2.2 Material Accounting Policies
(a) PROPERTY , PLANT AND EQUIPMENT
Recognition and measurement

The cost of an item of property, plant and equipment
shall be recognised as an asset if, and only if it is
probable that future economic benefits associated with
the item will flow to the Group and the cost of the item
can be measured reliably.

Property, Plant and equipment (PPE) are measured at
cost (which includes capitalised borrowing costs) less
accumulated depreciation and accumulated impairment
losses, if any.

The cost of an item of property, plant and equipment
comprises:

a) its purchase price, including import duties and
non-refundable purchase taxes, after deducting
trade discounts and rebates.

b) any costs directly attributable to bringing the asset
to the location and condition necessary for it to be
capable of operating in the manner intended by
the management.

c) the initial estimate of the costs of dismantling and
removing the item and restoring the site on which
it is located.

If significant parts of an item of property, plant and
equipment have different useful lives, then they are
accounted for as separate items (major components)
of property, plant and equipment and depreciated
accordingly.

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.

Capital work in progress and Capital advances

Assets under construction includes the cost of property,
plant and equipment that are not ready to use at the
balance sheet date. Advances paid to acquire property,
plant and equipment before the balance sheet date are
disclosed under other non-current assets. Assets under
construction are not depreciated as these assets are not
yet available for use.

Depreciation, Estimated useful life and Estimated
residual value

Depreciation is calculated using the Written Down
Value and SLM method, pro rata to the period of use,
taking into account useful lives and residual value of
the assets. The useful life of assets and the estimated
residual value taken from those prescribed under Part
C of Schedule II to the Companies Act, 2013 except in
case of leasehold improvements which are depreciated
over primary lease period, which in management's
opinion is reflective of economic useful lives of these
assets. Useful life and residual values are reviewed by
management at every balance sheet date and adjusted,
if appropriate.

(b) INTANGIBLE ASSETS

Recognition and measurement

Intangible assets comprise primarily of patent,computer
software and product under development.
Intangible assets are initially recorded at cost and
subsequent to recognition, intangible assets are stated
at cost less accumulated amortisation.

Research and development

Expenditure on research activities is recognised in profit
or loss as incurred.

Development expenditure is capitalised as part of
the cost of the resulting intangible asset only if the
expenditure can be measured reliably, the product or
process is technically and commercially feasible, future
economic benefits are probable and the Group intends
to and has sufficient resources to complete development
and to use or sell the asset. Otherwise, it is recognised
in profit or loss as incurred. Subsequent to initial
recognition, development expenditure is measured
at cost less accumulated amortisation and any
accumulated impairment losses.

Subsequent expenditure

Subsequent expenditure is capitalised only when it
increases the future economic benefits embodied in the
specific asset to which it relates. All other expenditure
are recognised in the Standalone statement of profit
and loss as incurred.

Amortisation

Amortisation is calculated to write off the cost of
intangible assets less their estimated residual values
using the straight-line method over their estimated
useful lives and is generally recognised in depreciation
and amortisation in Statement of profit and loss.

Derecognition

An intangible asset is derecognised on disposal, or when
no future economic benefits are expected from use or
disposal. Gains or losses arising from derecognition of
an intangible asset, measured as the difference between
the net disposal proceeds and the carrying amount of
the asset, are recognised in the Standalone statement
of profit and loss when the asset is derecognised.

Intangible assets under development

Intangible assets under development includes the cost
of patent, trademark and product development costs
that are not ready to use at the balance sheet date.
Product development costs includes employee benefits
expenses including employee stock option expense
incurred towards research and development team, raw
material consumed, testing charges, other expenses like
lease, electricity and other administration and office
expenses. Intangible assets under development are not
depreciated as these assets are not yet available for use.

) IMPAIRMENT

(i) Non-financial assets

Assessment for impairment is done at each
Balance Sheet date as to whether there is any
indication that a non-financial asset may be
impaired. For the purpose of assessing impairment,
the smallest identifiable group of assets that
generates cash inflows from continuing use that
are largely independent of the cash inflows from
other assets or groups of assets is considered as
a cash generating unit (CGU). If any indication of
impairment exists, an estimate of the recoverable
amount of the individual asset/cash generating
unit is made. Asset/cash generating unit whose
carrying value exceeds their recoverable amount
are written down to the recoverable amount by
recognising the impairment loss as an expense in
the Standalone Statement of Profit and Loss.

Recoverable amount is higher of an asset's or cash
generating unit's value in use and its fair value less
cost of disposal. Value in use is estimated future
cash flows expected to arise from the continuing
use of an asset or cash generating unit and from its
disposal at the end of its useful life discounted to
their present value using a post-tax discount rate
that reflects current market assessments of the time
value of money and the risks specific to the asset.
In determining fair value less costs of disposal,
recent market transactions are considered. If no
such transactions can be identified, an appropriate
valuation model is used.

An impairment loss is reversed in the Standalone
statement of profit and loss if there has been a
change in the estimates used to determine the
recoverable amount. The carrying amount of
the asset is increased to its revised recoverable
amount, provided that this amount does not
exceed the carrying amount that would have been
determined (net of any accumulated amortisation
or depreciation) had no impairment loss been
recognised for the asset in prior years.

(ii) Financial assets

The Company assesses on a forward looking basis
the expected credit losses associated with its
assets carried at amortised cost. The impairment
methodology applied depends on whether there
has been a significant increase in credit risk.
The Company recognises loss allowances using
the expected credit loss (ECL) model as per Ind
AS 109 for the financial assets which are not fair
valued through profit or loss. Loss allowance for
trade receivables with no significant financing
component is measured at an amount equal to
lifetime ECL. For all other financial assets, expected
credit losses are measured at an amount equal
to the 12-month ECL, unless there has been
a significant increase in credit risk from initial
recognition in which case those are measured at
lifetime ECL. The amount of expected credit losses
(or reversal) that is required to adjust the loss
allowance at the reporting date to the amount that
is required to be recognised is recognised as an
impairment gain or loss in profit or loss.

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 effective interest
rate. Lifetime ECL are the expected credit losses
resulting from all possible defaults events over the
expected life of a financial asset. 12 month ECL
are a portion of the lifetime ECL which result from

default events that are possible within 12 months
from the reporting date.

The Company considers a financial asset to be in
default when:

- the counter party is unlikely to pay its credit
obligations to the Company in full, without
recourse by the Company to actions such as
realising security (if any is held); or

- the financial asset is 180 days or more
past due.

ECL are measured in a manner that they reflect
unbiased and probability weighted amounts
determined by a range of outcomes, taking
into account the time value of money and other
reasonable information available as a result of past
events, current conditions and forecasts of future
economic conditions.

The gross carrying amount of a financial asset is
written off when the Company has no reasonable
expectations of recovering a financial asset in
its entirety or a portion thereof. The Company
expects no significant recovery from the amount
written off during the year.

(d) FINANCIAL INSTRUMENTS
FINANCIAL ASSETS
Initial recognition and measurement

All financial assets are initially recognized at fair value.
Transaction costs that are directly attributable to the
acquisition or issue of financial assets, which are not
at fair value through profit or loss, are adjusted to
the fair value on initial recognition. Financial assets
are classified, at initial recognition, as financial assets
measured at fair value or as financial assets measured
at amortised cost.

Subsequent Measurement

Financial Assets measured at Amortised Cost (AC)

A Financial Asset is measured at Amortised Cost if it is
held within a business model whose objective is to hold
the asset in order to collect contractual cash flows and
the contractual terms of the Financial Asset give rise
on specified dates to cash flows that represent solely
payments of principal and interest on the principal
amount outstanding.

Financial Assets measured at Fair Value Through
Other Comprehensive Income (FVTOCI)

A Financial Asset is measured at FVTOCI if it is held
within a business model whose objective is achieved
by both collecting contractual cash flows and selling
Financial Assets and the contractual terms of the
Financial Asset give rise on specified dates to cash
flows that represents solely payments of principal and
interest on the principal amount outstanding.

Financial Assets measured at Fair Value Through Profit
or Loss (FVTPL)

A Financial Asset which is not classified in any of the
above categories are measured at FVTPL. Financial assets
are reclassified subsequent to their recognition, if the
Company changes its business model for managing
those financial assets. Changes in business model are
made and applied prospectively from the reclassification
date which is the first day of immediately next reporting
period following the changes in business model in
accordance with principles laid down under Ind AS 109

- Financial Instruments.

I n case of investments In mutual fund and bonds-
Measured at Fair value through Profit and Loss
(FVTPL).

Derecognition of financial assets

The Company derecognises a financial asset when the
contractual rights to cash flows from the asset expire,
or it transfers the rights to receive the contractual cash
flows on the financial asset in a transaction in which
substantially all the risks and rewards of ownership of
the financial asset are transferred.

FINANCIAL LIABILITIES
Classification

The Company classifies its financial liabilities in the
following measurement categories:

- those to be measured subsequently at fair value
through profit and loss-[FVTPL]; and

- those measured at amortised cost. [AC]

Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as
financial liabilities at fair value through profit or loss or
at amortised cost.

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

The Company's financial liabilities include trade and
other payables, lease liabilities, loans and borrowings
including bank overdrafts.

Subsequent measurement

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

Financial liabilities at fair value through profit or loss
[FVTPL]

Financial liabilities at fair value through profit or loss
[FVTPL] include financial liabilities designated upon
initial recognition as at fair value through profit or loss.
Financial liabilities are classified as held for trading if
they are incurred for the purpose of repurchasing in
the near term. 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
recognised in Standalone statement of profit and loss.

Financial liabilities designated upon initial recognition
at fair value through profit or loss are designated at
the initial date of recognition, 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/
loss are not subsequently transferred to statement of
profit or loss. However, the Company may transfer the
cumulative gain or loss within equity. All other changes
in fair value of such liability are recognised in the
Standalone statement of profit and loss.

Financial liabilities at amortised cost (Loans and
borrowings)

After initial recognition, interest-bearing loans and
borrowings are subsequently measured at amortised
cost using the EIR method. Gains and losses are
recognised in profit or loss when the liabilities are
derecognised as well as through the 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 Standalone statement
of profit and loss. This category generally applies to
borrowings.

Derecognition

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 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
Standalone statement of profit and loss.

Offsetting of financial instruments

Financial assets and financial liabilities are offset and
the net amount is reported in the balance sheet if
there is a currently enforceable legal right to offset
the recognised amounts and there is an intention to
settle on a net basis, to realise the assets and settle the
liabilities simultaneously. The legally enforceable right
must not be contingent on future events and must be
enforceable in the normal course of business and in
the event of default, insolvency or bankruptcy of the
Company or the counterparty.

Derivative financial instruments

The Company uses derivative financial instruments,
such as forward currency contracts, interest rate swaps
and forward commodity contracts to hedge its foreign
currency risks, interest rate risks and commodity price
risks respectively. 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.

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 recognised 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 and
the amount recognised less cumulative amortisation.

Compound Financial Instruments

Compound Financial instruments are separated into
liability and equity components based on the terms of
the contract. On issuance of the compound financial
instruments, the fair value of the liability component is
determined using a market rate for an equivalent non¬
convertible instrument.This amount is classified as an
financial liability measured at FVTPL (net of transaction
costs) until it is extinguished on conversion or
redemption. The remainder of the proceeds is allocated
to the conversion option that is recognised and included
in equity since conversion option meets Ind AS 32
criteria for fixed to fixed classification. Transaction costs
are deducted from equity, net of associated income
tax. The carrying amount of the conversion option is
remeasured at each reporting date. Transaction Costs
are apportioned between the liability and equity
components of the compound financial instruments
based on the allocation of proceeds to the liability and
equity components when the instruments are initially
recognised.

:e) LOANS AND BORROWINGS

Borrowings are initially recognised at fair value, net of
transaction costs incurred. Any difference between the
proceeds (net of transaction costs) and the redemption
amount is recognised in profit or loss over the period
of borrowings using the effective interest method.
Processing/Upfront fee are treated as prepaid expenses
and same is amortised over the period of the facility to
which it relates.

After initial recognition, interest-bearing loans and
borrowings are subsequently measured at amortised
cost. Gains and losses are recognised in Standalone
statement of profit and loss when the liabilities are
derecognised as well as through the 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 Standalone statement
of profit and loss.

This category generally applies to interest-bearing
loans and borrowings.

Borrowings are derecognised from the balance
sheet when the obligation specified in the contract
is discharged, cancelled or expired. The difference
between the carrying amount of the financial liability
that has been extinguished or transferred to another
party and the consideration paid including any non cash
assets transferred or liability assumed, is recognised in
Standalone statement of profit and loss as other gains
or (losses).

Borrowings are classified as current liabilities unless
the Company has an unconditional right to defer the
settlement of liabilities for at least twelve months after
the reporting year.

Where there is a breach of a material provision of a
long term loan arrangement on or before the end of
the reporting period with the effect that the liability
becomes payable on demand on the reporting date, the
same is classified as current unless the lender agreed,
after the reporting year and before the approval of
Standalone Ind AS financial statements for issue, not to
demand payment as a consequence of the breach.

(f) CASH AND CASH EQUIVALENT

Cash and cash equivalent includes cash on hand, other
short-term, highly liquid investments with original
maturities 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, and
bank overdrafts.

Statement of Cash Flows

Cash flows are reported using the indirect method,
whereby net profit before taxes for the period 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 flows from operating, investing and financing
activities of the Company are segregated.

(g) INVENTORIES

Inventories comprises of raw material, work in progress
and finished goods. Inventories are valued at lower
of cost and net realisable value. Cost of inventories
comprises of all costs of purchase and other costs
incurred in bringing the inventories to their present
location and condition.

Inventories are valued at lower of cost and net realisable
value; cost is determined on FIFO basis. Net realisable
value is the estimated selling price in the ordinary
course of business, less estimated costs of completion
and estimated costs necessary to make the sale.

The net realizable value of work-in-progress is
determined with reference to the selling prices of
related finished products. Raw materials and other
supplies held for use in production of finished products
are not written down below cost except in cases where
material prices have declined and it is estimated that
the cost of the finished products will exceed their net
realizable value.

The comparison of cost and net realisable value is made
on an item-by-Item basis

(h) EARNINGS PER SHARE
Basic earnings per share

Basic earnings per shares is calculated by dividing
Profit/(Loss) attributable to equity holders (adjusted
for amounts directly charged to Reserves) before/after
Exceptional Items (net of tax) by Weighted average
number of Equity shares, (excluding treasury shares).

Diluted earnings per share

Diluted earnings per share is computed using the
net profit or loss for the year attributable to the
shareholders' and weighted average number of equity
and potential equity shares outstanding during the year
including share options, convertible preference shares
and debentures, except where the result would be
anti-dilutive. Potential equity shares that are converted
during the year are included in the calculation of diluted
earnings per share, from the beginning of the year or
date of issuance of such potential equity shares, to the
date of conversion.

(i) FOREIGN CURRENCY TRANSACTIONS AND
TRANSLATIONS

Foreign currency are translated into the functional
currency using the exchange rates at the dates of the
transactions. Foreign currency denominated monetary
assets and liabilities are translated into relevant
functional currency at exchange rates in effect at the
balance sheet date. Foreign exchange gains and losses
resulting from the settlement of such transactions
and from the translation of monetary assets and
liabilities denominated in foreign currencies at year end
exchange rates are generally recognized in Standalone
statement of profit and loss. Non-monetary assets
and non-monetary liabilities denominated in foreign
currency and measured at fair value are translated
at the exchange rate prevalent at the date when the
fair value was determined. Non-monetary assets and
non-monetary liabilities denominated in a foreign
currency and measured at historical cost are translated
at the exchange rate prevalent at the date of transaction.
Translation differences on assets and liabilities carried at
fair value are reported as part of the fair value gain or loss
and are generally recognised in Standalone statement
of profit and loss, except exchange differences arising
from the translation of the following items which are
recognised in OCI:

• equity investments at fair value through OCI
(FVOCI)

• a financial liability designated as a hedge of the
net investment in a foreign operation to the extent
that the hedge is effective; and

• qualifying cash flow hedges to the extent that the
hedges are effective.

(j) REVENUE RECOGNITION

Revenue is recognised to depict the transfer of control
of promised goods or services to customers upon
the satisfaction of performance obligation under the
contract in an amount that reflects the consideration to
which the entity expects to be entitled in exchange for
those goods or services.

Where performance obligation is satisfied over time,
Company recognizes revenue over the contract year.
Where performance obligation is satisfied at a point
in time, Company recognizes revenue when customer
obtains control of promised goods and services in the
contract.

Revenue is recognised net of any taxes collected
from customers, which are remitted to governmental
authorities.

(i) Sale of goods

Revenue from sale of goods is recognised
when control or substantial risks and rewards of
ownership are transferred to the buyer under the
terms of the contract

Revenue is measured at the amount of
consideration which the Company expects to be
entitled to in exchange for transferring distinct
services to a customer as specified in the contract,
excluding amounts collected on behalf of third
parties (for example taxes and duties collected
on behalf of the government). Consideration is
generally due upon satisfaction of performance
obligations and receivable is recognized when it
becomes unconditional.

Revenue is measured based on the transaction
price, which is the consideration, adjusted for
discounts and claims, if any, as specified in the
contract with the customer. Revenue also excludes
taxes collected from customers.

The specific recognition criteria described below
must also be met before revenue is recognized.
The Company has a Two stream of revenue i.e.
Sale of products & Sale of services.

The Company recognises revenue at a point in
time when the performance obligation is satisfied,
i.e. when 'control' of the goods underlying the
particular performance obligation are transferred
to the customer. Customers obtain control of the
good when the goods are delivered at the agreed
point of delivery which generally is the premises of
the customer.

Further, revenue from sale of goods is recognised
based on a 5-Step Methodology which is as
follows:

Step 1: Identify the contract(s) with a customer

Step 2: Identify the performance obligation in
contract

Step 3: Determine the transaction price

Step 4: Allocate the transaction price to the
performance obligations in the contract

Step 5: Recognise revenue when (or as) the entity
satisfies a performance obligation

(ii) Sale of service

The Company assesses the services promised
in a contract and identifies distinct performance
obligations in the contract. Identification of
distinct performance obligations to determine
the deliverables and the ability of the customer
to benefit independently from such deliverables,
and allocation of transaction price to these distinct
performance obligations involves significant
judgment.

Sale of service includes Maintenance services,
training services and other services.The Company
recognises revenue at a period of time when the
performance obligation is satisfied.

(iii) Warranty

The company provides warranties for general
repairs of defects as per terms of the contract
with ultimate customers. These warranties are
considered as assurance type warranties and
are accounted for under Ind AS 37 - Provisions,
Contingent Liabilities and Contingent assets.

(iv) Variable consideration (Liquidated damages)

The Company estimate the amount of consideration
to which the Company will be entitled in exchange
for transferring the promised goods or services
to a customer, if the consideration promised in a
contract includes a variable amount.

An amount of consideration can vary because
of discounts, rebates, refunds, credits, price
concessions, incentives, performance bonuses, or
other similar items. The promised consideration
can also vary if company's entitlement to the
consideration is contingent on the occurrence or
non-occurrence of a future event.

The Company recognises liquidated damages net
of sale of products for respective year.

(v) Contract Balances

Trade Receivables : A receivable represents the
Company's right to an amount of consideration
that is unconditional.

Contract liabilities

A contract liability is the obligation to transfer
goods or services to a customer for which the
Company has received consideration (or an amount
of consideration is due) from the customer. If a
customer pays consideration before the Company
transfers goods or services to the customer, a
contract liability is recognised when the payment
is made. Contract liabilities are recognised as
revenue when the Company performs under the
contract.

Contract assets

A contract asset is a right to receive consideration
in exchange for services already transferred to the
customer (which consists of unbilled revenue).
By transferring services to the customer before
the customer pays consideration or before the
payment is due, a contract asset is recognised for
the earned consideration that is unconditional.

(vi) Other operating income

Duty drawback income is recognised in the
Standalone statement of profit and loss of the
company under other operating revenue of the
company

(k) RECOGNITION OF DIVIDEND INCOME, INTEREST
INCOME OR EXPENSE

Interest income or expense is recognised using the
effective interest method.

The 'effective interest rate' is the rate that exactly
discounts estimated future cash payments or receipts
through the expected life of the financial instrument to:

- the gross carrying amount of the financial asset; or

- the amortised cost of the financial liability.

In calculating interest income and expense, the
effective interest rate is applied to the gross
carrying amount of the asset (when the asset is
not credit-impaired) or to the amortised cost of
the liability.

However, for financial assets that have become
credit-impaired subsequent to initial recognition,
interest income is calculated by applying the effective
interest rate to the amortised cost of the financial asset.

If the asset is no longer credit-impaired, then the
calculation of interest income reverts to the gross basis.

Dividend income is recognised in the Standalone
statement of profit and loss on the date on which the
Company's right to receive payment is established.

(l) EMPLOYEE BENEFITS

(i) During Employment benefits
(a) Short term employee benefits

Short-term employee benefits are expensed as the
related service is provided. A liability is recognised
for the amount expected to be paid if the Company
has a present legal or constructive obligation
to pay this amount as a result of past service
provided by the employee and the obligation can
be estimated reliably.

(ii) Post Employment benefits

(a) Defined contribution plans

A defined contribution plan is a post
employment benefit plan under which
a Company pays fixed contribution into
a separate entity and will have no legal
or constructive obligation to pay further
amounts.

Obligations for contributions to defined
contribution plans are expensed as the related
service is provided. Prepaid contributions are
recognised as an asset to the extent that a
cash refund or a reduction in future payments
is available.

(b) Defined benefit plans

The Company pays gratuity to the employees
who have has completed five years of service
with the Company at the time when employee
leaves the Company.

The gratuity liability amount is funded and
formed exclusively for gratuity payment to
the employees.

The liability in respect of gratuity and other
post-employment benefits is calculated using
the Projected Unit Credit Method and spread
over the periods during which the benefit
is expected to be derived from employees'
services.

Re-measurement of defined benefit plans in
respect of post employment are charged to
Other Comprehensive Income.

Compensated Absences : Accumulated
compensated absences, which are expected
to be availed or encashed within 12 months
from the end of the year are treated as short
term employee benefits. The obligation
towards the same is measured at the expected
cost of accumulated compensated absences
as the additional amount expected to be paid
as a result of the unused entitlement as at the
year end.

(iii) Termination benefits

Termination benefits are payable when
employment is terminated by the Company before
the normal retirement date or when an employee
accepts voluntary redundancy in exchange
for these benefits. In case of an offer made to
encourage voluntary redundancy, the termination
benefits are measured based on the number of
employees expected to accept the offer.

(iv) Equity settled share based payments

Employees of the Company receive remuneration
in the form of Share based payment transactions,
whereby employees render services as
consideration for equity instruments (equity
settled transactions). In accordance with the Ind
AS 102 Share based payment, the cost of equity-
settled transactions is measured using the fair
value method. The cumulative expense recognised
for equity settled transactions at each reporting
date until the vesting date reflects the extent
to which the vesting year has expired and the
Company's best estimate of the number of equity
instruments that will ultimately vest. The expense
or credit recognised in the Standalone statement
of profit and loss for the year represents the
movement in cumulative expense recognised as at
the beginning and end of that year is recognised
in employee benefits expense.

(m) INCOME TAXES

Income tax expense comprises current and deferred
tax. Tax is recognised in Standalone statement of profit
and loss, except to the extent that it relates to items
recognised in the other comprehensive income or in
equity. In which case, the tax is also recognised in the
other comprehensive income or in equity.

(i) Current tax

Current tax assets and liabilities are measured at
the amount expected to be recovered from or paid
to the taxation authorities, based on tax rates and
laws that are enacted or subsequently enacted at
the Balance sheet date.

Current tax assets and liabilities are offset only if,
the Company:

a) has a legally enforceable right to set off the
recognised amounts; and

b) i ntends either to settle on a net basis, or
to realise the asset and settle the liability
simultaneously.

Current tax provision is computed for income
calculated after considering allowances and
exemptions under the provisions of the applicable
Income Tax Laws. Current tax assets and current
tax liabilities are off set, and presented as net.

(ii) Deferred tax

Deferred tax is recognised on temporary
differences between the carrying amounts of
assets and liabilities in the Standalone Ind AS
financial statements and the corresponding tax
bases used in the computation of taxable profit.

Deferred tax liabilities and assets are measured
at the tax rates that are expected to apply in the
year in which the liability is settled or the asset
realised, based on tax rates (and tax laws) that
have enacted or substantively enacted by the
end of the reporting year. The carrying amount
of Deferred tax liabilities and assets are reviewed
at the end of each reporting year. Deferred tax
are recognised for unused tax losses, unused tax
credits and deductable temporary differences to
the extent that it is probable that future taxable
profit will be available against which they can be
used.

Future taxable profits are determined based on the
reversal of relevant taxable temporary differences.
If the amount of taxable temporary differences is
insufficient to recognise a deferred tax asset in full,
then future taxable profits, adjusted for reversals
of existing temporary differences, are considered,
based on the business plans for the Company.

The measurement of deferred tax reflects the tax
consequences that would follow from the manner
in which the Company expects, at the reporting
date, to recover or settle the carrying amount of
its assets and liabilities.

Deferred tax assets and liabilities are offset only if:

a) the Company has a legally enforceable right
to set off current tax assets against current
tax liabilities; and

b) The Deferred Tax Assets and the deferred tax
liabilities relate to income taxes levied by the
same taxation authority on the same taxable
Company.

(n) BORROWING COSTS
Borrowing costs include:

(i) interest expense calculated using the effective
interest rate method;

(ii) finance charges in respect of leases; and

(iii) exchange differences arising from foreign currency
borrowings to the extent that they are regarded as
an adjustment to interest costs.

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

Interest income earned on the temporary investment
of specific borrowings pending their expenditure on
qualifying assets is deducted from the borrowing costs
eligible for capitalisation.

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

(o) LEASES

The Company adopted Ind AS 116 "Leases" and applied
the standard to all lease contracts existing on April 1,
2021 using the full retrospective method and has taken
the cumulative adjustment to retained earnings, on the
date of initial application. Consequently, the Company
recorded the lease liability at the present value of
the lease payments discounted at the incremental
borrowing rate and the right of use asset at its carrying
amount as if the standard had been applied since the
commencement date of the lease, but discounted at
the Company's incremental borrowing rate at the date
of initial application.

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

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

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

(iii) the Company has the right to direct the use of the
asset.

The Company also applied the available practical
expedients wherein it:

• Used a single discount rate to a portfolio of leases
with reasonably similar characteristics

• Relied on its assessment of whether leases are
onerous immediately before the date of initial
application

• Excluded the initial direct costs from the
measurement of the right-of-use asset at the date
of initial application

• Used hindsight in determining the lease term
where the contract contained options to extend or
terminate the lease

Right-of-use assets

The Company recognizes right-of-use assets at the
commencement date of the lease (i.e., the date the
underlying asset is available for use). Right-of-use assets
are measured at cost, less any accumulated depreciation
and impairment losses, and adjusted for any

remeasurement of lease liabilities. The cost of right-of-
use assets includes the amount of lease liabilities
recognized, initial direct costs incurred, and lease
payments made at or before the commencement date
less any lease incentives received. Right-of use assets
are depreciated on a straight-line basis over the shorter
of the lease term and the estimated useful lives of the
assets.

Lease liability

At the commencement date of the lease, the Company
recognizes lease liabilities measured at the present
value of lease payments to be made over the lease term.
The lease payments include fixed payments (including
in-substance fixed payments) less any lease incentives
receivable, variable lease payments that depend on
an index or a rate, and amounts expected to be paid
under residual value guarantees. The lease payments
also include the exercise price of a purchase option
reasonably certain to be exercised by the Company and
payments of penalties for terminating the lease, if the
lease term reflects the Company exercising the option
to terminate. Variable lease payments that do not
depend on an index or a rate are recognized as expenses
(unless they are incurred to produce inventories) in the
period in which the event or condition that triggers the
payment occurs.

In calculating the present value of lease payments,
the Company uses its incremental borrowing rate
at the lease commencement date when the interest
rate implicit in the lease is not readily determinable.
After the commencement date, the amount of lease
liabilities is increased to reflect the accretion of interest
and reduced for the lease payments made. In addition,
the carrying amount of lease liabilities is remeasured
if there is a modification, a change in the lease term,
a change in the lease payments (e.g., changes to
future payments resulting from a change in an index
or rate used to determine such lease payments) or a
change in the assessment of an option to purchase the
underlying asset.

Short-term leases and leases of low-value assets

The Company has applied the short-term lease
recognition exemption to its short-term leases (i.e.,
those leases that have a lease term of 12 months or
less from the commencement date and do not contain
a purchase option) and low-value assets recognition
exemption.