Accounting Policies of Murudeshwar Ceramics Ltd. Company

Mar 31, 2025

Note: 2 Significant Accounting Policies

1. Basis of Preparation

These financial statements are separate financial statements prepared in accordance with Indian Accounting Standards ("Ind
AS"), the provisions of the Companies Act, 2013 ("the Act") (to the extent notified) and guidelines issued by the Securities and
Exchange Board of India (SEBI). The Ind AS are prescribed under section 133 of the Act read with Rule 3 of the Companies
(Indian Accounting Standards) Rules, 2015 as amended from time to time.

Accounting policies have been consistently applied except where a newly-issued accounting standard is initially adopted or a
revision to an existing accounting standard requires a change in the accounting policy hitherto in use

Functional and presentation currency

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

Basis of measurement

The financial statements have been prepared on the historical cost basis except certain financial assets and liabilities which are
required to be measured at fair value as per Ind AS.

2. Use of estimates and judgment

In the application of the Company’s accounting policies, the directors of the Company are required to make judgments,
estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources.
The estimates and associated assumptions are based on historical experience and other factors that are considered to be
relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized
in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future
periods if the revision affects both current and future periods.

The key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period
that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the
next financial year.

Current / Non-Current Classification

The Company recognizes any asset or liability as current if it satisfies any of the following conditions:

a) Asset/Liability is expected to be realized/settled during the company’s normal operating cycle.

b) The asset is intended for sale or consumption.

c) The Asset/Liability is held primarily for the purpose of trading.

d) The Asset/Liability is expected to be realized/settled within 12 months after the reporting period.

e) The Asset is cash/cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12
months after the reporting date.

f) In the case of the liability, the company does not have an unconditional right to defer the settlement of liability for at least
12 months after the reporting date.

All other assets/liabilities are classified as non-current.

3. Revenue

i) Disclosure as per Ind AS 115 "Revenue from contract with Customers - Revenue from contract from customers is
recognized on transfer of control of promised goods or services to a customer at an amount that reflects the consideration
to which the company is expected to be entitled to in exchange for those goods or services. The Transaction price of
goods sold, and services rendered is net of variable consideration on account of various discounts and schemes offered by
company as part of the contract. Revenue is recognized only to the extent that it is highly probable that the amount will
not be subject to significant reversal when uncertainty relating to its recognition is resolved.

ii) Sale of Products - Revenue from sale of products is recognized when the control on the goods have been transferred to
the customer. The performance obligation in case of sale of product is satisfied at a point in time that is, when the material
is shipped to the customer or on delivery to the customer as may be specified in the contract.

iii) Rendering of Services - The Revenue from services is recognized over time by measuring progress towards satisfaction
of performance obligations for the services rendered. The company uses output method for measurement of revenue from
services.

iv) Interest - Interest income from a financial asset is recognized when it is probable that the economic benefits will flow
to the company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by
reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts
estimated future cash receipts through the expected life of the financial asset to that asset''s net carrying amount on initial
recognition.

v) Dividend - Revenue is recognised when the shareholder’s or unit holders right to receive payment is established, which
is generally when share holders approve the dividend.

vi) Rental Income - Rental income from the properties given on lease (net of any incentives given to the lessees) is recognized
on accrual basis over the lease term.

4. Expenses

All expenditures are accounted on accrual basis after reducing any specific income attributable to such expenditure.

5. Property, plant and Equipment

The cost of property, plant and equipment comprises its purchase price net of any trade discounts and rebates, any import duties
and other taxes (other than those subsequently recoverable from the tax authorities), any directly attributable expenditure on
making the asset ready for its intended use, including relevant borrowing costs for qualifying assets and any expected costs of
decommissioning. Expenditure incurred after the property, plant and equipment have been put into operation, such as repairs
and maintenance, are charged to the Statement of Profit and Loss in the period in which the costs are incurred. Major shut¬
down and overhaul expenditure is capitalized as the activities undertaken to improve the economic benefits expected to arise
from the asset.

Capital Work in Progress

The cost of assets not ready for intended use, as on the balance sheet date, is shown as Capital Work in Progress.

Depreciation commences when the assets are ready for their intended use

Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value.
Depreciation is recognized so as to write off the cost of assets (other than freehold land and properties under construction) less
their residual values over their useful lives, using straight-line method as per the useful life prescribed in Schedule II to the
Companies Act, 2013 except in respect of Plant and Machinery and Factory building, in those case the life of the assets has
been assessed as under based on technical advice, taking into account the nature of the asset, the estimated usage of the asset,
the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers warranties
and maintenance support, etc.

Depreciation is provided on estimated useful lives of the assets as per Schedule - II of the Companies Act, 2013 except for the
following assets where the useful life has been estimated based on the technical estimate.

Amounts spent on Site preparation at Quarry for mining of Clay have been capitalized under the head Building-Others and
Depreciation provided accordingly.

No depreciation is charged on capital work in progress and free hold land.

The Company reviews the residual value, useful lives and depreciation method annually and, if expectations differ from
previous estimates, the change is accounted for as a change in accounting estimate on a prospective basis.

Derecognition

The carrying amount of an item of property, plant and equipment, is de-recognized on disposal or when no future economic
effects are expected from its use or disposal. The Gain or Loss arising from the Derecognition of an item of property, plant
and equipment is measured as the difference between the net disposal proceeds and the carrying amount of the item and is
recognized in the statement of profit and loss when the item is derecognized.

6. Inventories

Raw Materials, Work in progress, finished goods, packing materials, stores, spares, components, consumables and stock in
trade are carried at the lower of cost and net realizable value. However, the materials and other items held for use in production
of inventories are not written down below cost If the finished goods in which they will be incorporated are expected to be sold
at or above cost. The comparison of cost and net realizable value is made on an item by item basis. Net realizable value is the
estimated selling price in the ordinary course of the business less estimated cost of completion and estimated costs necessary
to make the sale.

In determining the cost of raw materials, packing materials, stock in trade, stores, spares, components and consumables
weighted average cost method is used. Cost of inventory comprises all costs of purchase, duties, taxes (other than those
subsequently recoverable from the tax authorities) and all the other costs incurred in bringing the inventory to their present
location and condition.

Cost of finished goods and work in progress, includes the cost of raw materials, packing materials, an appropriate share of
fixed and variable production overheads and other costs incurred in bringing the inventories to present location and condition.
Fixed production overheads are allocated on the basis of normal capacity of production facilities.

7. Leases

Ind AS 116 requires lessees to determine the lease term as the non-cancellable period of a lease adjusted with any option to
extend or terminate the lease, if the use of such option is reasonably certain

''The Company’s lease asset classes primarily consist of leases for shops. The Company assesses whether a contract 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 recognizes a right-of-use (ROU) asset and a corresponding lease
liability for all lease arrangements in which it is a lessee, except for leases with a term of 12 months or less (short-term leases)
and low value leases. For these short-term and low-value leases, the Company recognizes the lease payments as an operating
expense on a straight-line basis over the term of the lease.

Certain lease arrangements include the options to extend or terminate the lease before the end of the lease term. ROU assets
and lease liabilities includes these options when it is reasonably certain that they will be exercised.

The ROU assets are initially recognized 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.

ROU 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. ROU assets are evaluated for recoverability whenever events or changes in circumstances indicate
that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the
higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does
not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is
determined for the Cash Generating Unit (CGU) to which the asset belongs.

The lease liability is initially measured at amortized cost 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
in the country of domicile of these leases. Lease liabilities are remeasured with a corresponding adjustment to the related ROU
asset if the Company changes its assessment of whether it will exercise an extension or a termination option.

Lease liability and ROU assets have been separately presented in the Balance Sheet and lease payments have been classified
as financing cash flows.

8. Investments in associate company

The company has elected to recognize its investments in associate company at cost in accordance with the option available in
IND AS 27 “Separate financial statements”.

While preparing the consolidated financial statements, the company has followed Equity Method as per IND AS 28 “Investment
in Associates & Joint Ventures”.

9. Taxes on Income
Current Tax

The current tax is determined on the basis of taxable income and tax credits computed in accordance with the provisions of
Indian Income Tax Act, 1961.

Deferred Tax

Deferred income tax is provided using the liability method on all timing differences at the balance sheet date between tax bases
of assets and liabilities and their carrying amounts for financial reporting purposes at the tax rates and tax laws substantively
enacted at the balance sheet date. In assessing the realisability of deferred income tax assets, the Management considers
whether some portion or all of the deferred income tax assets will not be realized. The ultimate realization of deferred income
tax assets is dependent upon the generation of future taxable income during the periods in which the temporary differences
become deductible. The Management considers the scheduled reversals of deferred income tax liabilities, projected future
taxable income and tax-planning strategies in making this assessment. Based on the level of historical taxable income and
projections for future taxable income over the periods in which the deferred income tax assets are deductible, the Management
believes that the Company will realize the benefits of those deductible differences. The amount of the deferred income tax
assets considered realizable, however could be reduced in the near term if estimates of future taxable income during the carry
forward period are reduced.

10. Financial Instruments

The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions
of the instrument. All financial assets and liabilities are recognized at fair value on initial recognition, except for trade
receivables which are initially measured at transaction price. Transaction costs that are directly attributable to the acquisition
or issue of financial assets and financial liabilities are considered as cost on initial recognition.

The Disclosure as per IND AS is given as under -

Other Financial Instruments and Cash & Cash Equivalents

The Company held cash and cash equivalents of Rs.67.87 Lakhs (31st March 2024 - Rs.124.86 Lakhs). The cash and cash equivalents
are held with banks with high rating. The Company held deposits with banks and financial institutions of Rs.176.39 Lakhs (31st
March 2024 - Rs. 1314.15 Lakhs), In order to manage the risk, Company places deposits with only high rated banks/institutions.

The management assessed that the fair value of cash and cash equivalents, trade receivables, loans, other financial assets, trade
payables and other financial liabilities approximate the carrying amount largely due to short-term maturity of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current
transaction between willing parties, other than in a forced or liquidation sale.

Fair Value Hierarchy

Financial assets and financial liabilities measured at fair value in the statement of financial position are grouped into three Levels of
a fair value hierarchy. The three Levels are defined based on the observability of significant inputs to the measurement, as follows:

Level 1: Quoted prices (unadjusted) in active markets for financial instruments.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques
which maximize the use of observable market data rely as little as possible on entity specific estimates.

Level 3: Inputs for the assets or liabilities that are not based on the observable marked data (unobservable inputs).

Measurement of fair value of financial instruments

The fair value measurement is not applicable since there were no financial assets and liabilities are measured at fair value.
Financial Risk Management

The Company’s principal financial liabilities comprise borrowings, trade payables and other payables. The main purpose of
these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include trade & other
receivables, cash & cash Equivalent, Investment, other balances with banks, loans and deposits that derive directly from its
operations.

Company is exposed to following risk from the use of its financial instrument:

1. Market Risk

2. Credit Risk

3. Liquidity Risk

1. Market Risk : Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate
because of changes in market prices. The market risk comprises three types of risk: Interest rate risk, foreign currency risk and
another price risk.

a) Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of market
interest risk. The Company’s exposure to risk of changes in market interest rates is minimal. The company has not used
any interest rate derivatives.

b) Foreign currency risk is the risk that the fair value of future cash flows of an exposure will fluctuate due to changes in
foreign exchange rates. The company has not entered into any forward exchange contracts/derivative contracts.

c) Other price risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market traded prices.
The company has not invested in any traded equity instruments or bonds.

2. Credit risk

The credit risk refers to the risk that a counterparty will default on its contractual obligation resulting in financial loss to
the company. Credit risk arises from financial assets such as trade receivables, other balances with banks, loans and other
receivables. The Company has adopted a policy of only dealing with the counterparties that have sufficiently high credit
ratings. The exposure and credit ratings of the counterparties are continuously monitored, and aggregate value of transactions
is reasonably spread amongst the counterparties. There are no cases of historical defaults and hence no provision for expected
credit loss is necessary.

3. Liquidity risk

The liquidity risk is the risk that the company will encounter difficulty in raising funds to meet the commitments associated
with financial instruments that are settled by delivering cash or another financial asset. The company has established liquidity
risk management framework for managing its short term, medium term and long term and liquidity management requirements.
The company has adequate credit facilities agreed with banks to ensure that there is sufficient cash to meet all its normal
operating commitments in a timely and cost-effective manner.

11. Borrowings and Borrowing Cost

Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at
amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption value is recognized in the
income statement over the period of the borrowings using the effective interest rate method.

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that
necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets,
until such time as the assets are substantially ready for their intended use or sale.

All other borrowing costs are recognized in statement of profit and loss in the period in which they are incurred.

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Mar 31, 2024

Note: 1 Corporate Information

Murudeshwar Ceramics Limited (the Company) was established in the year 1983, The Company is manufacturing and trading Ceramic and Vitrified floor & wall Tiles. The Registered Office of the Company is at 604/B, Murudeshwar Bhavan, Gokul Road. Hubli - 580030 and the Corporate Office is at Naveen Complex, 7* Floor, 14, M.G.Road, Bengaluru - 560001. The Company is having 2 manufacturing plants at Sira, Dist. Tumkur and Karaikal, Pondicherry. The Company trading Vitrified Tiles and Ceramic Tiles sourced through other manufacturers as well. The Company’s products are branded as “Naveen Ceramic Tiles” and “Naveen Diamontile”. The Company is having well established marketing network all over the country.

Note: 2 Significant Accounting Policies

1. Basis of Preparation

These financial statements are separate financial statements prepared in accordance with Indian Accounting Standards ("Ind AS"), the provisions of the Companies Act, 2013 ("the Act") (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 as amended from time to time.

Accounting policies have been consistently applied except where a newly-issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use

Functional and presentation currency

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

Basis of measurement

The financial statements have been prepared on the historical cost basis except certain financial assets and liabilities which are required to be measured at fair value as per Ind AS.

2. Use of estimates and judgment

In the application of the Company’s accounting policies, the directors of the Company are required to make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

The key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

Current / Non-Current Classification

The Company recognizes any asset or liability as current if it satisfies any of the following conditions:

a) Asset/Liability is expected to be realized/settled during the company’s normal operating cycle.

b) The asset is intended for sale or consumption.

c) The Asset/Liability is held primarily for the purpose of trading.

d) The Asset/Liability is expected to be realized/settled within 12 months after the reporting period.

e) The Asset is cash/cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting date.

e) In the case of the liability, the company does not have an unconditional right to defer the settlement of liability for at least 12 months after the reporting date.

All other assets/liabilities are classified as non-current.

3. Revenue

i) Disclosure as per Ind AS 115 "Revenue from contract with Customers - Revenue from contract from customers is recognized on transfer of control of promised goods or services to a customer at an amount that reflects the consideration to which the company is expected to be entitled to in exchange for those goods or services. The Transaction price of goods sold, and services rendered is net of variable consideration on account of various discounts and schemes offered by company as part of the contract. Revenue is recognized only to the extent that it is highly probable that the amount will not be subject to significant reversal when uncertainty relating to its recognition is resolved.

11) Sale of Products - Revenue from sale of products is recognized when the control on the goods have been transferred to the customer. The performance obligation in case of sale of product is satisfied at a point in time that is, when the material is shipped to the customer or on delivery to the customer as may be specified in the contract.

iii) Rendering of Services - The Revenue from services is recognized over time by measuring progress towards satisfaction of performance obligations for the services rendered. The company uses output method for measurement of revenue from services.

iv) Interest - Interest income from a financial asset is recognized when it is probable that the economic benefits will flow to the company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset''s net carrying amount on initial recognition.

v) Dividend - Dividend income from investments is recognised when the shareholder’s right to receive payment has been established (provided that it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably).

vi) Rental Income - Rental income from the properties given on lease (net of any incentives given to the lessees) is recognized on accrual basis over the lease term.

4. Expenses

All expenditures are accounted on accrual basis after reducing any specific income attributable to such expenditure.

5. Property, plant and Equipment

The cost of property, plant and equipment comprises its purchase price net of any trade discounts and rebates, any import duties and other taxes (other than those subsequently recoverable from the tax authorities), any directly attributable expenditure on making the asset ready for its intended use, including relevant borrowing costs for qualifying assets and any expected costs of decommissioning. Expenditure incurred after the property, plant and equipment have been put into operation, such as repairs and maintenance, are charged to the Statement of Profit and Loss in the period in which the costs are incurred. Major shutdown and overhaul expenditure is capitalized as the activities undertaken to improve the economic benefits expected to anse from the asset.

Capital Work m Progress

The cost of assets not ready for intended use, as on the balance sheet date, is shown as Capital Work in Progress.

Depreciation commences when the assets are ready for their intended use

Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value. Depreciation is recognized so as to write off the cost of assets (other than freehold land and properties under construction) less their residual values over their useful lives, using straight-line method as per the useful life prescribed in Schedule II to the Companies Act, 2013 except in respect of Plant and Machinery and Factory building, in those case the life of the assets has been assessed as under based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers warranties and maintenance support, etc.

Depreciation is provided on estimated useful lives ofthe assets as per Schedule - II of the Companies Act, 2013 except for the following assets where the useful life has been estimated based on the technical estimate.

Assets	Estimated Life	Life as per Schedule-II
Plant & Machinery	25-30 Years	20 Years
Building/Factory	50 Years	60 Years

Amounts spent on Site preparation at Quarry for mining of Clay have been capitalized under the head Building-Others and Depreciation provided accordingly

No depreciation is charged on capital work in progress and free hold land.

The Company reviews the residual value, useful lives and depreciation method annually and, if expectations differ from previous estimates, the change is accounted for as a change in accounting estimate on a prospective basis.

Derecognition

The carrying amount of an item of property, plant and equipment, is de-recognized on disposal or when no future economic effects are expected from its use or disposal. The Gam or Loss arising from the Derecognition of an item of property, plant and equipment is measured as the difference between the net disposal proceeds and the carrying amount of the item and is recognized in the statement of profit and loss when the item is derecognized.

6. Inventories

Raw Materials, Work in progress, finished goods, packing materials, stores, spares, components, consumables and stock in trade are carried at the lower of cost and net realizable value. However, the materials and other items held for use in production of inventories are not written down below cost If the finished goods in which they will be incorporated are expected to be sold at or above cost. The comparison of cost and net realizable value is made on an item by item basis. Net realizable value is the estimated selling price in the ordinary course of the business less estimated cost of completion and estimated costs necessary to make the sale.

In determining the cost of raw materials, packing materials, stock in trade, stores, spares, components and consumables weighted average cost method is used. Cost of inventory comprises all costs of purchase, duties, taxes (other than those subsequently recoverable from the tax authorities) and all the other costs incurred in bringing the inventory to their present location and condition.

Cost of finished goods and work in progress, includes the cost of raw materials, packing materials, an appropriate share of fixed and variable production overheads and other costs incurred in bringing the inventories to present location and condition. Fixed production overheads are allocated on the basis of normal capacity of production facilities.

7. Leases

Ind AS 116 requires lessees to determine the lease term as the noil-cancellable period of a lease adjusted with any option to extend or terminate the lease, if the use of such option is reasonably certain

''The Company’s lease asset classes primarily consist of leases for shops. The Company assesses whether a contract 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 recognizes a right-of-use (ROU) asset and a corresponding lease liability for all lease arrangements in which it is a lessee, except for leases with a term of 12 months or less (short-term leases) and low value leases. For these short-term and low-value leases, the Company recognizes the lease payments as an operating expense on a straight-line basis over the term of the lease.

Certain lease arrangements include the options to extend or terminate the lease before the end of the lease term. ROU assets and lease liabilities includes these options when it is reasonably certain that they will be exercised.

The ROU assets are initially recognized 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 impainnent losses.

ROU 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. ROU assets are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the Cash Generating Unit (CGU) to which the asset belongs.

The lease liability is initially measured at amortized cost 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 in the country of domicile of these leases. Lease liabilities are remeasured with a corresponding adjustment to the related ROU asset if the Company changes its assessment of whether it will exercise an extension or a termination option.

Lease liability and ROU assets have been separately presented in the Balance Sheet and lease payments have been classified as financing cash flows.

8. Investments in associate company

The company has elected to recognize its investments in associate company at cost in accordance with the option available in IND AS 27 “Separate financial statements”.

While preparing the consolidated financial statements, the company has followed Equity Method as per IND AS 28 “Investment in Associates & Joint Ventures”.

9. Taxes on Income

Tax expense is the aggregate amount included in the determination of profit or loss for the period in respect of current tax and deferred tax

Current Tax

The current tax is determined oil the basis of taxable income and tax credits computed in accordance with the provisions of Indian Income Tax Act, 1961.

Deferred Tax

Deferred income tax is provided using the liability method on all timing differences at the balance sheet date between tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the tax rates and tax laws substantively enacted at the balance sheet date. In assessing the realisability of deferred income tax assets, the Management considers whether some portion or all of the deferred income tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which the temporary differences become deductible. The Management considers the scheduled reversals of deferred income tax liabilities, projected future taxable income and tax-planning strategies in making this assessment. Based on the level of historical taxable income and proj ections for future taxable income over the periods in which the deferred income tax assets are deductible, the Management believes that the Company will realize the benefits of those deductible differences. The amount of the deferred income tax assets considered realizable, however could be reduced in the near term if estimates of future taxable income during the carry forward penod are reduced.

10. Financial Instruments

The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of the instrument. All financial assets and liabilities are recognized at fair value on initial recognition, except for trade receivables which are initially measured at transaction price. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities are considered as cost on initial recognition.

The Disclosure as per IND AS is given as under -

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Mar 31, 2018

Note : 1 Significant Accounting Policies :

1. Basis of Preparation

These financial statements are separate financial statements prepared in accordance with Indian Accounting Standards ("Ind AS"), the provisions of the Companies Act, 2013 ("the Act") (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendments Rules, 2016.

The Company has adopted all the applicable Ind AS and the adoption was carried out in accordance with Ind AS 101 - First time adoption of Indian Accounting Standards. The transition was carried out from Indian Accounting Principles generally accepted in India as prescribed under Sec 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (IGAAP), which was the previous GAAP. These are the Company''s first Ind AS financial statements. The date of transition to Ind AS is April 1, 2016.

2. Use of estimates and judgement

In the application of the Company''s accounting policies, the directors of the Company are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

The key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

3. Income

i) Sales are net of returns and exclusive of taxes. Sales are accounted for on dispatch basis.

ii) Other Income is accounted on accrual basis.

4. Expenses

All expenditures are accounted on accrual basis after reducing any specific income attributable to such expenditure.

5. Property, plant and Equipment

The cost of property, plant and equipment comprises its purchase price net of any trade discounts and rebates, any import duties and other taxes (other than those subsequently recoverable from the tax authorities), any directly attributable expenditure on making the asset ready for its intended use, including relevant borrowing costs for qualifying assets and any expected costs of decommissioning. Expenditure incurred after the property, plant and equipment have been put into operation, such as repairs and maintenance, are charged to the Statement of Profit and Loss in the period in which the costs are incurred. Major shut-down and overhaul expenditure is capitalized as the activities undertaken improve the economic benefits expected to arise from the asset.

An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in Statement of Profit and Loss.

Depreciation commences when the assets are ready for their intended use

Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value. Depreciation is recognized so as to write off the cost of assets (other than freehold land and properties under construction) less their residual values over their useful lives, using straight-line method as per the useful life prescribed in Schedule II to the Companies Act, 2013 except in respect of Plant and Machinery, in whose case the life of the assets has been assessed as under based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers warranties and maintenance support, etc. Depreciation is provided on estimated useful lives of the assets as per Schedule - II of the Companies Act, 2013 except for the following assets where the useful life has been estimated based on the technical estimate.

Assets Estimated Life Life as per Schedule-II

Plant & Machinery 25-30 Years 20 Years

Amounts spent on Site preparation at Quarry for mining of Clay have been capitalized under the head Building -

Others and Depreciation provided accordingly.

The Company reviews the residual value, useful lives and depreciation method annually and, if expectations differ from previous estimates, the change is accounted for as a change in accounting estimate on a prospective basis.

6. Inventories :

Finished goods are valued at lower of cost or market value. Cost is inclusive of all overheads (including interest) incurred by the Company in bringing the goods to the finished stage. Raw materials, components and spare parts are valued at average cost. Average cost is calculated at weighted cost per unit after taking into account receipts at actual cost. Consumption and / or other stock diminution are accounted for at the aforesaid weighted cost.

7. Investments :

Investments are valued at cost and income thereon is accounted for when received.

8. Gratuity :

Gratuity has been paid through an approved gratuity fund managed by the LIC of India. Premium paid thereon is accounted as expenditure. The Company has also provided for gratuity as per actuarial valuation.

9. Bonus :

Minimum Bonus payable as per the Payment of Bonus Act has been provided in the accounts.

10. Leave Encashment :

Leave encashment has been determined based on the actuarial valuation, available leave entitlement at the end of each calendar year. The incremental amount so calculated each year is debited to Salaries and Wages - leave encashment.

11. Deferred Income Tax :

Deferred income tax is provided using the liability method on all timing differences at the balance sheet date between tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the tax rates and tax laws substantively enacted at the balance sheet date.

12. Financial Instruments

The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of the instrument. All financial assets and liabilities are recognized at fair value on initial recognition, except for trade receivables which are initially measured at transaction price. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities, which are not at fair value through Statement of Profit and Loss, are added to the fair value on initial recognition.

13. Borrowings and Borrowing Cost

Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption value is recognized in the income statement over the period of the borrowings using the effective interest rate method. Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.

All other borrowing costs are recognized in statement of profit and loss in the period in which they are incurred.

14. Earnings per share

Basic earnings per share is computed by dividing profit or loss attributable to equity shareholders of the Company by the weighted average number of equity shares outstanding during the year. The weighted average number of shares outstanding during the year is adjusted for events of bonus issue and share split.

Diluted earnings per share is computed by dividing the net profit after tax by the weighted average number of equity shares considered for deriving basic EPS and also weighted average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless issued at a later date. Dilutive potential equity shares are determined independently for each period presented.

15. Cash and cash equivalents

Cash and cash equivalent in the Balance Sheet comprise cash at banks and on hand.

16. FIRST-TIME ADOPTION - MANDATORY EXEMPTIONS, OPTIONAL EXEMPTIONS

DISCLOSURES REQUIRED AS PER INDIAN ACCOUNTING STANDARD (IND AS) 101- FIRST TIME ADOPTION OF INDIAN ACCOUNTING STANDARD TRANSITION TO IND AS

These are the Company''s first financial statements prepared in accordance with Ind AS. The accounting policies set out in note have been applied in preparing the financial statements for the year ended March 31, 2018, the comparative information presented in these financial statements for the year ended March 31, 2017 and in the preparation of an opening Ind AS Balance Sheet as at April 1, 2016 (the Company''s date of transition)

In preparing its opening Ind AS Balance Sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Section 133 of the Companies Act, 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (''previous GAAP'' or ''Indian GAAP'') except in case of optional exemptions and mandatory exemptions availed as under

a. Exemption availed

Carrying amount of such investments in associates as on transition date has been taken as deemed cost.

b. Exceptions applied

- Estimates

The estimates at 1st April 2016 and 31st March 2017 are consistent with estimates made for the same date in accordance with IGAAP.

- Classification and measurement of financial assets

The company has classified the financial assets in accordance with IND AS 109 on the basis of facts and conditions existed on IND AS transition date.

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Mar 31, 2016

Note : 1 Corporate Information :

Murudeshwar Ceramics Limited (the Company) was established during the year 1983. The Company is manufacturing Ceramic and Vitrified Tiles. The registered office of the Company is at 604/B, Murudeshwar Bhavan, Gokul Road, Hubli - 580 030 and the Corporate Office is at Naveen Complex, 7th Floor, 14, M.G.Road, Bengaluru - 560 001. The Company is having 2 manufacturing plants at Krishnapur Village, Hubli and Karaikal, Pondicherry. The Company started Trading activities for outsourcing of Vitrified Tiles and Ceramic Tiles. The Company''s products are branded as “Naveen Ceramic Tiles” and “Naveen Diamontile”. The Company is having well established marketing network all over the country.

Note : 2 Significant Accounting Policies :

1. Basis of Preparation :

The Company adopts generally accepted Accounting policies excepting those which have been specifically stated herein. The Financial statements have been drawn up according to the accounting standards prescribed under Section 133 of The Companies Act, 2013.

Finished stock lying at the factory has been valued inclusive of excise duty which has no impact on the profits of the company. This accounting policy is in conformity with the Accounting Standard issued by the Institute of Chartered Accountants of India.

2. Income :

i) Sales are net of returns and inclusive of excise duty. Sales are accounted for on dispatch basis.

ii) Other Income is accounted on accrual basis.

3. Expenses :

All expenditures are accounted on accrual basis after reducing any specific income attributable to such expenditure.

4. Fixed Assets :

Fixed Assets are stated at the historical cost which is inclusive of freight, installation cost and duties and other incidental expenses up to the date of commencement of commercial production.

Depreciation is provided on estimated useful lives of the assets as per Schedule - II of the Companies Act, 2013 except for the following assets where the useful life has been estimated based on the technical estimate.

Plant & Machinery

Amounts spent on Site preparation at Quarry for mining of Clay have been capitalized under the head Building - Others and Depreciation provided accordingly.

5. Inventories :

Finished goods are valued at lower of cost or market value. Cost is inclusive of all overheads (including interest) incurred by the Company in bringing the goods to the finished stage. Raw materials, components and spare parts are valued at average cost. Average cost is calculated at weighted cost per unit after taking into account receipts at actual cost. Consumption and / or other stock diminution is accounted for at the aforesaid weighted cost.

6. Investments :

Investments are valued at cost and income thereon is accounted for when received.

7. Gratuity :

Gratuity has been paid through an approved gratuity fund managed by the LIC of India. Premium paid thereon is accounted as expenditure. The Company has also provided for gratuity as per actuarial valuation.

8. Bonus :

Minimum Bonus payable as per the Payment of Bonus Act has been provided in the accounts.

9. Leave Encashment :

Leave encashment has been determined based on the actuarial valuation, available leave entitlement at the end of each calendar year. The incremental amount so calculated each year is debited to Salaries and Wages -leave encashment.

10. Deferred Income Tax :

Deferred income tax is provided using the liability method on all timing differences at the balance sheet date between tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the tax rates and tax laws substantively enacted at the balance sheet date.

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Mar 31, 2015

1. Basis of Preparation :

The Company adopts generally accepted Accounting policies excepting those which have been specifically stated herein. The Financial statements have been drawn up according to the accounting standards prescribed under Section 133 of The Companies Act, 2013.

Finished stock lying at the factory has been valued inclusive of excise duty which has no impact on the profits of the company. This accounting policy is in conformity with the Accounting Standard issued by the Institute of Chartered Accountants of India.

2. Income :

i) Sales are net of returns and inclusive of excise duty. Sales are accounted for on despatch basis.

ii) Other Income is accounted on accrual basis.

3. Expenses :

All expenditures are accounted on accrual basis after reducing any specific income attributable to such expenditure.

4. Fixed Assets :

Fixed Assets are stated at the historical cost which is inclusive of freight, installation cost and duties and other incidental expenses up to the date of commencement of commercial production.

Depreciation is provided on estimated useful lives of the assets as per Schedule - II of the Companies Act, 2013 except for the following assets where the useful life has been estimated based on the technical estimate. Assets Estimated Life Life as per

Schedule - II

Plant & Machinery 25 Years 20 Years

Amounts spent on Site preparation at Quarry for mining of Clay have been capitalized under the head Building - Others and Depreciation provided accordingly.

5. Inventories :

Finished goods are valued at lower of cost or market value. Cost is inclusive of all overheads (including interest) incurred by the Company in bringing the goods to the finished stage. Raw materials, components and spare parts are valued at average cost. Average cost is calculated at weighted cost per unit after taking into account receipts at actual cost. Consumption and / or other stock diminution is accounted for at the aforesaid weighted cost.

6. Investments :

Investments are valued at cost and income thereon is accounted for when received.

7. Gratuity :

Gratuity has been paid through an approved gratuity fund managed by the LIC of India. Premium paid thereon is accounted as expenditure. The Company has also provided for gratuity as per actuarial valuation.

8. Bonus :

Minimum Bonus payable as per the Payment of Bonus Act has been provided in the accounts.

9. Leave Encashment :

Leave encashment has been determined based on the actuarial valuation, available leave entitlement at the end of each calendar year. The incremental amount so calculated each year is debited to Salaries and Wages - leave encashment.

10. Deferred Income Tax :

Deferred income tax is provided using the liability method on all timing differences at the balance sheet date between tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the tax rates and tax laws substantively enacted at the balance sheet date.

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Mar 31, 2014

1. Basis of Preparation :

The Company adopts generally accepted Accounting policies excepting those which have been specifically stated herein. The Financial statements have been drawn up according to the accounting standards prescribed under Section 211(3C) of The Companies Act, 1956.

Finished stock lying at the factory has been valued inclusive of excise duty which has no impact on the profits of the company. This accounting policy is in conformity with the Accounting Standard issued by the Institute of Chartered Accountants of India.

2. Income :

i) Sales are net of returns and inclusive of excise duty. Sales are accounted for on despatch basis. ii) Other Income is accounted on accrual basis.

3. Expenses :

All expenditures are accounted on accrual basis after reducing any specific income attributable to such expenditure.

4. Fixed Assets :

Fixed Assets are stated at the historical cost which is inclusive of freight, installation cost and duties and other incidental expenses up to the date of commencement of commercial production.

Depreciation is provided on straight line basis at the rate as prescribed under Schedule XIV of The Companies Act, 1956 as amended by Notification issued by the Department of Company Affairs in this regard dated 16.12.1993.

Amounts spent on Site preparation at Quarry for mining of Clay have been capitalized under the head Building – Others and Depreciation provided accordingly.

5. Inventories :

Finished goods are valued at lower of cost or market value. Cost is inclusive of all overheads (including interest) incurred by the Company in bringing the goods to the finished stage. Raw materials, components and spare parts are valued at average cost. Average cost is calculated at weighted cost per unit after taking into account receipts at actual cost. Consumption and / or other stock diminution is accounted for at the aforesaid weighted cost.

6. Investments :

Investments are valued at cost and income thereon is accounted for when received.

7. Gratuity :

Gratuity has been paid through an approved gratuity fund managed by the LIC of India. Premium paid thereon is accounted as expenditure.

8. Bonus :

Minimum Bonus payable as per the Payment of Bonus Act has been provided in the accounts.

9. Leave Encashment :

Leave encashment has been determined based on the available leave entitlement at the end of each calendar year. The incremental amount so calculated each year is debited to Salaries and Wages - leave encashment.

10. Deferred Income Tax :

Deferred income tax is provided using the liability method on all timing differences at the balance sheet date between tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the tax rates and tax laws substantively enacted at the balance sheet date.

Notes : (i) Reconciliation of the number of shares and amount outstanding at the beginning and at the end of the reporting period:

Note : (i) Balances with banks include deposits amounting to Rs. 9.21 Lacs (As at 31 March, 2013 Rs. 7.85 Lacs) which have an original maturity of more than 12 months.

11.1 Monies received against share warrants

As approved by the shareholder at the Extra Ordinary General Meeting held on March 14, 2012, the Board of Directors at their meeting held on March 21, 2012 alloted 39,70,000 Convertible Share Warrants at a price of Rs.17/- per Convertible Share Warrants in accordance with SEBI Guidelines at Murdeshwar Power Corporation Ltd. 25% price of convertible Share Warrants which amounts to Rs.1,68,72,500/- was received by them. On 19.03.2013, Murdeshwar Power Corporation Limited converted its first trenche of 19,35,000 Convertible Share Warrants into 19,35,000 Equity Shares by paying the balance 75% amount to Rs.2,46,71,250/-. The second trenche of 20,35,000 Convertible Share Warrants was converted into 20,35,000 Equity Shares on 30.07.2013 by paying 75% balance amount of Rs.2,59,46,250/-.

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Mar 31, 2013

1. Basis of Preparation :

The Company adopts generally accepted Accounting policies excepting those which have been specifically stated herein. The Financial statements have been drawn up according to the accounting standards prescribed under Section 211(3C) of The Companies Act, 1956.

Finished stock lying at the factory has been valued inclusive of excise duty which has no impact on the profits of the company. This accounting policy is in conformity with the Accounting Standard issued by the Institute of Chartered Accountants of India.

2. Income :

i) Sales are net of returns and inclusive of excise duty. Sales are accounted for on despatch basis. ii) Other Income is accounted on accrual basis.

3. Expenses :

All expenditures are accounted on accrual basis after reducing any specific income attributable to such expenditure.

4. Fixed Assets :

Fixed Assets are stated at the historical cost which is inclusive of freight, installation cost and duties and other incidental expenses up to the date of commencement of commercial production.

Depreciation is provided on straight line basis at the rate as prescribed under Schedule XIV of The Companies Act, 1956 as amended by Notification issued by the Department of Company Affairs in this regard dated 16.12.1993. Amounts spent on Site preparation at Quarry for mining of Clay have been capitalized under the head Building - Others and Depreciation provided accordingly.

5. Inventories :

Finished goods are valued at lower of cost or market value. Cost is inclusive of all overheads (including interest) incurred by the Company in bringing the goods to the finished stage. Raw materials, components and spare parts are valued at average cost. Average cost is calculated at weighted cost per unit after taking into account receipts at actual cost. Consumption and / or other stock diminution is accounted for at the aforesaid weighted cost.

6. Investments :

Investments are valued at cost and income thereon is accounted for when received.

7. Gratuity :

Gratuity has been paid through an approved gratuity fund managed by the LIC of India. Premium paid thereon is accounted as expenditure.

8. Bonus :

Minimum Bonus payable as per the Payment of Bonus Act has been provided in the accounts.

9. Leave Encashment :

Leave encashment has been determined based on the available leave entitlement at the end of each calendar year. The incremental amount so calculated each year is debited to Salaries and Wages - leave encashment.

10. Deferred Income Tax :

Deferred income tax is provided using the liability method on all timing differences at the balance sheet date between tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the tax rates and tax laws substantively enacted at the balance sheet date.

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Mar 31, 2012

1. Basis of Preparation :

The Company adopts generally accepted Accounting policies excepting those which have been specifically stated herein. The Financial statements have been drawn up according to the accounting standards prescribed under Section 211(3C) of The Companies Act, 1956.

Finished stock lying at the factory has been valued inclusive of excise duty which has no impact on the profits of the company. This accounting policy is in conformity with the Accounting Standard issued by the Institute of Chartered Accountants of India.

2. Income :

i) Sales are net of returns and inclusive of excise duty. Sales are accounted for on despatch basis.

ii) Other Income is accounted on accrual basis.

3. Expenses :

All expenditures are accounted on accrual basis after reducing any specific income attributable to such expenditure.

4. Fixed Assets :

Fixed Assets are stated at the historical cost which is inclusive of freight, installation cost and duties and other incidental expenses up to the date of commencement of commercial production.

Depreciation is provided on straight line basis at the rate as prescribed under Schedule XIV of The Companies Act, 1956 as amended by Notification issued by the Department of Company Affairs in this regard dated 16.12.1993. Amounts spent on Site preparation at Quarry for mining of Clay have been capitalized under the head Building - Others and Depreciation provided accordingly.

5. Inventories :

Finished goods are valued at lower of cost or market value. Cost is inclusive of all overheads (including interest) incurred by the Company in bringing the goods to the finished stage. Raw materials, components and spare parts are valued at average cost. Average cost is calculated at weighted cost per unit after taking into account receipts at actual cost. Consumption and / or other stock diminution is accounted for at the aforesaid weighted cost.

6. Investments :

Investments are valued at cost and income thereon is accounted for when received.

7. Gratuity :

Gratuity has been paid through an approved gratuity fund managed by the LIC of India. Premium paid thereon is accounted as expenditure.

8. Bonus :

Minimum Bonus payable as per the Payment of Bonus Act has been provided in the accounts.

9. Leave Encashment :

Leave encashment has been determined based on the available leave entitlement at the end of each calendar year. The incremental amount so calculated each year is debited to Salaries and Wages - leave encashment.

10. Deferred Income Tax :

Deferred income tax is provided using the liability method on all timing differences at the balance sheet date between tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the tax rates and tax laws substantively enacted at the balance sheet date.

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Mar 31, 2011

The Company adopts generally accepted Accounting policies excepting those which have been specifically stated herein. The Financial statements have been drawn up according to the accounting standards prescribed under Section 211(3C) of The Companies Act, 1956.

During the year the company has changed accounting policy with regard to valuation of finished stock lying in the factory to comply with the Accounting Standard AS-2 issued by the ICAI. Finished stock lying at the factory has been valued inclusive of excise duty during the year which has no impact on the profits of the company. This change in accounting policy is in conformity with the Accounting Standard issued by the Institute of Chartered Accountants of India.

2. Income :

i) Sales are net of returns and inclusive of excise duty. Sales are accounted for on despatch basis.

ii) Other Income is accounted on accrual basis.

3. Expenses :

All expenditures are accounted on accrual basis after reducing any specific income attributable to such expenditure.

4. Fixed Assets :

Fixed Assets are stated at the historical cost which is inclusive of freight, installation cost and duties and other incidental expenses up to the date of commencement of commercial production.

Depreciation is provided on straight line basis at the rate as prescribed under Schedule XIV of The Companies Act, 1956 as amended by Notification issued by the Department of Company Affairs in this regard dated 16.12.1993. Amounts spent on Site preparation at Quarry for mining of Clay have been capitalized under the head Building - Others and Depreciation provided accordingly.

5. Inventories :

Finished goods are valued at lower of cost or market value. Cost is inclusive of all overheads (including interest) incurred by the Company in bringing the goods to the finished stage. Raw materials, components and spare parts are valued at average cost. Average cost is calculated at weighted cost per unit after taking into account receipts at actual cost. Consumption and / or other stock diminution is accounted for at the aforesaid weighted cost.

6. Investments :

Investments are valued at cost and income thereon is accounted for when received.

7. Gratuity :

Gratuity has been paid through an approved gratuity fund managed by the LIC of India. Premium paid thereon is accounted as expenditure.

8. Bonus :

Minimum Bonus payable as per the Payment of Bonus Act has been provided in the accounts.

9. Leave Encashment :

Leave encashment has been determined based on the available leave entitlement at the end of each calendar year. The incremental amount so calculated each year is debited to Salaries and Wages - leave encashment.

10. Deferred Income Tax :

Deferred income tax is provided using the liability method on all timing differences at the balance sheet date between tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the tax rates and tax laws substantively enacted at the balance sheet date.

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Mar 31, 2010

1.The Company adopts generally accepted Accounting policies excepting those which have been specifically stated herein. The Financial statements have been drawn up according to the accounting standards prescribed under Section 211 (3C) of The Companies Act, 1956.

2. Income:

i) Sales are net of returns and inclusive of excise duty. Sales are accounted for on despatch basis. ii) Other Income is accounted on accrual basis.

3. Expenses:

All expenditures are accounted on accrual basis after reducing any specific income attributable to such expenditure.

4. Fixed Assets:

Fixed Assets are stated at the historical cost which is inclusive of freight, installation cost and duties and

other incidental expenses up to the date of commencement of commercial production.

Depreciation isprovided on straight line basis at the rate as prescribed under Schedule XIV of The Companies

Act, 1956 as amended by Notification issued by the Department of Company Affairs in this regard dated

16.12.1993.

Amounts spent on Site preparation at Quarry, for mining of Clay have been capitalized under the head

Building - Others and Depreciation provided accordingly.

5. Inventories:

Finished goods are valued at lower of cost or market value. Cost is inclusive of all overheads (including interest) incurred by the Company in bringing the goods to the finished stage. Raw materials, components and spare parts are valued at average cost. Average cost is calculated at weighted cost per unit after taking into account receipts at actual cost. Consumption and / or other stock diminution is accounted for at the aforesaid weighted cost.

Excise Duty on Finished Goods lying at factory amounting to Rs.184.36 lacs has not been included in the closing stock, which is not in accordance with Accounting Standard - 2. However the same has no impact on the profit of the business. This has been consistently followed.

6. Investments:

Investments are valued at cost and income thereon is accounted for when received.

7. Gratuity:

Gratuity has been paid through an approved gratuity fund managed by the LIC of India. Premium paid thereon is accounted as expenditure.

8. Bonus:

Minimum Bonus payable as per the Payment of Bonus Act has been provided in the accounts.

9. Leave Encashment:

Leave encashment has been determined based on the available leave entitlement at the end of each calendar year. The incremental amount so calculated each year is debited to Salaries and Wages - leave encashment.

10. Deferred Income Tax :

Deferred income tax is provided using the liability method on all timing differences at the balance sheet date between tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the tax rates and.tax laws substantively enacted at the balance sheet date.