Accounting Policies of TGB Banquets and Hotels Ltd. Company

Mar 31, 2024

1. Corporate Information

TGB Banquets and Hotels Limited ("the Company") is a public limited company domiciled in India and is listed on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). The Company is into provision of Restaurants; banquets and hotel services since 1999.

2. Basis of preparation

These financial statements have been prepared in accordance with Indian Accounting Standards (IND AS) as notified the provision of the Companies Act,2013 ("the Act") and guidelines issued by the Securities & Exchange Board of India (SEBI). The Ind AS is prescribed under Section 133 of the Act read with Rule 3 of Companies (Indian Accounting Standard) Rules, 2015 and with Companies (Indian Accounting Standards) (Amendment) Rules, 2016.

The financial statements have been prepared on a historical cost basis, except

a. For Land which is valued at the Fair value.

b. For certain financial instruments at fair value.

3 Summary of significant accounting policies

i. Current versus non-current classification

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification.

An asset is treated as current when it is:

a. Expected to be realized or intended to be sold or consumed in normal operating cycle

b. Held primarily for the purpose of trading

c. Expected to be realized within twelve months after the reporting period, or

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

Current assets include the current portion of non-current financial assets.

All other assets are classified as non-current.

A liability is current when:

a. It is expected to be settled in normal operating cycle

b. It is held primarily for the purpose of trading

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

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

All other liabilities are classified as non-current.

Deferred tax assets and liabilities are classified as non-current assets and liabilities.

ii. Foreign Currencies:

These financial statements are presented in Indian Rupees ("INR") which is also the Company''s functional currency.

All amounts have been reported in Indian Rupees in lacs except for share and per share data, unless otherwise stated. Due to rounding off, the numbers presented throughout the document may not add up precisely to the totals and percentages may not precisely reflect the absolute figures.

Transactions in Foreign Currencies are recorded at the exchange rate prevailing on the date of transaction. Monitory Assets and Liabilities denominated in foreign currencies are translated at the foreign currency spot rates of exchange at the reporting date. Exchange differences arising on settlement or translation of the monetary items are recognised in profit and loss account. Non- monetary items that are measured at historical cost in foreign currency are translated using the exchange rates at the date of initial transactions.

iii. Fair value Measurement

The company measures financial instruments, such as, investment in quoted equity shares etc 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 n an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

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

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

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

The fair value of an asset or liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. A fair value measurement of a non-financial asset takes into account a market participant''s ability to generate economic benefits by using the asset in its highest and best use or by selling to another market participant that would use the asset in its highest and best use.

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 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.

Level2: 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 inputs that is significant to the fair value measurement is unobservable.

For the purpose of financial disclosure, the company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

iv. Use of Estimates:

The preparation of financial statements requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as at the date of the financial statements and the reported amounts of incomes and expenses during the reporting period. Estimates and underlying assumptions are reviewed on an ongoing basis. Difference between the actual results and estimates are recognised in the period in which the results are known or materialize.

Accounting estimates could change from period to period. Actual results could differ from those estimates. Appropriate changes in estimates are made as management becomes aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.

In the assessment of the company, the most significant effects of use of judgments and / or estimates on the amounts recognised in the financial statements relate to the following areas:

• Useful Lives of property, plant & equipments,

• Valuation of inventories,

• Measurement of recoverable amounts of assets / cash-generated units,

• Assets and obligations relating to employee benefits,

• Evaluation of recoverability of deferred tax assets, and

• Recognition and measurement of provisions and contingencies:

v. Going Concern:

The board of directors have considered the financial position of the Company at 31st March, 2024 and projected cash flows and financial performance of the Company for at least twelve months from the date of approval of these financial statements as well as planned cost and cash improvement actions, and believe that the plan for sustained profitability remains on course.

The board of directors have taken actions to ensure that appropriate long-term cash resources are in place at the date of signing the accounts to fund the Company''s operations.

vi. Property; Plant & Equipments:

a] Property; Plant & Equipments are stated at cost of construction or acquisition less accumulated depreciation / amortization and net of impairment except for land which have been measured at fair value.

b] Cost of an item of property, plant and equipment comprises its purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates, any directly attributable costs of bringing the item to its working condition for its intended use and estimated cost of dismantling and removing the item and restoring the site on which it is located. Subsequent expenditure relating to the property, plant & equipment is capitalized only when it is probable that future economic benefits associated with these will flow to the company and the cost of the item can be measured reliably.

c] An item of property, Plant & Equipment and intangible asset is derecognised 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 & equipment and intangible assets is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss.

vii. Capital work in progress

Projects under which property, plant and equipment are not yet ready for their intended use are carried at cost, comprising direct cost, related incidental expenses and attributable interest.

viii. Depreciation

Depreciation is calculated on cost of items of Plant and machinery forming part of property, plant and equipment less their estimated residual values over their estimated useful lives using the straight-line method. Freehold land is not depreciated.

ix. 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 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. De-recognition:

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 amortized 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 liabilitieuues 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. De recognition:

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 de recognition 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

x. Impairment of Assets:

(a) Financial Assets :

At each balance sheet date, the Company assesses whether a financial asset is to be impaired. Ind AS 109 requires expected credit losses to be measured through loss allowance. The Company measures the loss allowance for financial assets at an amount equal to lifetime expected credit losses if the credit risk on that financial asset has increased significantly since initial recognition. If the credit risk on a financial asset has not increased significantly since initial recognition, the Company measures the loss allowance for financial assets at an amount equal to 12-month expected credit losses. The Company uses both forward-looking and historical information to determine whether a significant increase in credit risk has occurred.

(b) Non-financial Assets :

Property, plant and equipment with finite life are evaluated for recoverability whenever there is any indication that their carrying amounts may not be recoverable. If any such indication exists, the recoverable amount (i.e. 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. If the recoverable amount of an asset (or CGU) is estimated to be less than its carrying amount, the carrying amount of the asset (or CGU) is reduced to its recoverable amount. An impairment loss is recognized in the statement of profit and loss to such extent. When an impairment loss subsequently reverses, the carrying amount of the asset (or a CGU) is increased to the revised estimate of its recoverable amount, such that the increase in the carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or CGU) in prior years. A reversal of an impairment loss is recognised immediately in statement of profit and loss.

xi. Valuation of Inventories:

a] Inventory comprises stock of food and beverages, Liquor stock and stores and spares and is carried at lower of cost and net realizable value.

b] Inventory of Cutlery, crockery, linen & uniform are amortized over the period of forty eight months except in case of obsolesces and other losses, wherever considered necessary.

xi. Cash and Cash Equivalents

Cash and cash equivalent comprise cash on hand and demand deposits with banks which are shortterm, highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

xii. Revenue Recognition:

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company in exchange for transferring control of goods and services to the customer and the revenue can be reliably measured, regardless of when the payment is being made. Effective April 01, 2018, the company has applied Ind AS 115 which replaced IND AS 18 Revenue recognition. Revenue is measured at the fair value of the consideration received or receivable and net of rebates, value added taxes, goods and service tax and loyalty reward points. The company has concluded that it is the principal in all of its revenue arrangements since it is the primary obligor in all the revenue arrangements as it has pricing latitude and is also exposed to inventory and credit risks.

Rendering of services

Revenue from rendering of hospitality services is recognised when the related services are rendered. Rooms, food, beverages, banquets and other services

Income from guest accommodation is recognised on a day to day basis after the guest checks into the Hotels and are stated net of allowances. Sale of food and beverages are recognised at the point of serving these items to the guests. Revenue from other services is recognised as and when rendered. The company collects Value Added Tax (VAT), and GST on behalf of the Guests and therefore are not economic benefits flowing to the company, hence, these are excluded from revenue.

Income from other allied services

In relation to laundry income, communication income, airport transfers income and other allied services, the revenue has been recognised by reference to the time of services rendered...

Interest Income

Interest Income from a financial asset is recognised 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, time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate exactly discounts estimated future cash receipts through the expected life of the financial assets to that asset''s net carrying value on initial recognition.

Windmill Energy Income

Revenue from windmill energy generation is accounted for on the basis of units generated against consumption at the Hotel, taking into consideration the energy charges and fuel charges charged by Torrent Power Ltd according to PPA agreement with them.

xiii. Borrowing Cost:

a] Borrowing cost is recognized as expense in the period in which these are incurred.

b] Interest and other borrowing cost on specific borrowings, attributable to qualifying assets are capitalized.

c] Foreign Exchange difference arising on repayment of foreign exchange term loan has been adjusted to interest cost.

xiv. Lease :

Finance Lease:

Leases where the Company assumes substantially all the risks and rewards of ownership are classified as finance lease. Such leases are capitalized at the inception of the lease at lower of the fair value or the present value of the minimum lease payments and a liability is recognized for an equivalent amount. Each lease rental paid is allocated between the liability and the interest cost so as to obtain a constant periodic rate of interest on the outstanding liability for each year.

Operating lease

Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor, are recognized as operating lease. Operating lease payments are recognized as an expense on a straight line basis over the lease term unless the payments are structured to increase in line with the expected general inflation so as to compensate for the lessor''s expected inflationary cost increases.

xv. Tax expense

Tax expense comprises of current tax and deferred tax.

a) Income tax expenses are recognized in statement of profit and loss, except when they relate to items recognized in other comprehensive income or directly in equity, in which case, income tax expenses are also recognized in other comprehensive income or directly in equity respectively. Current tax is the tax payable on the taxable profit for the year, using tax rates enacted or substantively enacted by the end of reporting period by the governing taxation laws, and any adjustment to tax payable in respect of previous periods. Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

b) Deferred taxes arising from deductible and taxable temporary differences between the tax base of assets and liabilities and their carrying amount in the financial statements are recognized using substantively enacted tax rates and laws expected to apply to taxable income in the years in which the temporary differences are expected to be received or settled. The deferred tax arising from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profit or loss at the time of the transaction are not recognized. Deferred tax asset are recognized only to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences can be utilized. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax assets to be utilized.

Deferred tax assets and liabilities are offset when the Company has a legally enforceable right to do the same.

xvi. Employee Benefits:

(a) Short term employee benefits are recognized as expenses at the undiscounted amount in the Statement of Profit and Loss of the year for which the related service is rendered.

(b) Defined Contribution Plan: Monthly contribution to the provident fund which is under defined contribution schemes are charged to Statement of Profit & Loss.

(c) Defined Benefit Plans: Gratuities to employees are provided for their actuarial valuation using the projected unit credit method. Actuarial gain and losses net of deferred taxes arising from experience adjustments and changes in actuarial assumptions are recognized in other comprehensive income in the period in which they arise. Any short falls in case of premature resignation or termination to the extent not reimbursed by LIC is being absorbed in the year of payment.

xvii. Provisions, Contingent Liabilities and Contingent Assets

Provision is recognized when the Company has a present obligation (legal or constructive) as a result of past events and it is probable that the outflow of resources will be required to settle the obligation and in respect of which reliable estimates can be made.

A disclosure for contingent liability is made when there is a possible obligation that may, but probably will not require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision/ disclosure is made. The Company does not recognize a contingent liability but discloses its existence in the financial statements. Contingent assets are not recognized in the financial statements. Provisions and contingencies are reviewed at each balance sheet date and adjusted to reflect the correct management estimates.

If the effect of the time value of money is material, provisions are discounted using a current pre- tax rate that reflects, using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. Commitments include the amount of purchase order (net of advances) issued to parties for completion of assets. Provisions, contingent liabilities, contingent assets and commitments are renewed at each balance sheet date.

xviii. Earnings per share

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders after deducting preference dividend and attributable taxes by the weighted average number of equity shares outstanding during the period.

Diluted Earnings per share, the net profit or loss for the period attributable to equity share holders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity share holders.

xix. Exceptional items

Certain occasions, the size, type or incidence of an item of income or expense, pertaining to the ordinary activities of the Company is such that its disclosure improves the understanding of the performance of the Company, such income or expense is classified as an exceptional item and accordingly, disclosed in the notes accompanying to the financial statements.

xx. Recent Accounting Pronouncements

Ministry of Corporate Affairs ("MCA") notifies new standard or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. On March 31, 2023,

MCA amended the Companies (Indian Accounting Standards) Rules, 2015 by issuing the Companies (Indian Accounting Standards) Amendment Rules, 2023, applicable from April 1, 2023, as below:

Ind AS 1 - Presentation of Financial Statements

The amendments require companies to disclose their material accounting policies rather than their significant accounting policies. Accounting policy information, together with other information, is material when it can reasonably be expected to influence decisions of primary users of general purpose financial statements. The Company does not expect this amendment to have any significant impact in its financial statements.

Ind AS 12 - Income Taxes

The amendments clarify how companies account for deferred tax on transactions such as leases and decommissioning obligations. The amendments narrowed the scope of the recognition exemption in paragraphs 15 and 24 of Ind AS 12 (recognition exemption) so that it no longer applies to transactions that, on initial recognition, give rise to equal taxable and deductible temporary differences. The Company is evaluating the impact, if any, in its financial statements.

Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors

The amendments will help entities to distinguish between accounting policies and accounting estimates. The definition of a change in accounting estimates has been replaced with a definition of accounting estimates. Under the new definition, accounting estimates are "monetary amounts in financial statements that are subject to measurement uncertainty". Entities develop accounting estimates if accounting policies require items in financial statements to be measured in a way that involves measurement uncertainty. The Company does not expect this amendment to have any significant impact in its financial statements.

Ind AS 107 - Financial Instruments - Disclosures

Information about the measurement basis for financial instruments shall be disclosed as a part of material accounting policy information. The Company does not expect this amendment to have any significant impact in its financial statements. The Company does not expect this amendment to have any significant impact in its financial statements.

xxi. Assets held for Sale :

Sale of business is classified as held for sale, if their carrying amount is intended to be recovered principally through sale rather than through continuing use. The condition for classification as held for sale is met when disposal business is available for immediate sale and the same is highly probable of being completed within one year from the date of classification as held for sale.

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Mar 31, 2016

1. Significant Accounting Policies

i. Basis of preparation of Financial Statements:

These financial statements have been prepared to comply with the Generally Accepted Accounting Principles in India, including the Accounting Standards notified under the relevant provisions of the Companies Act, 2013. The financial statements are prepared on accrual basis under the historical cost convention.

ii. Use of Estimates:

The preparation of financial statements requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as at the date of the financial statements and the reported amounts of incomes and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known or materialize.

i i i . Fixed Assets :

a) Fixed Assets are stated at cost of construction or acquisition less accumulated depreciation.

b) All other expenses including taxes, duties, freight incurred to bring the fixed assets to working condition is also treated as the cost of the fixed assets. However, convert availed in respect of the fixed assets is deducted from the cost of the fixed asset.

c) Depreciation is provided on straight line method over the estimated useful lives of the assets as prescribed under Schedule II of the Companies Act, 2013.

iv. Investments:

a) Current investments are carried at lower of cost and market value.

b) Long term investments are stated at cost. Provisions for diminution in value of long term investments are made, if the diminution is other than temporary.

v. Impairment of Assets:

At each balance sheet date, the company consider whether there is any indication that an asset may be impaired. If any indication exits the recoverable amount of the assets is estimated. An impairment loss is recognized immediately whenever the carrying amount of an asset exceeds its recoverable amount.

vi. Valuation of Inventories:

a) Inventory comprises stock of food and beverages and stores and spares and is carried at lower of cost and net realizable value. Cost includes all expenses incurred in bringing the goods to their present location and condition. Net realizable value is the estimated selling price in the ordinary course of business, less estimated cost of completion and to make the sale.

b) Inventory of Cutlery, crockery, linen & uniform are amortized over the period of forty eighth months.

vii. Deferred Revenue Expenditure:

a) Deferred Revenue Expenditure related to windmill has been amortized over a period of twenty years.

b) Deferred Revenue Expenditure other than above is amortized over a period of five years.

viii. Revenue Recognition:

a) Income from Rooms, Banquets, and Restaurant and Other Services represents invoice value of goods sold and services rendered exclusive of all applicable taxes.

b) Revenue from windmill energy generation is accounted for on the basis of units generated against consumption at the Hotel, taking into consideration the energy charges and fuel charges charged by Torrent Power Ltd according to PPA agreement with them.

ix. Foreign Currency Transactions:

Transactions in Foreign Currencies are recorded at the exchange rate prevailing on the date of transaction.

x. Borrowing Cost:

a) Borrowing cost is recognized as expense in the period in which these are incurred.

b) Interest and other borrowing cost on specific borrowings, attributable to qualifying assets are capitalized.

c) Foreign Exchange difference arising on repayment of foreign exchange term loan has been adjusted to interest cost.

xi. Provision for Taxation and Deferred Tax:

a) Provision for Income tax for the current year is based on the estimated taxable income for the period in accordance with the provisions of the Income Tax Act, 1961.

b) Deferred Tax resulting from "timing difference" between book and taxable profit is accounted for using tax rates & tax laws that have been enacted or substantively enacted as on the Balance Sheet date. The deferred tax asset is recognized only to the extent that there is a reasonable certainty that the future taxable profit will be available against which the deferred tax assets can be realized.

xii. Employee Benefits:

a) Gratuity liability is a defined benefit obligation and is recorded based on actuarial valuation on projected unit credit method made at the end of the financial year. The gratuity liability and the net periodic gratuity cost is actuarially determined after considering discount rates, expected long term return on plan assets and increase in compensation levels.

b) Company''s contribution to Provident Fund and Employees State Insurance is charged to the statement of profit and loss for the year.

c) Provision for leave salary has been made as determined by the management.

2.3.1 Security Particulars of Secured Loans

- Term Loan from SBI

i) First pari passu charge over present and future movable and immovable fixed assets at Ahmadabad and Surat properties of the Company.

ii) In addition to the above, the subsidiary company, Lov Kush Properties Pvt. Ltd., has given the corporate guarantee to the limits availed by the company.

iii) The term loans are further guaranteed by the personal guarantee of all executive directors.

- Term Loan & Working Capital Loan from ICICI

i) Pari passu charge over present and future movable and immovable fixed assets at Ahmadabad and Surat properties of the Company.

ii) The term loans are further guaranteed by the personal guarantee of all executive directors.

- Term Loan from Religare Finvest Ltd.

i) Pari passu charge over present and future movable and immovable fixed assets at Ahmadabad and Surat properties of the Company.

- Secured Loans from others

i) Vehicle loans are secured by the hypothecation of assets purchased.

F) Related Party Transactions :

a) Related Parties and their Relationship:

Name of Related Party Relationship

New Ramesh Kirana Stores Entities over which Key Management Personnel are able to

exercise significant influence

TGB Foods Pvt. Ltd Entities over which Key Management Personnel are able to

exercise significant influence

TGB Bakers & Confectioners Pvt. Ltd. Entities over which Key Management Personnel are able to

exercise significant influence

Devanand G. Somani HUF Entities over which Key Management Personnel are able to

exercise significant influence

Narendra G. Somani Key Management Personnel

Devanand G. Somani Key Management Personnel

Hemant G. Somani Key Management Personnel

Ramesh K. Motiani Key Management Personnel

Harshita D. Somani Relative of Key Management Personnel

Sunita N. Somani Relative of Key Management Personnel

Neeta H. Somani Relative of Key Management Personnel

Bhagwati Sales Corporation Relative of Key Management Personnel

G) Segment Reporting :

Since the company has only one segment, there is no separate reportable segment as required in AS-17 issued by the ICAI.

H) Since the business of the company is by way of Food and Beverages, the quantity wise details of purchase, consumption, turnover, stock etc. are not furnished as the items are so large in number that it is not practicable to present.

I) The company had not received any intimation from suppliers regarding their status under the Micro, Small & Medium Enterprise Act, 2006, and hence disclosures, if any, relating to amounts unpaid as the year end together with interest paid of payable as required under said Act, have not been given.

J) In the opinion of the Board, the Current Assets, Loans and Advances are approximately of the value stated, if realized, in the ordinary course of business. Provision for all known liabilities is adequate and not in excess of the amount reasonably necessary.

K) The previous year''s figure have been reworked, regrouped and reclassified wherever necessary.

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Mar 31, 2014

I. Basis of preparation of Financial Statements:

The financial statements are prepared and presented under the historical cost convention on an accrual basis of accounting in accordance with generally accepted accounting principles in India and are to comply with the applicable accounting standards notified under Section 211 (3C) of the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956, read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013. The accounting policies have been consistently applied unless otherwise stated.

ii. Use of Estimates:

The preparation of financial statements requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as at the date of the financial statements and the reported amounts of incomes and expenses during the reporting period. Difference between the actual results and estimates are recognised in the period in which the results are known or materialise.

iii. Fixed Assets:

a) Fixed Assets are stated at cost of construction or acquisition less accumulated depreciation.

b) All other expenses including taxes, duties, freight incurred to bring the fixed assets to working condition is also treated as the cost of the fixed assets. However, cenvat availed in respect of the fixed assets is deducted from the cost of the fixed asset.

c) Depreciation on Fixed Assets is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956.

iv. Investments:

a) Current investments are carried at lower of cost and market value.

b) Long term investments are stated at cost. Provisions for diminution in value of long term investments are made, if the diminution is other than temporary.

v. Impairment of Assets:

As at each Balance Sheet date, the carrying amount of fixed assets is tested for impairment so as to determine:

a) The provision for impairment loss, if any, required or

b) The renewal, if any, required of impairment loss recognized in previous periods. Impairment of loss is recognized when the carrying amount of an asset exceeds its recoverable amount.

vi. Valuation of Inventories:

a) Inventory comprises stock of food and beverages and stores and spares and is carried at lower of cost and net realizable value. Cost includes all expenses incurred in bringing the goods to their present location and condition. Net realizable value is the estimated selling price in the ordinary course of business, less estimated cost of completion and to make the sale.

b) Inventory of Cutlery, crockery, linen & uniform are amortised over the period of twenty four months.

vii. Deferred Revenue Expenditure:

a) Deferred Revenue Expenditure related to windmill has been amortized over a period of twenty years.

b) Deferred Revenue Expenditure other than above (i) is amortized over a period of five years.

viii. Revenue Recognition:

a) Income from Rooms, Banquets, and Restaurant and Other Services represents invoice value of goods sold and services rendered exclusive of all applicable taxes.

b) Revenue from windmill energy generation is accounted for on the basis of units generated against consumption at the Hotel, taking into consideration the energy charges and fuel charges charged by Torrent Power Ltd according to PPA agreement with them.

ix. Foreign Currency Transactions:

Transactions in Foreign Currencies are recorded at the exchange rate prevailing on the date of transaction.

x. Borrowing Cost:

a ) Borrowing cost is recognized as expense in the period in which these are incurred.

b) Interest and other borrowing cost on specific borrowings, attributable to qualifying assets are capitalized.

c) Foreign Exchange difference arising on repayment of foreign exchange term loan has been adjusted to interest cost.

xi. Provision for Taxation and Deferred Tax:

a) Provision for Income tax for the current year is based on the estimated taxable income for the period in accordance with the provisions of the Income Tax Act, 1961.

b) Deferred Tax resulting from "timing difference" between book and taxable profit is accounted for using tax rates & tax laws that have been enacted or substantively enacted as on the Balance Sheet date. The deferred tax asset is recognized only to the extent that there is a reasonable certainty that the future taxable profit will be available against which the deferred tax assets can be realized.

xii. Employee Benefits:

a) Gratuity liability is a defined benefit obligation and is recorded based on actuarial valuation on projected unit credit method made at the end of the financial year. The gratuity liability and the net periodic gratuity cost is actuarially determined after considering discount rates, expected long term return on plan assets and increase in compensation levels.

b) Company''s contribution to Provident Fund and Employees State Insurance is charged to the statement of profit and loss for the year. The company has no other obligation other than contribution payable.

c) Provision for leave salary has been made as determined by the management.

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Mar 31, 2013

I. Basis of preparation of Financial Statements:

The financial statements are prepared and presented under the historical cost convention on an accrual basis of accounting in accordance with generally accepted accounting principles in India and are to comply with the applicable accounting standards notified under Section 211 (3C) of the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956. The accounting policies have been consistently applied unless otherwise stated.

ii. Use of Estimates:

The preparation of financial statements requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as at the date of the financial statements and the reported amounts of incomes and expenses during the reporting period. Difference between the actual results and estimates are recognised in the period in which the results are known or materialise.

iii. Fixed Assets:

a) Fixed Assets are stated at cost of construction or acquisition less accumulated depreciation.

b) All other expenses including taxes, duties, freight incurred to bring the fixed assets to working condition is also treated as the cost of the fixed assets. However, cenvat availed in respect of the fixed assets is deducted from the cost of the fixed asset.

c) Depreciation on Fixed Assets is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956.

d) Goodwill is being amortized over the period of five years on straight line basis.

iv. Investments:

a) Current investments are carried at lower of cost and market value.

b) Long term investments are stated at cost. Provisions for diminution in value of long term investments are made, if the diminution is other than temporary.

v. Impairment of Assets:

As at each Balance Sheet date, the carrying amount of fixed assets is tested for impairment so as to determine:

a) The provision for impairment loss, if any, required or

b) The renewal, if any, required of impairment loss recognized in previous periods. Impairment of loss is recognized when the carrying amount of an asset exceeds its recoverable amount.

vi. Valuation of Inventories:

a) Inventory comprises stock of food and beverages and stores and spares and is carried at lower of cost and net realizable value. Cost includes all expenses incurred in bringing the goods to their present location and condition. Net realizable value is the estimated selling price in the ordinary course of business, less estimated cost of completion and to make the sale.

b) Inventory of Cutlery, crockery, linen & uniform are amortised over the period of twenty four months.

vii. Deferred Revenue Expenditure:

a) Deferred Revenue Expenditure related to windmill has been amortized over a period of twenty years.

b) Deferred Revenue Expenditure other than above (i) is amortized over a period of five years.

viii. Revenue Recognition:

a) Income from Rooms, Banquets, and Restaurant and Other Services represents invoice value of goods sold and services rendered exclusive of all applicable taxes.

b) Revenue from windmill energy generation is accounted for on the basis of units generated against consumption at the Hotel, taking into consideration the energy charges and fuel charges charged by Torrent Power Ltd according to PPA agreement with them.

ix. Foreign Currency Transactions:

Transactions in Foreign Currencies are recorded at the exchange rate prevailing on the date of transaction.

x. Borrowing Cost:

a) Borrowing cost is recognized as expense in the period in which these are incurred.

b) Interest and other borrowing cost on specific borrowings, attributable to qualifying assets are capitalized.

c) Foreign Exchange difference arising on repayment of foreign exchange term loan has been adjusted to interest cost.

xi. Provision for Taxation and Deferred Tax:

a) Provision for Income tax for the current year is based on the estimated taxable income for the period in accordance with the provisions of the Income Tax Act, 1961.

b) Deferred Tax resulting from "timing difference" between book and taxable profit is accounted for using tax rates & tax laws that have been enacted or substantively enacted as on the Balance Sheet date. The deferred tax asset is recognized only to the extent that there is a reasonable certainty that the future taxable profit will be available against which the deferred tax assets can be realized.

xii. Employee Benefits:

a) Gratuity liability is a defined benefit obligation and is recorded based on actuarial valuation on projected unit credit method made at the end of the financial year. The gratuity liability and the net periodic gratuity cost is actuarially determined after considering discount rates, expected long term return on plan assets and increase in compensation levels.

b) Company''s contribution to Provident Fund and Employees State Insurance is charged to the statement of profit and loss for the year. The company has no other obligation other than contribution payable.

c) Provision for leave salary has been made as determined by the management.

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Mar 31, 2012

I. Accounting Convention

The financial statements have been prepared under historical cost convention and on basis of the going concern, in accordance with the generally accepted accounting principles (GAAP) in India and as per the provision of the provision of the Companies Act,1956, wherever applicable.

Indian GAAP enjoins management to make estimates and assumptions that affect reported amount of assets, liabilities, revenue, expenses and contingent liabilities pertaining to year, the financial statements relate to. Actual result could differ from such estimates. Any revision in accounting estimate is recognized prospectively from current year and material revision, including its impact on financial statement, is reported in notes to accounts in the year of incorporation of revision.

ii. Fixed Assets

a) Fixed Assets are stated at cost of construction or acquisition less accumulated depreciation.

b) All other expenses including taxes, duties, freight incurred to bring the fixed assets to working condition is also treated as the cost of the fixed assets. However, cenvat availed in respect of the fixed assets is deducted from the cost of the fixed asset.

c) Depreciation on Fixed Assets is provided on straight line method at the rates and in the manner prescribed in schedule XIV to the Companies Act, 1956.

d) Goodwill is being amortized over the period of five years on straight line basis.

iii. Investments:

e) Current investments are carried at lower of cost and market value.

f) Long term investments are stated at cost. Provisions for diminution in value of long term investments are made, if the diminution is other than temporary.

iv. Impairment of Assets:

As at each Balance Sheet date, the carrying amount of fixed assets is tested for impairment so as to determine:

a) The provision for impairment loss, if any, required or

b) The renewal, if any, required of impairment loss recognized in previous periods. Impairment of loss is recognized when the carrying amount of an asset exceeds its recoverable amount.

v. Valuation of Inventories:

a) Inventory comprises stock of food and beverages and stores and spares and is carried at lower of cost and net realizable value. Cost includes all expenses incurred in bringing the goods to their present location and condition. Net realizable value is the estimated selling price in the ordinary course of business, less estimated cost of completion and to make the sale.

b) Inventory of Cutlery, crockery, linen & uniform are amortised over the period of twenty four months.

vi. Deferred Revenue Expenditure:

a) Deferred Revenue Expenditure related to windmill has been amortized over a period of twenty years.

b) Deferred Revenue Expenditure other than above (i) is amortized over a period of five years.

vii. Revenue Recognition:

a) Income from Rooms, Banquets, and Restaurant and Other Services represents invoice value of goods sold and services rendered exclusive of all applicable taxes.

b) Revenue from windmill energy generation is accounted for on the basis of units generated against consumption at the Hotel, taking into consideration the energy charges and fuel charges charged by Torrent Power Ltd according to PPA agreement with them.

viii. Foreign Currency Transactions:

Transactions in Foreign Currencies are recorded at the exchange rate prevailing on the date of transaction.

ix. Borrowing Cost:

a) Borrowing cost is recognized as expense in the period in which these are incurred.

b) Interest and other borrowing cost on specific borrowings, attributable to qualifying assets are capitalized.

c) Foreign Exchange difference arising on repayment of foreign exchange term loan has been adjusted to interest cost.

X. Provision for Taxation and Deferred Tax:

a) Provision for Income tax for the current year is based on the estimated taxable income for the period in accordance with the provisions of the Income Tax Act, 1961.

b) The Deferred Tax resulting from timing difference is accounted for using tax rates & tax laws that have been enacted or substantively enacted as at the Balance Sheet date.

xi. Employee Benefits:

a) Gratuity liability is a defined benefit obligation and is recorded based on actuarial valuation on projected unit credit method made at the end of the financial year. The gratuity liability and the net periodic gratuity cost is actuarially determined after considering discount rates, expected long term return on plan assets and increase in compensation levels. All actuarial gains / losses are immediately charged to the profit and loss account and are not deferred.

b) Provident fund is a defined contribution scheme and the company has no further obligation beyond the contributions made to the fund. Contributions are charged to the profit and loss account in the year in which they are accrued.

c) The Company has no other obligation other than the contribution payable.

d) Provision for leave salary has been made as determined by the management.

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Mar 31, 2011

1. Basis of preparation :

The financial statements have been prepared and presented on an accrual basis under the historical cost convention and in accordance with the applicable accounting standards prescribed by the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956. The accounting policies have been consistently applied unless otherwise stated.

2. Use of Estimates:

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumption that affects the reported amount of assets and liabilities on the date of financial statements and reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialised.

3. Fixed Assets:

(i) Fixed Assets are valued at cost less accumulated depreciation.

(ii) Incidental expenditure directly attributable to construction is accumulated as Capital Work-in-Progress.

4. Depreciation and Amortisation:

Tangible Assets:

During the year company has provided depreciation as per Straight Line Method at the rate & manner specified in Schedule XIV of the Companies Act.

5. Investments:

Investments are stated at cost of acquisition. Provision for diminution in value of Investment is made only if such a decline is other than temporary in the opinion of the management.

6. Valuation of Inventories:

(i) Inventory comprises stock of food and beverages and stores and spares and is carried at lower of cost and net realizable value. Cost includes all expenses incurred in bringing the goods to their present location and condition. Net realizable value is the estimated selling price in the ordinary course of business, less estimated cost of completion and to make the sale.

(ii) Inventory of Cutlery, crockery, linen & uniform are amortised over the period of twenty four months.

7. Miscellaneous Expenditure:

(i) Deferred Revenue Expenditure related to windmill has been amortized over a period of twenty years. (ii) Deferred Revenue Expenditure other than above (i) is amortized over a period of five years.

8. Revenue Recognition:

(i) Income from Rooms, Banquets, and Restaurant and Other Services represents invoice value of goods sold and services rendered exclusive of all applicable taxes.

(ii) Revenue from windmill energy generation is accounted for on the basis of units generated against consumption at the Hotel, taking into consideration the energy charges and fuel charges charged by Torrent Power Ltd according to PPA agreement with them.

9. Foreign Currency Transactions:

Transactions in Foreign Currencies are recorded at the exchange rate prevailing on the date of transaction.

10. Borrowing Cost:

(i) Borrowing cost is recognised as expense in the period in which these are incurred.

(ii) Interest and other borrowing cost on specific borrowings, attributable to qualifying assets are capitalised.

(iii) Foreign Exchange difference arising on repayment of foreign exchange term loan has been adjusted to interest cost.

11. Provision for Taxation:

(i) Provision for Income tax for the current year is based on the estimated taxable income for the period in accordance with the provisions of the Income Tax Act, 1961.

(ii) The Deferred Tax resulting from timing difference is accounted for using tax rates & tax laws that have been enacted or substantively enacted as at the Balance Sheet date.

12. Employee Benefits:

(i) Gratuity liability is a defined benefit obligation and is recorded based on actuarial valuation on projected unit credit method made at the end of the financial year. The gratuity liability and the net periodic gratuity cost is actuarially determined after considering discount rates, expected long term return on plan assets and increase in compensation levels. All actuarial gains / losses are immediately charged to the profit and loss account and are not deferred.

(ii) Provident fund is a defined contribution scheme and the company has no further obligation beyond the contributions made to the fund. Contributions are charged to the profit and loss account in the year in which they are accrued.

(iii) The Company has no other obligation other than the contribution payable.

(iv) Provision for leave salary has been made as determined by the management.

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Mar 31, 2010

1. Basis of preparation of Financial Statements:

The Financial Statements are prepared and presented under the historical cost convention on the accrual basis of accounting in accordance with accounting principles generally accepted in India ("Indian GAAP") and are in compliance with Accounting Standards issued by the Institute of Chartered Accountants of India ("ICAI") and the provisions of Companies Act, 1956.

2. Accounting Convention and Revenue Recognition:

The Company follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

3. Fixed Assets:

(i) Fixed Assets are valued at cost less accumulated depreciation.

(ii) Incidental expenditure directly attributable to construction is accumulated as Capital Work-in-Progress.

4. Depreciation and Amortisation:

Tangible Assets:

During the year company has provided depreciation as per Straight Line Method at the rate & manner specified in Schedule XIV of the Companies Act.

5. Investments:

Investments are classified into current and long term investment. Investments are stated at cost of acquisition. Provision for diminution in value of Investment is made only if such a decline is other than temporary in the opinion of the management.

6. Valuation of Inventories:

(i) Stock of food, beverages and other supplies are valued at cost on first-in-first-out basis. (ii) Inventory of Cutlery, crockery, linen & uniform are amortised over the period of 24 months.

7. Miscellaneous Expenditure:

(i) Hitherto the Company was amortizing the share issue expenses and preliminary expenses over a period of five years and the balance of unamortized expenses as on 1st April 2009 was Rs. 351.45 lacs and Rs.9.66 lacs respectively. The Company has changed the basis of amortizing such expenses during the year and amortized the entire unamortized share issue expenses of Rs.351.45 lacs and preliminary expenses of Rs. 9.66 lacs against the Share Premium Account during the year as permissible under Section 78(2) of the Companies Act, 1956. As a result of this change, the profits of the Company for the year ended 31st March 2010 are over stated by Rs.122.62 lacs.

(ii) Deferred Revenue Expenditure related to windmill has been amortized over a period of 20 years.

(iii) Deferred Revenue Expenditure other than above (ii) is amortized over a period of 5 years.

8. Revenue Recognition:

(i) Income from Rooms, Banquets, and Restaurant and Other Services represents invoice value of goods sold and services rendered exclusive of all applicable taxes.

(ii) Revenue from windmill energy generation is accounted for on the basis of units generated against consumption at the Hotel, taking into consideration the energy charges and fuel charges charged by Torrent Power Ltd according to PPA agreement with them.

9. Foreign Currency Transactions:

Transactions in Foreign Currencies are recorded at the exchange rate prevailing on the date of transaction.

10. Borrowing Cost:

(i) Borrowing cost is recognised as expense in the period in which these are incurred.

(ii) Interest and other borrowing cost on specific borrowings, attributable to qualifying assets are capitalised.

(iii) Foreign Exchange difference arising on repayment of foreign exchange term loan has been adjusted to interest cost.

11. Provision for Taxation:

(i) Provision for Income tax for the current year is based on the estimated taxable income for the period in accordance with the provisions of the Income Tax Act, 1961.

(ii) The Deferred Tax resulting from timing difference is accounted for using tax rates & tax laws that have been enacted or substantively enacted as at the Balance Sheet date.

12. Employee Benefits:

(i) Gratuity liability is a defined benefit obligation and is recorded based on actuarial valuation on projected unit credit method made at the end of the financial year. The gratuity liability and the net periodic gratuity cost is actuarially determined after considering discount rates, expected long term return on plan assets and increase in compensation levels. All actuarial gains / losses are immediately charged to the profit and loss account and are not deferred.

(ii) Provident fund is a defined contribution scheme and the company has no further obligation beyond the contributions made to the fund. Contributions are charged to the profit and loss account in the year in which they are accrued.

(iii) The Company has no other obligation other than the contribution payable.

(iv) Provision for leave salary has been made as determined by the management.

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Mar 31, 2009

1. Basis of preparation of Financial Statements:

The Financial Statements are prepared and presented under the historical cost convention on the accrual basis of accounting in accordance with accounting principles generally accepted in India ("Indian GAAP") and are in compliance with Accounting Standards issued by the Institute of Chartered Accountants of India ("ICAI") and the provisions of Companies Act, 1956.

2. Accounting Convention and Revenue Recognition:

The Company follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

3. Fixed Assets:

(i) Fixed Assets are valued at cost less accumulated depreciation.

(ii) Incidental expenditure directly attributable to construction is accumulated as Capital Work-in-Progress.

4. Depreciation and Amortisation: Tangible Assets:

During the year company has provided depreciation as per Straight Line Method at the rate & manner specified in

Schedule XIV of the Companies Act.

Intangible Assets:

Goodwill will be amortized over the period of 60 months.

5. Investments:

Investments are stated at cost of acquisition. Provision for diminution in value of Investment is made only if such a decline is other than temporary in the opinion of the management.

6. Valuation of Inventories:

(i) Stock of food, beverages and other supplies are valued at cost on first-in-first-out basis.

(ii) Inventory of Cutlery, crockery, linen & uniform are amortised over the period of 24 months.

7. Miscellaneous Expenditure:

(i) Preliminary Expenses are amortized over a period of 5 years.

(ii) Initial Public Expenditure is amortized over a period of 5 years.

(iii) Deferred Revenue Expenditure related to windmill has been amortized over a period of 20 years.

(iv) Deferred Revenue Expenditure other than above

(iii) is amortized over a period of 5 years.

8. Revenue Recognition:

(i) Income from Rooms, Banquets, and Restaurant and Other Services represents invoice value of goods sold and services rendered exclusive of all applicable taxes.

(ii) Revenue from windmill energy generation is accounted for on the basis of the billing by Torrent Power Limited as per the Purchase of Power Agreement entered into with them.

10. Borrowing Cost:

(i) Borrowing cost is recognised as expense in the period in which these are incurred. (ii) Interest and other borrowing cost on specific borrowings, attributable to qualifying assets are capitalised. (iii) Foreign Exchange difference arising on repayment of foreign exchange term loan has been adjusted to interest cost.

11. Provision for Taxation:

(i) Provision for Income tax and fringe benefit tax for the current year is based on the estimated taxable income for the period in accordance with the provisions of the Income Tax Act, 1961.

(ii) The Deferred Tax resulting from timing difference is accounted for using tax rates & tax laws that have been enacted or substantively enacted as at the Balance Sheet date.

10. Employee Benefits:

(i) Gratuity liability is a defined benefit obligation and is recorded based on actuarial valuation on projected unit credit method made at the end of the financial year. The gratuity liability and the net periodic gratuity cost is actuarially determined after considering discount rates, expected long term return on plan assets and increase in compensation levels. All actuarial gains / losses are immediately charged to the profit and loss account and are not deferred.

(ii) Provident fund is a defined contribution scheme and the company has no further obligation beyond the contributions made to the fund. Contributions are charged to the profit and loss account in the year in which they are accrued.

(iii) The Company has no other obligation other than the contribution payable.

11. Financial Derivatives Hedging Transactions:

(i) The use of Financial Derivatives Hedging Contracts is governed by the Companys policies approved by the Board of Directors which provide written principles on the use of such financial derivatives consistent with the companys risk management strategy. The Company does not use derivative financial instruments for speculative purpose

(ii) Financial Derivative Hedging Contracts are accounted on the date of their settlement / termination and realized gain / loss in respect of the settled / terminated contracts are recognised in the Profit and Loss Account, with the underlying transactions.

(iii) As required by the recent Announcement of the Institute of Chartered Accountants of India on positions of derivatives, keeping in view the principle of prudence as per Accounting Standard 1 on "Disclosure of Accounting Policies, outstanding derivative contracts at the Balance Sheet date are now reflected by making them to market and accordingly, the resulting mark to market losses are provided in the Profit and Loss Account.