Accounting Policies of Mahalaxmi Seamless Ltd. Company

Mar 31, 2024

Note :-l - STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

a) Basis for preparation

i) Compliance with Ind AS

These financial statements have been prepared in accordance with the Indian Accounting Standard (hereinafter
referred to as the ''Ind AS'') as notified by Ministry of Corporate Affairs pursuant to Section 133 of the Companies
Act, 2013 (''Act'') read with of the Companies (Indian Accounting Standard) Rules, 2015 as amended other relevant
provisions of the Act.

The accounting policies are applied consltently to all the periods presented In the financial statements.

ii) Historical Cost Convention

The financial statements have been prepared on a historical cost basis, except for the following
certain financial assets and liabilities that are measure at fair value;

iii) Current non-current classification

All assets and liabilities have been classified as current or non-current as per the Company''s normal operating
cycle (twelve months) and other criteria set out in the schedule III to the Act.

b) Use of estimates and judgements

The estimates and judgments used in the preparation of the financial statements are continuously evaluated by the Company and
are based on historical experience and various other assumptions and factors (including expectations of future events) that the
Company believes to be reasonable under the existing circumstances. Differences between actual results and estimates are
recognised in the period in which the results are known/materialised.

The said estimates are based on the facts and events, that existed as at the reporting date, or that occurred after that
date but provide additional evidence about conditions existing as at the reporting date.

c) Property, plant and equipment

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

Subsequent costs are included in the asset''s carrying amount or recognised as a separate asset, as appropriate, only
when it is probable that future economic benefits associated with the item will flow to the 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 the Statement of Profit and Loss during
the reporting period in which they are incurred.

Depreciation methods, estimated useful lives and residual value

Depreciation on Factory Buildings, Plant and Equipment, and other assets related to Factory is provided on a Straight

Line Method and all assets related to Mumbai Office on Written Down Value Method, over the estimated useful lives
of assets.

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The Company depreciates Its property, plant and equipment over the useful life In the manner preserved in bcneouie »
to the Act, and management believe that useful life of assets are same as those prescribed In Schedule II to the Act,

d) Investment Properties

Property that Is held for long term rental yields and that Is not occupied by the company, Is classified as
investment property.lnvestment property Is measured at Its cost, Including related transaction costs and where
applicable borrowing costs less depreciation and Impairment If any.

e) Cash and Cash Equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand,
bank overdraft, balance in current account.

f) Borrowings

Borrowings are initially recognised at net of transaction costs incurred and measured at amortised cost. Any difference
between the proceeds (net of transaction costs) and the redemption amount is recognised in the Statement of
Profit and Loss over the period of the borrowings using the effective interest method.

g) Borrowing costs

Other interest and borrowing costs are charged to Statement of Profit and Loss.

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Mar 31, 2015

A) Basis for preparation of financial statement

The financial statements have been prepared under historical cost convention and on accrual basis of accounting. The Company has prepared these financial statements in accordance with the Generally Accepted Accounting Principles in India and to comply in all material respects with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. The accounting policy adopted in preparation of the financial statements are consistent with those followed in previous year.

b) Method of Accounting

The Company follows the mercantile system of accounting.

c) Revenue recognition of Income & Expenditure

i) Revenue from sales of products is recognized on transfer of all significant risk and rewards of ownership of the product on to customer, which is generally on dispatch of goods. Sales are stated net of deductions during the year and exclusive of Value Added Tax and excise duty.

ii) Purchases are recognized when ownership of goods is transferred and inclusive of all statutory levies but excluding excise duty & value added tax

iii) Job work charges are accounted for on completion of job basis.

iv) Interest income is recognized on time proportion basis.

v) All items of Income & Expenses are accounted for on accrual basis.

d) Services Tax & Cenvat Credit

i) Services Tax on GTA is accounted on accrual basis.

ii) Cenvat Credit on input services is recognized on the date of the booking of the Invoice.

e) Fixed Assets

Fixed Assets are stated at cost net of Cenvat, other set-offs, accumulated depreciation and impairment loss if any. Cost includes all expenses incurred to bring the asset to its present location and condition.

f) Capital Work in Progress

The capital Work in progress is stated at cost plus pre operative expenses.

g) Depreciation

i) Depreciation on Fixed Asset at Mumbai Office is provided on written down value as per the rates prescribed under the schedule II of the Companies Act, 2013.

ii) Depreciation on Fixed Assets at Nagothane Factory Unit is provided on straight-line method as per the rates prescribed under Schedule II of the Companies Act, 2013.

h) Inventories

i) Raw Materials are valued at cost or net realizable value whichever is less. Cost is arrived at using FIFO Method and comprises of all expenditure including expenses incurred in bringing the inventories to the present condition and situation. It does not include Excise Duty and VAT.

ii) Work in progress is valued at cost or net realizable value whichever is lower. Cost consists of average cost of Raw material and conversion cost up to the stage of process completed.

iii) Finished goods are valued at cost or net realizable value whichever is less. Cost consists average cost of Raw material, conversion cost and excise duty.

iv) Stores and Spares are valued at cost exclusive of Excise Duty & VAT credit taken.

v) Scrap is valued at the net realizable value.

i) Foreign Currencies Transaction

a) Transactions in foreign currency are recorded at the exchange rates prevailing on the date of the transaction.

b) Monetary items denominated in foreign currency are restated at the exchange rate prevailing on the balance sheet date.

c) The exchange differences on realization or on restatement are adjusted to :

i) Carrying cost of fixed assets, if they relate to fixed assets and

ii) Profit and Loss account in other cases

d) In case of forward contracts, the exchange difference are dealt with in the profit and loss account over the period of the contracts except in respect of liabilities incurred for acquiring fixed assets in which case, the difference are adjusted in their carrying cost.

j) Employee Benefit

Liability in respect of employee benefits are accounted for as follows

A. Short-term employee benefits are recognized as expenses at undiscounted amount in the Statement of Profit and Loss of the year in which the relevant services is rendered.

B. Retirement Benefit

i) Retirement benefit in the form of Provident Fund, which are defined Contribution plans, are accounted on accrual basis and charged to the Statement of Profit and Loss of the year.

ii) The liability in respect of accumulated leave is accounted on accrual.

iii) The Company has taken a Group Gratuity cum Life Insurance policy with Life Insurance Corporation of India (LIC) for all eligible employees. The liability is actuarially assessed by LIC and accounted on accrual basis.

k) Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. All other borrowed cost is charged to Statement of Profit and Loss.

l) Taxation:

i) Current Tax is determined as the amount of tax payable in respect of taxable income for the year, computed in accordance with the applicable provisions of income tax Act, 1961.

ii) Deferred Tax resulting from timing difference between taxable and accounting income is accounted for using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. Deferred Tax Asset is recognized and carried forward only if there is reasonable certainty of its realisation.

m) Impairment of Assets

Impairment of assets is ascertained in each balance sheet date in respect of cash generating units. An impairment loss is recognized whenever carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value based on an appropriate discount factor.

n) Provisions, Contingent Liabilities and Contingent Assets

i) A provision is recognized based on a reliable estimate when there is a present obligation as a result of past events and it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation.

ii) Contingent liabilities, if material, are disclosed by way of notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

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Mar 31, 2012

A) Basis for preparation of financial statement

The financial statement have been prepared to comply in all material respects with the notified accounting standards by Companies (Accounting Standards) Rules, 2006 and the relevant provision of the Companies Act, 1956, under historical cost convention on an accrual basis unless stated otherwise.

b) Method of Accounting

The Company follows the mercantile system of accounting.

c) Revenue recognition of Income & Expenditure

i) Revenue from sales of products is recognized on transfer of all significant risk and rewards of ownership of the product on to customer, which is generally on dispatch of goods. Sales are stated exclusive of Value Added Tax/Sales Tax, returns and discounts for the year but inclusive of Excise duty.

ii) Purchases are recognized when ownership of goods is transferred and inclusive of all statutory levies but excluding excise duty & value added tax

iii) Job work charges are accounted for on completion of job basis.

iv) Interest income is recognized on time proportion basis.

v) All items of Income & Expenses are accounted for on accrual basis.

d) Services Tax & Convert Credit

i) Services Tax on GTA is accounted on accrual basis.

ii) Convert Credit on input services is recognized on the date of the payment of the same.

e) Fixed Assets

Fixed Assets are stated at cost net of Convert, other setoffs, accumulated depreciation and Impairment loss if any. Cost includes all expenses incurred to bring the asset to its present location and condition.

f) Capital Work in Progress

The capital Work in progress is stated at cost plus pre operative expenses.

g) Depreciation

i) Depreciation on Fixed Asset at Mumbai Office is provided on written down value as per the rates prescribed under the schedule XIV of the Companies Act, 1956.

ii) Depreciation on Fixed Assets at Nag thane Factory Unit is provided on straight-line method as per the rates prescribed under Schedule XIV of the Companies Act, 1956.

iii) Depreciation on Plant & Machinery is calculated on the basis of 3 shifts on straight-line method.

h) Inventories

i) Raw Materials are valued at cost or net realizable value whichever is less. Cost is arrived at using FIFO Method and comprises of all expenditure including expenses incurred in bringing the inventories to the present condition and situation. It does not include Excise Duty and VAT.

ii) Work in progress is valued at cost or net realizable value whichever is lower. Cost consists of average cost of Raw material and conversion cost up to the stage of process completed.

iii) Finished goods are valued at cost or net realizable value whichever is less. Cost consists average cost of Raw material, conversion cost and excise duty.

iv) Stores and Spares are valued at cost exclusive of Excise Duty & VAT credit taken.

v) Scrap is valued at the net realizable value.

I) Foreign Currencies Transaction

a) Transactions in foreign currency are recorded at the exchange rates prevailing on the date of the transaction.

b) Monetary items denominated in foreign currency are restated at the exchange rate prevailing on the balance sheet date.

c) The exchange differences on realization or on restatement are adjusted to :

i) Carrying cost of fixed assets, if they relate to fixed assets and

ii) Profit and Loss account in other cases

d) In case of forward contracts, the exchange difference are dealt with in the profit and loss account over the period of the contracts except in respect of liabilities incurred for acquiring fixed assets in which case, the difference are adjusted in their carrying cost.

j) Employee Benefit

Liability in respect of employee benefits are accounted for as follows: -

A. Short-term employee benefits are recognized as expenses at undiscounted amount in the Statement of Profit and Loss of the year in which the relevant services is rendered.

B. Retirement Benefit

i) Retirement benefit in the form of Provident Fund, which are defined Contribution plans, are accounted on accrual basis and charged to the Statement of Profit and Loss of the year.

ii) The liability in respect of accumulated leave is accounted on actual payment basis.

iii) The Company has taken a Group Gratuity cum Life Insurance policy with Life Insurance Corporation of India (LIC) for all eligible employees. The liability is actuarially assessed by LIC and accounted on accrual basis,

k) Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. All other borrowed cost is charged to Statement of Profit and Loss.

l) Taxation

(i) Current Tax is determined as the amount of tax payable in respect of taxable income for the year, computed in accordance with the applicable provisions of income tax Act, 1961.

ii) Deferred Tax resulting from timing difference between taxable and accounting income is accounted for using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. Deferred Tax Asset is recognized and carried forward only if there is reasonable certainty of its realisation.

m) Impairment of Assets

Impairment of assets is ascertained in each balance sheet date in respect of cash generating units. An impairment loss is recognized whenever carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value based on an appropriate discount factor.

n) Provisions, Contingent Liabilities and Contingent Assets

i) A provision is recognized based on a reliable estimate when there is a present obligation as a result of past events and it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation.

ii) Contingent liabilities, if material, are disclosed by way of notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

b) Terms/ Rights Attached to equity shares

The Company has one class of equity share having a par value of Rs. 10 per . Each holder of equity shares is entitled to one vote per share . The dividend, if any, is declared and paid in Indian Rupees. The dividend, if any, proposed by the Board of Director is subject to the approval of the holders in the ensuing Annual General Meeting.

In the event of Liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the holders

c) Nil number of bonus shares issued, shares issued for consideration other than cash and share bought back during the period of five years immediately preceding the reporting date .

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Mar 31, 2011

A) Basis for preparation of financial statement

The financial statement have been prepared to comply in all material respects with the notified accounting standards by Companies (Accounting Standards) Rules, 2006 and the relevant provision of the Companies Act, 1956, under historical cost convention on an accrual basis unless stated otherwise.

b) Method of Accounting

The Company follows the mercantile system of accounting.

c) Revenue recognition of Income & Expenditure

i) Revenue from sales of products is recognized on transfer of all significant risk and rewards of ownership of the product on to customer, which is generally on dispatch of goods. Sales are stated exclusive of Value Added Tax/Sales Tax, returns and discounts for the year but inclusive of Excise duty.

ii) Purchases are recognized when ownership of goods is transferred and inclusive of all statutory levies but excluding excise duty & value added tax

d) Job work charges are accounted for on completion of job basis.

iv) Interest income is recognized on time proportion basis.

v) All items of Income & Expenses are accounted for on accrual basis.

d) Services Tax & Convert Credit

i) Services Tax payable on Job work is accounted for on completion of Job Work.

ii) Convert Credit on input services is recognized on the date of the Payment of the same.

e) Fixed Assets

Fixed Assets are stated at cost net of Cenvat, other setoffs, accumulated depreciation and impairment loss if any. Cost includes all expenses incurred to bring the asset to its present location and condition.

f) Capital Work in Progress

The capital Work in progress is stated at cost plus pre operative expenses.

g) Depreciation

i) Depreciation on Fixed Asset at Mumbai Office is provided on written down value as per the rates prescribed under the schedule XTV of the Companies Act, 1956.

ii) Depreciation on Fixed Assets at Nag thane Factory Unit is provided on straight-line method as per the rates prescribed under Schedule XIV of the Companies Act, 1956.

iii) Depreciation on Plant & Machinery is calculated on the basis of 3 shifts on straight- line method.

h) Inventories

i) Raw Materials are valued at cost or net realizable value whichever is less. Cost is arrived at using FIFO Method and comprises of all expenditure including expenses incurred in bringing the inventories to the present condition and situation. It does not include Excise Duty and VAT.

ii) Work in progress is valued at cost or net realizable value whichever is lower. Cost consists of average cost of Raw material and conversion cost up to the stage of process completed.

iii) Finished goods are valued at cost or net realizable value whichever is less. Cost consists average cost of Raw material, conversion cost and excise duty.

iv) Stores and Spares are valued at cost exclusive of Excise Duty & VAT credit taken.

v) Scrap is valued at the net realizable value.

i) Foreign Currencies Transaction

a) Transactions in foreign currency are recorded at the exchange rates prevailing on the date of the transaction

b) Monetary items denominated in foreign currency are restated at the exchange rate prevailing on the balance sheet date.

c) The exchange differences on realization or on restatement are adjusted to :

i) Carrying cost of fixed assets, if they relate to fixed assets and

ii) Profit and Loss account in other cases

d) In case of forward contracts, the exchange difference are dealt with in the profit and loss account over the period of the contracts except in respect of liabilities incurred for acquiring fixed assets in which case, the difference are adjusted in their carrying cost.

j) Employee Benefit

Liability in respect of employee benefits are accounted for as follows:

A. Short-term employee benefits are recognized as expenses at undiscounted amount in the Profit & Loss Account of the year in which the relevant services is rendered.

B. Retirement Benefit

i) Retirement benefit in the form of Provident Fund, which are defined Contribution plans, are accounted on accrual basis and charged to the Profit & Loss Account of the year.

ii) The liability in respect of accumulated leave is provided for in the profit & loss account, based on actual leave liability determined at the end of the year at undiscounted amount.

iii) The Company has taken a Group Gratuity cum Life Insurance policy with Life Insurance Corporation of India (LIC) for all eligible employees. The liability is actuarially assessed by LIC and accounted on accrual basis.

k) Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. All other borrowed cost are charged to Profit & Loss Account.

l) Taxation:

i) Current Tax is determined as the amount of tax payable in respect of taxable income for the year, computed in accordance with the applicable provisions of income tax Act, 1961.

ii) Deferred Tax resulting from timing difference between taxable and accounting income is accounted for using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. Deferred Tax Asset is recognized and carried forward only if there is reasonable certainty of its realization.

m) Impairment of Assets

Impairment of assets is ascertained in each balance sheet date in respect of cash generating units. An impairment loss is recognized whenever carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value based on an appropriate discount factor.

n) Provisions, Contingent Liabilities and Contingent Assets

i) A provision is recognized based on a reliable estimate when there is a present obligation as a result of past events and it is probable that an outflow of resources embodying economic benefits will be required to settle an obligation.

ii) Contingent liabilities, if material, are disclosed by way of notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.