SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of Accounting
The financial statements have been prepared as a going concern in accordance with Indian Accoun ng Standards (Ind AS) no fied under the Sec
on 133 of the Companies Act, 2013 ("the Act") read with the Companies (Indian Accoun ng Standards) Rules, 2015 and other relevant provisions
of the Act.
(b) Going conern
The board of directors have considered the financial position of the Company at 31st March, 2025 and projected cash flows and financial
performance of the Company for at least twelve months from the date of approval of these financial statements as well as planned cost and
cash improvement actions, and believe that the plan for sustained profitability remains on course. The board of directors have taken actions to
ensure that appropriate long-term cash resources are in place at the date of signing the accounts to fund the Company's operations.
(c) Current and Non Current Classificaton
The Company presents assets and liabilities on the Balance Sheet based on Current / Non Current Classification.
An Asset is treated as Current when it is:
- Expected to be realized or consumed in operating cycle,
- Expected to be realised within twelve months aster the reporting period, or
- Cash or Cash equivalent unless restricted from being exchanged or used to settle a liability for atleast twelve months after the reporting
period.
All other Assets are classified as non-current.
A Liability is treated as Current when it is;
- It is expected to be settled in operating cycle,
- It is due to settled within twelve months aster the reporting period, or
- There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.
The Company classifies all other liabilities as non-current.
(e) Property, Plant and Equipment & Depreciation
Recognition and measurement
a) The cost of an item of property, plant and equipment is recognized as an asset only if it is probable that future economic benefits associated
with the item will flow to the entity and the cost of the item can be measured reliably.
b) Property, plant and equipment are stated at cost net of accumulated depreciation and accumulated impairment loss, if any.
c) The initial cost of an asset comprises its purchase price or construc on cost (including import duties and non-refundable taxes) after
deducting trade discounts and rebates, any costs directly attributable to bringing the asset into the location and condition necessary for it to be
capable of operating in the manner intended by management, the initial estimate of any decommissioning obligation (if any) and the applicable
borrowing cost till the asset is ready for its intended use.
d) Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to the
Company.
e) Any gain or loss on disposal of an item of property, plant and equipment recognized in profit or loss.
f) Major spare parts which meet the defini on of property plant and equipment are capitalized as property, plant and equipment. In other cases,
the spare parts are inventorised on procurement and charged to Statement of Profit & Loss on issue/consumption.
(f) Capital work-in-progress
Projects under which property, plant and equipment are not yet ready for their intended use are carried at cost, comprising direct cost, related
incidental expenses and a ributable interest.
(g) Investment property
Investment properties are properties held to earn rentals and/or for capital appreciation. Investment properties are measured initially at cost,
including transaction costs. Subsequent to initial recognition, investment properties are measured in accordance with Ind AS 16's requirements
(h) Cash Flow Statement
Cash flows are reported using the indirect method, whereby profit / (loss) before exceptional items and tax is adjusted for the effects of
transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating,
investing and financing activies of the Company are segregated based on the available information.
(i) Cash and Cash equivalents
In the cash flow statement, cash and cash equivalents includes cash in hand, cheques and drafts in hand, balances with bank and deposits held
at call with financial institutions, 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.
(j) Transaction in Foreign Currency
Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign
exchange gains and losses resulting from the setilement 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 profit or loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are recorded using the exchange rates at the date of the
transaction. Nonmonetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair
value was measured. The gain or loss arising on translation of nonmonetary items measured at fair value is treated in line with the recognition
of the gain or loss on the change in fair value of the item (i.e. translation differences on items whose fair value gain or loss is recognised in
Other Comprehensive Income or Statement of Profit and Loss are also recognised in Other Comprehensive Income or Statement of Profit and
Loss, respectively).
(k) Financial Instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another
entity. Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the
instruments.
(l) Financial assets at fair value through profit or loss (FVTPL)
Investment in equity instrument are classified at fair value through profit or loss, unless the Company irrevocably elects on initial recognition to
present subsequent changes in fair value in other comprehensive income for investments in equity instruments which are not held for trading.
Financial assets that do not meet the amortised cost criteria or fair value through other comprehensive income criteria are measured at fair
value through profit or loss. A financial asset that meets the amortised cost criteria or fair value through other comprehensive income criteria
may be designated as at fair value through profit or loss upon initial recognition if such designation eliminates or significantly reduces a
measurement or recognition inconsistency that would arise from measuring assets and liabilities or recognising the gains or losses on them on
different bases.
Financial assets which are fair valued through profit or loss are measured at fair value at the end of each reporting period, with any gains or
losses arising on re-measurement recognized in profit or loss.
(m) De-recognition of financial assets and liabilities
The Company derecognizes a financial asset when the contractual right to the cash flows from the asset expires or it transfers the rights to
receive the contractual cash flows on the financial asset in a transaction which substantially all the risk and rewards of ownership of the
financial asset are transferred. The Company derecognizes a financial liability when its contractual obligations are discharged, cancelled or
expired; the difference between the carrying amount of derecognized financial liability and the consideration paid is recognized as profit or loss.
(n) Trade Receivables
Trade receivables are recognised initially at fair value unless they do not carry a significant financing component, in which case they are
recognized at the transaction price. The Company generally determines the allowance for expected credit losses based on historical loss
experience adjusted to reflect current and estimated future economic conditions. The Company considered current and anticipated future
economic conditions relating to industries the company deals with and the countries where it operates. In calculating expected credit loss, the
Company has also considered credit reports and other related credit information for its customers to estimate the probability of default in
(o) Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any
difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the period of the
borrowings using the effective interest rate method. Borrowings are removed from the balance sheet when the obligation specified in the
contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or
transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit
(p) Trade payables
Trade payables are amounts due to vendors for purchase of goods in the ordinary course of business and are classified as current liabilities to
the extent it is expected to be paid within the normal operating cycle of the business.
(q) Leases - Company as a lessee
Finance lease:
Leases where the Company assumes substantially all the risks and rewards of ownership are classified as finance lease. Such leases are
capitalized at the inception of the lease at lower of the fair value or the present value of the minimum lease payments and a liability is
recognized for an equivalent amount. Each lease rental paid is allocated between the liability and the interest cost so as to obtain a constant
periodic rate of interest on the outstanding liability for each year
Operating lease:
Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor, are recognized as
operating lease. Operating lease payments are recognized as an expense on a straight line basis over the lease term unless the payments are
structured to increase in line with the expected general inflation so as to compensate for the lessor's expected inflationary cost increases.
(r) Inventories
Inventories are valued at the lower of cost and net realizable value after providing for obsolescence and other losses where considered
necessary. The cost of finished goods and work in progress comprises raw materials, direct labor, other direct costs and appropriate proportion
of variable and fixed overhead expenditure and also other costs incurred in bringing the inventories to their present location and condition.
Overhead expenditures are being allocated on the basis of normal operating capacity. Costs of purchased inventory are determined after
deducting rebates and discounts. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs
of completion and the estimated costs necessary to make the sale. Non- production inventory (other than those supplied along with main plant
and machinery, which are capitalised and depreciated accordingly) are charged to profit or loss on consumption. Raw Materials and other items
held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are
expected to be sold at or above cost. Work in progress and finished goods are valued at cost or Net Realisable Value whichever is lower.
Saleable scrap is valued at the net realisable value."
(s) Revenue Recognition
Revenue is measured at the fair value of the consideration received or receivable. Revenue from sale of goods are net of applicable taxes,
estimated returns and reduction/addition towards variable consideration includes discounts, rebates, incentives, promotional couponing and
schemes. Advance received from customer before transfer of control of goods to the customer is recognised as Current Liabilities. The company
estimates the amount of variable components based on historical, current and forecast information available and either expected value method
or most likely method, as appropriate and records a corresponding liability in other payables; the actual amounts may be different from such
estimates. These differences, which have historically not been significant, are recognized as a change in management estimate in a subsequent
period. The revenue is recognized when the significant risks and rewards of ownership of goods are transferred to the buyer, recoverability of
consideration is probable, the amount of revenue and cost incurred or to be incurred in respect of the transaction can be measured reliably and
there is no continuing managerial involvement over the goods sold. Income from services is recognized when the services are rendered or when
contracted milestones have been achieved. Interest income from a financial asset is recognised when it is probable that the economic benefits
will flow to the Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the
principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts
through the expected life of the financial asset to that asset's net carrying amount on initial recognition. Dividend income is recognized when
the Company's right to receive the payment is established, it is probable that the economic benefits associated with the dividend will flow to
the Company and the amount of dividend can be measured reliably. Revenue / Income and Cost / Expenditure are generally accounted on
accrual basis as they are earned/ incurred, except those with significant uncertainties. Dividend Income from investment is recognized as and
when received. Other Incomes are accounted for on accrual basis except when the recovery is uncertain, it is accounted for on receipt basis.
Claims made against the Company are evaluated as to type thereof, period for which they are outstanding and appropriate provisions made.
(t) Borrowing 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 these assets, until such time as the assets are
substantially ready for their intended use or sale. All other borrowing costs are recognised in statement of profit and loss in the period in which
they are incurred "
|