20.1 Statement of compliance
These Financial Statements are the financial statements of the Company prepared in accordance with Indian
Accounting standards ('Ind AS') notified by the Ministry of Corporate Affairs under section 133 of the
Companies Act, 2013 ('Act') read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 (as
amended) and the relevant provisions of the Act.
Accordingly, the Company has prepared these Financial Statements which comprise the Balance Sheet as at 31
March, 2024, the Statement of Profit and Loss for the year ended 31 March 2024, the Statement of Cash Flows
for the year ended 31 March 2024 and the Statement of Changes in Equity for the year ended as on that date,
and accounting policies and other explanatory information (together hereinafter referred to as 'Financial
Statements').
These Financial Statements are approved for issue by the Board of Directors on 28 May 2024.
20.2 Basis of Preparation & Measurement
The Financial Statements have been prepared on an accrual system, based on principle of going concern and
under the historical cost convention except for the following -
(i) Certain financial assets and liabilities measured at fair value (refer Note 20.9)
(ii) Employee's Defined Benefit plans measured as per Actuarial valuation (refer Note 20.14)
Accounting policies have been consistently applied except where a newly issued accounting standard is
initially adopted or a revision to an existing accounting standard requires a change in the accounting policy
hitherto in use.
The Financial Statements have been presented in Indian Rupees (INR), which is the Company's functional
currency. All financial information presented in INR has been rounded off to the nearest rupee, unless
otherwise stated.
20.3 Key Accounting Estimates And Judgements
The preparation of Financial Statements in accordance with Ind AS requires management to make certain
judgments, estimates and assumptions in the application of accounting policies that affect the reported
amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates, with the
differences between the same being recognized in the period in which the results are known or materialize.
Continuous evaluation is done on the estimation and judgments based on historical experience and other
factors, including expectations of future events that are believed to be reasonable. Revisions to accounting
estimates are recognised prospectively.
Information about areas involving a higher degree of judgment or complexity or critical judgments in applying
accounting policies, as well as estimates and assumptions that have the most significant effect to the carrying
amounts of assets and liabilities are included in the following notes:
(a) Measurement of defined benefit obligations - Note 20.14
(b) Measurement of Provisions and likelihood of occurrence of contingencies - Notes 20.15 and 20.16
(c) Estimation of useful life - Note 20.5
(e) Fair value measurements and valuation processes - Note 20.10
20.4 Property Plant & Equipment:
(a) Initial Measurement & Recognition
Items of Property, plant and equipment are carried at cost less accumulated depreciation and impairment
losses, if any. The cost of an item of Property, plant and equipment comprises its purchase price, including
import duties and other non-refundable taxes or levies and any directly attributable cost of bringing the
assets to its working condition for its intended use with any trade discounts or rebates being deducted in
arriving at purchase price. Cost of the assets also includes interest on borrowings if any attributable to
acquisition of qualifying fixed assets incurred up to the date the asset is ready for its intended use.
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.
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 Advances under Other non¬
current Assets.
Any gain or loss on disposal of an item of property plant and equipment is recognized in statement of
profit and loss.
(b) Subsequent expenditure
Subsequent expenditure relating to fixed assets is capitalized only if such expenditure results in an
increase in the future benefits from such asset beyond its previously assessed standard of performance
20.5 Depreciation:
Depreciation is provided on the straight-line method based on estimated useful life prescribed under Schedule
II to the Companies Act, 2013. Depreciation on assets added/disposed off during the year is provided on pro¬
rata basis from the date of addition or up to the date of disposal, as applicable.
The residual values, useful lives and method of depreciation of property, plant and equipment is reviewed at
each financial year end and adjusted prospectively, if appropriate.
20.6 Impairment of Assets:
At the end of each reporting period, the Company reviews the carrying amounts of its tangible and intangible
assets to determine whether there is any indication that those assets have suffered an impairment loss. If any
such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of
the impairment loss.
Impairment loss is recognized wherever the carrying amount of an asset is in excess of its recoverable amount
and the same is recognized as an expense in the statement of profit and loss and carrying amount of the asset
is reduced to its recoverable amount.
Reversal of impairment losses recognized in the prior years is recorded when there is an indication that the
impairment losses recognized for the asset no longer exist or have decreased.
20.7 Investments in Subsidiaries:
Investments in subsidiaries are carried at fair value through OCI. As of 31 March 2024, the Company has no
subsidiaries, subsequent to the disposal of the shares of Durlabh Commodities Private Limited, during the year
on 29.09.2023.
20.8 Deferred Sales Tax Amounts:
The Company has elected to use the previous GAAP carrying amounts of Instalments of Deferred Sales Tax
Liabilities existing at the date of transition to Ind AS i.e. 1st April 2016 as the carrying amount of the loan in the
opening Ind AS Balance Sheet.
20.9 Financial Instruments:
(A) Financial Assets
Recognition and measurement
Financial assets are recognised when the Company becomes a party to the contractual provisions of the
instrument. On initial recognition, a financial asset is measured at its fair value plus, for a financial asset
not measured at Fair Value Through Profit and Loss (FVTPL), transaction costs that are directly attributable
to its acquisition or issue. In case of Financial assets which are recognised at fair value through profit and
loss (FVTPL), its transaction cost is recognised in the statement of profit and loss.
Financial assets are subsequently classified as measured at
• amortised cost
• fair value through other comprehensive income (FVOCI)
• fair value through profit and loss (FVTPL)
(a) Measured at amortised cost: Financial assets that are held within a business model whose objective is
to hold financial assets in order to collect contractual cash flows that are solely payments of principal
and interest, are subsequently measured at amortised cost using the effective interest rate ('EIR')
method less impairment, if any. The amortisation of EIR and loss arising from impairment, if any is
recognised in the Statement of Profit and Loss.
(b) Measured at fair value through other comprehensive income: Debt instruments that are held within
a business model whose objective is achieved by both, selling financial assets and collecting
contractual cash flows that are solely payments of principal and interest, are subsequently measured
at fair value through other comprehensive income. Fair value movements are recognized in the other
comprehensive income (OCI). Interest income measured using the EIR method and impairment losses,
if any are recognised in the Statement of Profit and Loss. On derecognition, cumulative gain or loss
previously recognised in OCI is reclassified from the equity to other income in the Statement of Profit
and Loss.
(c) Measured at fair value through profit or loss: A financial asset not classified as either amortised cost
or FVOCI, is classified as FVTPL. Such financial assets are measured at fair value with all changes in fair
value, including interest income and dividend income if any, recognised as other income in the
Statement of Profit and Loss
Equity Instruments:
All investments in equity instruments classified under financial assets are initially measured at fair value.
Fair value changes excluding dividends, on an equity instrument measured at FVOCI are recognised in OCI.
Dividend income on the investments in equity instruments are recognised as other income in the
Statement of Profit and Loss.
Derecognition
The Company derecognises a financial asset when the contractual rights to the cash flows from the
financial asset expire, or it transfers the contractual rights to receive the cash flows from the asset.
Impairment of Financial Assets
Expected credit losses are recognized for all financial assets subsequent to initial recognition other than
financials assets in FVTPL category. For financial assets other than trade receivables, as per Ind AS 109, the
Company recognises 12 month expected credit losses for all originated or acquired financial assets, if at
the reporting date the credit risk of the financial asset has not increased significantly since its initial
recognition. The expected credit losses are measured as lifetime expected credit losses if the credit risk on
financial asset increases significantly since its initial recognition. The Company's trade receivables do not
contain significant financing component and loss allowance on trade receivables is measured at an
amount equal to life time expected losses i.e. expected cash shortfall. The impairment losses and reversals
if any are recognised in Statement of Profit and Loss.
(B) Financial Liabilities:
Initial recognition and measurement
Financial liabilities are recognised when the Company becomes a party to the contractual provisions of the
instrument. Financial liabilities are initially measured at the amortised cost unless at initial recognition,
they are classified as fair value through profit and loss. In case of trade payables, they are initially
recognised at fair value and subsequently, these liabilities are held at amortised cost, using the effective
interest method.
Subsequent measurement
Financial liabilities are subsequently measured at amortised cost using the EIR method. Financial liabilities
carried at fair value through profit or loss are measured at fair value with all changes in fair value
recognised in the Statement of Profit and Loss.
Derecognition
A financial liability is derecognised when the obligation specified in the contract is discharged, cancelled or
expires.
20.10 Fair Value Measurement Disclosures
The Fair Values of Financial assets and liabilities are determined at the amount at which the same could be
sold or transferred in an orderly transaction between willing market participants at the measurement date.
Current Financial Assets & Liabilities
The Management has assessed that the fair Value of cash and short-term deposits, trade and other short-term
receivables, trade payables, current borrowings, and other short-term financial instruments approximate their
carrying amounts largely due to the short-term maturities of these instruments
The Company uses the following hierarchic structure of valuation methods to determine and disclose
information about the fair value of financial instruments:
Level 1: Observable prices in active markets for identical assets and liabilities;
Level 2: Observable inputs other than quoted prices in active markets for identical assets and liabilities;
Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the
fair value of the assets and liabilities
The Fair Value of Unquoted Investments has been determined on the basis of independent valuer's report obtained by
the Company except for shares of Malad Sahakari Bank Ltd. which have been considered at face value.
20.11 Inventories
a. Raw materials are valued at cost or net realizable value whichever is lower as per FIFO method
followed.
b. Work-in-process is valued at estimated cost (including factory over-heads and depreciation)
c. Manufactured finished goods are valued at lower of estimated cost (including factory overheads
and depreciation) or net realizable value as per FIFO method followed.
d. Traded goods are valued at lower of cost or net realizable value as per FIFO method followed.
e. Re-usable waste generated if any on conversion of defective or damaged or obsolete stocks are
valued at estimated material cost.
f. Un-usable inventory for commercial purpose if any has been written-off as damaged stock.
g. Closing stock is as per the inventory taken, valued and certified by the management.
20.12 Revenue Recognition
Revenue from contracts with customers is recognized on transfer of control of promised goods or services
to a customer at an amount that reflects the consideration to which the Company is expected to be
entitled to in exchange for those goods or services.
Revenue towards satisfaction of a performance obligation is measured at the amount of transaction price
(net of variable consideration) allocated to that performance obligation. The transaction price of goods
sold and services rendered is net of variable consideration on account of various discounts and schemes
offered by the Company as part of the contract. This variable consideration is estimated based on the
expected value of outflow. Revenue (net of variable consideration) is recognized only to the extent that it
is highly probable that the amount will not be subject to significant reversal when uncertainty relating to
its recognition is resolved.
Revenue from the sale of goods is recognised when the control on the goods have been transferred to the
buyer. The performance obligation in case of sale of product is satisfied at a point in time i.e., when the
material is shipped to the customer or on delivery to the customer, as may be specified in the contract. In
case of export sales, revenue is recognized as on the date of bill of lading, being the effective date of
dispatch. Revenue from the sale of goods is measured at the value of the consideration received or
receivable, net of returns and discounts and net of all taxes
Revenue from services is recognized when the rendering of the relevant service is completed or
substantially completed.
20.13 Taxation:
Income tax expense for the year comprises of current tax and deferred tax. It is recognised in the Statement of
Profit and Loss except to the extent it relates to a business combination or to an item which is recognised
directly in equity or in other comprehensive income.
Current tax is the expected tax payable/receivable on the taxable income/ loss for the year using applicable
tax rates at the Balance Sheet date, and any adjustment to taxes in respect of previous years. Interest income/
expenses and penalties, if any, related to income tax are included in current tax expense.
Deferred tax is recognised in respect of temporary differences between the carrying amount of assets and
liabilities for financial reporting purposes and the corresponding amounts used for taxation purposes.
Deferred tax is recognized using the tax rates enacted, or substantively enacted, by the end of the reporting
period.
A deferred tax liability is recognised based on the expected manner of realisation or settlement of the carrying
amount of assets and liabilities. Deferred tax assets are recognised only to the extent that it is probable that
future taxable profits will be available against which the asset can be utilised. Deferred tax assets are reviewed
at each reporting date and reduced to the extent that it is no longer probable that the related tax benefit will
be realised.
Current tax assets and current tax liabilities are offset when there is a legally enforceable right to set off the
recognised amounts and there is an intention to settle the asset and the liability on a net basis. Deferred tax
assets and deferred tax liabilities are offset when there is a legally enforceable right to set off current tax
assets against current tax liabilities; and the deferred tax assets and the deferred tax liabilities relate to
income taxes levied by the same taxation authority.
The Company has not recognised Deferred Tax Assets as it is not probable that future taxable profits will be
available against which the asset can be utilised
Employee benefits include salaries, wages, contribution to provident fund, gratuity, leave encashment
towards un-availed leave, compensated absences, post-retirement medical benefits and other terminal
benefits.
Short-term employee benefits
Wages and salaries, including non-monetary benefits that are expected to be settled within 12 months after
the end of the period in which the employees render the related service are recognized in respect of
employees' services up to the end of the reporting period and are measured at the amounts expected to be
paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the
balance sheet.
Defined contribution plans
Contributions under defined contribution plans are recognized as expense for the period in which the
employee has rendered the service. Payments made to state managed retirement benefit schemes are dealt
with as payments to defined contribution schemes where the Company's obligations under the schemes are
equivalent to those arising in a defined contribution retirement benefit scheme.
Defined benefit plans
For defined benefit retirement schemes, the cost of providing benefits is determined using the Projected Unit
Credit Method, with actuarial valuation being carried out at each year-end balance sheet date.
Remeasurement gains and losses of the net defined benefit liability/(asset) are recognised immediately in
other comprehensive income. The service cost and net interest on the net defined benefit liability/(asset) are
recognised as an expense within employee costs. Past service cost is recognised as an expense when the plan
amendment or curtailment occurs or when any related restructuring costs or termination benefits are
recognised, whichever is earlier.
The retirement benefit obligations recognised in the balance sheet represents the present value of the defined
benefit obligations as reduced by the fair value of plan assets
The Company has made provision for gratuity for the year under review as certified by M/s. Kapadia &
Kochrekar, Actuaries & Consultants. Disclosures as per IND AS 19 are given below
Sensitivity analysis fails to focus on the interrelationship between underlying parameters. Hence, the results may vary
if two or more variables are changed simultaneously.
The method used does not indicate anything about the likelihood of change in any parameter and the extent of the
change if any.
The future accrual is not considered in arriving at the above cash-flows.
The Expected contribution for the next year is Rs. 16,96,699/-
The Weighted Average Duration (Years) as at valuation date is 7.07 Years.
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