4 MATERIAL ACCOUNTING POLICIES

4.1 Fair value measurement

Fair value is the price that would be received to sell an asset or
paid to transfer a liability in an orderly transaction between market
participants at the measurement date, regardless of whether that
price is directly observable or estimated using another valuation
technique. In estimating the fair value of an asset or a liability, the
Company takes into account the characteristics of the asset or

liability if market participants would take those characteristics into
account when pricing the asset or liability at the measurement
date. Fair value for measurement and/or disclosure purposes in
these financial statements is determined on such a basis, except
for leasing transactions that are within the scope of Ind AS 116,
and measurements that have some similarities to fair value but are
not fair value, such as net realisable value in Ind AS 2 or value in
use in Ind AS 36.

In addition, for financial reporting purposes, fair value
measurements are categorised into Level 1, 2, or 3 based on
the degree to which the inputs to the fair value measurements
are observable and the significance of the inputs to the fair value
measurement in its entirety, which are described as follows:

- Level 1 inputs are quoted prices (unadjusted) in active
markets for identical assets or liabilities that the entity can
access at the measurement date;

- Level 2 inputs are inputs, other than quoted prices included
within Level 1, that are observable for the asset or liability,
either directly or indirectly; and

- Level 3 inputs are unobservable inputs for the asset
or liability.

4.2 Revenue Recognition

a. Revenue from contracts with customers

Revenue from contracts with customers is recognised
when control of the goods or services are transferred to
the customer at an amount that reflects the consideration to
which the Company expects to be entitled in exchange for
those goods or services. Revenue is measured based on
the transaction price, which is the consideration, adjusted
for discounts and other credits, if any, as specified in the
contract with the customer. The Company presents revenue
from contracts with customers net of indirect taxes in its
Statement of Profit and Loss.

The Company considers whether there are other promises
in the contract that are separate performance obligations
to which a portion of the transaction price needs to be
allocated. In determining the transaction price, the Company
considers the effects of variable consideration, the existence
of significant financing components, non-cash consideration,
and consideration payable to the customer (if any).

i. Recognition of revenue from sale of real estate
developments

Revenue from real estate development of residential
or commercial unit is recognised at the point in time,
when the control of the asset is transferred to the
customer, which generally coincides with either of the
two conditions as stated below -

- on transfer of legal title of the residential or
commercial unit to the customer; or

- on transfer of physical possession of the
residential or commercial unit to the customer.

Sale of residential and commercial units consists of
sale of undivided share of land and constructed area

to the customer, which have been identified by the
Company as a single performance obligation, as they
are highly interrelated with each other.

The performance obligation in relation to real
estate development is satisfied upon completion of
project work and transfer of control of the asset to
the customer.

For contracts involving sale of real estate unit, the
Company receives the consideration in accordance
with the terms of the contract in proportion of the
percentage of completion of such real estate project
and represents payments made by customers to
secure performance obligation of the Company
under the contract enforceable by customers. Such
consideration is received and utilised for specific real
estate projects in accordance with the requirements
of the Real Estate (Regulation and Development) Act,
2016. Consequently, the Company has concluded
that such contracts with customers do not involve any
financing element since the same arises for reasons
explained above, which is other than for provision of
finance to/from the customer.

I n respect of Joint development (‘JD’) arrangements
wherein the land owner/ possessor provides land and
in lieu of land owner providing land, the Company
transfers certain percentage of constructed area/
revenue proceeds, the revenue from development
and transfer of constructed area/ revenue proceeds, to
land owner is recognised over time using percentage-
of-completion method (‘POC method’) of accounting.
Project costs include fair value of such land received
and the same is accounted on launch of the project.

When the fair value of the land received cannot be
measured reliably, the revenue and cost, is measured
at the fair value of the estimated construction service
rendered to the landowner, adjusted by the amount of
any cash or cash equivalents transferred.

In case of JD arrangements, where performance
obligation is satisfied over time, the Company
recognises revenue only when it can reasonably
measure its progress in satisfying the performance
obligation. Until such time, the Company recognises
revenue to the extent of cost incurred, provided
the Company expects to recover the costs incurred
towards satisfying the performance obligation.

ii. Recognition of revenue from contractual
projects

Revenue from contractual project is recognised over
time, using an input method with reference to the stage
of completion of the contract activity at the end of the
reporting period, measured based on the proportion
of contract costs incurred for work performed to date
relative to the estimated total contract costs.

The Company recognises revenue only when it can
reasonably measure its progress in satisfying the

vii. Contract cost assets

The Company pays sales commission for contracts
that they obtain to sell certain units of property and
capitalises the incremental costs of obtaining a
contract. These costs are amortised on a systematic
basis that is consistent with the transfer of the property
to the customer. Capitalised costs to obtain such
contracts are presented separately as a current asset
in the Balance Sheet.

b. Revenue from property rental

The Company's policy for recognition of revenue from leases
is described in note 4.4 below.

c. Share in profit/ loss of Limited liability partnerships
(LLPs) and partnership firms

The Company's share in profits/ losses from partnership firms
and LLPs, where Company is a partner, is recognised as
income/ loss in the statement of profit and losses as and
when the right to receive its profit/ loss share is established
by the Company in accordance with the terms of contract
between the Company and partnership entity. Such share in
profits/ losses from partnership firms and LLPs is recorded
under Current account in partnership firms / LLPs or Advance
from partnership firms / LLPs.

d. Interest income

Interest income, including income arising from other financial
instruments, is recognised using the effective interest
rate method. Interest on delayed payment by customers
are accounted when reasonable certainty of collection
is established.

e. Dividend income

Revenue is recognised when the shareholders' or unit
holders' right to receive payment is established, which is
generally when shareholders approve the dividend.

4.3 Land

a. Advance paid towards land procurement

Advances paid by the Company to the seller/ intermediary
towards outright purchase of land is recognised as land
advance under other current assets during the course
of obtaining clear and marketable title, free from all
encumbrances and transfer of legal title to the Company,
whereupon it is transferred to land stock under inventories.
Management is of the view that these advances are given
under normal trade practices and are neither in the nature
of loans nor advance in the nature of loans.

b. Land/ development rights received under joint
development arrangements (‘JDA’)

Land/ development rights received under joint development
arrangements (‘JDA’) is measured at the fair value of the
estimated construction service rendered to the landowner
and the same is accounted on launch of the project. The
amount of non-refundable deposit paid by the Company
under JDA is transferred as land cost to work in-progress/

capital work in progress. Further, the amount of refundable
deposit paid by the Company under JDA is recognized
as deposits.

4.4 Leases

The Company assesses at contract inception whether a contract
is, or contains, a lease. 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.

a. The Company as lessor

Leases in which the Company does not transfer substantially
all the risks and rewards incidental to ownership of an asset
are classified as operating leases. Rental income arising is
accounted for on a straight-line basis over the lease terms.
Contingent rents are recognised as revenue in the period in
which they are earned.

b. The Company as lessee

The Company applies a single recognition and measurement
approach for all leases, except for short-term leases and
leases of low-value assets. The Company recognises
right-of-use assets and lease liabilities at the lease
commencement date. The right-of-use assets is initially
measured at cost which includes the initial amount of lease
liabilities recognised, 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 lease term.

The lease liabilities is initially measured at the present
value of lease payments to be made over the lease term,
discounted using the Company’s incremental borrowing
rate. It is re-measured when there is a change in future
lease payments arising from a change in an index or rate, if
there is a change in the Company’s estimate of the amount
expected to be payable under a residual value guarantee,
or if the Company changes its assessment of whether it will
exercise a purchase, extension or termination option. When
the lease liability is re-measured in this way, a corresponding
adjustment is made to the carrying amount of the right-of-use
asset, or is recorded in Statement of Profit and Loss.

The Company applies the short-term lease recognition
exemption to Short-term leases of assets (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).

Lease payments on short term leases are recognised as
expense on a straight-line basis over the lease term.

4.5 Borrowing Costs

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. Borrowing costs, allocated to
and utilised for qualifying assets, pertaining to the period from
commencement of activities relating to construction / development
of the qualifying asset upto the date of capitalisation of such asset,
is added to the cost of the assets. Capitalisation of borrowing costs

is suspended and charged to the Statement of Profit and Loss
during extended periods when active development activity on the
qualifying assets is interrupted.

A qualifying asset is an asset that necessarily takes a substantial
period of time to get ready for its intended use or sale and includes
the real estate properties developed by the Company.

4.6 Foreign Currency Transactions

Foreign currency transactions are recorded in the reporting
currency, by applying to the foreign currency amount the exchange
rate between the reporting currency and the foreign currency at
the date of the transaction. Foreign currency monetary items are
reported using the exchange rate prevailing at the reporting date.
Non-monetary items, which are measured in terms of historical
cost denominated in a foreign currency, are reported using the
exchange rate at the date of the transaction. Exchange differences
arising on the settlement of monetary items or on reporting
monetary items of Company at rates different from those at which
they were initially recorded during the year, or reported in previous
financial statements, are recognised as income or as expense in
the year in which they arise.

4.7 Employee Benefits

Employee benefits include provident fund, employee state
insurance scheme, gratuity and compensated absences.

a. Short-term obligations

The undiscounted amount of short-term employee benefits
expected to be paid in exchange for the services rendered
by employees are recognised during the year when the
employees render the service. These benefits include
performance incentive and compensated absences which
are expected to occur within twelve months after the end of
the period in which the employee renders the related service.

The cost of short-term compensated absences is accounted
as under:

(a) in case of accumulated compensated absences, when
employees render the services that increase their
entitlement of future compensated absences; and

(b) i n case of non-accumulating compensated absences,
when the absences occur.

b. Long-term employee benefit obligations

Compensated absences which are not expected to occur
within twelve months after the end of the period in which
the employee renders the related service are recognised as
a liability at the present value of expected future payments
to be made in respect of services provided by employees
upto the end of the reporting period using the projected
unit credit method. The benefits are discounted using the
market yields at the end of the reporting period that have
terms approximating to the terms of the related obligation.
Remeasurements as a result of experience adjustments
and changes in actuarial assumptions are recognised in
Statement of Profit and Loss.

The obligations are presented as current liabilities in the
Balance Sheet if the entity does not have an unconditional
right to defer the settlement for at least twelve months
after the reporting period, regardless of when the actual
settlement is expected to occur.

c. Post-employment obligations

The Company operates the following post¬
employment schemes:

i. Defined Contribution Plan:

The Company's contribution to provident fund is
considered as defined contribution plan and is
charged as an expense based on the amount of
contribution required to be made. The Company has
no further payment obligations once the contributions
have been paid.

ii. Defined Benefit Plan:

The liability or assets recognised in the Balance Sheet
in respect of defined benefit gratuity plan is the present
value of the defined benefit obligation at the end of
the reporting period less the fair value of the plan
assets. The defined benefit obligation is calculated by
actuaries using the projected unit credit method.

The present value of the defined benefit obligation is
determined by discounting the estimated future cash
outflows by reference to market yields at the end of the
reporting period on government bonds that have terms
approximating to the terms of the related obligation.

The net interest cost is calculated applying the discount
rate to the net balance of the defined benefit obligation
and the fair value of plan assets. This cost is included in
the employee benefit expenses in the Statement of Profit
and Loss.

Remeasurement gains and losses arising from experience
adjustments and changes in actuarial assumptions are
recognised in the period in which they occur, directly in
other comprehensive income. They are included in retained
earnings in the Statement of Changes in Equity and in the
Balance Sheet.

Changes in the present value of the defined benefit
obligation resulting from plan amendments or curtailments
are recognised immediately in Statement of Profit and Loss
as past service cost.

d. Other Defined Contribution Plan

The Company's contribution to employee state insurance
scheme is charged as an expense based on the amount
of contribution required to be made. The Company has no
further payment obligations once the contributions have
been paid.

1.8 Income Taxes

i ncome tax expense represents the sum of current tax and
deferred tax.

a. Current tax

Current tax assets and liabilities are measured at the amount
expected to be recovered from or paid to the taxation
authorities. The tax rates and tax laws used to compute the
amount are those that are enacted or substantively enacted,
at the reporting date. Current tax relating to items recognised
outside Statement of Profit and Loss is recognised outside
Statement of Profit and Loss (either in other comprehensive
income (OCI) or in equity). Current tax items are recognised
in correlation to the underlying transaction either in OCI or
directly in equity.

b. Deferred tax

Deferred tax is recognised on temporary differences arising
between the tax bases of assets and liabilities and their
carrying amounts in the financial statements. However,
deferred tax liabilities are not recognised if they arise from
the initial recognition of goodwill.

Deferred tax is also not accounted for if it arises from initial
recognition of an asset or liability in a transaction other than
a business combination that at the time of the transaction
affects neither accounting profit nor taxable profit / loss.

Deferred tax is determined using tax rates (and laws) that
have been enacted or substantively enacted by the end of
the reporting period and are expected to apply when the
related deferred tax asset is realised or the deferred tax
liability is settled.

Deferred tax assets are recognised for all deductible
temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to
utilise those temporary differences and losses.

Current tax and deferred tax is recognised in Statement of
Profit and Loss, except to the extent that it relates to items
recognised in other comprehensive income or directly
in equity. In this case, the tax is also recognised in other
comprehensive income or directly in equity, respectively.

Deferred tax assets are recognised for unused tax losses
to the extent that it is probable that taxable profit will be
available against which the losses can be utilised. Significant
management judgement is required to determine the amount
of deferred tax assets that can be recognised, based upon
the likely timing and the level of future taxable profits.

The carrying amount of deferred tax assets is reviewed at
each reporting date and reduced to the extent that it is no
longer probable that sufficient future taxable profits will be
available to allow all or part of the deferred tax asset to be
utilised. Unrecognised deferred tax assets are re-assessed
at each reporting date and are recognised to the extent that
it has become probable that future taxable profits will allow
the deferred tax asset to be recovered.

4.9 Property, plant and equipment

Property, plant and equipment are stated at cost, net of accumulated

depreciation and accumulated impairment losses, if any. The cost

comprises purchase price, borrowing costs if capitalisation criteria

are met and directly attributable cost of bringing the asset to its
working condition for the intended use. Each part of an item of
property, plant and equipment with a cost that is significant in
relation to the total cost of the item is depreciated separately.

Subsequent costs are included in the asset's carrying amount or
recognised as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with the item
will flow to the Company and the cost of the item can be measured
reliably. Cost of the asset includes expenditure that is directly
attributable to the acquisition and installation, including interest
on borrowing for the project / property, plant and equipment up
to the date the asset is put to use. Any cost incurred relating to
settlement of claims regarding titles to the properties is accounted
for and capitalised as incurred.

Advances paid towards the acquisition of property, plant and
equipment outstanding at each Balance Sheet date is classified
as capital advances under other non-current assets.

Depreciation method, estimated useful lives and residual values

Depreciable amount for assets is the cost of an asset, or other
amount substituted for cost, less its estimated residual value.
Depreciation on property, plant and equipment is provided
using written-down value method over the useful lives of assets
estimated by the Management. The Management estimates the
useful lives for the property, plant and equipment as follows:
# includes certain assets that has been assessed with useful lives
of 15 years.

For these class of assets, based on internal assessment and
independent technical evaluation carried out by external valuers,
taking into account the nature of the asset, the estimated usage
of the asset, the operating conditions of the asset, past history
of replacement, the Management believes that the useful
lives as given above best represent the period over which the
Management expects to use these assets. Hence the useful lives
for these assets is different from the useful lives as prescribed
under Part C of Schedule II to the Companies Act, 2013.

Gains and losses on disposals are determined by comparing
proceeds with the carrying amount. These are included in
Statement of Profit and Loss.

In respect of leasehold improvements - building, plant and
machinery and furniture and fixtures, depreciation has been
provided over lower of useful lives of assets or lease period.

4.10 Capital work-in-progress

Projects under which tangible assets are not yet ready for
their intended use are carried at cost comprising direct cost,
related incidental expenses and attributable borrowing costs.

Depreciation is not provided on capital work-in-progress until
construction and installation are complete and the asset is
ready for its intended use.

4.11 Investment Property

I nvestment properties are properties held to earn rentals
and/or for capital appreciation (including property under
construction for such purposes). 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 for
cost model. The cost of Investment property includes the
cost of replacing parts and borrowing costs for long-term
construction projects if the recognition criteria are met. When
significant parts of the investment property are required to
be replaced at intervals, the Company depreciates them
separately based on their specific useful lives. All other
repair and maintenance costs are recognised in Statement
of Profit and Loss as incurred.

I nvestment properties are depreciated using written-down
value method over the useful lives as stated in note 4.9
The useful life has been determined based on internal
assessment and independent technical evaluation carried
out by external valuer, taking into account the nature of
the asset, the estimated usage of the asset, the operating
conditions of the asset, past history of replacement.

The fair value of investment property is disclosed in the
notes. Fair values are determined based on evaluation
performed by accredited external independent valuers.

An investment property is derecognised upon disposal or
when the investment property is permanently withdrawn
from use and no future economic benefits are expected
from the disposal. Any gain or loss arising on derecognition
of the property (calculated as the difference between the
net disposal proceeds and the carrying amount of the asset)
is included in Statement of Profit and Loss in the period in
which the property is derecognised.

4.12 Intangible Assets

Intangible assets acquired separately are measured on initial
recognition at cost. Following initial recognition, intangible
assets are carried at cost less accumulated amortization
and accumulated impairment losses, if any. Intangible
assets, comprising of software are amortized on the basis
of written down value method over a period of 6 years,
which is estimated to be the useful life of the asset. Gains
or losses arising from de-recognition 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 asset
is derecognised.

4.13 Impairment of tangible and intangible assets other
than goodwill

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 (if
any). When it is not possible to estimate the recoverable
amount of an individual asset, the Company estimates the
recoverable amount of the cash generating unit to which
the asset belongs. When a reasonable and consistent
basis of allocation can be identified, corporate assets
are also allocated to individual cash-generating units, or
otherwise they are allocated to the smallest Company of
cash-generating units for which a reasonable and consistent
allocation basis can be identified.

I ntangible assets with indefinite useful lives and intangible
assets not yet available for use are tested for impairment at
least annually, and whenever there is an indication that the
asset may be impaired.

Recoverable amount is the higher of fair value less costs
of disposal and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present
value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks
specific to the asset for which the estimates of future cash
flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating
unit) is estimated to be less than its carrying amount, the
carrying amount of the asset (or cash-generating unit) is
reduced to its recoverable amount. An impairment loss is
recognised immediately in Statement of Profit and Loss.

When an impairment loss subsequently reverses, the carrying
amount of the asset (or a cash-generating unit) is increased
to the revised estimate of its recoverable amount, but so that
the increased carrying amount does not exceed the carrying
amount that would have been determined had no impairment
loss been recognised for the asset (or cash-generating unit)
in prior years. A reversal of an impairment loss is recognised
immediately in Statement of Profit and Loss.

4.14 Inventories

Related to contractual and real estate activity
Direct expenditure relating to construction activity is
inventorised. Other expenditure (including borrowing costs)
during construction period is inventorised to the extent
the expenditure is directly attributable cost of bringing the
asset to its working condition for its intended use. Other
expenditure (including borrowing costs) incurred during
the construction period which is not directly attributable for
bringing the asset to its working condition for its intended
use is charged to the Statement of Profit and Loss. Direct
and other expenditure is determined based on specific
identification to the construction and real estate activity. Cost
incurred/ items purchased specifically for projects are taken
as consumed as and when incurred/ received.

Work-in-progress - Real estate projects (including land
inventory): Represents cost incurred in respect of unsold
area of the real estate development projects or cost incurred
on projects where the revenue is yet to be recognised. Real
estate work-in-progress is valued at lower of cost and net
realisable value.

Finished goods - Flats & Plots: Valued at lower of cost and
net realisable value.

Land inventory - Valued at lower of cost and net
realisable value.

Inventory also comprises of stock of food and beverages and
operating supplies and is carried at the lower of cost and net
realisable value. 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. However, inventory held for use in production of
finished goods is not written down below cost if the finished
products in which they will be incorporated are expected to
be sold at or above cost.