.

3.2.1.4 DE-RECOGNITION OF FINANCIAL ASSETS

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily
derecognised (i.e. removed from the Company’s balance sheet) when:

i. The rights to receive cash flows from the asset have expired, or

ii. The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay
the received cash flows in full without material delay to a third party under a ‘passthrough’ arrangement- and either

(a) The Company has transferred substantially all the risks and rewards of the asset, or

(b) The Company has neither transferred nor retained substantially all the risks and rewards of the asset, but
has transferred control of the asset.

When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass¬
through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership.

When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred
control of the asset, the Company continues to recognise the transferred asset to the extent of the Company’s
continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset
and the associated liability are measured on a basis that reflects the rights and obligations that the Company has
retained.

3.2.2 FINANCIAL LIABILITIES

3.2.2.1 INITIAL RECOGNITION AND MEASUREMENT

Financial liabilities are classified at initial recognition as financial liabilities at fair value through Profit or Loss, Loans and
Borrowings, and Payables, net of directly attributable transaction costs. The Company’s financial liabilities include Loans
and Borrowings including Bank Overdraft, Security Deposit received against lease of building including investment
properties and Other Payables.

All Financial Liabilities are recognised initially at fair value and transaction cost that is attributable to the acquisition of the
Financial Liabilities is also adjusted. Financial Liabilities are classified as amortised cost.

The measurement of financial liabilities depends on their classification, as described below:

i. Financial liabilities at Fair Value Through Statement of Profit and Loss - Financial liabilities at Fair Value
through statement of Profit and Loss include financial liabilities held for trading and financial liabilities designated
upon initial recognition as at Fair Value through statement of Profit and Loss. Financial liabilities are classified as
held for trading if they are incurred for the purpose of repurchasing in the near term.

ii. Other Payables - These amounts represent liabilities for goods and services provided to the Company prior to the
end of financial year which are unpaid.

3.2.2.2 SUBSEQUENT MEASUREMENT

Subsequent to initial recognition, these liabilities are measured at Amortised Cost using the Effective Interest Rate (EIR)
method.

3.2.2.3 DE-RECOGNITION OF FINANCIAL LIABILITIES

A Financial Liability is de-recognised when the obligation under the liability is discharged or cancelled or expired.
Consequently, write back of unsettled credit balances is done on the previous experience of Management and actual facts
of each case and recognised in Other Income. 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 and Loss.

3.2.3 OFFSETTING OF FINANCIAL INSTRUMENTS

Financial Assets and Financial Liabilities are offset and the net amount is reported in the balance sheet if there is a
currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to
realise the assets and settle the liabilities simultaneously.

3.3 PROPERTY, PLANT AND EQUIPMENT

3.3.1 RECOGNITION

All other items of property, plant and equipment are stated at historical cost, less accumulated depreciation/amortized and
impairments, if any. Historical cost includes taxes, duties, freight and other incidental expenses related to acquisition &
installation.

3.3.2 SUBSEQUENT MEASUREMENT

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.

All other repairs & maintenance are charged to profit or loss.

3.3.3 DEPRECIATION

Depreciation on Property, Plant and Equipment is charged on straight line method on useful life prescribed under Part C of
Schedule II of the Companies Act, 2013.

3.3.4 DE-RECOGNITION

An item of Property, Plant and Equipment and any significant part initially recognised is derecognised upon disposal or
when no future economic benefits are expected from its use or disposal. Any gain or loss arising on de-recognition of the
asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in
the Statement of Profit and Loss account when the asset is derecognised.

3.4 IMPAIRMENT OF NON FINANCIAL ASSETS

Carrying amount of assets is reviewed at each reporting date where there is any indication of impairment based on
internal/ external indicators. An impairment loss is recognised in the Statement of Profit and Loss where carrying amount
exceeds recoverable amount of assets. Impairment loss is reversed, if, there is change in recoverable amount and such
loss either no longer exists or has decreased or indication on which impairment was recognised no longer exists.

3.5 TRADE RECEIVABLES

Trade receivables are amounts due from customers for services performed in the ordinary course of business.

3.6 CLASSIFICATION OF ASSETS AND PROVISIONING

Assets are classified into Performing and Non-Performing categories based on their record of recovery as prescribed by
the Reserve Bank of India’s Prudential Norms and after considering adjustments effected, if any. Provisions are being
made as per Reserve Bank of India’s Prudential Norms.

3.7 CASH AND CASH EQUIVALENTS

Cash and Cash Equivalents comprise cash in hand, Balances in Bank Account, Remittance in Transit, Cheques in hand
and demand deposits, together with other short-term, highly liquid investments (original maturity less than 3 months) that
are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value.

3.8 TAXES

3.8.1 CURRENT INCOME TAX

Current Income Tax assets and liabilities are measured at the amount expected to be recovered from or payable to the
taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively
enacted, at the reporting date.

Current income tax relating to items recognised outside Profit or Loss is recognised outside profit or loss (either in Other
Comprehensive Income or in Equity). Current tax items are recognised in correlation to the underlying transaction either in
OCI or directly in equity. Management periodically evaluates positions taken in the tax returns with respect to situations in
which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

3.8.2 DEFERRED TAX

Deferred Income Taxes are calculated using Balance Sheet Approach, on temporary differences between the tax bases of
assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.

Deferred tax liabilities are recognised for all taxable temporary differences, except when it is probable that the temporary
differences will not reverse in the foreseeable future.

Deferred tax assets are recognised for all deductible temporary differences and the carry forward of unused tax credits
and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be
available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax
losses can be utilized.

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

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

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

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets
against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

Tax expense for the year comprises of current tax and deferred tax.

3.8.3 INDIRECT TAX

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

i. When the tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which
case, the tax paid is recognised as part of the cost of acquisition of the asset or as part of the expense item, as
applicable.

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

3.9 EQUITY AND RESERVES

i. Share Capital represents the nominal value of shares that have been issued. Any transaction costs associated
with the issuing of shares are deducted from retained earnings, net of any related income tax benefits.

ii. Other Components of Equity includes Other Comprehensive Income arising from actuarial gain or loss on re¬
measurement of defined benefit liability and return on plan assets

iii. Retained Earnings include all current and prior period retained profits.

3.10 DIVIDEND PAYMENTS

Annual dividend distribution to shareholders is recognised as a liability in the period in which the dividend is approved by
the shareholders. Any interim dividend paid is recognised on approval by Board of Directors. Dividend payable and
corresponding tax on Dividend Distribution is recognised directly in equity.

3.11 EMPLOYEE BENEFIT SCHEMES

3.11.1 SHORT-TERM EMPLOYEE BENEFITS

Employee benefits payable wholly within twelve months of receiving employee services are classified as short-term
employee benefits. These benefits include salaries and wages, performance incentives and compensated absences
which are expected to occur in next twelve months. The undiscounted amount of short-term employee benefits to be paid
in exchange for employee services is recognised as an expense as the related service is rendered by employees.

3.11.2 GRATUITY

Liabilities with regard to the gratuity benefits payable in future are determined by actuarial valuation at each Balance Sheet
date using the Projected Unit Credit method. Gratuity is unfunded.

Actuarial gains and losses arising from changes in actuarial assumptions are recognized in Other Comprehensive Income
and shall not be reclassified to the Statement of Profit and Loss in a subsequent period.

3.11.3 PROVIDENT FUND

Eligible employees of the Company receive benefits from a Provident Fund, which is a defined benefit plan. Both the
eligible employee and the Company make monthly contributions to the provident fund plan equal to a specified percentage
of the covered employee’s salary.

3.12 LEASES

The determination of whether an arrangement is (or contains) a lease is based on the substance of the arrangement at the
inception of the lease. The arrangement is, or contains, a lease if fulfilment of the arrangement is dependent on the use of a
specific asset or assets and the arrangement conveys a right to use the asset or assets, even if that right is not explicitly
specified in an arrangement.

3.13 EARNINGS PER SHARE

The Company presents basic and diluted earnings per share (“EPS”) data for its equity shares.

i. Basic EPS is calculated by dividing the profit and loss attributable to equity shareholders of the Company by the
weighted average number of equity shares outstanding during the period.

ii. Diluted EPS is determined by adjusting the profit and loss attributable to equity shareholders and the weighted
average number of equity shares outstanding for the effects of all dilutive potential equity shares.

---

Mar 31, 2015

I) Accounting Convention

The financial statements of the Company, have been prepared on historical cost convention, applicable Accounting Standards specified under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014, and the relevant provisions of Companies Act, 2013 to the extent applicable and guidelines issued by the Reserve Bank of India to Non-Banking Financial Companies from time to time.

ii) Fixed Assets

Fixed Assets (including assets given on lease upto 31.3.2001) have been stated at cost less accumulated depreciation and impairment, if any. Cost refers to cost of acquisitions.

iii) Investments

Long terms investments are valued at cost. Cost refers to actual cost of acquisition / carrying cost. Provisions for diminution in value, if any, is made if decline is of permanent nature. Current Investments are valued at lower of cost or market value.

iv) Repossessed Vehicles

Repossessed vehicles in hand are valued at the Principal or Principal and Interest amount due form hirers or at net realisable value, whichever is lower.

v) Assets given under finance lease

Assets given under finance lease w.e.f. 1st April, 2001 are recorded as receivables and shown under current assets. Finance income is recognized based on a pattern reflecting a constant periodic rate of return on the net investment outstanding. Initial direct costs incurred are charged to the Profit & Loss Account.

vi) Depreciation

(a) Depreciation on fixed assets is provided on the written down value (WDV) method based on the useful lives and residual value of the assets as prescribed in Schedule II to the Companies Act, 2013.

vii) Classification of Assets and Provisioning

Assets are classified into Performing and Non Performing categories based on their record of recovery as prescribed by the Reserve Bank of India's Prudential Norms and after considering adjustments effected, if any. Provisions are being made as per Reserve Bank of India's Prudential Norms.

viii) Revenue Recognition

a) Finance Charges on hire purchase/ loans against hypothecation contracts and income from finance lease transactions are computed using Internal Rate of Return Method which ensures a constant periodic rate of return on net finance amount outstanding.

b) Lease Rentals are accounted for as per terms of lease agreements. However, in compliance of the Guidance Note on "Accounting for Leases" issued by the Institute of Chartered Accountants of India, and applicable to transactions entered into prior to 01.4.2001, the differential between the Capital Recovery Component comprised (based on the Internal Rate of Return Method) in the lease rentals and the depreciation referred to in Para 6(ii) above, (for all assets acquired on or beginning from 1st April, 1995 from accounting year 1995-96 and in respect of assets acquired upto 1.4.1995 prospectively from the accounting year 1996-97) is carried to "Lease Equalisation" in the Profit & Loss Account.

c) Income from Non Performing Assets is recognised when realised.

d) Bill Discounting Charges are accounted for on accrual basis except in case of Non Performing Assets, wherein it is recognised on realisation basis.

e) Overdue charges from hirers/lessees are accounted for on realisation basis in view of significant uncertainties.

f) Interest income recognised on accrual basis.

g) Dividend in accounted for on accrual basis when the right to receive dividend is established.

ix) Retirement Benefits

a) The liability on account of Gratuity is provided on the basis of actuarial valuation at the year end.

b) Provident Fund contribution for all employees is charged to revenue each year.

x) Deferred Tax

Deferred Tax is recognised, subject to consideration of prudence, on timing differences, representing the difference between the taxable income/ (loss) and the accounting income/ (loss) that originated in one period and are capable of reversal in one or more subsequent periods. Deferred Tax assets and liabilities are measured using tax rates and the tax laws that have been enacted or substantively enacted by the Balance Sheet date. Deferred Tax assets viz. unabsorbed depreciation and carry forward losses are recognised if there is 'virtual certainty' that sufficient future taxable income will be available against which such deferred tax assets can be realised.

xi) Impairment of Assets

The carrying amounts of assets are reviewed at each Balance Sheet date to ascertain impairment based on internal/external factors. An impairment loss is recognised when the carrying amount of an asset exceeds its realisable value. The realisable value is greater of the assets net selling price and value in use.

xii) Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation, if

a) the Company has a present obligation as a result of past event,

b) a probable outflow of resources is expected to settle the obligation and

c) the amount of obligation can be reliably estimated.

Reimbursements expected in respect of expenditure required to settle a provision are recognised only when it is virtually certain that the reimbursement will be received.

Contingent liability is disclosed in the case of

a) a present obligation arising from the past event, when it is not probable that an outflow of resources will be required to settle the obligation.

b) a possible obligation, of which the probability of outflow of resources is remote. Contingent Assets are neither, recognised nor disclosed.

Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.

---

Mar 31, 2014

I) Accounting Convention

The financial statements have been prepared under the historical cost convention, as per provisions of the Companies Act, 1956 and after taking into account the applicable guidelines issued by the Reserve Bank of India to Non Banking Financial Companies from time to time and in accordance with the mandatory Accounting Standards issued by The Institute of Chartered Accountants of India.

ii) Fixed Assets

Fixed Assets (including assets given on lease upto 31.3.2001) have been stated at cost less accumulated depreciation and impairment, if any. Cost refers to cost of acquisitions.

iii) Investments

Long terms investments are valued at cost. Cost refers to actual cost of acquisition / carrying cost. Provisions for diminution in value, if any, is made if decline is of permanent nature. Current Investments are valued at lower of cost or market value.

iv) Repossessed Vehicles

Repossessed vehicles in hand are valued at the Principal or Principal and Interest amount due form hirers or at net realisable value, whichever is lower.

v) Assets given under finance lease

Assets given under finance lease w.e.f. 1st April, 2001 are recorded as receivables and shown under current assets. Finance income is recognized based on a pattern reflecting a constant periodic rate of return on the net investment outstanding. Initial direct costs incurred are charged to the Profit & Loss Account.

vi) Depreciation

(a) Depreciation on office equipments and generators, owned by the Company, is provided on written down value method at the rate, as per the Income Tax Act, 1961. Depreciation on other owned assets, are provided on written down value method, at rates prescribed under Schedule XIV to the Companies Act 1956.

(b) Assets given on lease prior to 31st March, 2001 and included under ''Assets on Lease'' in the Fixed Asset Schedule are depreciated on straight line method at rates prescribed under Schedule XIV to the Companies Act 1956 except machinery which is depreciated on written down value method at the rates as per the Income Tax Act 1961.

vii) Classification of Assets and Provisioning

Assets are classified into Performing and Non Performing categories based on their record of recovery as prescribed by the Reserve Bank of India''s Prudential Norms and after considering adjustments effected, if any. Provisions are being made as per Reserve Bank of India''s Prudential Norms.

viii) Revenue Recognition

a) Finance Charges on hire purchase/ loans against hypothecation contracts and income from finance lease transactions are computed using Internal Rate of Return Method which ensures a constant periodic rate of return on net finance amount outstanding.

b) Lease Rentals are accounted for as per terms of lease agreements. However, in compliance of the Guidance Note on "Accounting for Leases" issued by The Institute of Chartered Accountants of India, and applicable to transactions entered into prior to 01.4.2001, the differential between the Capital Recovery Component comprised (based on the Internal Rate of Return Method) in the lease rentals and the depreciation referred to in Para 6(ii) above, (for all assets acquired on or beginning from 1st April, 1995 from accounting year 1995-96 and in respect of assets acquired upto 1.4.1995 prospectively from the accounting year 1996-97) is carried to "Lease Equalisation" in the Profit & Loss Account.

c) Income from Non Performing Assets is recognised when realised.

d) Bill Discounting Charges are accounted for on accrual basis except in case of Non Performing Assets, wherein it is recognised on realisation basis.

e) Overdue charges from hirers/lessees are accounted for on realisation basis in view of significant uncertainties.

f) Interest income recognised on accrual basis.

g) Dividend in accounted for on accrual basis when the right to receive dividend is established.

ix) Retirement Benefits

a) The liability on account of Gratuity is provided on the basis of actuarial valuation at the year end.

b) Provident Fund contribution for all employees is charged to revenue each year.

x) Deferred Tax

Deferred Tax is recognised, subject to consideration of prudence, on timing differences, representing the difference between the taxable income/ (loss) and the accounting income/ (loss) that originated in one period and are capable of reversal in one or more subsequent periods. Deferred Tax assets and liabilities are measured using tax rates and the tax laws that have been enacted or substantively enacted by the Balance Sheet date. Deferred Tax assets viz. unabsorbed depreciation and carry forward losses are recognised if there is ''virtual certainty'' that sufficient future taxable income will be available against which such deferred tax assets can be realised.

xi) Impairment of Assets

The carrying amounts of assets are reviewed at each Balance Sheet date to ascertain impairment based on internal/external factors. An impairment loss is recognised when the carrying amount of an asset exceeds its realisable value. The realisable value is greater of the assets net selling price and value in use.

xii) Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation, if

a) the Company has a present obligation as a result of past event,

b) a probable outflow of resources is expected to settle the obligation and

c) the amount of obligation can be reliably estimated.

Reimbursements expected in respect of expenditure required to settle a provision are recognised only when it is virtually certain that the reimbursement will be received.

Contingent liability is disclosed in the case of

a) a present obligation arising from the past event, when it is not probable that an outflow of resources will be required to settle the obligation.

b) a possible obligation, of which the probability of outflow of resources is remote.

Contingent Assets are neither, recognised nor disclosed.

Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.

---

Mar 31, 2013

I) Accounting Convention

The financial statements have been prepared under the historical cost convention, as per provisions of the Companies Act, 1956 and after taking into account the applicable guidelines issued by the Reserve Bank of India to Non Banking Financial Companies from time to time and in accordance with the mandatory Accounting Standards issued by the Institute ofCharteredAccountants ofIndia.

ii) Fixed Assets

FixedAssets (including assets given on lease upto 31.3.2001) have been stated at cost less accumulated depreciation and impairment,ifany. Cost referstocostofacquisitions.

iii) Investments

Long terms investments are valued at cost. Cost refers to actual cost of acquisition / carrying cost. Provisions for diminution in value, if any, is made if decline is of permanent nature. Current Investments are valued at lower of cost or market value.

iv) Repossessed Vehicles

Repossessed vehicles in hand are valued at the Principal or Principal and Interest amount due from hirers or at net realisable value, whicheverislower.

v) Assets given under finance lease

Assets given under finance lease w.e.f. 1st April, 2001 are recorded as receivables and shown under current assets. Finance income is recognized based on a pattern reflecting a constant periodic rate of return on the net investment outstanding. Initial direct costs incurred are chargedto the Profit & LossAccount.

vi) Depreciation

(a) Depreciation on office equipments and generators, owned by the Company, is provided on written down value method at the rate, as per the IncomeTa xAct, 1961. Depreciation on other owned assets, are provided on written down value method,at rates prescribed under Schedule XIVto the CompaniesAct 1956.

(b) Assets given on lease prior to 31st March, 2001 and included under ''Assets onLease''in the FixedAsset Schedule are depreciated on straight line method at rates prescribed under Schedule XIV to the Companies Act 1956 except machinery which is depreciated on written down value method at the rates as per the Income Ta x Act 1961.

vii) ClassificationofAssets and Provisioning

Assets are classified into Performing and Non Performing categories based on their record of recovery as prescribed by the Reserve Bank of India''s Prudential Norms and after considering adjustments effected, if any. Provisions are being madeasper Reserve Bankof India''s Prudential Norms.

viii) Revenue Recognition

a) Finance Charges on hire purchase/ loans against hypothecation contracts and income from finance lease transactions are computed using Internal Rate of Return Method which ensures a constant periodic rate of return on net finance amount outstanding.

b) Lease Rentals are accounted for as per terms of lease agreements. However, in compliance of the Guidance Note on "Accounting for Leases" issued by the Institute of Chartered Accountants of India, and applicable to transactions entered into prior to01.4.2001, the differential between the Capital Recovery Component comprised (based on the Internal Rate of Return Method) in the lease rentals and the depreciation referred to in Para 6(ii) above, (for all assets acquired on or beginning from 1st April, 1995 from accounting year 1995-96 and in respect of assets acquired upto 1.4.1995 prospectively from the accounting year 1996-97) iscarriedto"Lease Equalisation" in the Profit & LossAccount.

c) Income from Non PerformingAssetsis recognised when realised.

d) Bill Discounting Charges are accounted for on accrual basis except in case of Non Performing Assets, wherein it is recognisedonrealisation basis.

e) Overdue charges from hirers/lessees are accounted for on realisation basis inviewofsignificant uncertainties.

f) Interest income recognised on accrual basis.

g) Dividend inaccounted foronaccrual basis when the right toreceive dividendis established.

ix) Retirement Benefits

a) The liabilityonaccount ofGratuityisprovidedonthe basisofactuarial valuationatthe year end.

b) Provident Fund contribution for all employeesischarged torevenue each year.

x) Deferred Tax

Deferred Ta x is recognised, subject to consideration of prudence, on timing differences, representing the difference between the taxable income/ (loss) and the accounting income/ (loss) that originated in one period and are capable of reversal in one or more subsequent periods. Deferred Ta x assets and liabilities are measured using tax rates and the tax laws that have been enacted or substantively enacted by the Balance Sheet date. Deferred Ta x assets viz. unabsorbed depreciation and carry forward losses are recognised if there is ''virtual certainty'' that sufficient future taxable income willbeavailable against which such deferred tax assets canberealised.

xi) ImpairmentofAssets

The carrying amounts of assets are reviewed at each Balance Sheet date to ascertain impairment based on internal/external factors. An impairment loss is recognised when the carrying amount ofan asset exceeds its realisable value. The realisable valueis greaterofthe assets net selling price and value inuse.

xii) Provisions, Contingent Liabilities and ContingentAssets

Provisions are recognized for liabilities that canbemeasured onlybyusingasubstantial degree ofestimation, if

a) the Company has apresent obligationas a resultofpast event,

b) aprobable outflowofresources isexpectedtosettle the obligation and

c) the amount ofobligation can be reliably estimated.

Reimbursements expected in respect of expenditure required to settle a provision are recognised only when it is virtually certain that the reimbursement willbereceived.

Contingent liability is disclosed in the case of

a) a present obligation arising from the past event, when it is not probable that an outflow of resources will be required to settle the obligation.

b) apossibleobligation, ofwhich the probabilityofoutflowofresourcesisremote. ContingentAssets are neither, recognised nor disclosed.

Provisions, Contingent Liabilities and ContingentAssets are reviewedat each Balance Sheet date.

---

Mar 31, 2010

1. Accounting Convention

The financial statements have been prepared under the historical cost convention, as per provisions of the Companies Act, 1956 and after taking into account the applicable guidelines issued by the Reserve Bank of India to Non Banking Financial Companies from time to time and in accordance with the mandatory Accounting Standards issued by the Institute of Chartered Accountants of India.

2. Fixed Assets

Fixed Assets (including assets given on lease upto 31.3.2001) have been stated at cost less accumulated depreciation and impairment, if any. Cost refers to cost of acquisitions.

3. Investments

Long terms investments are valued at cost. Cost refers to actual cost of acquisition / carrying cost. Provisions for diminution in value, if any, is made if decline is of permanent nature. Current Investments are valued at lower of cost or market value.

4. Repossessed Vehicles

Repossessed vehicles in hand are valued at the Principal or Principal and Interest amount due from hirers or at net realisable value, whichever is lower.

5. Assets given under finance lease

Assets given under finance lease w.e.f. 1st April, 2001 are recorded as receivables and shown under current assets. Finance income is recognized based on a pattern reflecting a constant periodic rate of return on the net investment outstanding. Initial direct costs incurred are charged to the Profit & Loss Account.

6. Depreciation

(I) Depreciation on office equipments and generators, owned by the Company, is provided on written down value method at the rate, as per the Income Tax Act, 1961. Depreciation on other owned assets, are provided on written down value method, at rates prescribed under Schedule XIV to the Companies Act 1956.

(ii Assets given on lease prior to 31st March, 2001 and included under Assets on Lease’ in the Fixed Asset Schedule are depreciated on straight line method at rates prescribed under Schedule XIV to the Companies Act 1956 except machinery which is depreciated on written down value method at the rates as per the Income Tax Act 1961.

7. Classification of Assets and Provisioning

Assets are classified into Performing and Non Performing categories based on their record of recovery as prescribed by the Reserve Bank of India’s Prudential Norms and after considering adjustments effected, if any. Provisions are being made as per Reserve Bank of India’s Prudential Norms.

8. Revenue Recognition

a) Finance Charges on hire purchase/ loans against hypothecation contracts and income from finance lease transactions are computed using Internal Rate of Return Method which ensures a constant periodic rate of return on net finance amount outstanding.

b) Lease Rentals are accounted for as per terms of lease agreements. However, in compliance of the Guidance Note on “Accounting for Leases” issued by the Institute of Chartered Accountants of India, and applicable to transactions entered into prior to 01.4.2001, the differential between the Capital Recovery Component comprised (based on the Internal Rate of Return Method) in the lease rentals and the depreciation referred to in Para 6(ii) above, (for all assets acquired on or beginning from 1st April, 1995 from accounting year 1995-96 and in respect of assets acquired upto 1.4.1995 prospectively from the accounting year 1996-97) is carried to “Lease Equalisation” in the Profit & Loss Account.

c) Income from Non Performing Assets is recognised when realised.

d) Bill Discounting Charges are accounted for on accrual basis except in case of Non Performing Assets, wherein it is recognised on realisation basis.

e) Overdue charges from hirers/lessees are accounted for on realisation basis in view of significant uncertainties.

f) Interest income recognised on accrual basis.

g) Dividend in accounted for on accrual basis when the right to receive dividend is established.

9. Retirement Benefits

a) The liability on account of Gratuity is provided on the basis of actuarial valuation at the year end.

b) Provident Fund contribution for all employees is charged to revenue each year.

10. Deferred Tax

Deferred Tax is recognised, subject to consideration of prudence, on timing differences, representing the difference between the taxable income/ (loss) and the accounting income/ (loss) that originated in one period and are capable of reversal in one or more subsequent periods. Deferred Tax assets and liabilities are measured using tax rates and the tax laws that have been enacted or substantively enacted by the Balance Sheet date. Deferred Tax assets viz. unabsorbed depreciation and carry forward losses are recognised if there is ‘virtual certainty’ that sufficient future taxable income will be available against which such deferred tax assets can be realised.

11. Impairment of Assets

The carrying amounts of assets are reviewed at each Balance Sheet date to ascertain impairment based on internal/external factors. An impairment loss is recognised when the carrying amount of an asset exceeds its realisable value. The realisable value is greater of the assets net selling price and value in use.

12. Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation, if

a) the Company has a present obligation as a result of past event,

b) a probable outflow of resources is expected to settle the obligation and

c) the amount of obligation can be reliably estimated.

Reimbursements expected in respect of expenditure required to settle a provision are recognised only when it is virtually certain that the reimbursement will be received.

Contingent liability is disclosed in the case of

a) a present obligation arising from the past event, when it is not probable that an outflow of resources will be required to settle the obligation.

b) a possible obligation, of which the probability of outflow of resources is remote. Contingent Assets are neither, recognised nor disclosed.

Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.