4) SIGNIFICANT ACCOUNTING POLICIES

These Financial Statements have been prepared in accordance with the Indian Accounting Standards ("Ind AS")
as per the Companies (Indian Accounting Standards) Rules, (Amended) 2015 and notified by Ministry of Corporate
Affairs("MCA") pursuant to Section 133 of the Companies Act, 2013 read with Rule 3.

a) Revenue Recognition

Sale of Goods:

Sales include excise duty, where applicable and represent invoice value of goods sold as reduced by rebates
and discounts.

Sale of Flats:

Sale of flat purchased from other developers is recognized on execution of transfer deed in favour of the buyer.

In respect of development projects undertaken by the company, revenue is recognised when the significant
risks and rewards of ownership of the unit in real estate have passed to the buyer and the revenue is
recognized to the extent that it is probable that the economic benefit s will flow to the Company and the revenue
can be reliably measured.

Construction Contracts:

Revenue from each Real Estate Development Project is recognized:

(i) On the basis of "Percentage Completion Method"

(ii) The percentage completion method is applied on a cumulative basis in each accounting period to the current
estimates of contract revenue and contract costs

(iii) When the stage of completion of each project reaches a significant level, which is estimated to be at least 25%
of the total estimated cost of project

(iv) When no significant uncertainty exists regarding the amount of the consideration from sale, which is estimated
on collection of at least 25% of sale consideration.

Real Estate Development Project:

The Company follows completed project method of accounting ("Project Completion Method of Accounting").
Allocable expenses incurred during the year are debited to work-in-progress account. The income is accounted
for as and when the projects get completed or substantially completed and then revenue is recognized to the
extent that it is probable that the economic benefit s will flow to the Company and the revenue can be reliably
measured.

Royalty:

Revenue is recognized on an accrual basis in accordance with the terms of the relevant agreement.

Interest:

Interest on fixed deposits is recognized on accrual basis on a time proportion basis taking in to account the
amount outstanding and the rate applicable.

Dividend:

Revenue is recognized when the right to receive the income is established.

Rent:

Revenue is recognized on an accrual basis in accordance with the terms of the relevant agreement.

b) Property, Plant and Equipment

(i) The Company has applied Ind AS 16 with retrospective effect for all of its property, plant and equipment
as at the transition date, viz., 1 April 2016.

The initial cost of property, plant and equipment comprises its purchase price, including import duties and
non-refundable purchase taxes, attributable borrowing cost and any other directly attributable costs of
bringing an asset to working condition and location for its intended use. It also includes the present value
of the expected cost for the decommissioning and removing of an asset and restoring the site after its
use, if the recognition criteria for a provision are met.

Expenditure incurred after the property, plant and equipment have been put into operation, such as
repairs and maintenance, are normally charged to the statements of profit and loss in the period in which
the costs are incurred. Major inspection and overhaul expenditure is capitalized if the recognition criteria
are met.

When significant parts of plant and equipment are required to be replaced at intervals, the Company
depreciates them separately based on their specific useful lives. Likewise, when a major inspection is
performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement if
the recognition criteria are satisfied. All other repair and maintenance costs are recognised in the
statement of profit and loss as incurred.

Gains and losses on disposal of an item of property, plant and equipment are determined by comparing
the proceeds from disposal with the carrying amount of property, plant and equipment, and are recognized
net within other income/other expenses in statement of profit and loss.

An item of property, plant and equipment and any significant part initially recognised is derecognised
upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or
loss arising on derecognition of the asset (calculated as the difference between the net disposal
proceeds and the carrying amount of the asset) is included in the statement of profit and loss, when the
asset is derecognised.

The residual values, useful lives and methods of depreciation of property, plant and equipment are
reviewed at each financial year end and adjusted prospectively, if appropriate.

(i) Depreciation

Assets in the course of development or construction and freehold land are not depreciated. Other
property, plant and equipment are stated at cost less accumulated depreciation and any provision for
impairment. Depreciation commences when the assets are ready for their intended use.

Depreciation is provided on a pro-rata basis on the straight line method based on estimated useful life
prescribed under Schedule II to the Company Act, 2013. The estimated useful life of determined by the
management based on technical estimates as follows:

Plant and Machinery 15 Years

Furniture and Fixtures 10 Years

Office Equipment 5 Years

Computers 3 Years

Vehicles 8 Years

Individual items of assets costing up to Rs. 5,000 are fully depreciated in the year of acquisition. Land is
not depreciated.

Major inspection and other direct costs are depreciated over the estimated life of the economic benefit
derived from such costs.

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

Depreciation methods, useful lives and residual values are reviewed at each financial year end and
changes in estimates, if any, are accounted for prospectively.

c) Intangible assets

Intangible assets acquired are measured on initial recognition at cost. Following initial recognition, intangible
assets are carried at cost less any accumulated amortisation and accumulated impairment losses.

The useful lives of intangible assets are assessed as either finite or indefinite. The Company currently
does not have any intangible assets with indefinite useful life. Intangible assets are amortised over the
useful economic life and assessed for impairment whenever there is an indication that the intangible
asset may be impaired. The amortisation period and the amortisation method for an intangible asset are
reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected
pattern of consumption of future economic benefits embodied in the asset are considered to modify the
amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The
amortisation expense on intangible assets is recognised in the statement of profit and loss unless such
expenditure forms part of carrying value of another asset.

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

d) Investment in Subsidiaries, Associates and Joint Venture

Investment in subsidiaries, associates and joint venture are carried at cost less accumulated impairment
losses,if any, Where an indication of impairment exists, the carrying amount of the investment is assessed
and written down immediately to its recoverable amount. On disposal of investment in subsidiaries,
associates and Joint Ventures, the difference between net disposal proceeds and carrying amount are
recognized in the statement of profit and loss.

e) 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

Initial recognition and measurement

All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded
at fair value through statement of profit and loss, transaction costs that are attributable to the acquisition
of the financial asset. Purchases or sales of financial assets that require delivery of assets within a time
frame established by regulation or convention in the market place (regular way trades) are recognised
on the trade date, i.e., the date that the Company commits to purchase or sell the asset.

Subsequent measurement

Subsequent measurement of financial assets is described below -
Debt instruments at amortised cost

A 'debt instrument' is measured at the amortised cost if both the following conditions are met:

a) The asset is held within a business model whose objective is to hold assets for collecting
contractual cash flows, and

b) Contractual terms of the asset give rise on specified dates to cash flows that are solely payments
of principal and interest (SPPI) on the principal amount outstanding.

After initial measurement, such financial assets are subsequently measured at amortised cost using the
effective interest rate (EIR) method. 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 in finance income in the statement of profit and loss. The losses arising from impairment are
recognised in the statement of profit and loss. This category generally applies to trade and other
receivables.

Debt instrument at FVTOCI

A 'debt instrument' is classified as at the FVTOCI if both of the following criteria are met:

a) The objective of the business model is achieved both by collecting contractual cash flows and selling the
financial assets, and

b) The asset's contractual cash flows represent SPPI.

Debt instruments included within the FVTOCI category are measured initially as well as at each reporting
date at fair value. Fair value movements are recognized in the other comprehensive income (OCI).
However, the Company recognizes interest income, impairment losses & reversals and foreign exchange
gain or loss in the P&L. On derecognition of the asset, cumulative gain or loss previously recognised in
OCI is reclassified from the equity to P&L. Interest earned whilst holding FVTOCI debt instrument is
reported as interest income using the EIR method.

Debt instrument at FVTPL

FVTPL is a residual category for debt instruments. Any debt instrument, which does not meet the criteria
for categorization as at amortized cost or as FVTOCI, is classified as at FVTPL.

In addition, the Company may elect to designate a debt instrument, which otherwise meets amortized
cost or FVTOCI criteria, as at FVTPL. However, such election is allowed only if doing so reduces or
eliminates a measurement or recognition inconsistency (referred to as 'accounting mismatch'). The
Company has designated its investments in debt instruments as FVTPL. Debt instruments included within
the FVTPL category are measured at fair value with all changes recognized in the P&L.

Financial Assets - Derecognition

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial
assets) is primarily derecognised (i.e. removed from the Company's balance sheet) when:

(i) The rights to receive cash flows from the asset have expired, or

(ii) The Company has transferred its rights to receive cash flows from the asset or has assumed an
obligation to pay the received cash flows in full without material delay to a third party under a 'pass¬
through' arrangement? and either (a) the Company has transferred substantially all the risks and rewards
of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and
rewards of the asset, but has transferred control of the asset.

When the Company has transferred its rights to receive cash flows from an asset or has entered into a
pass- through arrangement, it evaluates if and to what extent it has retained the risks and rewards of
ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the
asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to
the extent of the Company's continuing involvement. In that case, the Company also recognises an
associated liability. The transferred asset and the associated liability are measured on a basis that
reflects the rights and obligations that the Company has retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the
lower of the original carrying amount of the asset and the maximum amount of consideration that the
Company could be required to repay.

Equity Instruments

All Investment in equity Instruments classified under assets are initially measured at fair value, the
company may, on initial recognition, irrevocably elect to measure to same either at OCI or FVTPL.

The company makes such election on instruments -by -instruments basis. Fair value changes on an
equity instrument is recognized as other income in the statement of profit and loss unless the company
has elected to measure such instrument at OCI. Fair value changes excluding dividends, on an equity
instrument measured at OCI are recognized in OCI. Amounts recognized in OCI are not subsequently
reclassified to the statement of profit and loss. Dividend income on the investments in equity instruments
are recognized as "Other Income" in the statement of profit and loss.

Impairment of financial assets

In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model for measurement
and recognition of impairment loss on the financial assets that are debt instruments, and are measured
at amortised cost e.g., loans, debt securities, deposits and trade receivables or any contractual right to
receive cash or another financial asset that result from transactions that are within the scope of Ind AS
18.

The Company follows 'simplified approach' for recognition of impairment loss allowance on trade
receivables. The application of simplified approach does not require the Company to track changes in
credit risk. Rather, it recognizes impairment loss allowance based on lifetime ECLs at each reporting date,
right from its initial recognition.

For recognition of impairment loss on other financial assets and risk exposure, the Company determines
that whether there has been a significant increase in the credit risk since initial recognition. If credit risk
has not increased significantly, 12-month ECL is used to provide for impairment loss. However, if credit
risk has increased significantly, lifetime ECL is used. If, in a subsequent period, credit quality of the
instrument improves such that there is no longer a significant increase in credit risk since initial recognition,
the Company reverts to recognizing impairment loss allowance based on 12-month ECL.

Lifetime ECL are the expected credit losses resulting from all possible default events over the expected
life of a financial instrument. The 12-month ECL is a portion of the lifetime ECL which results from default
events that are possible within 12 months after the reporting date.

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 EIR.

ECL impairment loss allowance (or reversal) recognized during the period is recognized as income/
expense in the statement of profit and loss. This amount is reflected under the head 'other expenses' in
the statement of profit and loss. The balance sheet presentation for various financial instruments is
described below:

(i) Financial assets measured as at amortised cost: ECL is presented as an allowance, i.e., as an
integral part of the measurement of those assets in the balance sheet. The allowance reduces the net
carrying amount. Until the asset meets write-off criteria, the Company does not reduce impairment
allowance from the gross carrying amount.

(ii) Debt instruments measured at FVTPL: Since financial assets are already reflected at fair value,
impairment allowance is not further reduced from its value. The change in fair value is taken to the
statement of Profit and Loss.

(iii) Debt instruments measured at FVTOCI: Since financial assets are already reflected at fair value,
impairment allowance is not further reduced from its value. Rather, ECL amount is presented as
'accumulated impairment amount' in the OCI.

For assessing increase in credit risk and impairment loss, the Company combines financial instruments
on the basis of shared credit risk characteristics with the objective of facilitating an analysis that is
designed to enable significant increases in credit risk to be identified on a timely basis.

The Company does not have any purchased or originated credit-impaired (POCI) financial assets, i.e.,
financial assets which are credit impaired on purchase/ origination.

Financial liabilities - Recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through statement
of profit and loss, loans and borrowings, payables, or as derivatives designated as hedging instruments
in an effective hedge, as appropriate.

All financial liabilities are recognized 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, loans and borrowings including
bank overdrafts, financial guarantee contracts and derivative financial instruments.

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

• Financial liabilities at fair value through statement of profit and loss Financial liabilities at fair value through
statement of profit and loss include financial liabilities held for trading and financial liabilities designated
upon initial recognition as at fair value through statement of profit and 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 the statement of profit and loss. Financial
liabilities designated upon initial recognition at fair value through statement of profit and loss are designated
as such at the initial date of recognition, and 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/ losses are not subsequently transferred to statement of profit and 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 statement of profit and loss. The Company has not designated any
financial liability as at fair value through statement of profit and loss.

• Loans and Borrowings After initial recognition, interest-bearing loans and borrowings are subsequently
measured at amortized cost using the effective interest rate (hereinafter referred as EIR) method. Gains
and losses are recognized in statement of profit and loss when the liabilities are derecognized as well as
through the EIR amortization process. Amortized 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 amortization is
included as finance costs in the statement of profit and loss.

Financial liabilities - Derecognition

A financial liability is derecognized when the obligation under the liability is discharged or cancelled or
expires. When an existing financial liability is replaced by another from the same lender on substantially
different terms, or the terms of an existing liability are substantially modified, such an exchange or
modification is treated as the derecognition of the original liability and the recognition of a new liability. The
difference in the respective carrying amounts is recognized in the 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 recognized amounts and there is an intention to
settle on a net basis, to realize the assets and settle the liabilities simultaneously.