6. Material Accounting Policies

6.1 Property, Plant and Equipment

Recognition and measurement:

Items of PPE are carried at cost less accumulated
depreciation and impairment losses, if any. The
cost of an item of PPE comprises its purchase
price, including import duties and other
non-refundable taxes or levies and any directly to the
attributable cost of bringing the assets to its working
condition for its intended use and any trade discount
and rebates are deducted in arriving at purchase price.
Cost of the assets also includes interest on borrowings
attributable to acquisition of qualifying fixed assets
up to the date the asset is ready for its intended use
incurred up to that date.

Such cost includes the cost of replacing part of the
plant and equipment and borrowing costs for long¬
term construction projects if the recognition criteria are
met. When significant parts of plant and equipment
are required to be replaced at intervals, the Company
depreciates these components separately based
on their specific useful lives. Likewise, when a major
inspection is performed, its cost is recognised in the
carrying amount of the plant and equipment as a

replacement if the recognition criteria are satisfied. All
other repair and maintenance costs are recognised in
the statement of profit or loss as incurred.

Cost of Items of Property, plant and equipment not
ready for intended use as on the balance sheet date, is
disclosed as capital work-in-progress. Advances given
towards acquisition of property, plant and equipment
outstanding at each balance sheet date are disclosed
as Capital Advance under Other non-current assets.

All identifiable revenue expenses including interest
incurred in respect of various projects/expansion, net
of income earned during the project development
stage prior to its intended use, are considered as
pre-operative expenses and disclosed under Capital
Work-in-Progress.

Capital expenditure on Property, plant and equipment
for research and development is classified under
property, plant and equipment and is depreciated on
the same basis as other property, plant and equipment.

Property, plant and equipment are derecognised
either on disposal or when the asset retires from
active use. Losses arising in the case of the retirement
of property, plant and equipment and gains or losses
arising from disposal of property, plant and equipment
are recognised in the statement of profit and loss in the
year of occurrence.

Transition to Ind AS:

The cost of property, plant and equipment as at 1
April 2016, the Companies date of transition to Ind AS,
was determined with reference to its carrying value
recognised as per the previous GAAP (deemed cost),
as at the date of transition to Ind AS.

Subsequent expenditure:

Subsequent expenditure is capitalised only if it is
probable that the future economic benefits associated
with the expenditure will flow to the Company and the
cost of the item can be measured reliably.

Depreciation:

Depreciation is the systematic allocation of the
depreciable amount of PPE over its useful life and is
provided on a straight-line basis over the useful lives
as prescribed under Schedule II to the Act or as per
technical assessment. The residual values, useful lives
and method of depreciation of PPE is reviewed at
each financial year end and adjusted prospectively,
if appropriate.

Depreciation on additions/disposals is provided on
a pro-rata basis i.e. from/up to the date on which is
asset is ready to use/disposed off. Freehold land is
not depreciated.

The estimated useful lives of Tangible assets are
as follows
* For these class of assets, the useful life of assets is different than
the prescribed life as per Part C of Schedule II of the Companies
Act, 2013. The different useful life is based on internal technical
evaluation by the Company and historical usage of assets.

Dies & Punches having useful life of 3 years as per
technical evaluation and management estimate and
Solar Plants having useful life of 25 years.

Property, plant and equipment which are added/
disposed off during the year, depreciation is provided
on pro-rata basis.

Building constructed on leasehold land are depreciated
based on the useful life specified in Schedule II to the
Companies Act, 2013, where the lease period of the
land is beyond the life of the building. In other cases,
building constructed on leasehold land are amortised
over the primary lease period of the land.

6.2 Intangible Assets

Intangible assets are recognised when it is probable
that the future economic benefits that are attributable
to the assets will flow to the Company and the cost of
the assets can be measured reliably.

Intangible assets are carried at cost less accumulated
amortisation and impairment losses, if any. Internally
generated intangibles, excluding development costs
as defined in Ind AS, are not capitalised and the related
expenditure is reflected in Statement of profit and loss
in the period in which the expenditure is incurred.

Trademarks and Software are amortised over their
estimated useful life on straight-line basis from the
date they are available for intended use or the period
of the license as applicable, subject to impairment test.

The amortisation period and the amortisation method
for an intangible assets with a finite useful life are
reviewed at least at the end of each reporting period.
Changes in the expected useful life or the expected
pattern of consumption of future economic benefits
embodied in the asset are considered to modify the
amortisation period or method, as appropriate, and
are treated as changes in accounting estimates.

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

Research and Development:

Revenue expenditure on research is recognised in the
statement of profit and loss in the period in which it
is incurred.

Development expenditure incurred on an individual
project is carried forward when its future recoverability
can reasonably be regarded as assured. Any
expenditure carried forward is amortised over the
period of expected future sales from the related
project. The carrying value of development costs is
reviewed for impairment annually when the asset is
not yet in use, and otherwise when events or changes
in circumstances indicate that the carrying value may
not be recoverable.

Impairment on non-financial assets:

The Company's non-financial assets other than
inventories and deferred tax assets, are reviewed at
each reporting date to determine whether there is any
indication of impairment. If any such indication exists,
then the asset's recoverable amount is estimated.

For impairment testing, assets that do not generate
independent cash inflows (i.e. corporate assets) are
grouped together into cash-generating units (CGUs).
Each CGU represents the smallest group of assets that
generates cash inflows that are largely independent of
the cash inflows of other assets or CGUs.

The recoverable amount of a CGU is the higher of its
value in use and its fair value less costs to sell. Value
in use is based on the estimated future cash flows,
discounted to their present value using a discount rate
that reflects current market assessments of the time
value of money and the risks specific to the CGU.

An impairment loss is recognised if the carrying amount
of an asset or CGU exceeds its estimated recoverable
amount. Impairment loss recognised in respect of a
CGU is allocated first to reduce the carrying amounts
of the assets of the CGU (or group of CGUs) on a pro
rata basis.

An impairment loss in respect of assets for which
impairment loss has been recognised in prior periods,
the Company reviews at each reporting date whether
there is any indication that the loss has decreased or
no longer exists. An impairment loss is reversed if there
has been a change in the estimates used to determine
the recoverable amount. Such a reversal is made only
to the extent that the asset's carrying amount does
not exceed the carrying amount that would have been
determined, net of depreciation or amortisation, if no
impairment loss had been recognised.

The following intangible assets are tested for
impairment each financial year even if there is no
indication that the asset is impaired:

i) An intangible asset that is not yet available for
use; and

ii) An intangible asset that is amortised over a period
exceeding ten years from the date when the asset
is available for use.

6.3 Non-current Assets Classified as Held For
Sale

Assets are classified as held for sale and stated at the
lower of carrying amount and fair value less costs to
sell if the asset is available for immediate sale and its
sale is highly probable. Such assets or group of assets
are presented separately in the Balance Sheet as
“Assets Classified as Held for Sale". Once classified as
held for sale, intangible assets, investment property
and property, plant and equipment are no longer
amortised or depreciated.

6.4 Financial Instruments

Trade receivables and debt securities issued are
initially recognised when they originate. All other
financial assets and financial liabilities are initially
recognised when the Company becomes a party to
the contractual provisions of the instrument.

A financial asset (unless it is a trade receivable without
a significant financing component) or financial liability
is initially measured at fair value plus or minus, for
an item not at FVTPL, transaction costs that are
directly attributable to its acquisition or issue. A trade
receivable without a significant financing component
is initially measured at the transaction price.

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.

Financial Assets:

Classification:

The Company classifies financial assets as
subsequently measured at amortised cost, fair value
through other comprehensive income or fair value
through profit or loss, on the basis of its business model
for managing the financial assets and the contractual
cash flow characteristics of the financial asset.

Initial recognition and measurement:

All financial assets excluding trade receivable(not
measured subsequently at fair value through profit or
loss) are recognised initially at fair value plus transaction
costs that are attributable to the acquisition of the
financial asset.

Subsequent measurement:

For the purpose of subsequent measurement, financial
assets are classified in two broad categories:

» Financial assets at fair value ( FVTPL / FVTOCI)

» Financial assets at amortised cost

When assets are measured at fair value, gains and
losses are either recognised in the statement of profit
and loss (i.e. fair value through profit or loss (FVTPL)),
or recognised in other comprehensive income (i.e. fair
value through other comprehensive income (FVOCI)).

Financial Assets measured at amortised cost (net of
write down for impairment, if any):

Financial assets are measured at amortised cost when
asset is held within a business model, whose objective
is to hold assets for collecting contractual cash
flows and contractual terms of the asset give rise on
specified dates to cash flows that are solely payments
of principal and interest. Such financial assets are
subsequently measured at amortised cost using the
effective interest rate (EIR) method less impairment, if
any. The losses arising from impairment are recognised
in the Statement of profit and loss.

Financial Assets measured at Fair Value through
Other Comprehensive Income (“FVTOCI"):

Financial assets under this category are measured
initially as well as at each reporting date at fair
value, when asset is held within a business model,
whose objective is to hold assets for both collecting
contractual cash flows and selling financial assets.
Fair value movements are recognised in the other
comprehensive income.

Financial Assets measured at Fair Value through
Profit or Loss (“FVTPL"):

Financial assets under this category are measured
initially as well as at each reporting date at fair value
with all changes recognised in profit or loss.

Investment in Subsidiary:

Investment in equity instruments of Subsidiaries
are measured at cost. In the financial statements,
investment in subsidiaries is carried at cost. The carrying
amount is reduced to recognise any impairment in the
value of investment.

Investment in Equity Instruments:

Equity instruments which are held for trading are
classified as at FVTPL. Fair value changes on the
instrument, excluding dividends, are recognised in
profit or loss.

Investment in Debt Instruments:

A debt instrument is measured at amortised cost or
at FVTOCI. Any debt instrument, which does not meet
the criteria for categorisation as at amortised cost or
as FVOCI, is classified as at FVTPL. Debt instruments
included within the FVTPL category are measured at
fair value with all changes recognised in the Statement
of profit and loss.

Derecognition of Financial Assets:

A financial asset is primarily derecognised when the
rights to receive cash flows from the asset have expired
or the Company has transferred its rights to receive
cash flows from the asset.

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 financial assets
that are debt instruments and trade receivables.

Financial Liabilities:

Classification:

The Company classifies all financial liabilities as
subsequently measured at amortised cost or FVTPL.

Initial recognition and measurement:

All financial liabilities are recognised initially at fair value
and, in the case of loans, borrowings and payables,
net of directly attributable transaction costs.

Financial liabilities include trade and other payables,
loans and borrowings including bank overdrafts and
derivative financial instruments.

Subsequent measurement:

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. Interest-bearing loans and
borrowings are subsequently measured at amortised
cost using the Effective Interest Rate (EIR) method.
Gains and losses are recognised in profit or loss when
the liabilities are derecognised as well as through EIR
amortisation process. Amortised 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 amortisation is included as finance
costs in the Statement of Profit and Loss.

Derecognition of Financial Liabilities:

A financial liability is derecognised 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
recognised in the Statement of Profit and Loss.

Derivative Financial Instrument:

The Company uses derivative financial instruments,
such as forward currency contracts to mitigate

its foreign currency risks. Such derivative financial
instruments are initially recognised at fair value on
the date on which a derivative contract is entered
into and are subsequently re-measured at fair value.
Derivatives are carried as financial assets when the fair
value is positive and as financial liabilities when the fair
value is negative. Any changes therein are generally
recognised in the statement of profit and loss.

6.5 Inventories

Raw materials and packing materials are valued at
lower of cost (on moving weighted average basis) and
the net realisable value, cost of which includes duties
and taxes (net off CENVAT and Goods and Service Tax
wherever applicable). Cost of imported raw materials
and packing materials lying in bonded warehouse
includes the amount of customs duty. Finished products
including traded goods and work-in-progress are
valued at lower of cost and net realisable value.

The cost of finished goods and work-in-progress have
been computed to include all cost of purchases, cost
of conversion, appropriate share of fixed production
overheads based on normal operating capacity and
other related cost incurred in bringing the inventories
to their present location and condition.

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

Slow and non-moving material, products nearing
expiry, defective inventory are fully provided for and
valued at net realisable value.

Goods and materials in transit are valued at actual cost
incurred up to the date of balance sheet. Materials and
other items held for use in production of inventories are
not written down, if the finished products in which they
will be used are expected to be sold at or above cost.

Consumables and other materials procured for R&D
purpose are charged off when acquired.

The comparison of cost and Net realisable value is
made on an item-by-item basis.

6.6 Cash and Cash Equivalents

Cash and Cash Equivalents comprise of cash on
hand and cash at bank including fixed deposit/highly
liquid investments with original maturity period of
three months or less that are readily convertible to
known amounts of cash and which are subject to an
insignificant risk of changes in value.

For the purpose of the statement of cash flows, cash
and cash equivalents consist of cash and short-term
deposits, as defined above, as they are considered
an integral part of the Company's cash management.

6.7 Cash Flow Statement

Cash flows are reported using the indirect method,
whereby net profit before tax is adjusted for the effects
of transactions of a non-cash nature, any deferrals or
accruals of past or future operating cash receipts or
payments and item of income or expenses associated
with investing or financing cash flows. The cash flow
from operating, investing and financing activities of the
Company are segregated.

6.8 Foreign Currency Transactions

Transactions in foreign currencies are translated into
the Company's functional currency at the exchange
rates at the dates of the transactions.

Monetary assets and liabilities denominated in foreign
currencies are translated into the functional currency
at the exchange rate at the reporting date. Non¬
monetary assets and liabilities that are measured at
fair value in a foreign currency are translated into the
functional currency at the exchange rate when the
fair value was determined. Non-monetary assets and
liabilities that are measured based on historical cost in
a foreign currency are not translated. Foreign currency
exchange differences are generally recognised in the
statement of profit and loss.

Exchange differences arising on the settlement of
monetary items or on translating monetary items
at rates different from those at which they were
translated on initial recognition during the period or
in previous Financial Statements are recognised in the
Standalone Statement of Profit and Loss in the period
in which they arise. When a gain or loss on a non¬
monetary item is recognised in Other Comprehensive
Income, any exchange component of that gain or
loss is recognised in Other Comprehensive Income.
Conversely, when a gain or loss on a non-monetary
item is recognised in Standalone Statement of Profit
and Loss, any exchange component of that gain or
loss is recognised in Standalone Statement of Profit
and Loss.

6.9 Revenue Recognition

Sale of Goods:

Revenue is measured based on the transaction price
adjusted for discounts and rebates, which is specified
in a contract with customer. Revenue are net of
estimated returns and taxes collected from customers.

Revenue from sale of goods is recognised at point in
time when control is transferred to the customer and
it is probable that consideration will be collected.
Control of goods is transferred upon the shipment of
the goods to the customer or when goods is made
available to the customer as per terms agreed.

The transaction price is documented on the sales
invoice and payment is generally due as per agreed
credit terms with customer.

The consideration can be fixed or variable. Variable
consideration is only recognised when it is highly
probable that a significant reversal will not occur.

Sales return is variable consideration that is recognised
and recorded based on historical experience, market
conditions and provided for in the year of sale as
reduction from revenue. The methodology and
assumptions used to estimate returns are monitored
and adjusted regularly in line with trade practices,
historical trends, past experience and projected
market conditions.

Interest income: Interest income is recognised with
reference to the Effective Interest Rate method.

Dividend income: Dividend from investment is
recognised as revenue when right to receive
is established.

Income from Export Benefits and Other Incentives:

Export benefits available under prevalent schemes are
accrued as revenue in the year in which the goods are
exported and/or services are rendered only when their
reasonable assurance that the conditions attached
to them will be complied with, and the amounts will be
received. Export benefit receivables are carried at net
realisable value.

6.10 Employee Benefits

All employee benefits payable wholly within twelve
months of rendering service are classified as short-term
employee benefits. Benefits such as salaries, wages,
short-term compensated absences, performance
incentives etc., and the expected cost of bonus, ex-
gratia are recognised during the period in which the
employee renders related service.

(i) Defined benefit plans

The Company provides for gratuity, a defined benefit
retirement plan ('the Gratuity Plan') covering eligible
employees. The Gratuity Plan provides a lump-sum
payment to vested employees at retirement, death,
incapacitation or termination of employment, of an
amount based on the respective employee's salary
and the tenure of employment with the Company.

Liabilities with regard to Gratuity Plan are determined
by actuarial valuation, performed by an independent
actuary, at each balance sheet date using the
Projected Unit Credit Method.

The Company fully contributes all ascertained liabilities
to the Ajanta Pharma Limited Group Gratuity Trust (the
Trust). Trustees administer contributions made to the
Trust and contributions are invested in a scheme with
Life Insurance Corporation of India as permitted by
laws of India.

The retirement benefit obligations recognised in the
balance sheet represents the present value of the
defined benefit obligations reduced by the fair value of

scheme assets. Any asset resulting from this calculation
is limited to the present value of available refunds and
reductions in future contributions to the scheme. The
Company recognises the net obligation of a defined
benefit plan in its balance sheet as an asset or liability.
Actuarial gains and losses are recognised in full in the
other comprehensive income for the period in which
they occur. The effect of any plan amendments are
recognised in the Statement of Profit and Loss.

(ii) Defined contribution plans

Contributions to defined contribution plans are
recognised as expense when employees have
rendered services entitling them to such benefits.

The Company pays provident fund contributions
to publicly administered provident funds as per
local regulations. The Company has no further
payment obligations once the contributions have
been paid. The contributions are accounted for as
defined contribution plans and the contributions are
recognised as employee benefit expense when they
are due. Prepaid contributions are recognised as an
asset to the extent that a cash refund or a reduction
in the future payments is available.

(iii) Compensated absences

The Company has a policy on compensated absences
which are both accumulating and non-accumulating
in nature. The expected cost of accumulating
compensated absences is determined by actuarial
valuation performed by an independent actuary at
each balance sheet date using projected unit credit
method on the additional amount expected to be
paid/availed within twelve months as a result of the
unused entitlement that has accumulated at the
balance sheet date.

Compensated absences which are not expected to
occur within twelve months after the end of the period
in which the employee renders the related services are
recognised as a liability at the present value of the
defined benefit obligation at the balance sheet date.

Expense on non-accumulating compensated
absences is recognised in the period in which the
absences occur.

(iv) Share-based compensation

Employees Stock Options Plans (“ESOPs"): The grant
date fair value of options granted to employees
is recognised as an employee expense, over the
period that the employees become unconditionally
entitled to the options. The expense is recorded for
each separately vesting portion of the award as if
the award was, in substance, multiple awards. The
increase in equity recognised in connection with
Share-based payment transaction is presented as
a separate component in equity under “Employee
Stock Options Outstanding Reserve". The amount

recognised as an expense is adjusted to reflect the
actual number of stock options that vest. The options
granted to employees of subsidiary is recognised as
an equity investment.

The Company recognises compensation expense
relating to share-based payments in net profit using
fair-value in accordance with Ind AS 102, Share-
Based Payment.

6.11 Borrowing Costs

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 capitalised as part of the cost
of the asset. All other borrowing costs are expensed
in the period in which they occur. Borrowing costs
consist of interest and other costs that an entity incurs
in connection with the borrowing of funds. Borrowing
cost also includes exchange differences to the extent
regarded as an adjustment to the borrowing costs.

6.12 Leases

The Company's lease asset classes primarily consist of
leases for land and buildings. The Company assesses
whether a contract contains a lease, at inception of
a contract. A contract is, or contains, a lease if the
contract conveys the right to control the use of an
identified asset for a period of time in exchange for
consideration. To assess whether a contract conveys
the right to control the use of an identified asset, the
Company assesses whether: (1) the contract involves
the use of an identified asset (2) the Company has
substantially all of the economic benefits from use of
the asset through the period of the lease and (3) the
Company has the right to direct the use of the asset.

At the date of commencement of the lease, the
Company recognises a right-of-use asset (“ROU")
and a corresponding lease liability for all lease
arrangements in which it is a lessee, except for leases
with a term of twelve months or less (short-term leases)
and low value leases. For these short-term and low
value leases, the Company recognises the lease
payments as an operating expense on a straight-line
basis over the term of the lease.

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

The right-of-use assets are initially recognised at
cost, which comprises the initial amount of the lease
liability adjusted for any lease payments made at or
prior to the commencement date of the lease plus
any initial direct costs less any lease incentives. They
are subsequently measured at cost less accumulated
depreciation and impairment losses.

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

The lease liability is initially measured at amortised
cost at the present value of the future lease payments.
The lease payments are discounted using the
generally accepted interest rate. Lease liabilities are
remeasured with a corresponding adjustment to the
related right of use asset if the Company changes its
assessment if whether it will exercise an extension or a
termination option.

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

Leases for which the Company is a lessor is classified
as a finance or operating lease. Whenever the terms of
the lease transfer substantially all the risks and rewards
of ownership to the lessee, the contract is classified
as a finance lease. All other leases are classified as
operating leases.

In respect of assets given on operating lease, lease
rentals are accounted in the Statement of Profit
and Loss, on accrual basis in accordance with the
respective lease agreements.

6.13 Government Grants

Government grants are initially recognised as deferred
income at fair value if there is reasonable assurance
that they will be received and the Company will comply
with the conditions associated with the grant;

» In case of capital grants, they are then recognised
in Standalone Statement of Profit and Loss as other
income on a systematic basis over the useful life of
the asset.

» In case of grants that compensate the Company
for expenses incurred are recognised in Standalone
Statement of Profit and Loss on a systematic basis
in the periods in which the expenses are recognised.

6.14 Earnings Per Share

Basic earnings per equity share is computed by
dividing the net profit attributable to the equity holders
of the Company by the weighted average number of
equity shares outstanding during the period. Diluted
earnings per equity share is computed by dividing

the net profit attributable to the equity holders of the
Company by the weighted average number of equity
shares considered for deriving basic earnings per
equity share and also the weighted average number
of equity shares that could have been issued upon
conversion of all dilutive potential equity shares. The
dilutive potential equity shares are adjusted for the
proceeds receivable had the equity shares been
actually issued at fair value. Dilutive potential equity
shares are deemed converted as of the beginning
of the period, unless issued at a later date. Dilutive
potential equity shares are determined independently
for each period presented.

6.15 Income Taxes

Income tax expense comprises current and deferred
income tax.

Current tax is recognised in statement of profit or loss,
except when they relate to items that are recognised
in other comprehensive income or directly in equity,
in which case, the current tax is also recognised in
other comprehensive income or directly in equity
respectively. Current income tax for current and prior
periods is recognised at the amount expected to be
paid to or recovered from the tax authorities, using the
tax rates and tax laws that have been enacted by the
balance sheet date. Deferred income tax assets and
liabilities are recognised for all temporary differences
arising between the tax bases of assets and liabilities
and their carrying amounts in the financial statements.

Deferred tax assets are reviewed at each reporting
date and are reduced to the extent that it is no longer
probable that the related tax benefit will be realised.

Deferred income tax assets and liabilities are measured
using tax rates and tax laws that have been enacted or
substantively enacted by the balance sheet date and
are expected to apply to taxable income in the years
in which those temporary differences are expected to
be recovered or settled. The effect of changes in tax
rates on deferred income tax assets and liabilities is
recognised as income or expense in the period that
includes the enactment or the substantive enactment
date. A deferred income tax asset is recognised
to the extent that it is probable that future taxable
profit will be available against which the deductible
temporary differences and tax losses can be utilised.
The Company offsets current tax assets and current
tax liabilities, where it has a legally enforceable right
to set off the recognised amounts and where it intends
either to settle on a net basis, or to realize the asset
and settle the liability simultaneously.

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.

6.16 Dividends to Shareholders

Annual dividend distribution to the shareholders is
recognised as a liability in the period in which the
dividends are approved by the shareholders. Any
interim dividend paid is recognised on approval by
Board of Directors. Dividend payable is recognised
directly in equity.