2.2 MATERIAL ACCOUNTING POLICIES INFORMATION(a) Current and non-current classification

The Company segregates assets and liabilities into
current and non-current categories for presentation
in the balance sheet after considering its normal
operating cycle and other criteria set out in Ind AS
1, "Presentation of Financial Statements". For this
purpose, current assets and liabilities include the
current portion of non-current assets and liabilities
respectively.

Deferred tax assets and liabilities are always classified
as non-current.

The operating cycle is the time between the acquisition
of assets for processing and their realization in cash
and cash equivalents. The Company has identified
period up to twelve months as its operating cycle.

(b) Foreign currency transactions

Transactions in foreign currencies are translated
into the functional currency of the Company at the
exchange rates prevailing at the date of the transaction.
Monetary assets and liabilities denominated in foreign
currencies are translated into the functional currency
at the exchange rate prevailing at the reporting date.
Non-monetary assets and liabilities that are measured
at fair value in a foreign currency are translated into
the functional currency at the exchange rate when the
fair value was determined. Non-monetary assets and
liabilities that are measured based on historical cost in
a foreign currency are translated at the exchange rate
at the date of initial transaction. Exchange differences
are recognised in the Statement of Profit and Loss in
the year in which they arise.

(c) Property, plant and equipment (PPE)Recognition and measurement

I tems of property, plant and equipment are stated at
cost less accumulated depreciation and accumulated
impairment losses, if any.

The cost of an item of property, plant and
equipment comprises its purchase price inclusive of
nonrefundable duties and taxes, incidental expenses,
erection/commissioning expenses, borrowing cost,
any directly attributable cost of bringing the item to
its working condition for its intended use and costs of
dismantling and removing the item and restoring the
site on which it is located. Trade discounts and rebates
are deducted from the purchase price. Expenditure
incurred in setting up of stores are capitalised as a part
of lease hold improvements.

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 on disposal of an item of property, plant and
equipment is recognised in Statement of Profit and
Loss.

Depreciation methods, estimated useful lives and
residual value

Depreciation is calculated using the straight line
method to allocate their cost, net of their residual
values on the basis of useful lives prescribed in
Schedule II to the Act and based on management's
estimate of useful lives. The management believes
that these estimated useful lives are realistic and
reflect fair approximation of the period over which the
assets are likely to be used along with consideration
of climate related matters. Expenditure in respect of
improvements, etc. carried out at the rented/leased
premises are depreciated over the initial period
of lease or useful life of assets, whichever is lower.
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.

Depreciation is calculated on a straight line basis using
the rates arrived based on the useful lives estimated
by the management, which are as follows:

Based on the internal assessment carried out by the
in-house technical team, management believes that
the residual value and useful lives as given above
best represents the period over which management

expects to use these assets. Hence, the useful lives
for these assets are different from the useful lives
as prescribed under part C of schedule II of the
Companies Act 2013

Capital work in progress (CWIP)

Capital work-in-progress includes cost of property,
plant and equipment under installation/under
development net off impairment loss, if any, as at the
balance sheet date. Directly attributable expenditure
incurred on project under implementation are shown
under CWIP At the point when an asset is capable of
operating in the manner intended by management,
the capital work in progress is transferred to the
appropriate category of property, plant and equipment.

(d) Impairment of non-financial assets

The carrying amount of assets is reviewed at each
balance sheet date, to determine if there is any
indication of impairment based on the internal/
external factors. An impairment loss is recognized
wherever the carrying amount of assets exceeds
its recoverable amount which is the greater of net
selling price and value in use of the respective assets.
In assessing the value in use, the estimated future
cash flows are discounted to their present value
using a pre-tax discount rate that reflects current
market assessment of the time value of money and
risk specific to the asset. For the purpose of assessing
impairment, assets are grouped at the lowest levels
for which there are separately identifiable cash flows.

(e) Intangible assets

Intangible assets acquired separately are measured
on initial recognition at cost, which includes purchase
price and any cost directly attributable to bringing the
asset to the conditions necessary for it to be capable
of operating in the manner intended by management.
Following initial recognition, intangible assets are
carried at cost less any accumulated amortisation and
accumulated impairment losses, if any.

All relatable expenditure incurred with respect to
developing designs which are capable of being
used for more than one season are capitalised and
amortised over the useful period of the design.

The useful lives of intangible assets are assessed as
either finite or indefinite. Finite life intangible assets
are amortised using straight line method over the
period of their expected useful lives. Estimated useful
lives of intangible assets are as follows:

An intangible asset is derecognised upon disposal (i.e.,
at the date the recipient obtains control) or when no
future economic benefits are expected from its use or
disposal. Any gain or loss arising upon 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.

I ntangible assets with finite lives 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 with
a finite useful life 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.

I ntangible assets with indefinite useful lives are not
amortised, but are tested for impairment annually.
The assessment of indefinite life is reviewed annually
to determine whether the indefinite life continues to
be supportable. If not, the change in useful life from
indefinite to finite is made on a prospective basis.

(f) Inventories

Inventories of traded goods, finished goods and
packing materials are valued at lower of cost and net
realisable value. Cost of inventories comprises costs
of purchase and other costs incurred in bringing the
inventories to their present condition and location.
Cost is determined under moving weighted average
method. Costs of purchased inventory are determined
after deducting rebates and discounts.

Raw materials are valued at lower of cost and net
realisable value. However, materials held for use
in 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. Cost is determined on a weighted average basis.

Obsolete, slow moving and damaged stock is valued
at lower of cost less provision and net realisable value.
Such inventories are identified from time to time
and where necessary a provision is made for such
inventories.

Net realisable value is the estimated selling price in
the ordinary course of business, less estimated cost
necessary to make the sale.

(g) 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 AssetsInitial recognition and measurement

Financial assets are classified, at initial recognition,
and subsequently measured at amortised cost, fair
value through other comprehensive income (FVOCI),
and fair value through profit or loss (FVTPL).

The classification of financial assets at initial recognition
depends on the financial asset's contractual cash
flow characteristics and the Company's business
model for managing them. With the exception of
trade receivables that do not contain a significant
financing component or for which the Company has
applied the practical expedient, the Company initially
measures a financial asset at its fair value plus, in the
case of a financial asset not at fair value through profit
or loss, transaction costs. Trade receivables that do
not contain a significant financing component or
for which the Company has applied the practical
expedient are measured at the transaction price
determined under Ind AS 115.

Upon initial recognition, the Company can elect to
classify irrevocably its equity investments as equity
instruments designated at fair value through OCI
when they meet the definition of equity under Ind
AS 32 Financial Instruments: Presentation and are
not held for trading. The classification is determined
on an instrument-by-instrument basis. Equity
instruments which are held for trading and contingent
consideration recognised by an acquirer in a business
combination to which Ind AS103 applies are classified
as at FVTPL.

In order for a financial asset to be classified and
measured at amortised cost or fair value through
OCI, it needs to give rise to cash flows that are
'solely payments of principal and interest (SPPI)' on
the principal amount outstanding. This assessment
is referred to as the SPPI test and is performed at an
instrument level. Financial assets with cash flows that
are not SPPI are classified and measured at fair value
through Statement of Profit and Loss, irrespective of
the business model.

The Company's business model for managing
financial assets refers to how it manages its financial
assets in order to generate cash flows. The business
model determines whether cash flows will result
from collecting contractual cash flows, selling the

financial assets, or both. Financial assets classified
and measured at amortised cost are held within a
business model with the objective to hold financial
assets in order to collect contractual cash flows while
financial assets classified and measured at fair value
through OCI are held within a business model with
the objective of both holding to collect contractual
cash flows and selling.

Subsequent measurement

For purposes of subsequent measurement, financial
assets are classified in three categories:

• Financial assets at amortised cost

• Financial assets designated at fair value through
OCI (equity instruments)

• Financial assets at fair value through profit or loss
(FVTPL)

Financial assets at amortised cost

A 'financial asset' 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 profit or loss. The
losses arising from impairment are recognised in
the profit or loss. The Company's financial assets at
amortised cost includes trade receivables, loans and
other financial assets.

Financial assets designated at fair value through
OCI (equity instruments)

Gains and losses on these financial assets are never
reclassed to profit or loss. Dividends are recognised as
other income in the statement of profit and loss when
the right of payment has been established, except
when the Company benefits from such proceeds as
a recovery of part of the cost of the financial asset, in
which case, such gains are recorded in OCI. Equity
instruments designated at fair value through OCI are
not subject to impairment assessment.

The Company elected to classify irrevocably its equity
investments in subsidiaries under this category.

Financial assets at fair value through profit or loss
(FVTPL):

Financial assets at fair value through profit or loss
are carried in the balance sheet at fair value with net
changes in fair value recognised in the statement of
profit and loss.

This category includes investments in units of mutual
funds, alternative investment fund. It also includes
equity investments which the Company had not
irrevocably elected to classify at fair value through
OCI. Dividends on equity investments are recognised
in the statement of profit and loss when the right of
payment has been established.

Derecognition:

A financial asset is primarily derecognised (i.e.
removed from the Company's balance sheet) when:

- The rights to receive cash flows from the asset
have expired, or

- 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. 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.

Impairment of financial assets

The Company recognises an allowance for expected
credit losses (ECLs) for all debt instruments not held at
fair value through profit or loss. ECLs are based on the
difference between the contractual cash flows due in
accordance with the contract and all the cash flows
that the Company expects to receive, discounted
at an approximation of the original effective interest
rate. The expected cash flows will include cash
flows from the sale of collateral held or other credit
enhancements that are integral to the contractual
terms.

In accordance with Ind AS 109, the Company assesses
on a forward-looking basis the expected credit loss
associated with its assets carried at amortised cost.

The Company considers a financial asset in default
when contractual payments are due for a period
greater than a predefined period as per management
policy. However, in certain cases, the Company
may also consider a financial asset to be in default
when internal or external information indicates that
the Company is unlikely to receive the outstanding
contractual amounts in full before taking into account
any credit enhancements held by the Company.
A financial asset is written off when there is no
reasonable expectation of recovering the contractual
cash flows.

Financial Liabilities

All financial liabilities are recognised initially at fair
value and, in the case of loans and borrowings and
payables, net of directly attributable transaction costs.
After initial recognition, Interest-bearing loans and
borrowings are measured at amortised cost using the
Effective Interest Rate (EIR) method. Gains and losses
are recognised in profit or loss when the liabilities are
derecognised as well as through the EIR amortisation
process.

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 as finance costs in the
statement of profit and loss.

A financial liability is derecognised when the obligation
under the liability is discharged or cancelled or expires.

Offsetting financial instruments

Financial assets and liabilities are off set and the net
amount is reported in the balance sheet where there
is a legally enforceable right to offset the recognised
amounts and there is an intention to settle on a
net basis or realise the asset and settle the liability
simultaneously. The legally enforceable right must
not be contingent on future events.

Fair value measurement

The Company measures financial instruments, such
as, equity share, mutual funds etc. at fair value at each
balance sheet date.

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. The fair value measurement is
based on the presumption that the transaction to sell
the asset or transfer the liability takes place either:

- In the principal market for the asset or liability, or

- In the absence of a principal market, in the most
advantageous market for the asset or liability

The principal or the most advantageous market must
be accessible by the Company.

The fair value of an asset or a liability is measured
using the assumptions that market participants would
use when pricing the asset or liability, assuming that
market participants act in their economic best interest.
A fair value measurement of a non-financial asset
takes into account a market participant's ability to
generate economic benefits by using the asset in its
highest and best use or by selling it to another market
participant that would use the asset in its highest and
best use.

The Company uses valuation techniques that are
appropriate in the circumstances and for which
sufficient data are available to measure fair value,
maximising the use of relevant observable inputs and
minimising the use of unobservable inputs.

All assets and liabilities for which fair value is measured
or disclosed in the financial statements are categorised
within the fair value hierarchy, described as follows,
based on the lowest level input that is significant to
the fair value measurement as a whole:

Level 1 — Quoted (unadjusted) market prices in active
markets for identical assets or liabilities

Level 2 — Valuation techniques for which the
lowest level input that is significant to the fair value
measurement is directly or indirectly observable
Level 3 — Valuation techniques for which the
lowest level input that is significant to the fair value
measurement is unobservable

For assets and liabilities that are recognised in the
financial statements on a recurring basis, the Company
determines whether transfers have occurred between
levels in the hierarchy by re-assessing categorization
(based on the lowest level input that is significant to
the fair value measurement as a whole) at the end of
each reporting period.

The management determines the policies and
procedures for both recurring fair value measurement,
such as unquoted financial assets measured at fair
value, etc.

(h) Cash and cash equivalents

Cash and cash equivalent (including for Statement
of Cash Flows) comprise cash at banks, cash on
hand, balance with credit card, e-wallet companies
and short-term deposits with an original maturity
of less than three months, which are subject to an
insignificant risk of changes in value.

(i) Employee benefitsShort-term employee benefits

Short-term employee benefit obligations are measured
on an undiscounted basis and are expensed as and
when the related services are provided. A liability is
recognised for the amount expected to be paid,
if the Company has a present legal or constructive
obligation to pay this amount as a result of past
service provided by the employee, and the amount of
obligation can be estimated reliably.

Defined contribution plans

A defined contribution plan is a post-employment
benefit plan under which an entity pays a fixed
contribution and will have no legal or constructive
obligation to pay further amounts. Obligations for
contributions to provident and superannuation fund
are recognised as an employee benefit expense in
Statement of Profit and Loss when the contributions
to the respective funds are due.

Defined benefit plans

A defined benefit plan is a post-employment benefit
plan other than a defined contribution plan. The
Company's gratuity benefit scheme is a defined
benefit plan. The Company's net obligation in respect
of defined benefit plans is calculated by estimating
the amount of future benefit that employees have
earned in the current and prior periods, discounting
that amount and deducting the fair value of any plan
assets.

The calculation of defined benefit obligation is
performed annually by a qualified actuary using the
projected unit credit method. When the calculation
results in a potential asset for the Company, the
recognised asset is limited to the present value
of economic benefits available in the form of any
future refunds from the plan or reductions in future
contributions to the plans.

Remeasurements, comprising of actuarial gains
and losses, the effect of the asset ceiling, excluding
amounts included in net interest on the net defined
benefit liability and the return on plan assets (excluding
amounts included in net interest on the net defined
benefit liability), are recognised immediately in the
balance sheet with a corresponding debit or credit to
retained earnings through OCI in the period in which
they occur. Remeasurements are not reclassified to
profit or loss in subsequent periods. Past service costs
are recognised in profit or loss on the earlier of:

- The date of the plan amendment or curtailment,
and

- The date that the Company recognises related
restructuring costs

Net interest is calculated by applying the discount
rate to the net defined benefit liability or asset. The
Company recognises the following changes in the
net defined benefit obligation as an expense in the
statement of profit and loss:

- Service costs comprising current service
costs, past-service costs, gains and losses on
curtailments and non-routine settlements; and

- Net interest expense or income
Compensated absences

The employees of the Company are entitled to
compensated absences which are both accumulating
and non-accumulating in nature. The expected cost
of accumulating compensated absences is measured
on the basis of an independent actuarial valuation
using the projected unit credit method, for the
unused entitlement that has accumulated as at the
balance sheet date. Non-accumulating compensated
absences are recognised in the period in which the
absences occur.

Share-based payment arrangement

Equity-settled share-based payments to eligible
employees of the Company are measured at the fair
value of the equity instruments/option at the grant
date. Details regarding the determination of the fair
value of equity-settled share-based transactions are
set out in Note 37. The fair value determined at the
grant date of the equity settled share-based payments
to eligible employees of the Company is expensed
on a straight-line basis over the vesting period, based
on the Company's estimate of equity instruments
that will eventually vest, with a corresponding
increase in equity at the end of year. At the end of
each year, the Company revisits its estimate of the
number of equity instruments expected to vest and
recognizes any impact in profit or loss, such that the
cumulative expense reflects the revised estimate,
with a corresponding adjustment to the share based
payment reserve. Any unappropriated shares which
are not backed by grants, and acquired through
secondary acquisition by the trust, are appropriated
within a reasonable period of time.

The Company has created an Employee Benefit Trust
for providing share-based payment to its eligible
employees. The Company uses the Trust as a vehicle
for distributing shares to eligible employees under the
Employee Stock Option Plan, 2019. The Trust buys
shares of the Company from the market, for giving