Accounting Policies of Switching Technologies Gunther Ltd. Company

Mar 31, 2025

3. SIGNIFICANT ACCOUNTING POLICIES

3.1 Property, Plant and Equipment:

Property, Plant and Equipment are stated at original cost (including any revalued amount)
net of tax / duty credit availed, less accumulated depreciation, and accumulated and
accumulated impairment losses, if any. Costs include financing costs of borrowed funds
attributable to acquisition or construction of fixed assets, up to the date the assets are put-
to-use. When significant parts of property, plant and equipment are required to be replaced
at intervals, the Company derecognizes the replaced part, and recognizes the new part
with its own associated useful life and it is depreciated accordingly. Where components
of an asset are significant in value in relation to the total value of the asset as a whole,
and they have substantially different economic lives as compared to principal item of the
asset, they are recognized separately as independent items and are depreciated over their
estimated economic useful lives. Ail other repair and maintenance costs are recognized
in the statement of profit and loss as incurred unless they meet the recognition criteria for
capitalization under Property, Plant and Equipment

Tangible Fixed Assets:

(a) Depreciation is charged using straight line method on the basis of the expected useful
life as specified in Schedule II to the Act. A residual value of 5% (as prescribed in
Schedule II to the Act) of the cost of the assets is used for the purpose of calculating
the depreciation charge. The management believes that these estimated useful lives are
realistic and reflect fair approximation of the period over which the assets are likely to
be used. However, management reviews the residual values, useful lives and methods
of depreciation of property, plant and equipment at each reporting period end and any
revision to these is recognized prospectively in current and future periods.

(b) Depreciation on leasehold improvements is being charged equally over the period of the
lease.

(c) On transition to Ind AS, the Company had elected to measure its Property, Plant and
Equipment at cost as per Ind AS.

Capital Work- in- progress

Capital work-in-progress represents directly attributable costs of construction to be
capitalized. All other expenses including interest incurred during construction period are
capitalized as a part of the construction cost to the extent to which these expenditures are
attributable to the construction as per Ind AS-23 “Borrowing Costs". Interest income earned
on temporary investment of funds brought in for the project during construction period are set
off from the interest expense accounted for as expenditure during the construction period.

3.2 Impairment of non-financial assets

The carrying amounts of assets are reviewed at each balance sheet date if there is any
indication of impairment based on internal/externa! factors. An impairment loss is recognized
wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable
amount is the greater of the asset''s net selling price and value in use. In assessing value in
use, the Company measures it on the basis of discounted cash flow projections estimated
based on current prices. Assessment is also done at each Balance Sheet date as to whether
there is any indication that an impairment loss recognized for an asset in prior accounting
periods may no longer exist or may have decreased.

After impairment, depreciation is provided on the revised carrying amount of the asset over
its remaining useful life.

Impairment losses of continuing operations, including impairment on inventories, are
recognized in profit and loss section of the statement of profit and loss, except for properties
previously revalued with the revaluation taken to other comprehensive Income (the ‘OCI’).
For such properties, the impairment is recognized in OCI up to the amount of any previous
revaluation.

3.3 Foreign Currency Transactions

The Company’s financial statements are presented in INR, which is also the Company’s
functional currency.

Initial Recognition

Foreign currency transactions are recorded in the reporting currency, by applying to the
foreign currency amount the exchange rate between the reporting currency and the foreign
currency at the date of transaction.

Conversion

Foreign currency monetary items are reported using the closing rate. Non-monetary items,
which are measured in terms of historical costs denominated in foreign currency, are
reported using the exchange rate at the date of the transaction. Non-monetary items, which
are measured at fair value or other similar valuation denominated in a foreign currency, are
translated using the exchange rate at the date when such value was determined.

Exchange Differences

Exchange differences arising on the settlement of monetary items or on reporting Company’s
monetary items at rates different from those at which they were initially recorded during the
year, or reported in previous financial statements including receivables and payables which
are likely to be settled in foreseeable future, are recognized as income or as expenses in
the year in which they arise. All other exchange differences are recognized as income or as
expenses in the period in which they arise.

The gain or loss arising on translation of non-monetary items is recognized in line with the
gain or loss of the item that give rise to the translation difference (i.e. translation difference
on items whose gain or loss is recognized in other comprehensive income or the statement
of profit and loss is also recognized in other comprehensive income or the statement of profit
and loss respectively).

3.4 Revenue recognition

Effective 01 April 2018, the Company has adopted Indian Accounting Standard 115 (Ind
AS 115) -''Revenue from contracts with customers’ using the cumulative catch-up transition
method, applied to contracts that were not completed as on the transition date i.e. 01 April
2018. Accordingly, the comparative amounts of revenue and the corresponding contract
assets / liabilities have not been retrospectively adjusted. The effect on adoption of Ind-
AS 115 was insignificant. Revenue is recognized on satisfaction of performance obligation
upon transfer of control of promised products or services to customers in an amount that
reflects the consideration the Company expects to receive in exchange for those products
or services. The Company does not expect to have any contracts where the period between
the transfer of the promised goods or services to the customer and payment by the customer
exceeds one year. As a consequence, it does not adjust any of the transaction prices for the
time value of money.

Revenue from Sale of Goods

(i) Revenue from sales of Goods is recognised, net of returns and trade discounts, on transfer
of significant risks and rewards of ownership to the buyer, which generally coincides with
the delivery of goods to customers. Sales exclude Goods & Services Tax, if any.

Other Income

(ii) Other Income is accounted for on accrual basis.

3.5 Financial Instruments

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

A. Financial Assets

a. Initial recognition and measurement:

All financial assets are recognized initially at fair value plus, in the case of financial
assets not recorded at fair value through profit or loss, transaction costs that are
attributable to the acquisition of the financial asset. Purchases or sales of financial
assets that require delivery of assets within a time frame established by regulation or
convention in the marketplace [regular way trades] are recognized on the settlement
date, trade date, i.e., the date that the Company settle commits to purchase or sell
the asset.

b. Subsequent measurement:

For purposes of subsequent measurement, financial assets are classified in four
categories:

i. Debt instruments at amortized cost:

A ‘debt instrument’ is measured at the amortized cost if both the following
conditions are met:

- The asset is held with an objective of collecting contractual cash flows

- 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
amortized cost using the effective interest rate [EIR] method. Amortized cost is
calculated by taking into account any discount or premium on acquisition and
fees or costs that are an integral part of the EIR. The EIR amortization is included
in finance income in the Statement of Profit and Loss. The losses arising from
impairment are recognized in the profit or loss. This category generally applies
to trade and other receivables.

ii. Debt instruments at fair value through other comprehensive income
[FVTOCI]:

A ‘debt instrument’ is classified as at the FVTOCI if both of the following criteria
are met:

- The asset is held with objective of both - for collecting contractual cash flows
and selling the financial assets

- The asset''s contractual cash flows represent SPPI.

Debt instruments included within the FVTOCI category are measured initially as
well as at each reporting date at fair value. Fair value movements are recognized
in the other comprehensive income [OCI]. However, the Company recognizes
interest income, impairment losses & reversals and foreign exchange gain
or loss in the Statement of Profit and Loss. On derecognition of the asset,
cumulative gain or loss previously recognized in OCI is reclassified from the
equity to Statement of Profit and Loss. Interest earned whilst holding FVTOCI
debt instrument is reported as interest income using the EIR method.

iii. Debt instruments, derivatives and equity instruments at fair value through
profit or loss [FVTPL]:

FVTPL is a residual category for debt instruments. Any debt instrument, which
does not meet the criteria for categorization as at amortized cost or as FVTOCI,
is classified as at FVTPL. Debt instruments included within the FVTPL category
are measured at fair value with all changes recognized in the P&L.

iv. Equity instruments measured at fair value through other comprehensive
income [FVTOCI]:

All equity investments in scope of Ind AS 109 are measured at fair value.
Equity instruments which are held for trading and contingent consideration
recognized by an acquirer in a business combination to which Ind AS103
applies are classified as at FVTPL. For all other equity instruments, the
Company may make an irrevocable election to present in other comprehensive
income subsequent changes in the fair value. The Company has made such
election on an instrument by- by instrument basis. The classification is made
on initial recognition and is irrevocable. If the Company decides to classify an
equity instrument as at FVTOCI, then all fair value changes on the instrument,
excluding dividends, are recognized in the OCI. There is no recycling of the
amounts from OCI to Statement of Profit and Loss, even on sale of investment.
However, the Company may transfer the cumulative gain or loss within equity.
Equity instruments included within the FVTPL category are measured at fair
value with all changes recognized in the Statement of Profit and Loss.

c. Derecognition:

A financial asset is primarily derecognized when:

i. The Company has transferred its rights to receive cash flows from the asset or has
assumed an obligation to pay the received cash flows in full without material delay
to a third party under a ‘pass-through’ arrangement; and either [a] the Company has
transferred substantially all the risks and rewards of the asset, or [b] the Company
has neither transferred nor retained substantially all the risks and rewards of the
asset, but has transferred control of the asset.

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

d. Impairment of financial assets:

In accordance with Ind AS 109, the Company applies expected credit loss [ECL] model

for measurement and recognition of impairment loss on the following financial assets and

credit risk exposure:

a. Financial assets that are debt instruments, and are measured at amortised cost e.g.,
loans, deposits, trade receivables and bank balance

b. Trade receivables or any contractual right to receive cash

c. Financial assets that are debt instruments and are measured as at FVTOCI

d. Lease receivables under Ind AS 17

e. Financial guarantee contracts which are not measured as at FVTPL

The Company follows ‘simplified approach’ for recognition of impairment loss
allowance on Point c and d provided above. The application of simplified approach
requires the company to recognize the impairment loss allowance based on lifetime
ECLs at each reporting date, right from its initial recognition. For recognition
of impairment loss on other financial assets and risk exposure, the Company
determines that whether there has been a significant increase in the credit risk since
initial recognition. If credit risk has not increased significantly, 12-month ECL is used
to provide for impairment loss. Flowever, if credit risk has increased significantly,
lifetime ECL is used. If, in a subsequent period, credit quality of the instrument
improves such that there is no longer a significant increase in credit risk since initial
recognition, then the entity reverts to recognizing impairment loss allowance based
on 12-month ECL

Lifetime ECL are the expected credit losses resulting from all possible default events
over the expected life of a financial instrument. The 12-month ECL is a portion of the
lifetime ECL which results from default events that are possible within 12 months
after the reporting date. 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 entity expects to receive [i.e., all cash shortfalls], discounted at the original EIR.

As a practical expedient, the Company uses a provision matrix to determine
impairment loss allowance on portfolio of its trade receivables. The provision matrix
is based on its historically observed default rates over the expected life of the trade
receivables and is adjusted for forward-looking estimates. At every reporting date,
the historical observed default rates are updated and changes in the forward-looking
estimates are analyzed.

ECL impairment loss allowance [or reversal] recognized during the period is
recognized as income/ expense in the statement of profit and loss. The balance
sheet presentation for various financial instruments is described below:

a. Financial assets measured as at amortized cost, contractual revenue receivables
and lease receivables: ECL is presented as an allowance which reduces the net
carrying amount. Until the asset meets write-off criteria, the Company does not
reduce impairment allowance from the gross carrying amount.

b. Debt instruments measured at FVTOCI: Since financial assets are already
reflected at fair value, impairment allowance is not further reduced from its
value. Rather, ECL amount is presented as ‘accumulated impairment amount''
in the OCI.

B. Financial liabilities:

a. Initial recognition and measurement:

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value
through profit or loss, loans and borrowings, payables, or as derivatives designated as
hedging instruments in an effective hedge, as appropriate. All financial liabilities are
recognized initially at fair value and, in the case of loans and borrowings and payables,
net of directly attributable transaction costs.

b. Subsequent measurement:

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

i. Financial liabilities at fair value through profit or loss:

Financial liabilities at fair value through profit or loss include financial liabilities held
for trading and financial liabilities designated upon initial recognition as at fair value
through profit or loss. This category also includes derivative financial instruments
entered into by the Company that are not designated as hedging instruments in
hedge relationships as defined by Ind AS 109. Separated embedded derivatives are
also classified as held for trading unless they are designated as effective hedging

instruments. Gains or losses on liabilities held for trading are recognized in the profit
or loss.

Financial liabilities designated upon initial recognition at fair value through profit or
loss are designated as such at the initial date of recognition, and only if the criteria in
Ind AS 109 are satisfied for liabilities designated as FVTPL, fair value gains/ losses
attributable to changes in own credit risk are recognized in OCI. These gains/ losses
are not subsequently transferred to P&L. However, the Company may transfer the
cumulative gain or loss within equity. All other changes in fair value of such liability
are recognized in the statement of profit or loss. The Company has not designated
any financial liability as at fair value through profit and loss.

ii. Loans and borrowings:

After initial recognition, interest-bearing loans and borrowings are subsequently
measured at amortized cost using the EIR method. Gains and losses are recognized
in profit or loss when the liabilities are derecognized as well as through the EIR
amortization process. Amortized cost is calculated by taking into account any
discount or premium on acquisition and fees or costs that are an integral part of the
EIR. The EIR amortization is included as finance costs in the statement of profit and
loss.

iii. Financial guarantee contracts:

Financial guarantee contracts issued by the Company are those contracts that
require a payment to be made to reimburse the holder for a loss it incurs because the
specified debtor fails to make a payment when due in accordance with the terms of a
debt instrument. Financial guarantee contracts are recognized initially as a liability at
fair value, adjusted for transaction costs that are directly attributable to the issuance
of the guarantee. Subsequently, the liability is measured at the higher of the amount
of loss allowance determined as per impairment requirements of Ind AS 109 and the
amount recognized less cumulative amortization.

c. Derecognition:

A financial liability is derecognized 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 derecognition
of the original liability and the recognition of a new liability. The difference in the respective
carrying amounts is recognized in the statement of profit or loss.

C. Reclassification of financial assets:

The Company determines classification of financial assets and liabilities on initial
recognition. After initial recognition, no reclassification is made for financial assets
which are equity instruments and financial liabilities. For financial assets which are debt
instruments, a reclassification is made only if there is a change in the business model for
managing those assets. Changes to the business model are expected to be infrequent.
If the Company reclassifies financial assets, it applies the reclassification prospectively
from the reclassification date which is the first day of the immediately next reporting period
following the change in business model. The Company does not restate any previously
recognized gains, losses [including impairment gains or losses] or interest.

D. 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 recognized
amounts and there is an intention to settle on a net basis, to realize the assets and settle
the liabilities simultaneously.

3.6 Fair Value Measurement

The Company measures financial instruments, such as, derivatives at fair value at each
balance sheet date. 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:

a. In the principal market for the asset or liability, or

b. 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
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
statements 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

3.7 Inventories

Inventories are stated at the lower of cost and net realizable value. Costs comprise direct
materials and, where applicable, direct labour costs and those overheads that have been
incurred in bringing the inventories to their present location and condition. Net realisable
value is the price at which the inventories can be realised in the normal course of business
after allowing for the cost of conversion from their existing state to a finished condition and for
the cost of marketing, selling and distribution Stores and spare parts are carried at lower of
cost and net realisable value. Provisions are made to cover slow moving and obsolete items
based on historical experience of utilisation on a product category basis, which involves
individual businesses considering their product lines and market conditions.

3.8 Retirement benefits

Retirement benefit costs for the year are determined on the following basis:

(i) All employees are covered under contributory provident fund benefit of a contribution of
12% of salary. There is no obligation other than the contribution payable to the respective
fund.

(ii) The Company also provides for retirement benefits in the form of gratuity and compensated
absences/ Leave encashment in pursuance of the Company leave rules. The Company''s
liability towards such defined benefit plans are determined based on valuations as at the
Balance Sheet date made by independent actuaries. The classification of the Company''s
net obligation into current and non-current is as per the actuarial valuation report.

Re-measurements, comprising of actuarial gains and losses, the effect of the asset
ceiling, excluding amounts included in net interest on the net defined benefit liability and
the return on plan assets (excluding amounts included in net interest on the net defined
benefit liability), are recognized immediately in the balance sheet with a corresponding
debit or credit to retained earnings through other comprehensive income in the period in
which they occur. Re-measurements are not classified to the statement of profit and loss
in subsequent periods.

Net interest is calculated by applying the discount rate to the net defined benefit liability
or asset

3.9 Taxes on Income

Tax expense comprises current and deferred tax. Current income tax is measured at the
amount expected to be paid to the tax authorities in accordance with the Income Tax Act,
1961 and tax laws prevailing in the respective tax jurisdictions where the Company operates.
Current tax items are recognized in correlation to the underlying transaction either in P&L,
OCI or directly in equity.

Deferred tax is provided using the liability method on temporary differences between the tax
bases of assets and liabilities and their carrying amounts for financial reporting purposes at
the reporting date.

Deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax
assets are recognized for all deductible temporary differences, the carry forward of unused
tax credits and any unused tax losses. Deferred tax assets are recognized on the basis of
reasonable certainty that the company will be having sufficient future taxable profits and
based on the same the DTA has been recognized in the books.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced
to the extent that it is no longer probable that sufficient taxable profit will be available to allow
all or part of the deferred tax asset to be utilized.

Unrecognized deferred tax assets are re-assessed at each reporting date and are recognized
to the extent that it has become probable thatfuture taxable profits will allow the deferred tax
asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates [and tax laws] that have been
enacted or substantively enacted at the reporting date. Deferred tax items are recognized
in correlation to the underlying transaction either in OCI or directly in equity. Deferred tax
assets and deferred tax liabilities are offset if a legally enforceable right exists to set off
current tax assets against current tax liabilities.

3.10 Borrowing costs

Borrowing cost includes interest, amortization of ancillary costs incurred in connection with
the arrangement of borrowings and exchange differences arising from foreign currency
borrowings to the extent they are regarded as an adjustment to the interest cost.

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

Borrowing costs which are not specifically attributable to the acquisition, construction or
production of a qualifying asset, the amount of borrowing costs eligible for capitalization is
determined by applying a weighted average capitalization rate. The weighted average rate is
taken of the borrowing costs applicable to the outstanding borrowings of the company during
the period, other than borrowings made specifically for the purpose of obtaining a qualifying
asset. The amount of borrowing costs capitalized cannot exceed the amount of borrowing
costs incurred during that period.

3.11 Earnings per equity share

Basic earnings per share is calculated by dividing the net profit or loss from continuing
operation and total profit, both attributable to equity shareholders of the Company by the
weighted average number of equity shares outstanding during the period.

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Mar 31, 2024

3. SIGNIFICANT ACCOUNTING POLICIES

3.1 Property, Plant and Equipment:

Property, Plant and Equipment are stated at original cost (including any revalued amount)
net of tax / duty credit availed, less accumulated depreciation, and accumulated and
accumulated impairment losses, if any. Costs include financing costs of borrowed funds
attributable to acquisition or construction of fixed assets, up to the date the assets are put-
to-use. When significant parts of property, plant and equipment are required to be replaced
at intervals, the Company derecognizes the replaced part, and recognizes the new part
with its own associated useful life and it is depreciated accordingly. Where components
of an asset are significant in value in relation to the total value of the asset as a whole,
and they have substantially different economic lives as compared to principal item of the
asset, they are recognized separately as independent items and are depreciated over their
estimated economic useful lives. All other repair and maintenance costs are recognized
in the statement of profit and loss as incurred unless they meet the recognition criteria for
capitalization under Property, Plant and Equipment

Tangible Fixed Assets:

(a) Depreciation is charged using straight line method on the basis of the expected useful
life as specified in Schedule II to the Act. A residual value of 5% (as prescribed in
Schedule II to the Act) of the cost of the assets is used for the purpose of calculating
the depreciation charge. The management believes that these estimated useful lives are
realistic and reflect fair approximation of the period over which the assets are likely to
be used. However, management reviews the residual values, useful lives and methods
of depreciation of property, plant and equipment at each reporting period end and any
revision to these is recognized prospectively in current and future periods.

(b) Depreciation on leasehold improvements is being charged equally over the period of the
lease.

(c) On transition to Ind AS, the Company had elected to measure its Property, Plant and
Equipment at cost as per Ind AS.

Capital Work- in- progress

Capital work-in-progress represents directly attributable costs of construction to be
capitalized. All other expenses including interest incurred during construction period are
capitalized as a part of the construction cost to the extent to which these expenditures are

attributable to the construction as per Ind AS-23 “Borrowing Costs”. Interest income earned
on temporary investment of funds brought in for the project during construction period are set
off from the interest expense accounted for as expenditure during the construction period.

3.2 Impairment of non-financial assets

The carrying amounts of assets are reviewed at each balance sheet date if there is any
indication of impairment based on internal/external factors. An impairment loss is recognized
wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable
amount is the greater of the asset''s net selling price and value in use. In assessing value in
use, the Company measures it on the basis of discounted cash flow projections estimated
based on current prices. Assessment is also done at each Balance Sheet date as to whether
there is any indication that an impairment loss recognized for an asset in prior accounting
periods may no longer exist or may have decreased.

After impairment, depreciation is provided on the revised carrying amount of the asset over
its remaining useful life.

Impairment losses of continuing operations, including impairment on inventories, are
recognized in profit and loss section of the statement of profit and loss, except for properties
previously revalued with the revaluation taken to other comprehensive Income (the ‘OCI’).
For such properties, the impairment is recognized in OCI up to the amount of any previous
revaluation.

3.3 Foreign Currency Transactions

The Company’s financial statements are presented in I NR, which is also the Company’s
functional currency.

Initial Recognition

Foreign currency transactions are recorded in the reporting currency, by applying to the
foreign currency amount the exchange rate between the reporting currency and the foreign
currency at the date of transaction.

Conversion

Foreign currency monetary items are reported using the closing rate. Non-monetary items,
which are measured in terms of historical costs denominated in foreign currency, are
reported using the exchange rate at the date of the transaction. Non-monetary items, which
are measured at fair value or other similar valuation denominated in a foreign currency, are
translated using the exchange rate at the date when such value was determined.

Exchange Differences

Exchange differences arising on the settlement of monetary items or on reporting Company’s
monetary items at rates different from those at which they were initially recorded during the
year, or reported in previous financial statements including receivables and payables which
are likely to be settled in foreseeable future, are recognized as income or as expenses in
the year in which they arise. All other exchange differences are recognized as income or as
expenses in the period in which they arise.

The gain or loss arising on translation of non-monetary items is recognized in line with the
gain or loss of the item that give rise to the translation difference (i.e. translation difference
on items whose gain or loss is recognized in other comprehensive income or the statement
of profit and loss is also recognized in other comprehensive income or the statement of profit
and loss respectively).

3.4 Revenue recognition

Effective 01 April 2018, the Company has adopted Indian Accounting Standard 115 (Ind
AS 115) -’Revenue from contracts with customers’ using the cumulative catch-up transition
method, applied to contracts that were not completed as on the transition date i.e. 01 April
2018. Accordingly, the comparative amounts of revenue and the corresponding contract
assets / liabilities have not been retrospectively adjusted. The effect on adoption of Ind-
AS 115 was insignificant. Revenue is recognized on satisfaction of performance obligation
upon transfer of control of promised products or services to customers in an amount that
reflects the consideration the Company expects to receive in exchange for those products
or services. The Company does not expect to have any contracts where the period between
the transfer of the promised goods or services to the customer and payment by the customer
exceeds one year. As a consequence, it does not adjust any of the transaction prices for the
time value of money.

Revenue from Sale of Goods

(i) Revenue from sales of Goods is recognised, net of returns and trade discounts, on transfer
of significant risks and rewards of ownership to the buyer, which generally coincides with
the delivery of goods to customers. Sales exclude Goods & Services Tax, if any.

Other Income

(ii) Other Income is accounted for on accrual basis.

3.5 Financial Instruments

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

A. Financial Assets

a. Initial recognition and measurement:

All financial assets are recognized initially at fair value plus, in the case of financial
assets not recorded at fair value through profit or loss, transaction costs that are
attributable to the acquisition of the financial asset. Purchases or sales of financial
assets that require delivery of assets within a time frame established by regulation or
convention in the market place [regular way trades] are recognized on the settlement
date, trade date, i.e., the date that the Company settle commits to purchase or sell
the asset.

b. Subsequent measurement:

For purposes of subsequent measurement, financial assets are classified in four
categories:

i. Debt instruments at amortized cost:

A ‘debt instrument'' is measured at the amortized cost if both the following
conditions are met:

- The asset is held with an objective of collecting contractual cash flows

- 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
amortized cost using the effective interest rate [EIR] method. Amortized cost is
calculated by taking into account any discount or premium on acquisition and
fees or costs that are an integral part of the EIR. The EIR amortization is included
in finance income in the Statement of Profit and Loss. The losses arising from
impairment are recognized in the profit or loss. This category generally applies
to trade and other receivables.

ii. Debt instruments at fair value through other comprehensive income
[FVTOCI]:

A ‘debt instrument’ is classified as at the FVTOCI if both of the following criteria
are met:

- The asset is held with objective of both - for collecting contractual cash flows
and selling the financial assets

- The asset''s contractual cash flows represent SPPI.

Debt instruments included within the FVTOCI category are measured initially as
well as at each reporting date atfairvalue. Fairvalue movements are recognized
in the other comprehensive income [OCI], However, the Company recognizes
interest income, impairment losses & reversals and foreign exchange gain
or loss in the Statement of Profit and Loss. On derecognition of the asset,
cumulative gain or loss previously recognized in OCI is reclassified from the
equity to Statement of Profit and Loss. Interest earned whilst holding FVTOCI
debt instrument is reported as interest income using the EIR method.

iii. Debt instruments, derivatives and equity instruments at fair value through
profit or loss [FVTPL]:

FVTPL is a residual category for debt instruments. Any debt instrument, which
does not meet the criteria for categorization as at amortized cost or as FVTOCI,
is classified as at FVTPL. Debt instruments included within the FVTPL category
are measured at fair value with all changes recognized in the P&L.

iv. Equity instruments measured at fair value through other comprehensive
income [FVTOCI]:

All equity investments in scope of Ind AS 109 are measured at fair value.
Equity instruments which are held for trading and contingent consideration
recognized by an acquirer in a business combination to which Ind AS103
applies are classified as at FVTPL. For all other equity instruments, the
Company may make an irrevocable election to present in other comprehensive
income subsequent changes in the fair value. The Company has made such
election on an instrument by- by instrument basis. The classification is made
on initial recognition and is irrevocable. If the Company decides to classify an
equity instrument as at FVTOCI, then all fairvalue changes on the instrument,
excluding dividends, are recognized in the OCI. There is no recycling of the
amounts from OCI to Statement of Profit and Loss, even on sale of investment.
However, the Company may transfer the cumulative gain or loss within equity.
Equity instruments included within the FVTPL category are measured at fair
value with all changes recognized in the Statement of Profit and Loss.

c. Derecognition:

A financial asset is primarily derecognized when:

i. The Company has transferred its rights to receive cash flows from the asset or has
assumed an obligation to pay the received cash flows in full without material delay
to a third party under a ‘pass-through’ arrangement; and either [a] the Company has
transferred substantially all the risks and rewards of the asset, or [b] the Company
has neither transferred nor retained substantially all the risks and rewards of the
asset, but has transferred control of the asset.

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

d. Impairment of financial assets:

In accordance with Ind AS 109, the Company applies expected credit loss [ECL] model

for measurement and recognition of impairment loss on the following financial assets and

credit risk exposure:

a. Financial assets that are debt instruments, and are measured at amortised cost e.g.,
loans, deposits, trade receivables and bank balance

b. Trade receivables or any contractual right to receive cash

c. Financial assets that are debt instruments and are measured as at FVTOCI

d. Lease receivables under Ind AS 17

e. Financial guarantee contracts which are not measured as at FVTPL

The Company follows ‘simplified approach’ for recognition of impairment loss
allowance on Point c and d provided above. The application of simplified approach
requires the company to recognize the impairment loss allowance based on lifetime
ECLs at each reporting date, right from its initial recognition. For recognition
of impairment loss on other financial assets and risk exposure, the Company
determines that whether there has been a significant increase in the credit risk since
initial recognition. If credit risk has not increased significantly, 12-month ECL is used
to provide for impairment loss. However, if credit risk has increased significantly,
lifetime ECL is used. If, in a subsequent period, credit quality of the instrument
improves such that there is no longer a significant increase in credit risk since initial
recognition, then the entity reverts to recognizing impairment loss allowance based
on 12-month ECL.

Lifetime ECL are the expected credit losses resulting from all possible default events
over the expected life of a financial instrument. The 12-month ECL is a portion of the
lifetime ECL which results from default events that are possible within 12 months
after the reporting date. 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 entity expects to receive [i.e., all cash shortfalls], discounted at the original EIR.

As a practical expedient, the Company uses a provision matrix to determine
impairment loss allowance on portfolio of its trade receivables. The provision matrix
is based on its historically observed default rates over the expected life of the trade
receivables and is adjusted for forward-looking estimates. At every reporting date,
the historical observed default rates are updated and changes in the forward-looking
estimates are analyzed.

ECL impairment loss allowance [or reversal] recognized during the period is
recognized as income/ expense in the statement of profit and loss. The balance
sheet presentation for various financial instruments is described below:

a. Financial assets measured as at amortized cost, contractual revenue receivables
and lease receivables: ECL is presented as an allowance which reduces the net
carrying amount. Until the asset meets write-off criteria, the Company does not
reduce impairment allowance from the gross carrying amount.

b. Debt instruments measured at FVTOCI: Since financial assets are already
reflected at fair value, impairment allowance is not further reduced from its
value. Rather, ECL amount is presented as ‘accumulated impairment amount''
in the OCI.

B. Financial liabilities:

a. Initial recognition and measurement:

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value
through profit or loss, loans and borrowings, payables, or as derivatives designated as
hedging instruments in an effective hedge, as appropriate. All financial liabilities are
recognized initially at fair value and, in the case of loans and borrowings and payables,
net of directly attributable transaction costs.

b. Subsequent measurement:

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

i. Financial liabilities at fair value through profit or loss:

Financial liabilities at fair value through profit or loss include financial liabilities held
for trading and financial liabilities designated upon initial recognition as at fair value
through profit or loss. This category also includes derivative financial instruments
entered into by the Company that are not designated as hedging instruments in
hedge relationships as defined by Ind AS 109. Separated embedded derivatives are
also classified as held for trading unless they are designated as effective hedging
instruments. Gains or losses on liabilities held for trading are recognized in the profit
or loss.

Financial liabilities designated upon initial recognition at fair value through profit or
loss are designated as such at the initial date of recognition, and only if the criteria in
Ind AS 109 are satisfied for liabilities designated as FVTPL, fair value gains/ losses
attributable to changes in own credit risk are recognized in OCI. These gains/ losses
are not subsequently transferred to P&L. However, the Company may transfer the
cumulative gain or loss within equity. All other changes in fair value of such liability
are recognized in the statement of profit or loss. The Company has not designated
any financial liability as at fair value through profit and loss.

ii. Loans and borrowings:

After initial recognition, interest-bearing loans and borrowings are subsequently
measured at amortized cost using the EIR method. Gains and losses are recognized
in profit or loss when the liabilities are derecognized as well as through the EIR
amortization process. Amortized cost is calculated by taking into account any
discount or premium on acquisition and fees or costs that are an integral part of the
EIR. The EIR amortization is included as finance costs in the statement of profit and
loss.

iii. Financial guarantee contracts:

Financial guarantee contracts issued by the Company are those contracts that
require a payment to be made to reimburse the holderfor a loss it incurs because the
specified debtor fails to make a payment when due in accordance with the terms of a
debt instrument. Financial guarantee contracts are recognized initially as a liability at
fair value, adjusted for transaction costs that are directly attributable to the issuance
of the guarantee. Subsequently, the liability is measured at the higher of the amount
of loss allowance determined as per impairment requirements of Ind AS 109 and the
amount recognized less cumulative amortization.

c. Derecognition:

A financial liability is derecognized 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 derecognition
of the original liability and the recognition of a new liability. The difference in the respective
carrying amounts is recognized in the statement of profit or loss.

C. Reclassification of financial assets:

The Company determines classification of financial assets and liabilities on initial
recognition. After initial recognition, no reclassification is made for financial assets
which are equity instruments and financial liabilities. For financial assets which are debt
instruments, a reclassification is made only if there is a change in the business model for
managing those assets. Changes to the business model are expected to be infrequent.
If the Company reclassifies financial assets, it applies the reclassification prospectively
from the reclassification date which is the first day of the immediately next reporting period
following the change in business model. The Company does not restate any previously
recognized gains, losses [including impairment gains or losses] or interest.

D. 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 recognized
amounts and there is an intention to settle on a net basis, to realize the assets and settle
the liabilities simultaneously.

3.6 Fair Value Measurement

The Company measures financial instruments, such as, derivatives at fair value at each
balance sheet date. 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:

a. In the principal market for the asset or liability, or

b. 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
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
statements 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

3.7 Inventories

Inventories are stated at the lower of cost and net realizable value. Costs comprise direct
materials and, where applicable, direct labour costs and those overheads that have been
incurred in bringing the inventories to their present location and condition. Net realisable
value is the price at which the inventories can be realised in the normal course of business
after allowing for the cost of conversion from their existing state to a finished condition and for
the cost of marketing, selling and distribution Stores and spare parts are carried at lower of
cost and net realisable value. Provisions are made to cover slow moving and obsolete items
based on historical experience of utilisation on a product category basis, which involves
individual businesses considering their product lines and market conditions.

3.8 Retirement benefits

Retirement benefit costs for the year are determined on the following basis:

(i) All employees are covered under contributory provident fund benefit of a contribution of
12% of salary. There is no obligation other than the contribution payable to the respective
fund.

(ii) The Company also provides for retirement benefits in the form of gratuity and compensated
absences/ Leave encashment in pursuance of the Company leave rules. The Company''s
liability towards such defined benefit plans are determined based on valuations as at the
Balance Sheet date made by independent actuaries. The classification of the Company’s
net obligation into current and non-current is as per the actuarial valuation report.

Re-measurements, comprising of actuarial gains and losses, the effect of the asset
ceiling, excluding amounts included in net interest on the net defined benefit liability and
the return on plan assets (excluding amounts included in net interest on the net defined
benefit liability), are recognized immediately in the balance sheet with a corresponding
debit or credit to retained earnings through other comprehensive income in the period in
which they occur. Re-measurements are not classified to the statement of profit and loss
in subsequent periods.

Net interest is calculated by applying the discount rate to the net defined benefit liability
or asset

3.9 Taxes on Income

Tax expense comprises current and deferred tax. Current income tax is measured at the
amount expected to be paid to the tax authorities in accordance with the Income Tax Act,
1961 and tax laws prevailing in the respective tax jurisdictions where the Company operates.
Current tax items are recognized in correlation to the underlying transaction either in P&L,
OCI or directly in equity.

Deferred tax is provided using the liability method on temporary differences between the tax
bases of assets and liabilities and their carrying amounts for financial reporting purposes at
the reporting date.

Deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax
assets are recognized for all deductible temporary differences, the carry forward of unused
tax credits and any unused tax losses. Deferred tax assets are recognized on the basis of
reasonable certainty that the company will be having sufficient future taxable profits and
based on the same the DTA has been recognized in the books.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced
to the extent that it is no longer probable that sufficient taxable profit will be available to allow
all or part of the deferred tax asset to be utilized.

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 [and tax laws] that have been
enacted or substantively enacted at the reporting date. Deferred tax items are recognized
in correlation to the underlying transaction either in OCI or directly in equity. Deferred tax
assets and deferred tax liabilities are offset if a legally enforceable right exists to set off
current tax assets against current tax liabilities.

3.10 Borrowing costs

Borrowing cost includes interest, amortization of ancillary costs incurred in connection with
the arrangement of borrowings and exchange differences arising from foreign currency
borrowings to the extent they are regarded as an adjustment to the interest cost.

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

Borrowing costs which are not specifically attributable to the acquisition, construction or
production of a qualifying asset, the amount of borrowing costs eligible for capitalization is
determined by applying a weighted average capitalization rate. The weighted average rate is
taken of the borrowing costs applicable to the outstanding borrowings of the company during
the period, other than borrowings made specifically for the purpose of obtaining a qualifying
asset. The amount of borrowing costs capitalized cannot exceed the amount of borrowing
costs incurred during that period.

3.11 Earnings per equity share

Basic earnings per share is calculated by dividing the net profit or loss from continuing
operation and total profit, both attributable to equity shareholders of the Company by the
weighted average number of equity shares outstanding during the period.

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Mar 31, 2015

I. Basis of Accounting

These financial statements have been prepared under historical cost convention from Books of Accounts maintained on Accrual basis (unless otherwise stated herewith) in conformity with Accounting principles generally accepted in India and comply with the Accounting Standards issued by Institute of Chartered Accountants of India and referred to Sec 129 and 133 of Companies Act, 2013. The Accounting Policies applied by the Company are consistent with those used in previous year.

ii. Fixed Assets and Depreciation

Fixed assets are stated at their original cost, which includes expenditure incurred in the Acquisition of Assets/construction of assets, Pre-operative expenses till the commencement of operations and Interest up to the date of commencement of commercial production.

Depreciation on fixed assets has been provided on straight line method based on life assigned to each asset in accordance with Schedule II of the Companies Act, 2013.

iii. Impairment of Fixed Assets

Consideration is given at each Balance Sheet date to determine whether there is any indication of impairment of the carrying amount of the company's fixed assets. If any indication exists, an asset's recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is greater of the net selling price and value in use. In assessing the value based in use, the estimated future cash flows are discounted to their present value based on an appropriate discount factor.

iv. Foreign Exchange Transactions

Foreign exchange transactions are recorded in the books by applying the exchange rate as on the date of the transaction. Foreign currency liabilities (other than for acquisition of fixed assets from outside India) are converted at exchange rates prevailing on the last working day of the accounting year or settlement date as applicable and for fixed assets acquired from outside India the exchange difference is adjusted to the cost of the assets. Other foreign currency assets and liabilities are converted at the exchange rate prevailing on the last working day of the accounting year or settlement date, as applicable and the exchange difference is adjusted to the Profit and Loss Account.

v. Inventories

Inventories are valued at lower of cost or net realizable value except stores and spares, which are valued at cost. The determination of cost of various categories of inventories is as follows:

a. Stores and spares and raw materials are valued at rates determined on "First In - First Out" method.

b. Work-in-process and finished goods are valued on full absorption costing method based on annual average cost of production.

vi. Revenue Recognition

Revenue is recognized at the point of dispatch of finished goods to customers from plant.

vii. Retirement Benefits

Contributions to provident fund are made monthly, at predetermined rates, and debited to the Profit and Loss Account on an accrual basis. Provision for Gratuity and Leave encashment has been made on the basis of Actuarial Valuation as per Accounting Standard AS-15. The Company has subscribed to group gratuity scheme of LIC for all its employees. The date of commencement of the scheme is 26-03-2014.

viii. Contingent Liabilities

All liabilities have been provided for in the accounts except liabilities of a contingent nature, which have been disclosed at their estimated value in the notes to the accounts.

ix. Taxation

Provision is made for Income tax liability estimated to arise on the results for the year at the current rate of tax in accordance with Income Tax Act, 1961.

In accordance with the Accounting Standard 22, Accounting for Taxes on Income, issued by Institute of Chartered Accountants of India, Deferred tax resulting from "timing differences" between book profits and Tax profit is accounted for, at the current rate of tax, to the extent of timing difference are expected to crystallize.

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Mar 31, 2014

The accounts have been prepared under the historical cost convention and materially comply with the mandatory accounting standards. The significant accounting policies followed by the company are as stated below:

i. Fixed Assets and Depreciation

Fixed assets are capitalized at acquisition cost including any directly attributable cost of bringing the assets to their working condition for the intended use.

Depreciation on fixed assets is provided on straight line method in accordance with Schedule XIV to the Companies Act, 1956. Where the carrying value of an asset has undergone subsequent changes on account of exchange fluctuation, the depreciation on the revised unamortized depreciable amount is provided prospectively over the residual useful life of the asset.

ii. Impairment of Fixed Assets

Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the company''s fixed assets. If any indication exists, an asset''s recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is greater of the net selling price and value in use. In assessing the value based in use, the estimated future cash flows are discounted to their present value based on an appropriate discount factor.

iii. Foreign Exchange Transactions

Foreign exchange transactions are recorded in the books by applying the exchange rate as on the date of the transaction. Foreign currency liabilities (other than for acquisition of fixed assets from outside India) are converted at exchange rates prevailing on the last working day of the accounting year or settlement date as applicable and for fixed assets acquired from outside India the exchange difference is adjusted to the cost of the assets. Other foreign currency assets and liabilities are converted at the exchange rate Prevailing on the last working day of the accounting year or settlement date, as applicable and the exchange difference is adjusted to the profit and loss account.

iv. Inventories

Inventories are valued at lower of cost or net realizable value except stores and spares, which are valued at cost. The determination of cost of various categories of inventories is as follows:

a. Stores and spares and raw materials are valued at rates determined on "first in - first out" method.

b. Work-in-process and finished goods are valued on full absorption costing method based on annual average cost of production. .

v. Revenue Recognition

Revenue is recognized at the point of dispatch of finished goods to customers from plant.

vi. Retirement Benefits

Contributions to provident fund are made monthly, at predetermined rates, and debited to the profit and loss account on an accrual basis. Provision for gratuity and Leave encashment has been made on the basis of Actuarial Valuation as per Accounting Standard AS-15. The Company has subscribed to group gratuity scheme of LIC for all its employees. The date of commencement of the scheme is 26-03-2014. The Gratuity Liability for the financial year 2013-14 has been deposited into Gratuity Fund Trust on 31.03.2014.

vii. Contingent Liabilities

All liabilities have been provided for in the accounts except liabilities of a contingent nature, which have been disclosed at their estimated value in the notes to the accounts.

viii. Taxes on Income

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961.

Deferred tax resulting from "timing differences" between book and taxable profit is accounted for using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date.

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Mar 31, 2013

I. Fixed Assets and Depreciation

Fixed assets are capitalized at acquisition cost including any directly attributable cost of bringing the assets to their working condition for the intended use.

Depreciation on fixed assets is provided on straight line method in accordance with Schedule XIV to the Companies Act, 1956. Where the carrying value of an asset has undergone subsequent changes on account of exchange fluctuation, the depreciation on the revised unamortised depreciable amount is provided prospectively over the residual useful life of the asset.

ii. Impairment of Fixed Assets

Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the company''s fixed assets. If any indication exists, an asset''s recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is greater of the net selling price and value in use. In assessing the value based in use, the estimated future cash flows are discounted to their present value based on an appropriate discount factor.

iii. Foreign Exchange Transactions

Foreign exchange transactions are recorded in the books by applying the exchange rate as on the date of the transaction. Foreign currency liabilities (other than for acquisition of fixed assets from outside India) are converted at exchange rates prevailing on the last working day of the accounting year or settlement date as applicable and for fixed assets acquired from outside India the exchange difference is adjusted to the cost of the assets. Other foreign currency assets and liabilities are converted at the exchange rate prevailing on the last working day of the accounting year or settlement date, as applicable and the exchange difference is adjusted to the profit and loss account.

iv. Inventories

Inventories are valued at lower of cost and net realisable value except stores and spares, which are valued at cost. The determination of cost of various categories of inventories is as follows:

a. Stores and spares and raw materials are valued at rates determined on "first in - first out" method.

b. Work-in-process and finished goods are valued on full absorption costing method based on annual average cost of production. .

v. Revenue Recognition

Revenue is recognized at the point of dispatch of finished goods to customers from plant.

vi. Retirement Benefits

Contributions to provident fund are made monthly, at predetermined rates, and debited to the profit and loss account on an accrual basis. Provision for gratuity and Leave encashment has been made on the basis of Actuarial Valuation as per Accounting Standard AS-15. The company is unable to fund the liability provided due to cash flow problems.

vii. Contingent Liabilities

All liabilities have been provided for in the accounts except liabilities of a contingent nature, which have been disclosed at their estimated value in the notes to the accounts.

viii. Taxes on Income

Income taxes are accounted for in accordance with Accounting Standard 22 - Accounting for Taxes on Income issued by the Institute of Chartered Accountants of India. Deferred tax is accounted under the liability method, subject to consideration of prudence for deferred tax assets, at the current rate of tax, on timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods and are measured using tax rates enacted or substantively enacted as at the Balance Sheet date. The carrying amount of Deferred Tax Assets and Liabilities are reviewed at each Balance Sheet date

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Mar 31, 2012

The accounts have been prepared under the historical cost convention and materially comply with the mandatory accounting standards. The significant accounting policies followed by the company are as stated below:

i. Fixed Assets and Depreciation

Fixed assets are capitalized at acquisition cost including any directly attributable cost of bringing the assets to their working condition for the intended use.

Depreciation on fixed assets is provided on straight line method in accordance with Note 7 to the Companies Act, 1956. Where the carrying value of an asset has undergone subsequent changes on account of exchange fluctuation, the depreciation on the revised unamortised depreciable amount is provided prospectively over the residual useful life of the asset.

ii. Impairment of Fixed Assets

Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the company's fixed assets. If any indication exists, an asset's recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is greater of the net selling price and value in use. In assessing the value based in use, the estimated future cash flows are discounted to their present value based on an appropriate discount factor.

iii. Foreign Exchange Transactions

Foreign exchange transactions are recorded in the books by applying the exchange rate as on the date of the transaction. Foreign currency liabilities (other than for acquisition of fixed assets from outside India) are converted at exchange rates prevailing on the last working day of the accounting year or settlement date as applicable and for fixed assets acquired from outside India the exchange difference is adjusted to the cost of the assets. Other foreign currency assets and liabilities are converted at the exchange rate prevailing on the last working day of the accounting year or settlement date, as applicable and the exchange difference is adjusted to the profit and loss account.

iv. Inventories

Inventories are valued at lower of cost and net realisable value except stores and spares, which are valued at cost. The determination of cost of various categories of inventories is as follows:

a. Stores and spares and raw materials are valued at rates determined on "First in-First Out" method.

b. Work-in-process and finished goods are valued on full absorption costing method based on annual average cost of production. .

v. Revenue Recognition

Revenue is recognized at the point of dispatch of finished goods to customers from plant.

vi. Retirement Benefits

Contributions to provident fund are made monthly, at predetermined rates, and debited to the profit and loss account on an accrual basis. Provision for gratuity and Leave encashment has been made on the basis of Actuarial Valuation as per Accounting Standard AS-15. The company is unable to fund the liability provided due to cash flow problems.

vii. Contingent Liabilities

All liabilities have been provided for in the accounts except liabilities of a contingent nature, which have been disclosed at their estimated value in the notes to the accounts.

viii. Taxes on Income

Income taxes are accounted for in accordance with Accounting Standard 22 - Accounting for Taxes on Income issued by the Institute of Chartered Accountants of India. Deferred tax is accounted under the liability method, subject to consideration of prudence for deferred tax assets, at the current rate of tax, on timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods and are measured using tax rates enacted or substantively enacted as at the Balance Sheet date. The carrying amount of Deferred Tax Assets and Liabilities are reviewed at each Balance Sheet date.

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Mar 31, 2010

The accounts have been prepared under the historical cost convention and materially comply with the mandatory accounting standards. The significant accounting policies followed by the company are as stated below:

i. Fixed Assets and Depreciation

Fixed assets are capitalized at acquisition cost including any directly attributable cost of bringing the assets to their working condition for the intended use. Depreciation on fixed assets is provided on straight line method in accordance with Schedule XIV to the Companies Act, 1956. Where the carrying value of an asset has undergone subsequent changes on account of exchange fluctuation, the depreciation on the revised unamortised depreciable amount is provided prospectively over the residual useful life of the asset.

ii. Impairment of Fixed Assets

Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the company’s fixed assets. If any indication exists, an asset’s recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is greater of the net selling price and value in use. In assessing the value based in use, the estimated future cash flows are discounted to their present value based on an appropriate discount factor.

iii. Foreign Exchange Transactions

Foreign exchange transactions are recorded in the books by applying the exchange rate as on the date of the transaction. Foreign currency liabilities (other than for acquisition of fixed assets from outside India) are converted at exchange rates prevailing on the last working day of the accounting year or settlement date as applicable and for fixed assets acquired from outside India the exchange difference is adjusted to the cost of the assets. Other foreign currency assets and liabilities are converted at the exchange rate prevailing on the last working day of the accounting year or settlement date, as applicable and the exchange difference is adjusted to the profit and loss account.

iv. Inventories

Inventories are valued at lower of cost and net realisable value except stores and spares, which are valued at cost. The determination of cost of various categories of inventories is as follows:

a. Stores and spares and raw materials are valued at rates determined on - first in - first out” method.

b. Work-in-process and finished goods are valued on full absorption costing method based on annual average cost of production.

v. Revenue Recognition

Revenue is recognized at the point of dispatch of finished goods to customers from plant.

vi. Retirement Benefts

Contributions to provident fund are made monthly, at predetermined rates, and debited to the profit and loss account on an accrual basis. Provision for gratuity and Leave encashment has been made on the basis of Actuarial Valuation as per Accounting Standard AS-15. The company is unable to fund the liability provided due to cash flow problems.

vii. Contingent Liabilities

All liabilities have been provided for in the accounts except liabilities of a contingent nature, which have been disclosed at their estimated value in the notes to the accounts.

viii. Taxes on Income

Income taxes are accounted for in accordance with Accounting Standard 22 - Accounting for Taxes on Income issued by the Institute of Chartered Accountants of India. Deferred tax is accounted under the liability method, subject to consideration of prudence for deferred tax assets, at the current rate of tax, on timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods and are measured using tax rates enacted or substantively enacted as at the Balance Sheet date. The carrying amount of Deferred Tax Assets and Liabilities are reviewed at each Balance Sheet date.