Note 2: Summary of significant accounting policies:
a. Basis of preparation
The standalone financial statements of the Company have been prepared in accordance with Ind AS
notified under the Companies (Indian Accounting Standards) Rules, 2015.
The company received order approving cancellation of certificate of registration to carry on the business of
NBFC, from RBI, on November 30,2018. The Ministry of Corporate Affairs (MCA) had issued a notification
dated 16th February 2015, announcing the Companies (Indian Accounting Standards) Rules, 2015 for
adoption and applicability of Indian Accounting Standards (Ind AS). Also as per guidelines given by Ind AS
Technical Facilitation Group (ITFG) Ind AS will be applicable from when company does not have NBFC
Status. Thus being a listed entity, the company adopted Ind AS from 01/12/18. The transition date for Ind
AS implementation is 01/04/2017.
The financial statements have been prepared on the historical cost basis except for a leasehold premises
and certain financial instruments that are measured at fair values at the end of each reporting period, as
explained in the accounting policies below.
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 assumptions that market participants
would use when pricing the asset or liability, assuming that market participants act in their economic best
interest. 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 standalone 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.
b. Current versus non-current classification
The Company presents assets and liabilities in the balance sheet based on currenbnon-current
classification. An asset is current when it is:
1. Expected to be realised or intended to be sold or consumed in the normal operating cycle;
2. Heldprimarilyforthepurposeoftrading;
3. Expected to be realised within the operating cycle or twelve months after the reporting period; or
4. Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least
twelve months after the reporting period.
All other assets are classified as non-current.
A liability is current when:
1. It is expected to be settled in the normal operating cycle;
2. Itis held primarily for the purpose of trading;
3. It is due to be settled within the operating cycle or twelve months after the reporting period; or
4. There is no unconditional right to defer the settlement of the liability for at least twelve months after the
reporting period
The Company classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities.
c. Revenue Recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company
and the revenue can be reliably measured, regardless of when the payment is being made. Revenue is
measured at the fair value of the consideration received or receivable, taking into account contractually
defined terms of payment and excluding taxes or duties collected on behalf of the government.
The specific recognition criteria described below must also be met before revenue is recognised.
Revenue from Rental Income
Rental income is considered in books as and when due and the bills are raised.
Interest income
Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective
interest rate applicable. Interest income is included in other income in the statement of profit and loss.
Dividends
Income from dividend on investments is accrued in the year in which it is declared, whereby the Company's
right to receive is established.
d. Trade Receivables
The Company classifies the right to consideration in exchange for deliverables as either a receivable or as
unbilled revenue. A receivable is a right to consideration that is unconditional upon passage of time.
e. Property, plant and equipment
Property, plant and equipment are stated at cost, net of accumulated depreciation and accumulated
impairment losses, if any. Such cost includes the cost of replacing part of the property, plant and equipment
and borrowing costs for long-term construction projects if the recognition criteria are met. When significant
parts of the property, 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 statement of profit or loss as incurred.
No decommissioning liabilities are expected to be incurred on the assets of plant and equipment.
The leasehold premises, comprising of one building having Written Down Value (WDV) Rs. 145,596/- as per
IND AS as at 31st Mar, 2025 is leased to the company under Finance Lease up to the year 2066. The
premises is partly being used by the company for its own business and partly leased out. Since the company
is using the premises for the purpose of its business, also being the registered office of the company, the
property is classified under Property, Plant and Equipment.
Depreciation is calculated on a WDV basis over the estimated useful lives of the assets.
The Company, based on technical assessment made by technical expert and management estimate,
depreciates all the assets over estimated useful life which is also the useful life prescribed in Schedule II to
the Companies Act, 2013. 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.
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.
f. Inventory
Inventories are valued at cost or net realisable value whichever is lower
g. Borrowing Costs
Borrowing costs directly attributable to the acquisition, construction or production of an 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 the Company incurs in connection with the borrowing of funds.
h. Leases
The Company assesses whether a contract contains a lease, at inception of a contract. 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 from consideration. To assess whether a contact conveys the right to control the use of an
identified assets, the Company assesses whether:
(i) The contact involves the use of an identified asset
(ii) The Company has substantially all of the economic benefits from use of the asset through the
period of the lease and
(iii) The Company has the right to direct the use of the assets.
Company as a lessee
As a lessee, the Company recognizes a right-of-use-assets and a lease liability at the lease
commencement date. The right-of-use-assets is initially measured at cost, which comprises the initial
amount of the lease liability adjusted for any lease payments made at or before the commencement date,
plus and initial direct costs incurred and a estimate of costs to dismantle and remove the underlying asset or
to restore the underlying asset or the site on which it is located, less and lease incentives received. The right-
of-use-assets is subsequently depreciated using the straight line method from the commencement date to
the earlier of the end of the useful life of the right-of-use-assets or the end of the lease term. The estimated
useful lives of right-of-use-assets are determined on the same basis as those of property and equipment. In
addition, the right-of-use-asset is periodically reduced by impairment losses, if any, and adjusted for certain
remeasurement of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily
determined, the Company’s incremental borrowing rate. Generally, the Company uses its incremental
borrowing rate as the discount rate.
Lease payment included in the measurement of the lease liability comprise the fixed payment, including in¬
substance fixed payment. Lease liability is measured at amortised cost using the effective interest method.
The Company has used number of practical expedients when applying Ind AS 116:- short -term leases,
leases of low value assets and single discount rate.
The Company has elected not to recognize right-of-use-assets and lease liability for short term leases that
have a lease term of 12 months or less and leases of low-value assets. The Company recognizes the lease
payment associated with these leases as an expense on a straight line basis over the lease term.
As a Lessor
Leases for which the Company is a lessor classified as finance or operating lease.
Lease Income from operating leases where the Company is a lessor is recognized in income on a straight¬
line basis over the lease term unless the receipt are structured to increase in line with expected general
inflation to compensate for the expected inflationary cost increases. The respective leased assets are
included in the balance sheet based on their nature.
i Taxes
Current tax
Current tax comprises the expected tax payable or receivable on the taxable income or loss of the year and
any adjustment to the tax payable or receivable in respect of previous years. It is measured using tax rate
enacted or substantially enacted at the reporting date.
Deferred tax
Deferred tax is recognised in respect of temporary differences between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes at the reporting date.
Deferred tax assets are recognised for deductible temporary differences, the carry forward of unused tax
credits and any unused tax losses to the extent that it is probable that taxable profit will be available against
which those can be utilised. 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 taxable profit 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.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when
the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.
Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current
tax assets against current tax liabilities and the deferred taxes relate to the same taxable Company and the
same taxation authority.
Current and deferred tax are recognized in profit or loss, except when they relate to items that are
recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax
are also recognized in other comprehensive income or directly in equity respectively
j. Cash and cash equivalents
Cash and cash equivalents in the balance sheet comprise cash at banks, cash in hand and deposits with an
original maturity of 12 months or less, which are subject to an insignificant risk of changes in value.
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