[B] Material Accounting Policies:

a) Basis of preparation

(i) Compliance with Ind AS

These financial statements have been prepared in accordance with the Indian Accounting
Standards ('Ind AS') as notified under the Companies (Indian Accounting Standards) Rules,
2015 read with Section 133 of the Companies Act, 2013 and presentation requirements of
Division II of Schedule III to the Companies Act, 2013 (as amended from time to time).

(ii) Historical cost convention

The financial statements have been prepared on a historical cost basis, except for the
following:

1) certain financial assets and liabilities that are measured at fair value;

2) defined benefit plans - plan assets measured at fair value;

3) assets held for sale - measured at lower of carrying amount of fair value less cost to
sell

(iii) Current non-current classification

All assets and liabilities have been classified as current or non-current as per the
Company's normal operating cycle (twelve months) and other criteria set out in the
Schedule III to the Act.

(iv) Functional currency

The financial statements are presented in Indian rupee (INR), which is Company's
functional and presentation currency

(v) Rounding of amounts

All amounts disclosed in the financial statements and notes have been rounded off to the
nearest lakh as per the requirement of Schedule III, unless otherwise stated.

b) Key accounting estimates and judgments

The estimates and judgments used in the preparation of the financial statements are
continuously evaluated by the company and are based on historical experience and various
other assumptions and factors (including expectations of future events) that the company
believes to be reasonable under the existing circumstances. Differences between actual results
and estimates are recognized in the period in which the results are known/materialized.

The said estimates are based on the facts and events, that existed as at the reporting date, or
that occurred after that date but provide additional evidence about conditions existing as at the
reporting date.

c) Fair value measurement

The fair values of the financial assets and liabilities are measured at the amount at which the
instrument could be exchanged in a current transaction between willing parties, other than in a
forced or liquidation sale.

All financial instruments are initially recognized and subsequently re-measured at fair value as
described below:

1) The fair value of investment in quoted equity shares and mutual funds is measured at
quoted price or NAV respectively.

2) Financial instruments with fixed and variable interest rates are evaluated by the Company
based on parameters such as interest rates and individual credit worthiness of the
counterparty. Based on the evaluation, allowances are taken to account for the expected
losses of these receivables.

3) The fair value of forward foreign exchange contracts and currency swaps is determined
using forward exchange rates and yield curves at the balance sheet date.

The company uses the following hierarchy for determining and disclosing the fair values of
financial instruments by valuation technique:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: Inputs other than the quoted prices included within Level 1 that are observable for the
asset or liability, either directly or indirectly.

Level 3: Inputs are not based on observable market data (unobservable inputs).

At each reporting date, the management analyses the movements in the values of assets and
liabilities which are required to be re-measured or re-assessed as per the Company's
accounting policies. For this analysis, the management verifies the major inputs applied in the
latest valuation by agreeing the information in the valuation computation to contracts and other
relevant documents.

The management, in conjunction with the Company's external valuers, wherever required, also
compares the change in the fair value of each asset and liability with relevant external sources
to determine whether the change is reasonable on yearly basis.

For the purpose of fair value disclosures, the Company has determined classes of assets and
liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level
of the fair value hierarchy, as explained above.

d) Property, plant and equipment

Freehold land is carried at cost. All other items of property, plant and equipment are stated at
cost, net of recoverable taxes, less depreciation and impairment losses, if any. Such cost
includes Purchase price, borrowing cost and other cost that is directly attributable to the
acquisition of the items.

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. The carrying
amount of any component accounted for as a separate asset is derecognised when replaced.
All other repairs and maintenance are charged to the Statement of Profit and Loss during the
reporting period in which they are incurred.

All expenditure incurred towards property, plant and equipment including expenditure incurred
during construction / new projects are accumulated and shown as capital work in progress and
not depreciated until such assets are ready for commercial use.

Depreciation methods, estimated useful lives and residual value

Depreciation is provided on a Straight Line Method over the estimated useful lives of assets.

The Company depreciates its property, plant and equipment over the useful life in the manner
prescribed in Schedule II to the Act, and management believe that useful life of assets are same
as those prescribed in Schedule II to the Act, except for certain plant and machinery which
based on an independent technical evaluation, life has been estimated as 20 years (on multiple
shift basis) and for cylinders life has been estimated as 5 years, which is different from that
prescribed in Schedule II to the Act.

The residual values are not more than 5% of the original cost of the asset. The assets residual
values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting
period.

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

e) Intangible Assets

Computer software are stated at cost, less accumulated amortisation and impairments, if any.
Amortisation method and useful life

The Company amortizes computer software using the straight-line method over the period of 3
years. Gains and losses on disposals are determined by comparing proceeds with carrying
amount. These are included in the Statement of Profit and Loss.

f) Cash and Cash Equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents
includes cash on hand, cash at bank, deposits held at call with financial institutions, 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.

g) Inventories

Items of inventories of Raw Material, Finished goods, Spares and Stores, Packing Material &
Fuel are valued at lower of cost or net realizable value except waste which is valued at
estimated net realizable value. Cost of inventories comprise of cost of purchase, cost of
conversion and other costs including manufacturing overheads incurred in bringing them to their
respective present location and condition. Cost is determined on weighted average method.

Net realisable value is the estimated selling price in the ordinary course of business, less
estimated costs of completion and the estimated costs necessary to make the sale. Obsolete,
slow-moving and defective inventories are identified by management and wherever necessary,
provision is created for such inventories.

h) Financial instruments

i. Recognition and initial measurement

All financial assets and financial liabilities are initially recognized when the Company
becomes a party to the contractual provisions of the instrument.

A financial asset or financial liability is initially measured at fair value plus, for an item not at
fair value through profit and loss (FVTPL), transaction costs that are directly attributable to
its acquisition or issue. Trade receivables that do not contain a significant financing
component are measured at the transaction price determined under Ind AS 115.

ii. Classification and subsequent measurement
Financial assets

On initial recognition, a financial asset is classified as measured at

• amortized cost;

• Fair Value through Other Comprehensive Income (FVOCI) - equity investment; or

• Fair Value Through Profit and Loss (FVTPL)

Financial assets are not reclassified subsequent to their initial recognition, except if and in
the period the Company changes its business model for managing financial assets.

A financial asset is measured at amortized cost if it meets both of the following conditions
and is not designated as at FVTPL:

• The asset is held within a business model whose objective is to hold assets to collect
contractual cash flows; and

• The contractual terms of the financial asset give rise on specified dates to cash flows
that are solely payments of principal and interest on the principal amount outstanding.

On initial recognition of an equity investment that is not held for trading, the Company may
irrevocably elect to present subsequent changes in the investment's fair value in OCI.
(designated as FVOCI - equity investment). This election is made on an investment-by¬
investment basis.

All financial assets not classified as measured at amortized cost or FVOCI as described
above are measured at FVTPL. This includes all derivative financial assets. On initial
recognition, the Company may irrevocably designate a financial asset that otherwise meets
the requirements to be measured at amortized cost or at FVOCI or at FVTPL if doing so
eliminates or significantly reduces an accounting mismatch that would otherwise arise.

Financial liabilities

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial
liability is classified as at FVTPL if it is classified as held-for-trading, or it is a derivative or it
is designated as such on initial recognition. Financial liabilities at FVTPL are measured at
fair value and net gains and losses, including any interest expense, are recognized in profit
or loss. Other financial liabilities are subsequently measured at amortized cost using the
effective interest method. Interest expense and foreign exchange gains and losses are
recognized in profit or loss. Any gain or loss on de-recognition is also recognized in profit or
loss.

iii. De-recognition

The company de-recognizes a financial asset when the contractual rights to the cash flows
from the financial asset expire, or it transfers the rights to receive the contractual cash flows
in a transaction in which substantially all of the risks and rewards of ownership of the
financial asset are transferred or in which the company neither transfers nor retains
substantially all of the risks and rewards of ownership and does not retain control of the
financial asset.

If the company enters into transactions whereby it transfers assets recognized on its
balance sheet, but retains either all or substantially all of the risks and rewards of the
transferred assets, the transferred assets are not derecognized.

Financial liabilities

The company de-recognizes a financial liability when its contractual obligations are
discharged or cancelled, or expire. The company also de-recognizes a financial liability
when its terms are modified and the cash flows under the modified terms are substantially
different. In this case, a new financial liability based on the modified terms is recognized at
fair value. The difference between the carrying amount of the financial liability extinguished
and the new financial liability with modified terms is recognized in profit or loss.

iv. Off-setting

Financial assets and financial liabilities are offset and the net amount presented in the
balance sheet when, and only when, the company currently has a legally enforceable right
to set off the amounts and it intends either to settle them on a net basis or to realize the
asset and settle the liability simultaneously.

i) Borrowings

Borrowings are initially recognized at net of transaction costs incurred and measured at
amortised cost. Any difference between the proceeds (net of transaction costs) and the
redemption amount is recognised in the Statement of Profit and Loss over the period of the
borrowings using the effective interest method.

Preference shares, which are mandatorily redeemable on a specific date are classified as
liabilities.

j) Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of a qualifying
asset that necessarily takes a substantial period of time to get ready for its intended use or sale
are capitalised as part of the cost of the asset. All other borrowing costs are expensed in the
period in which they occur. 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.