1 Significant Accouting Policies
i) Basis of Preparation of Financial Statements
The financial statements have been prepared in conformity with the generally accepted accounting principles in India to comply with all material respects with the notified Accounting Standards under Section 133 of the Companies Act, 2013. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year except for the change in accounting policies explained below. The complete financial statements have been prepared along with all disclosures
ii) Use of Estimates
The preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognised in the period in which the results are known/materialised.
iii) Revenue Recognition
Revenue is recognised only when it can be reliably measured and it is reasonable to expect ultimate collection. The aboslute figures on the face of Financial Statements with respect to outward and inward supply is exclusive of all applicable taxes if any.
Interest income on deposits and income bearing securities is recognized on time proportionate method.
Rental Income has been recognized on time proprtionalte method over a period of 12 months.
Further, a loan amount to the tune of 35,96,997.58/- which remain unpaid has been recognized as income under section 41 of the Income Tax Act,1961.
iv) Property, Plant & Equipment
Property, Plant & Equipment are stated at cost net of GST and includes amounts added on revaluation, less accumulated depreciation and impairment loss if any. All costs, including financing costs till commencement of commercial production, net charges on foreign exchange contracts and adjustments arising from exchange rate variations attributable to the Property, Plant & Equipmentss are capitalised.Each part of an item of property,plant & equipment with a cost that is significant in relation to the total cost of the item is depreciated seperately.
v) Depreciation
Depreciation on Property, Plant & Equipment is provided to the extent of depreciable amount on Written Down vale (WDV) method in the manner prescribed in Schedule II to the Companies Act, 2013 over their useful life.
vi) Impairment of Assets
An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment of loss is charged to the Profit & Loss Account in the year in which an asset is identified as impaired. The impairment loss recognised in the prior accounting period is reversed if there has been a change in the estimate of recoverable value.
vii) Foreign Currency transactions
(a) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of transaction.
(b) Monetary items denominated in foreign currencies at the year end are restated at year end rates. In case of items which are covered by forward exchange contracts, the difference between the year end rate and the rate on the date of the contract is recognised as exchange difference and the premium paid on forward contracts is recognised over the life of the contract.
(c) Non monetary foreign currency items are carried at cost.
(d) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Profit and Loss account except in case of long term liabilities, where they relate to acquisition of Property, Plant & Equipmentss, in which case they are adjusted to the carrying cost of such assets.
viii) Borrowing costs
Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to Profit and Loss account.
ix) Taxation
Provision for Current tax is based on the liability computed in accordance with the relevant tax rates and tax laws.
Minimum Alternate Tax (MAT) under the provisions of Income tax act, 1961 is recogised as current tax in the statement of Profit & Loss. The Credit available in respect of MAT is recognised as an asset only when and and to the extent that there is convincing evidence that the company will pay normal income tax during the period for which the MAT credit can be carried forward for set-off against the normal tax liability.
Provision for Deferred tax is made for timing differences arising between are taxable income and accounting income computed at the rates enacted or substantively enacted by the balance sheet date. Deferred tax assets are recognised only if there is a reasonable/ virtual certainty that they will be realised and are reviewed for the appropriateness of their respective carrying values at each balance sheet date.
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