Accounting Policies of Majestic Auto Ltd. Company

Mar 31, 2025

1.3 Material accounting policy information

The material accounting policy information that are used in the
preparation of these financial statements are summarised below.
These accounting policies are consistently used throughout the
periods presented in the financial statements.

a) Current versus non-current classification

The Company presents assets and liabilities in the balance
sheet based on current/ non-current classification. An asset
is treated as current when it is:

• Expected to be realised or intended to be sold or
consumed in normal operating cycle*

• Held primarily for the purpose of trading

• Expected to be realised within twelve months after the
reporting period, or

• Cash or cash equivalent unless restricted from being
exchanged or used to settle a liability for at least twelve
months after the reporting period.

All other assets are classified as non-current.

A liability is current when:

• It is expected to be settled in normal operating cycle*

• It is held primarily for the purpose of trading

• It is due to be settled within twelve months after the
reporting period, or

• There is no unconditional right to defer the settlement
of the liability for at least twelve months after the
reporting period

The Company classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non¬
current assets and liabilities respectively.

*Based on the nature of products and the time between
acquisition of assets for processing and their realisation in
cash and cash equivalents, the Company has ascertained
its operating cycle as 12 months for the purpose of current
or non-current classification of assets and liabilities.

b) Inventory

Inventories are valued as follows:

Work in progress and finished goods
Work in progress and finished goods are valued at lower of
cost and net realisable value. Cost includes raw material cost
and a proportion of direct and indirect overheads up to
estimated stage of completion. Cost is determined on a
weighted average basis.

Raw material, components, stores and spares
Raw materials, components, stores and spares are valued
at lower of cost and net realisable value. However, materials
and other items held for use in the production of inventories
are not written down below cost if the finished products in
which they will be incorporated are expected to be sold at
or above cost. Cost of raw materials, components and stores
and spares is determined on a weighted average basis. Stores
and spares having useful life of more than twelve months
are capitalised as "Property, plant and equipment" and are
depreciated prospectively over their remaining useful lives
in accordance with Ind AS 16.

Scrap

Scrap is valued at net realisable value.

Goods in transit

Goods in transit are value at cost.

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

c) Property, plant and equipment

Recognition and initial measurement:

Items of property, plant and equipment are measured at
cost less accumulated depreciation and accumulated
impairment losses. The cost comprises purchase price,
borrowing cost if capitalisation criteria are met and directly
attributable cost of bringing the asset to its working
condition for the intended use. Any trade discount and
rebates are deducted in arriving at the purchase price.
Subsequent costs are capitalized in the asset''s carrying
amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic beneuts
attributable to such subsequent cost associated with the
item will uow to the Company. All other repair and
maintenance costs are recognised in statement of prout or
loss as incurred.

The cost of replacing part of an item of property, plant and
equipment is recognised in the carrying amount of the item
if it is probable that the future economic benefits embodied
within the part will flow to the Company and its cost can be
measured reliably. The costs of repairs and maintenance are
recognised in the statement of profit and loss as incurred.
Subsequent measurement (depreciation and useful lives)
Depreciation on property, plant and equipment is provided
on the straight line method arrived on the basis of the useful
life prescribed under Schedule II of the Companies Act, 2013.
Leasehold land is amortised over the period of lease.

The residual values, useful lives and method of depreciation
of are reviewed at each financial year end and adjusted
prospectively, if appropriate.

Where, during any unancial year, any addition has been
made to any asset, or where any asset has been sold,
discarded, demolished or destroyed, or signiucant
components replaced; depreciation on such assets is
calculated on a pro rata basis as individual assets with
speciuc useful life from the month of such addition or, as
the case may be, up to the month on which such asset has
been sold, discarded, demolished or destroyed or replaced.
De-recognition

An item of property, plant and equipment and any signiucant
part initially recognised is de-recognised upon disposal or
when no future economic beneuts 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 income statement when the asset is
derecognized.

d) Investment property
Recognition and initial measurement

Investment properties are properties held to earn rentals
or for capital appreciation, or both. Investment properties
are measured initially at their cost of acquisition. The cost
comprises purchase price, borrowing cost, if capitalization
criteria are met and directly attributable cost of bringing
the asset to its working condition for the intended use. Any
trade discount and rebates are deducted in arriving at the
purchase price.

Subsequent costs are capitalized in the asset''s carrying
amount or recognized as a separate asset, as appropriate,
only when it is probable that future economic benefits
associated with the item will flow to the Company. All other
repair and maintenance costs are recognized in statement
of profit and loss as incurred.

Subsequent measurement (Amortisation and useful lives)
Investment properties are subsequently measured at cost
less accumulated depreciation and impairment losses.
Depreciation on investment properties is provided on the
straight-line method, computed on the basis of useful lives
prescribed in Schedule II to the Companies Act 2013.

The residual values, useful lives and method of depreciation
are reviewed at the end of each financial year.
De-recognition

Investment properties are de-recognized either when they
have been disposed of or when they are permanently
withdrawn from use and no future economic benefit is
expected from their disposal. The difference between the
net disposal proceeds and the carrying amount of the asset
is recognized in statement of profit and loss in the period of
de-recognition.

e) Intangible assets

Recognition and initial measurement
Intangible assets acquired separately are measured on initial
recognition at cost. Following initial recognition, intangible
assets are carried at cost less accumulated amortisation and
accumulated impairment losses, if any. Internally generated
intangible assets, excluding product development costs, are
not capitalised and expenditure is reflected in the statement
of profit and loss in the year in which the expenditure is
incurred.

Subsequent measurement (Amortisation and useful lives)
All unite-lived intangible assets, including internally
developed intangible assets, are accounted for using the cost
model whereby capitalised costs are amortised on a straight¬
line basis over their estimated useful lives. Residual values
and useful lives are reviewed at each reporting date and
any change in the same is accounted for prospectively. The
following useful lives are applied:

De-recognition

Gains or losses arising from de-recognition of an intangible
asset are measured as the difference between the net
disposal proceeds and the carrying amount of the asset and
are recognised in the statement of profit or loss when the
asset is derecognised.

f) Impairment of non-financial assets

The carrying amounts of the Company''s non-financial assets,
other than inventories and deferred tax assets are reviewed
at each reporting date to determine whether there is any
indication of impairment. If any such indication exists, then
the asset''s recoverable amount is estimated. Goodwill and
intangible assets that have indefinite lives or that are not
yet available for use are tested for impairment annually;

their recoverable amount is estimated annually each year
at the reporting date.

For the purpose of impairment testing, assets are grouped
together into the smallest group of assets that generates
cash inflows from continuing use that are largely
independent of the cash inflows of other assets or groups
of assets (the ''cash-generating unit''). The recoverable
amount of an asset or cash-generating unit is the greater of
its value in use or its fair value less costs to sell. In assessing
value in use, the estimated future cash flows are discounted
to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of
money and the risks specific to the asset. The goodwill
acquired in a business combination is, for the purpose of
impairment testing, allocated to cash-generating units that
are expected to benefit from the synergies of the
combination. Intangibles with indefinite useful lives are
tested for impairment individually.

An impairment loss is recognised if the carrying amount of
an asset or its cash-generating unit exceeds its estimated
recoverable amount. Impairment losses recognised in
respect of cash-generating units are allocated first to reduce
the carrying amount of any goodwill allocated to the units
and then to reduce the carrying amount of the other assets
in the unit on a pro-rata basis. Impairment losses are
recognised in the statement of profit and loss.

Impairment losses recognised in prior periods are assessed
at each reporting date for any indications that the loss has
decreased or no longer exists. An impairment loss is reversed
if there has been a change in the estimates used to
determine the recoverable amount. An impairment loss is
reversed only to the extent that the asset''s carrying amount
does not exceed the carrying amount that would have been
determined, net of depreciation or amortisation, if no
impairment loss had been recognised.

g) Borrowing costs

Borrowing costs directly attributable to the acquisition,
construction or production of a qualifying asset are
capitalized as part of the cost of the asset. All other
borrowing costs are expensed in the period in which they
occur. A qualifying asset is an asset that necessarily takes a
substantial period of time to get ready for its intended use
or sale.

Borrowing costs include interest expense calculated using
the effective interest method as described in Ind AS 109,
and Interest in respect of the finance leases liabilities
recognized in accordance with Ind AS 116. Borrowing cost
also includes exchange differences arising from foreign
currency borrowings to the extent regarded as an
adjustment to the interest costs.

h) Foreign currency transactions
Initial recognition

Transactions in foreign currencies are initially recorded in
the functional currency (Indian Rupee) by applying exchange
rates at the date the transaction first qualifies for
recognition.

Subsequent measurement

Monetary items denominated in foreign currencies (except
monetary items that form part of foreign currency
operation) are translated at the exchange rates at the
reporting date. Exchange differences arising on settlement
or translation of monetary items are recognised in the
statement of profit or loss in the year in which they arise.
Non-monetary items that are measured in terms of historical
cost in a foreign currency are translated using the exchange
rates at the dates of the initial transactions.

Non-monetary items measured at fair value in a foreign
currency are translated using the exchange rates at the date
when the fair value is determined. The gain or loss arising
on translation of non-monetary items measured at fair value
is treated in line with the recognition of the gain or loss on
the change in fair value of the item (i.e. translation
differences on items whose fair value gain or loss is
recognised in Other comprehensive income or profit or loss
are also recognised in Other comprehensive income or profit
or loss, respectively).

All other exchange differences are charged to the statement
of profit and loss.

i) Leases

The Company has adopted Ind AS 116-Leases effective 1st
April, 2019, using the modified retrospective method. The
Company has applied the standard to its leases with the
cumulative impact recognised on the date of initial
application (1st April, 2019). Accordingly, previous period
information has not been restated.

The Company assesses whether a contract is or contains a
lease, at inception of a contract. A contract is, or contains,
a lease if the contract conveys the right to control the use
of an identified asset for a period of time in exchange for
consideration. To assess whether a contract conveys the
right to control the use of an identified asset, the Company
assesses whether:

(i) the contract involves the use of an identified asset

(ii) the Company has substantially all of the economic
benefits from use of the asset through the period of
the lease and

(iii) the Company has the right to direct the use of the asset.
At the date of commencement of the lease, the Company
recognises a right-of-use asset ("ROU") and a corresponding
lease liability for all lease arrangements in which it is a
lessee, except for leases with a term of twelve months or
less (short-term leases) and leases of low value assets. For
these short-term and leases of low value assets, the
Company recognises the lease payments as an operating
expense on a straight-line basis over the term of the lease.
The right-of-use assets are initially recognised at cost, which
comprises the initial amount of the lease liability adjusted
for any lease payments made at or prior to the
commencement date of the lease plus any initial direct costs
less any lease incentives. They are subsequently measured
at cost less accumulated depreciation and impairment
losses, if any. Right-of-use assets are depreciated from the
commencement date on a straight-line basis over the
shorter of the lease term and useful life of the underlying
asset.

The lease liability is initially measured at the present value
of the future lease payments. The lease payments are
discounted using the interest rate implicit in the lease or, if
not readily determinable, using the incremental borrowing
rates. The lease liability is subsequently remeasured by
increasing the carrying amount to reflect interest on the
lease liability, reducing the carrying amount to reflect the
lease payments made.

A lease liability is remeasured upon the occurrence of certain
events such as a change in the lease term or a change in an
index or rate used to determine lease payments. The
remeasurement normally also adjusts the leased assets.
Lease liability and ROU asset have been separately presented
in the Balance Sheet and lease payments have been
classified as financing cash flows.

Company as a lessor

Leases in which the Company does not transfer substantially
all the risks and rewards of ownership of an asset are
classified as operating leases. Rental income from operating
lease is recognised on a straight-line basis over the term of
the relevant lease except in case where lease rentals are
structured to increase in line with expected general inflation
to compensate for the lessor''s expected inflationary cost.
Contingent rents are recognised as revenue in the period in
which they are earned.

Leases are classified as finance leases when substantially
all of the risks and rewards of ownership transfer from the
Company to the lessee. Amounts due from lessees under
finance leases are recorded as receivables at the Company''s
net investment in the leases. Finance lease income is
allocated to accounting periods so as to reflect a constant
periodic rate of return on the net investment outstanding
in respect of the lease.

j) Fair value measurement

Fair value is the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. The
fair value measurement is based on the presumption that
the transaction to sell the asset or transfer the liability takes
place either:

• In the principal market for the asset or liability, or

• In the absence of a principal market, in the most
advantageous market for the asset or liability

The principal or the most advantageous market must be
accessible by the Company.

The fair value of an asset or a liability is measured using the
assumptions that market participants would use when
pricing the asset or liability, assuming that market
participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into
account a market participant''s ability to generate economic
benefits by using the asset in its highest and best use or by
selling it to another market participant that would use the
asset in its highest and best use.

Company uses valuation techniques that are appropriate in
the circumstances and for which sufficient data are available
to measure fair value, maximizing the use of relevant

observable inputs and minimizing the use of unobservable
inputs.

All assets and liabilities for which fair value is measured or
disclosed in the financial results are categorized within the
fair value hierarchy, described as follows, based on the
lowest level input that is significant to the fair value
measurement as a whole:

Level 1 — Quoted (unadjusted) market prices in active
markets for identical assets or liabilities
Level 2 — Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
directly or indirectly observable

Level 3 — Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
Unobservable

For assets and liabilities that are recognized in the financial
results on a recurring basis, company determines whether
transfers have occurred between levels in the hierarchy by
re-assessing categorization (based on the lowest level input
that is significant to the fair value measurement as a whole)
at the end of each reporting period or each case.

k) Revenue recognition

The Company applies the revenue recognition criteria to
each separately identifiable component of the Revenue
transaction as set out below:

Revenue from Contract with Customers:

The Company derives revenues primarily from Facility
management services and rental of property.

Revenues from customer contracts are considered for
recognition and measurement when the contract has been
approved by the parties to the contract, the parties to
contract are committed to perform their respective
obligations under the contract, and the contract is legally
enforceable.

Revenue is recognised when performance obligation of such
contract is satisfied by transferring a promised good or
service to the customer at transaction price allocated to that
performance obligation.

The transaction price is the amount of consideration to
which an entity expects to be entitled in exchange for
transferring promised goods or services to a customer,
excluding amounts collected on behalf of third parties.
When there is uncertainty as to collectability, revenue
recognition is postponed until such uncertainty is resolved.
The Company includes variable consideration as part of
transaction price when there is a basis to reasonably
estimate the amount of the variable consideration and when
it is probable that a significant reversal of cumulative
revenue recognized will not occur when the uncertainty
associated with the variable consideration is resolved.

Dividend income

Dividend income is recognised at the time when right to
receive the payment is established, which is generally when
the shareholders approve the dividend.

Interest income

Interest income is recorded on accrual basis using the
effective interest rate (EIR) method.

Rental income

Rental income is recognized on a straight-line basis over the
term of the lease, except for contingent rental income which
is recognized when it arises and where scheduled increase
in rent compensates the lessor for expected inflationary
costs.

l) Financial instruments

Initial Recognition and measurement
The Company recognizes financial assets and financial
liabilities when it becomes a party to the contractual
provisions of the instrument.

All financial assets and financial liabilities are initially
measured at its fair value. Transaction costs that are directly
attributable to the acquisition or issue of financial assets
and financial liabilities, which are not at fair value through
profit or loss(FVTPL), are adjusted to the fair value on initial
recognition.

However, trade receivables that do not contain a significant
financing component are measured at transaction price.
Subsequent measurement
Financial assets

i. Financial assets carried at amortised cost - A financial
instrument is measured at 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 method.

ii. Investments in equity instruments of subsidiaries -

Investments in equity instruments of subsidiaries are
accounted for at cost in accordance with Ind AS 27
Separate Financial Statements.

iii. Financial assets at fair value

• Investments in equity instruments other than
above -Investments in equity instruments which
are held for trading are generally classified as at
fair value through profit and loss (FVTPL). For all
other equity instruments, the Company makes
irrevocable choice upon initial recognition, on an
instrument to instrument basis, to classify the
same either as at fair value through other
comprehensive income (FVOCI) or fair value
through profit and loss (FVTPL).

If the Company decides to classify an equity instrument
as at FVOCI, then all fair value changes on the
instrument, excluding dividends, are recognised in the
other comprehensive income (OCI). There is no
recycling of the amounts from OCI to statement of
profit and loss, even on sale of investment. However,
the Company transfers the cumulative gain or loss
within equity. Dividends on such investments are

recognised in the statement of profit or loss unless the
dividend clearly represents a recovery of part of the
cost of the investment.

De-recognition of financial assets
A financial asset is primarily de-recognised when the
rights to receive cash flows from the asset have expired
or the Company has transferred its rights to receive
cash flows from the asset.

Financial liabilities

Subsequent to initial recognition, all non-derivative
financial liabilities, other than derivative liabilities, are
subsequently measured at amortised cost using the
effective interest method.

De-recognition of financial liabilities
A financial liability is de-recognised 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.
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 realize the assets and settle the
liabilities simultaneously.

m) 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 for financial Assets.

ECL is the difference between all contractual cash flows that
are due to the Company in accordance with the contract
and all the cash flows that the Company expects to receive.
When estimating the cash flows, the Company considers
the following:

• All contractual terms of the Financial Assessments
(including prepayment and extension) over the
expected life of the assets.

• Cash flows from the sale of collateral held or other
credit enhancements that are integral to the
contractual terms.

Trade receivables

As a practical expedient the Company has adopted
''simplified approach'' using the provision matrix method for
recognition of expected loss on trade receivables. The
provision matrix is based on three- years rolling average
default rates observed over the expected life of the trade
receivables and is adjusted for forward-looking estimates.
These average default rates are applied on total credit risk
exposure on trade receivables and outstanding for more
than one year at the reporting date to determine lifetime
Expected Credit Losses.

Other financial assets

For recognition of impairment loss on other financial assets
and risk exposure, the Company determines whether there
has been a significant increase in the credit risk since initial
recognition and if credit risk has increased significantly,
impairment loss is provided.

Investment in subsidiaries

Investments in subsidiaries are carried at cost less
accumulated impairment losses, if any. Where an indication
of impairment exists, the carrying amount of the investment
is assessed and written down immediately to its recoverable
amount. On disposal of these investments, the difference
between net disposal proceeds and the carrying amounts
are recognised in the Statement of Prout and Loss.

n) Retirement and other employee benefits
Provident and Superannuation fund

Retirement benefit in the form of provident and
superannuation fund is a defined contribution scheme. The
Company has no obligation, other than the contribution
payable to the provident and superannuation fund. The
Company recognizes contribution payable to the provident
fund scheme as an expense, when an employee renders the
related service. The Company has no obligation other than
the contribution payable to the Provided and
superannuation fund.

Gratuity

A defined benefit plan is a post-employment benefit plan
other than a defined contribution plan. The Company''s net
obligation in respect of the gratuity plan (administered
through Life Insurance Corporation of India), which is a
defined benefit plan, is calculated by estimating the ultimate
cost to the entity of the benefit that employees have earned
in return for their service in the current and prior periods.
This requires an entity to determine how much benefit is
attributable to the current and prior periods and to make
estimates (actuarial assumptions) about demographic
variables and financial variables that will affect the cost of
the benefit. The cost of providing benefits under the defined
benefit plan is determined using actuarial valuation
performed annually by a qualified actuary using the
projected unit credit method. Actuarial gains/losses
resulting from re-measurements of the liability are included
in other comprehensive income.

Accumulated leaves

Accumulated leave, which is expected to be utilized within
the next 12 months, is treated as short term employee
benefit. The Company measures the expected cost of such
absences as the additional amount that it expects to pay as
a result of the unused entitlement that has accumulated at
the reporting date.

Other short-term benefits

Expense in respect of other short-term benefits is recognized
on the basis of amount paid or payable for the period during
which services are rendered by the employees.

o) Earnings per share

Basic earnings per share is calculated by dividing the net
profit or loss for the period attributable to equity

shareholders (after deducting attributable taxes) by the
weighted average number of equity shares outstanding
during the period. The weighted average number of equity
shares outstanding during the period is adjusted for events
including a bonus issue.

For the purpose of calculating diluted earnings per share,
the net profit or loss for the period attributable to equity
shareholders and the weighted average number of shares
outstanding during the period are adjusted for the effects
of all dilutive potential equity shares.

p) Taxes

Tax expense recognized in statement of profit and loss
comprises the sum of deferred tax and current tax except
the ones recognized in other comprehensive income or
directly in equity.

Current tax is determined as the tax payable in respect of
taxable income for the year and is computed in accordance
with relevant tax regulations. Current income tax relating
to items recognized outside profit or loss is recognized
outside profit or loss (either in other comprehensive income
or in equity).

Deferred tax is recognized in respect of temporary
differences between carrying amount of assets and liabilities
for financial reporting purposes and corresponding amount
used for taxation purposes. Deferred tax assets on unrealised
tax loss are recognized to the extent that it is probable that
the underlying tax loss will be utilised against future taxable
income. This is assessed based on the Company''s forecast
of future operating results, adjusted for significant non¬
taxable income and expenses and specific limits on the use
of any unused tax loss. Unrecognized deferred tax assets
are re-assessed at each reporting date and are recognized
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
recognized outside statement of profit and loss is recognized
outside statement of profit or loss (either in other
comprehensive income or in equity).

q) Segment reporting

The operations of the Company fall primarily under one
business segment, which is considered to be the only
reportable segment by the management.

r) Cash and cash equivalents

Cash and cash equivalent in the balance sheet comprise cash
at banks and on hand and short-term deposits with an
original maturity of three months or less, which are subject
to an insignificant risk of changes in value.

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Mar 31, 2018

Amounts recognised in profit or loss

Write-downs of inventories to net realisable value amounted to Rs. 35.94 lakhs (31 March 2017 - Rs. nil). These were recognised as an expense during the year and included in ‘changes in value of inventories of work-in-progress and finished goods’ in statement of profit and loss.

Assets and liabilities classified as held for sale

During the year, management decided to discontinue ‘Fine Blanking Components’ and ‘Electricals’ divisions due to lack of viable orders, profitability and capital investment requirements for new technology. Consequently, certain assets and liabilities were classified as a disposal group.

The Company has sold certain Property plant and equipment which were part of the discontinued manufacturing operations. Further, the Company has identified certain Property, plant and equipment which were part of the discontinued manufacturing operations whose carrying amounts will be recovered principally through a sale transaction rather than through continuing use. The proposal has been approved by the Board of Directors and shareholders of the Company. The Company is in the process of closing the sale transaction and expects to realize the sale proceeds within next 12 months. Accordingly, the said Property plant and equipment have been classified as “Non-current asset held for sale”.

Segment information

Plant and equipment is disclosed as part of the ‘Electrical’ segment which has now been discontinued. Freehold land and buildings are disclosed as part of the ‘Facility Management Services’ segment under Segment reporting disclosures.

Non-recurring fair value measurements

Asset classified as held for sale during the reporting period was measured at the lower of its carrying amount and fair value less costs to sell at the time of re-classification.

v Rights, preferences and restrictions attached to equity shares

The Company has one class of equity shares with paid up value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share on all resolutions submitted to shareholders. They have right to participate in the profits of the Company, if declared by the board as interim dividend and recommended by the board and declared by the members as final dividend. They are also entitled to bonus/right issue, as declared by Company from time to time. In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the Company, beside other rights available under the Companies Act.

The distribution will be in proportion to the number of equity shares held by the shareholders.

viii Aggregate number and class of shares allotted as fully paid up pursuant to contract(s) without payment being received in cash, by way of bonus shares and shares bought back for the period of 5 years immediately preceding the balance sheet date

The Company has not issued any shares pursuant to contract(s) without payment being received in cash.

No bonus shares have been issued in preceding 5 years.

1500 equity shares of Rs. 10 per share were forfeited by Company against unpaid call money of Rs. 5 per equity share

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Mar 31, 2016

A. ACCOUNTING CONVENTIONS

The financial statements of the company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under section 133 of the Companies Act, 2013, read together with Rule 7 of the Companies (Accounts) Rules 2014. The financial statements have been prepared on an accrual basis and under the historical cost convention.

All assets and liabilities have been classified as current or non-current as per the Company''s normal operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of products and the normal time between the acquisition of the assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current-non current classification of its assets and liabilities as current and non-current.

B. FIXED ASSETS INCLUDING INTANGIBLE ASSETS AND DEPRECIATION/AMORTIZATION

a) Fixed assets including intangible assets are stated at cost net of cenvat, less accumulated depreciation and/ or impairment loss, if any. Intangible assets comprise purchased software/licenses. All costs till the commencement of commercial production attributable to the fixed assets and intangible assets are capitalized.

b) Depreciation on fixed assets has been provided on straight-line method at the rates and in the manner prescribed in Schedule II to the Companies Act, 2013.

c) Depreciation on intangible assets has been provided as per Accounting Standard 26 ''Intangible Assets''.

d) The cost of Leasehold land is amortized over the period of lease.

e) In respect of assets added / disposed off during the year, depreciation is charged on a pro-rata basis with reference to the month of addition/disposal.

f) Intangible assets are recognized if it is probable that the future economic benefits that are attributable to the asset will flow to the Company and the cost of the asset can be measured reliably. These assets are valued at cost which comprises its purchase price and any directly attributable expenditure.

C. INVESTMENTS

Investments are classified into current and long term investments. Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Current investments (excluding current maturities of long term investments) are stated at the lower of cost and fair value. Long term investments are carried at cost. Provision for diminution in value of long term investments is made only if such decline is not temporary.

D. INVENTORIES

a) Finished goods are valued at lower of cost or net realizable value. Cost is considered at material cost on movement moving weighted average basis plus appropriate overheads.

b) Work in progress is valued at material cost on movement moving weighted average basis plus appropriate overheads.

c) Scrap is valued at net realizable value.

d) Goods in transit are valued at cost.

e) Other inventories are valued at cost on moment moving weighted average basis.

f) The liability of excise duty on finished goods and scrap lying in the factory at year end is estimated on the basis of sales price of goods and excise rates prevailing on the said date, while determining the cost of closing stock of finished goods and scrap.

E. EMPLOYEE BENEFITS

Superannuation, Provident and Gratuity Funds are accounted for on accrual basis with corresponding payments to recognized scheme/fund. Short term employees'' benefits are recognized as an expense at the undiscounted amount in the Statement of profit and loss for the year in which the related services rendered. The liability for gratuity (in the nature of a defined benefit obligation) is provided on the basis of actuarial valuation (PUC method) conducted by Life Insurance Company of India (LIC), since the gratuity scheme of the company is covered under a group gratuity cum life assurance cash accumulation policy of the LIC. Actuarial gains or loss arising from such valuation are charged to revenue in the year in which they arise.

F. REVENUE RECOGNITION

Revenue from sale of products/job-work is recognized on dispatch of goods from factory premises and is recognized on accrual basis except for export sales, which are booked on the basis of date of custom clearance.

Gross sales as reflected in the financial statements are inclusive of excise duty and net of rebate / trade discounts and returns.

Interest income is recognized on an accrual basis on time proportion method, taking into account the amount outstanding and the rate applicable.

Dividend income is recognized when the right to receive payment is established by the balance sheet date. Exports benefits are recognized on an accrual basis at the anticipated realizable value, based on past experience.

G. RESEARCH AND DEVELOPMENT

Revenue expenditure on research and development is charged against the profit of the year in which it is incurred. Capital expenditure on research and development is shown as an addition to fixed assets and depreciation is provided on the same basis as for other fixed assets.

H. FOREIGN EXCHANGE TRANSACTIONS

The Company accounts for effects of difference in foreign exchange rates in accordance with Accounting Standard 11 notified by the Companies (Accounting Standards) Rules, 2006.

a) Transactions in foreign currencies are accounted for at the exchange rate prevailing at the date of transaction/ negotiations.

b) Monetary foreign currencies items outstanding at the year end are reinstated into rupees at the rate of exchange prevailing on the Balance Sheet date.

c) Non monetary foreign currency items are carried at cost.

d) Any income or expenses on account of exchange rate difference either on settlement or on transaction is recognized in the statement of profit and loss.

e) In respect of forward contracts, forward premium or discount arising at the inception of forward contract is amortized over the life of contract. Exchange differences on such contracts are recognized in the statement of profit and loss in the year in which exchange rates change. Any profit and loss arising on cancellation or renewal of forward exchange contract is recognized as income or as expense for the year.

I. TAXATION

The provision for current income tax liability is ascertained on the basis of assessable profits computed in accordance with the provisions of Income Tax Act, 1961. Deferred tax is recognized, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of being reversed in one or more subsequent periods.

Minimum Alternative Tax ("MAT") paid in accordance with the tax laws, which gives rise to future economic benefits in the form of adjustment of future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal tax in future. MAT Credit entitlement can be carried forward and utilized for a specific period as prescribed under the law from the year in which the same is availed. Accordingly, it is recognized as an asset in the Balance Sheet when it is probable that the future economic benefit associated with it will flow to the Company and the asset can be measured reliably.

J. GOVERNMENT GRANTS

Government grants are deducted from the value of the concerned asset if the grant is specifically received for the purchase, construction or acquisition of the asset. However, if it is received as a contribution towards the total investment or by way of contribution to its capital outlay and no repayment is ordinarily required to be made; such grants are treated as capital reserves.

K. ACCOUNTING FOR ESTIMATES

The preparation of financial statements in conformity with Generally Accepted Accounting Principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Examples of such estimates include estimation of future obligations under employee retirement benefit plans, estimated useful life of fixed assets, classification of assets / liabilities etc. Actual results could differ from these estimates. Any revision to accounting estimates is recognized in accordance with the requirements of the respective accounting standards.

L. IMPAIRMENT

The carrying amounts of assets are reviewed at each balance sheet date in accordance with Accounting Standard 28, ''Impairment of Assets'', to determine whether there is any indication of impairment. An impairment loss is charged to the statement of profit & loss in the year in which an assets is identified as impaired.

M. ACCOUNTING FOR LEASES

Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased asset are classified as operating leases. Operating lease charges are expensed on a straight line basis with reference to lease terms and other considerations.

N. BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets to the extent that they relate to the period till such assets are ready to be put to use. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to the Statement of Profit and Loss.

O. SEGMENT REPORTING

a) The Company has disclosed business segment as the primary segment for disclosure. The Company has identified three separate segments i.e. Fine Blanking Components, Electricals and others. The Segments are identified with regard to the dominant source, nature of risks and returns, internal organization and management structure and internal reporting systems.

b) The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

c) Segment revenues, Results and Capital employed figures include the respective amounts identifiable to each of the segments. Interest and other financial charges/ incomes are reported at corporate level. Also those assets and liabilities which are not identifiable to the individual segments are reported at corporate level.

d) The inter segmental revenue is accounted for on the basis of transfer price agreed to amongst segments as per market trend.

P. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

A provision is recognized when the company has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation in respect of which reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.

A contingent asset is neither recognized nor disclosed in the financial statements.

Q. CASH FLOW STATEMENT

The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard-3 on Cash Flow Statements and presents cash flows by operating, investing and financing activities of the Company. The Company considers all highly liquid financial instruments, which are readily convertible into cash, to be cash equivalents.

R. EARNINGS PER SHARE

Basic earnings per share are calculated by dividing the net profit for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

The weighted average number of equity shares outstanding during the period and for all periods presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares that have changed the number of equity shares outstanding without a corresponding change in resources. For the purpose of calculating diluted earnings per share, the net profit for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

---

Mar 31, 2014

A. ACCOUNTING CONVENTIONS

The financial statements are prepared under the historical cost convention, on the accrual basis of accounting in accordance with the Generally Accepted Accounting Principles (GAAP) in India and comply with the accounting standards as notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant presentational requirements of the Companies Act, 1956.

B. BASIS OF PREPARATION

The financial statements have been prepared and presented under the historical cost convention on the accrual basis of accounting, unless stated otherwise and comply with the mandatory Accounting Standards (''AS'') prescribed under the Companies Act, 1956 read with the General Circular 08/2014 dated April 04, 2014 issued by the Ministry of Corporate Affairs, and other accounting principles generally accepted in India. The accounting policies adopted in the preparation of financial statements are consistent with those of the previous year.

C. FIXED ASSETS INCLUDING INTANGIBLE ASSETS AND DEPRECIATION/AMORTIZATION

a) Fixed assets including intangible assets are stated at cost net of cenvat, less accumulated depreciation and/ or impairment loss, if any. Intangible assets comprise purchased softwares/licenses. All costs till commencement of commercial production attributable to the fixed assets and intangible assets are capitalized.

b) Depreciation on fixed assets including intangible assets has been provided on straight-line method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

c) The cost of Leasehold land is amortized over the period of lease.

d) In respect of assets added / disposed off during the year, depreciation is charged on a pro-rata basis with reference to the month of addition/disposal.

e) Assets costing up to Rs. 5,000 are fully depreciated in the year of purchase.

f) Intangible assets are recognised if it is probable that the future economic benefits that are attributable to the asset will flow to the Company and the cost of the asset can be measured reliably. These assets are valued at cost which comprises its purchase price and any directly attributable expenditure.

D. INVESTMENTS

Investments are classified into current and long term investments. Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Current investments (excluding current maturities of long term investments) are stated at the lower of cost and fair value. Long term investments are carried at cost. Provision for diminution in value of long term investments is made only if such decline is not temporary.

E. INVENTORIES

a) Finished goods are valued at lower of cost or net realizable value. Cost is considered at material cost on movement moving weighted average basis plus appropriate overheads.

b) Work in progress is valued at material cost on movement moving weighted average basis plus appropriate overheads.

c) Scrap is valued at net realizable value.

d) Goods in transit are valued at cost.

e) Other inventories are valued at cost on moment moving weighted average basis.

f) The liability of excise duty on finished goods and scrap lying in the factory at year end is estimated on the basis of sales price of goods and excise rates prevailing on the said date, while determining the cost of closing stock of finished goods and scrap.

F. EMPLOYEE BENEFITS

Superannuation, Provident and Gratuity Funds are accounted for on accrual basis with corresponding payments to recognized scheme/fund. Short term employees'' benefits are recognized as an expense at the undiscounted amount in the Statement of profit and loss for the year in which the related services rendered. The liability for gratuity (in the nature of a defined benefit obligation) is provided on the basis of actuarial valuation (PUC method) conducted by Life Insurance Company of India (LIC), since the gratuity scheme of the company is covered under a group gratuity cum life assurance cash accumulation policy of the LIC. Actuarial gains or loss arising from such valuation are charged to revenue in the year in which they arise.

G REVENUE RECOGNITION

Revenue from sale of products/job-work is recognized on dispatch of goods from factory premises and is recognized on accrual basis except for export sales, which are booked on the basis of date of custom clearance.

Gross sales as reflected in the financial statements are inclusive of excise duty and net of rebate / trade discounts and returns.

Interest income is recognized on an accrual basis on time proportion method, taking into account the amount outstanding and the rate applicable.

Dividend income is recognized when the right to receive payment is established by the balance sheet date. Exports benefits are recognized on an accrual basis at the anticipated realizable value, based on past experience.

H. RESEARCH AND DEVELOPMENT

Revenue expenditure on research and development is charged against the profit of the year in which it is incurred. Capital expenditure on research and development is shown as an addition to fixed assets and depreciation is provided on the same basis as for other fixed assets.

I. FOREIGN EXCHANGE TRANSACTIONS

The Company accounts for effects of difference in foreign exchange rates in accordance with Accounting Standard 11 notified by the Companies (Accounting Standards) Rules, 2006.

a) Transactions in foreign currencies are accounted for at the exchange rate prevailing at the date of transaction/ negotiations.

b) Monetary foreign currencies items outstanding at the year end are restated into rupees at the rate of exchange prevailing on the Balance Sheet date.

c) Non monetary foreign currency items are carried at cost.

d) Any income or expenses on account of exchange rate difference either on settlement or on transaction is recognized in the statement of profit and loss.

e) In respect of forward contracts, forward premium or discount arising at the inception of forward contract is amortized over the life of contract. Exchange differences on such contracts are recognized in the statement of profit and loss in the year in which exchange rates change. Any profit and loss arising on cancellation or renewal of forward exchange contract is recognized as income or as expense for the year.

J. TAXATION

The provision for current income tax liability is ascertained on the basis of assessable profits computed in accordance with the provisions of Income Tax Act, 1961. Deferred tax is recognized, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of being reversed in one or more subsequent periods. Minimum Alternative Tax ("MAT") paid in accordance with the tax laws, which gives rise to future economic benefits in the form of adjustment of future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal tax in future. MAT Credit entitlement can be carried forward and utilized for a specific period as prescribed under the law from the year in which the same is availed. Accordingly, it is recognized as an asset in the Balance Sheet when it is probable that the future economic benefit associated with it will flow to the Company and the asset can be measured reliably.

K. GOVERNMENT GRANTS

Government grants are deducted from the value of the concerned asset if the grant is specifically received for the purchase, construction or acquisition of the asset. However, if it is received as a contribution towards the total investment or by way of contribution to its capital outlay and no repayment is ordinarily required to be made; such grants are treated as capital reserves.

L. ACCOUNTING FOR ESTIMATES

The preparation of financial statements in conformity with Generally Accepted Accounting Principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Examples of such estimates include estimation of future obligations under employee retirement benefit plans, estimated useful life of fixed assets, classification of assets / liabilities etc. Actual results could differ from these estimates. Any revision to accounting estimates is recognized in accordance with the requirements of the respective accounting standards.

M. IMPAIRMENT

The carrying amounts of assets are reviewed at each balance sheet date in accordance with Accounting Standard 28, ''Impairment of Assets'', to determine whether there is any indication of impairment. An impairment loss is charged to the statement of profit & loss in the year in which an assets is identified as impaired.

N. ACCOUNTING FOR LEASES

Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased asset are classified as operating leases. Operating lease charges are expensed on a straight line basis with reference to lease terms and other considerations.

O. BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets to the extent that they relate to the period till such assets are ready to be put to use. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to the Statement of Profit and Loss.

P. SEGMENT REPORTING

a) The Company has disclosed business segment as the primary segment for disclosure. The Company has identified four separate segments i.e. Fine Blanking Components, Mufflers, Spokes and Electricals. The Segments are identified with regard to the dominant source, nature of risks and returns, internal organization and management structure and internal reporting systems.

b) The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

c) Segment revenues, Results and Capital employed figures include the respective amounts identifiable to each of the segments. Interest and other financial charges/ incomes are reported at corporate level. Also those assets and liabilities which are not identifiable to the individual segments are reported at corporate level.

d) The inter segmental revenue is accounted for on the basis of transfer price agreed to amongst segments as per market trend.

Q. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

A provision is recognized when the company has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation in respect of which reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.

A contingent asset is neither recognized nor disclosed in the financial statements.

R. CASH FLOW STATEMENT

The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard-3 on Cash Flow Statements and presents cash flows by operating, investing and financing activities of the Company. The Company considers all highly liquid financial instruments, which are readily convertible into cash, to be cash equivalents.

S. EARNINGS PER SHARE

Basic earnings per share are calculated by dividing the net profit for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

The weighted average number of equity shares outstanding during the period and for all periods presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares that have changed the number of equity shares outstanding without a corresponding change in resources. For the purpose of calculating diluted earnings per share, the net profit for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

---

Mar 31, 2012

A. ACCOUNTING CONVENTIONS

The financial statements are prepared under the historical cost convention, on the accrual basis of accounting in accordance with the Generally Accepted Accounting Principles (GAAP) in India and comply with the accounting standards as notified under the Companies (Accounting Standards) Rules, 2006 and the relevant presentational requirements of the Companies Act, 1956.

B. BASIS OF PREPARATION

The financial statements have been prepared to comply in all material aspects with applicable accounting principles in India, the applicable Accounting Standards notified under Section 211(3C) of the Companies Act, 1956 and the relevant provisions thereof.

All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle and other criteria set out in Revised Schedule VI to the Companies Act, 1956.

C. FIXED ASSETS INCLUDING INTANGIBLE ASSETS AND DEPRECIATION / AMORTISATION

a) Fixed assets including intangible assets are stated at cost net of cenvat, less accumulated depreciation and / or impairment loss, if any. All costs till commencement of commercial production attributable to the fixed assets and intangible assets are capitalized.

b) Depreciation on fixed assets including intangible assets has been provided on straight-line method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

c) The cost of Leasehold land is amortized over the period of lease.

d) In respect of assets added / disposed off during the year, depreciation is charged on a pro-rata basis with reference to the month of addition/disposal.

e) Assets costing up to Rs. 5,000 are fully depreciated in the year of purchase.

f) Intangible assets are recognised if it is probable that the future economic benefits that are attributable to the asset will flow to the Company and the cost of the asset can be measured reliably. These assets are valued at cost which comprises its purchase price and any directly attributable expenditure.

D. INVESTMENTS

Investments are classified into current and long term investments. Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments. Current investments (excluding current maturities of long term investments) are stated at the lower of cost and fair value. Long term investments are carried at cost. Provision for diminution in value of long term investments is made only if such decline is not temporary.

E. INVENTORIES

a) Finished goods are valued at lower of cost or net realizable value. Cost is considered at material cost on moment moving weighted average basis plus appropriate overheads.

b) Work in progress is valued at material cost on moment moving weighted average basis plus appropriate overheads.

c) Scrap is valued at net realizable value.

d) Other inventories are valued at cost on moment moving weighted average basis.

e) The liability of excise duty on finished goods and scrap lying in the factory at year end is estimated on the basis of sales price of goods and excise rates prevailing on the said date, while determining the cost of closing stock of finished goods and scrap.

F. EMPLOYEE BENEFITS

Superannuation, Provident and Gratuity Funds are accounted for on accrual basis with corresponding payments to recognized scheme/fund. Short term employees' benefits are recognized as an expense at the undiscounted amount in the Statement of profit and loss for the year in which the related services rendered. The liability for gratuity (in the nature of a defined benefit obligation) is provided on the basis of actuarial valuation (PUC method) conducted by Life Insurance Company of India (LIC), since the gratuity scheme of the company is covered under a group gratuity cum life assurance cash accumulation policy of the LIC.

G. REVENUE RECOGNITION

Revenue from sale of products/job-work is recognized on dispatch of goods from factory premises and is recognized on accrual basis except for export sales, which are booked on the basis of date of custom clearance. Gross sales as reflected in the financial statements are inclusive of excise duty and net of rebate / trade discounts and returns.

Interest income is recognized on an accrual basis on time proportion method, taking into account the amount outstanding and the rate applicable.

Dividend income is recognized when the right to receive payment is established by the balance sheet date. Exports benefits are recognized on an accrual basis at the anticipated realizable value, based on past experience.

H. RESEARCH AND DEVELOPMENT

Revenue expenditure on research and development is charged against the profit of the year in which it is incurred. Capital expenditure on research and development is shown as an addition to fixed assets and depreciation is provided on the same basis as for other fixed assets.

I. FOREIGN EXCHANGE TRANSACTIONS

The Company accounts for effects of difference in foreign exchange rates in accordance with Accounting Standard 11 notified by the Companies (Accounting Standards) Rules, 2006.

a) Transactions in foreign currencies are accounted for at the exchange rate prevailing at the date of transaction/ negotiations.

b) Monetary foreign currencies items outstanding at the year end are restated into rupees at the rate of exchange prevailing on the Balance Sheet date.

c) Non monetary foreign currency items are carried at cost.

d) Any income or expenses on account of exchange rate difference either on settlement or on transaction is recognized in the statement of profit and loss.

e) In respect of forward contracts, forward premium or discount arising at the inception of forward contract is amortized over the life of contract. Exchange differences on such contracts are recognized in the statement of profit and loss in the year in which exchange rates change. Any profit and loss arising on cancellation or renewal of forward exchange contract is recognized as income or as expense for the year.

J. TAXATION

The provision for current income tax liability is ascertained on the basis of assessable profits computed in accordance with the provisions of Income Tax Act, 1961. Deferred tax is recognized, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of being reversed in one or more subsequent periods.

Minimum Alternative Tax ("MAT") paid in accordance with the tax laws, which gives rise to future economic benefits in the form of adjustment of future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal tax in future. MAT Credit entitlement can be carried forward and utilized for a specific period as prescribed under the law from the year in which the same is availed. Accordingly, it is recognized as an asset in the Balance Sheet when it is probable that the future economic benefit associated with it will flow to the Company and the asset can be measured reliably.

K. GOVERNMENT GRANTS

Government grants are deducted from the value of the concerned asset if the grant is specifically received for the purchase, construction or acquisition of the asset. However, if it is received as a contribution towards the total investment or by way of contribution to its capital outlay and no repayment is ordinarily required to be made; such grants are treated as capital reserves.

L. ACCOUNTING FOR ESTIMATES

The preparation of financial statements in conformity with Generally Accepted Accounting Principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Examples of such estimates include estimation of future obligations under employee retirement benefit plans, estimated useful life of fixed assets, classification of assets / liabilities etc. Actual results could differ from these estimates. Any revision to accounting estimates is recognized in accordance with the requirements of the respective accounting standards.

M. IMPAIRMENT

The carrying amounts of assets are reviewed at each balance sheet date in accordance with Accounting Standard 28, 'Impairment of Assets', to determine whether there is any indication of impairment. An impairment loss is recognized when the carrying amount of fixed assets exceeds its recoverable amount. The recoverable amount of an asset is lower of net selling price and its value in use.

N. ACCOUNTING FOR LEASES

Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased asset are classified as operating leases. Operating lease charges are recognised as an expense in the Statement of Profit and Loss on a straight line basis.

O. BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets to the extent that they relate to the period till such assets are ready to be put to use. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to the Statement of Profit and Loss.

P. SEGMENT REPORTING

a) The Company has disclosed business segment as the primary segment for disclosure. The Company has identified four separate segments i.e. Fine Blanking Components, Mufflers, Spokes and Electricals. The Segments are identified with regard to the dominant source, nature of risks and returns, internal organization and management structure and internal reporting systems.

b) The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

c) Segment revenues, Results and Capital employed figures include the respective amounts identifiable to each of the segments. Interest and other financial charges/ incomes are reported at corporate level. Also those assets and liabilities which are not identifiable to the individual segments are reported at corporate level.

d) The inter segmental revenue is accounted for on the basis of transfer price agreed to amongst segments as per market trend.

Q. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

A provision is recognised when the company has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation in respect of which reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.

A contingent asset is neither recognised nor disclosed in the financial statements.

R. CASH FLOW STATEMENT

The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard-3 on Cash Flow Statements and presents cash flows by operating, investing and financing activities of the Company. The Company considers all highly liquid financial instruments, which are readily convertible into cash, to be cash equivalents.

S. EARNINGS PER SHARE

Basic earnings per share are calculated by dividing the net profit for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

The weighted average number of equity shares outstanding during the period and for allperiods presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares that have changed the number of equity shares outstanding without a corresponding change in resources. For the purpose of calculating diluted earnings per share, the net profit for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

---

Mar 31, 2011

I) ACCOUNTING CONVENTIONS

The financial statements are prepared under the historical cost convention on accrual basis and in accordance with the Accounting Standards issued under the Companies (Accounting Standards) Rules, 2006 and the relevant presentational requirements of the Companies Act, 1956.

II) ACCOUNTING FOR ESTIMATES

The preparation of financial statements is in conformity with the generally accepted accounting principles and requires estimates and assumptions to be made that affect reportable amount of assets and liabilities on date of financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the year in which the results are known/ materialized.

III) FIXED ASSETS INCLUDING INTANGIBLE ASSETS AND DEPRECIATION/AMORTISATION

a) Fixed assets including intangible assets are stated at cost net of cenvat, less accumulated depreciation and / or impairment loss, if any. Intangible assets comprise purchased computer software/licenses. All costs till commencement of commercial production attributable to the fixed assets and intangible assets are capitalized.

b) Depreciation on fixed assets including intangible assets has been provided on straight-line method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

c) The cost of Leasehold land is amortized over the period of lease.

IV) INVESTMENTS

Long term investments are stated at cost. Provision for diminution in value of long term investments is made only if such decline is not temporary in the opinion of the management.

V) INVENTORIES

a) Finished goods are valued at lower of cost or net realizable value. Cost is considered at material cost on moment moving weighted average basis plus appropriate overheads.

b) Work in progress is valued at material cost on moment moving weighted average basis plus appropriate overheads.

c) Scrap is valued at net realizable value.

d) Other inventories are valued at cost on moment moving weighted average basis.

e) The liability of excise duty on finished goods and scrap lying in the factory at year end is estimated on the basis of sales price of goods and excise rates prevailing on the said date, while determining the cost of closing stock of finished goods and scrap.

VI) RETIREMENT BENEFITS

Superannuation, Provident and Gratuity Funds are accounted for on accrual basis with corresponding payments to recognized scheme/fund. Short term employees benefits are recognized as an expense at the undiscounted amount in the profit and loss account for the year in which the related services rendered. The liability for gratuity (in the nature of a defined benefit obligation) is provided on the basis of actuarial valuation conducted by Life Insurance Company of India (LIC), since the gratuity scheme of the company is covered under a group gratuity cum life assurance cash accumulation policy of the LIC.

VII) REVENUE RECOGNITION

Sales and Job Charges are accounted for on the basis of date of dispatch except for export sales which are booked on the basis of date of custom clearance.

VIII) DIVIDEND

The dividend income is accounted for when the right to receive the payment is established.

IX) GOVERNMENT GRANTS

Government grant of the nature of promoters' contribution is credited to capital reserve at the time of receipt.

X) FOREIGN EXCHANGE TRANSACTIONS

a) Transactions in foreign currencies are accounted for at the exchange rate prevailing at the date of transaction/ negotiations.

b) Monetary foreign currencies items outstanding at the year end are restated into rupees at the rate of exchange prevailing on the Balance Sheet date.

c) Non monetary foreign currency items are carried at cost.

d) Any income or expenses on account of exchange difference either on settlement or on transaction is recognized in the profit and loss account.

e) In respect of forward contracts, forward premium or discount arising at the inception of forward contract is amortized over the life of contract. Exchange differences on such contracts are recognized in the profit and loss account in the year in which exchange rates change. Any profit and loss arising on cancellation or renewal of forward exchange contract is recognized as income or as expense for the year.

XI) BORROWING COSTS

Borrowing Costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of cost of such assets. Qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. Other borrowing costs are charged to revenue.

XII) TAXATION

The provision for current income tax liability is ascertained on the basis of assessable profits computed in accordance with the provisions of Income Tax Act, 1961. Deferred tax is recognized, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of being reversed in one or more subsequent periods.

XIII) CONTINGENCIES

Contingent liabilities arising from claims, litigation, assessments, fines, penalties etc. are provided when it is probable that the contingency will result in the loss and reasonable estimate of the amount of the resulting loss can be made. Liabilities which are material and whose future outcome can not be ascertained with reasonable certainty are treated as contingent liabilities and disclosed by way of notes to account.

XIV) ACCOUNTING FOR LEASES

Lease payments under operating lease have been charged to profit and loss account as expense on straight line basis over the lease term.

XV) SEGMENT REPORTING

a) The Company has disclosed business segment as the primary segment for disclosure. The Company has identified four separate segments i.e. Fine Blanking Components, Mufflers, Spokes and Electricals. The Segments are identified with regard to the dominant source, nature of risks and returns, internal organization and management structure and internal reporting systems.

b) The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

c) Segment revenues, Results and Capital employed figures include the respective amounts identifiable to each of the segments. Interest and other financial charges/ incomes are reported at corporate level. Alsothose assets and liabilities which are not identifiable to the individual segments are reported at corporate level.

d) The inter segmental revenue is accounted for on the basis of transfer price agreed to amongst segments as per market trend.

XVI) IMPAIRMENT LOSS

An impairment loss is recognized when the carrying amount of fixed assets exceeds its recoverable amount. The recoverable amount of an asset is lower of net selling price and its value in use.

XVII) CASH FLOW STATEMENT

The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard-3 on Cash Flow Statements and presents cash flows by operating, investing and financing activities of the Company. The Company considers all highly liquid financial instruments, which are readily convertible into cash, to be cash equivalents

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Mar 31, 2010

I) ACCOUNTING CONVENTIONS

The financial statements are prepared under the historical cost convention on accrual basis and in accordance with the Accounting Standards issued under the Companies (Accounting Standards) Rules, 2006 and the relevant presentational requirements of the Companies Act, 1956.

II) ACCOUNTING FOR ESTIMATES

The preparation of financial statements is in conformity with the generally accepted accounting principles and requires estimates and assumptions to be made that affect reportable amount of assets and liabilities on date of financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the year in which the results are known/ materialised.

III) FIXED ASSETS AND DEPRECIATION

a) Fixed assets including intangible assets are stated at cost net of cenvat, less accumulated depreciation and/or impairment loss, if any. All costs till commencement of commercial production are capitalized.

b) Depreciation on fixed assets including intangible assets has been provided on straight-line method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956.

IV) INVESTMENTS

Long term investments are stated at cost. Provision for diminution in value of long term investments is made only if such decline is not temporary in the opinion of the management.

V) INVENTORIES

a) Finished goods are valued at lower of cost or net realizable value. Cost is considered at material cost on monthly moving weighted average basis plus appropriate overheads.

b) Work in progress is valued at material cost on monthly moving weighted average basis plus appropriate overheads.

c) Scrap is valued at net realisable value.

d) Other inventories are valued at cost on monthly moving weighted average basis.

e) The liability of excise duty on finished goods and scrap lying in the factory at year end is estimated on the basis of sales price of goods and excise rates prevailing on the said date, while determining the cost of closing stock of finished goods and scrap.

VI) RETIREMENT BENEFITS

Superannuation, Provident and Gratuity Funds are accounted for on accrual basis with corresponding payments to recognized scheme/fund. Short term employees benefits are recognized as an expense at the undiscounted amount in the profit and loss account for the year in which the related services rendered. The liability for gratuity (in the nature of a defined benefit obligation) is provided on the basis of acturial valuation conducted by Life Insurance Company of India (LIC), since the gratuity scheme of the company is covered under a group gratuity cum life assurance cash accumulation policy of the LIC.

VII) REVENUE RECOGNITION

Sales are accounted for on the basis of date of dispatch except for export sales which are booked on the basis of date of custom clearance.

VIII) DIVIDEND

The dividend income is accounted for when the right to receive the payment is established.

IX) GOVERNMENTGRANTS

Government grant of the nature of promoters contribution is credited to capital reserve at the time of receipt.

X) FOREIGN EXCHANGE TRANSACTIONS

a) Transactions in foreign currencies are accounted for at the exchange rate prevailing at the date of transaction/ negotiations.

b) Monetary foreign currencies items outstanding at the year end are restated into rupees at the rate of exchange prevailing on the Balance Sheet date.

c) Non monetary foreign currency items are carried at cost.

d) Any income or expenses on account of exchange difference either on settlement or on transaction is recognized in the profit and loss account, except in cases where they relate to fixed assets in which they are adjusted in the carrying cost of such assets.

e) In respect of forward contracts, forward premium or discount arising at the inception of forward contract is amortized over the life of contract. Exchange differences on such contracts are recognized in the profit and loss account in the year in which exchange rates change. Any profit and loss arising on cancellation or renewal of forward exchange contract is recognized as income or as expense for the year.

XI) BORROWING COSTS

Borrowing Costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of cost of such assets. Qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. Other borrowing costs are charged to revenue.

XII) TAXATION

The provision for current income tax liability is ascertained on the basis of assessable profits computed in accordance with the provisions of Income Tax Act, 1961. Deferred tax is recognized, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of being reversed in one or more subsequent periods.

The provision for Fringe Benefit Tax is ascertained on the basis of Fringe Benefits assessable value as per the provisions of the Income Tax Act, 1961 (upto year ending 31.03.2009).

XIII) CONTINGENCIES

Contingent liabilities arising from claims, litigation, assessments, fines, penalties etc. are provided when it is probable that the contingency will result in the loss and reasonable estimate of the amount of the resulting loss can be made. Liabilities which are material and whose future outcome can not be ascertained with reasonable certainty are treated as contingent liabilities and disclosed by way of notes to account.

XIV) ACCOUNTING FOR LEASES

Lease payments under operating lease have been charged to profit and loss account as expense on straight line basis over the lease term.

XV) SEGMENT REPORTING

a) The Company has disclosed business segment as the primary segment for disclosure. The Company has identified four separate segments i.e. Fine Blanking Components, Mufflers, Spokes and Electricals. The Segments are identified with regard to the dominant source, nature of risks and returns, internal organization and management structure and internal reporting systems.

b) The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

c) Segment revenues, Results and Capital employed figures include the respective amounts identifiable to each of the segments. Interest and other financial charges/ incomes are reported at corporate level. Also those assets and liabilities which are not identifiable to the individual segments are reported at corporate level.

d) The inter segmental revenue is accounted for on the basis of transfer price agreed to amongst segments as per market trend.

XVI) IMPAIRMENT LOSS

An impairment loss is recognized when the carrying amount of fixed assets exceeds its recoverable amount. The recoverable amount of an asset is lower of net selling price and its value in use.

XVII) CASH FLOW STATEMENT

The Cash Flow Statement is prepared by the indirect method set out in Accounting Standard - 3 on Cash Flow Statements and presents cash flows by operating, investing and financing activities of the Company. The Company considers all highly liquid financial instruments, with are readily convertible into cash, to be cash equivalents.