2. MATERIAL ACCOUNTING POLICIES:-
a) Statement of compliance
These financial statements comprising of Balance Sheet, Statement of Profit and Loss including other comprehensive
income, Statement of Changes in Equity and Statement of Cash Flows as at March 31, 2025 have been prepared in
accordance with Ind AS as prescribed under Section 133 of the Companies Act, 2013 read with Rule 3 of the Companies
(Indian Accounting Standards) Rules, 2015, as amended from time to time, and other relevant provisions of the Act.
b) Basis of Preparation of Financial Statements
The financial statements have been prepared on the historical cost basis except for certain financial instruments that are
measured at fair values at the end of each financial year, as explained in the accounting policies below. Historical cost is
generally based on the fair value of the consideration given in exchange for goods and services.
The financial statements have been prepared on accrual and going concern basis. The accounting policies are applied
consistently to all the periods presented in the financial statements.
The financial statements are presented in Indian Rupee ("INR") and all values are rounded to the nearest crore as per the
requirement of Schedule III, except when otherwise indicated. Amounts less than ? 50,000/- have been presented as "0.00"
Fair value
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, regardless of whether that price is directly observable or estimated using
another valuation technique. In estimating the fair value of an asset or liability, the Company takes into account the
characteristics of the asset or liability if market participants would take those characteristic into account when pricing the
asset or liability at the measurement date.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized 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:
1) Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or Liabilities.
2) Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is
directly or indirectly observable.
3) Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is
unobservable.
c) Operating Cycle
The Company presents assets and liabilities in the balance sheet based on current / non-current classification based on
operating cycle.
An asset is treated as current when it is:
1. Expected to be realized or intended to be sold or consumed in normal operating cycle;
2. Held primarily for the purpose of trading;
3. Expected to be realized within twelve months after the financial year, or
4. Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months
after the financial year
All other assets are classified as non-current.
A liability is current when:
1. It is expected to be settled in normal operating cycle;
2. It is held primarily for the purpose of trading;
3. It is due to be settled within twelve months after the financial year, or
4. There is no unconditional right to defer the settlement of the liability for at least twelve months after the financial
year.
All other liabilities are classified as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities.
The company has identified twelve months as its operating cycle.
d) Use of estimates and critical accounting judgements
The preparation of the financial statements in conformity with the Ind AS requires management to make judgements,
estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities
and disclosures as at date of the financial statements and the reported amounts of the revenues and expenses for the
years presented. The estimates and associated assumptions are based on historical experience and other factors that are
considered to be relevant. Actual results may differ from these estimates under different assumptions and conditions. The
estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized
in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and
future periods if the revision affects both current and future periods.
The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end
of the financial year that may have a significant risk of causing as material adjustment to the carrying amounts of assets
and liabilities within next financial year.
i. Useful lives of property, plant and equipment
As described in Note 2(e), the Company reviews the estimated useful lives and residual values of property, plant and
equipment at the end of each financial year. During the current financial year, the management determined that
there were no changes to the useful lives and residual values of the property, plant and equipment.
ii. Allowances for Expected credit loss
As described in Note 10, the Company makes allowances for expected credit loss based on an assessment of the
recoverability of trade and other receivables. The identification of expected credit loss requires use of judgement
and estimates. Where the expectation is different from the original estimate, such difference will impact the carrying
value of the trade and other receivables and doubtful debts expenses in the period in which such estimate has been
changed.
iii. Allowances for inventories
Management reviews the inventory age listing on a periodic basis. This review involves comparison of the carrying
value of the aged inventory items with the respective net realizable value. The purpose is to ascertain whether an
allowance is required to be made in the financial statements for any obsolete and slow-moving items. Management
is satisfied that adequate allowance for obsolete and slow-moving inventories has been made in the financial
statements.
iv. Fair Value Measurement of Financial Instruments
When the fair values of financials assets and financial liabilities recorded in the Balance Sheet cannot be measured
based on quoted prices in active markets, their fair value is measured using valuation techniques, including the
discounted cash flow model, which involve various judgements and assumptions. Information about the fair value
of various assets and liabilities are disclosed in Note 39.
v. Provisions and contingent liabilities
A provision is recognised when the Company has a present obligation as result of a past event and it is probable
that the outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be
made. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. Contingent
liabilities are not recognised in the financial statements.
vi. Discount rate used to determine the carrying amount of the Company's defined benefit obligation
As described in Note 42, in determining the appropriate discount rate for plans operated in India, the management
considers the interest rates of government bonds in currencies consistent with the currencies of the post¬
employment benefit obligation.
e) Property, plant and equipment
Property, Plant & Equipments are stated at actual cost (including cost of acquisition and installation) less accumulated
depreciation and net of impairment, if any.
All items of property, plant and equipment are derecognized upon disposal or when no future economic benefits are
expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of
property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the
asset and is recognized in the statement of profit and loss.
Capital work-in-progress comprises cost of fixed assets that are not yet installed for their intended use at the balance sheet
date.
Depreciation
Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value.
Depreciation on Property, Plant and Equipment is charged based on straight line method on an estimated useful life as
prescribed in Schedule II to the Companies Act, 2013 except in respect of the following assets,for which, based on technical
evaluation, useful life is different than those prescribed in Schedule II.
The estimated useful lives and residual values of the property, plant and equipment are reviewed at the end of each
financial year, with the effect of any changes in estimate accounted for on a prospective basis.
Depreciation on items of property, plant and equipment acquired / disposed off during the year is provided on pro-rata
basis with reference to the date of addition / disposal.
f) Intangible assets
Intangible assets acquired separately
Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated amortisation
and accumulated impairment losses. Amortisation is recognized on a straight-line basis over their estimated useful lives.
The estimated useful life are reviewed at the end of each financial year, with the effect of any changes in estimate being
accounted for on a prospective basis.
Derecognition of intangible assets
An intangible asset is derecognized on disposal, or when no future economic benefits are expected from use or disposal.
Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal
proceeds and the carrying amount of the asset, are recognized in the statement of profit and loss when the asset is
derecognized.
Useful lives of intangible assets
Intangible assets are amortised over their estimated useful life on a straight line basis over a period of 5 years.
g) Impairment
Financial assets (other than at fair value)
The Company assesses at each Balance sheet whether a financial asset or a group of financial assets is impaired. Ind AS
109 requires expected credit losses to be measured through a loss allowance. The Company recognizes lifetime expected
losses for all contract assets and/or all trade receivables that do not constitute a financing transaction. For all other financial
assets, expected credit losses are measured at an amount equal to the 12 month expected credit losses or at an amount
equal to the lifetime expected credit losses if the credit risk on the financial asset has increased significantly since initial
recognition.
Non-financial assets
Property, plant and Equipment and intangible assets
At the end of each financial year, the Company reviews the carrying amounts of its tangible and intangible assets to
determine whether there is any indication that those assets have suffered an impairment loss. If any such indication
exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).
When it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable
amount of the cash generating unit to which the asset belongs. When a reasonable and consistent basis of allocation can
be identified, corporate assets are also allocated to individual cash generating units, or otherwise they are allocated to the
smallest group of cash generating unit for which a reasonable and consistent allocation basis can be identified.
Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market
assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have
not been adjusted.
If the recoverable amount of an asset (or cash generating unit) is estimated to be less than its carrying amount, the carrying
amount of the asset (or cash generating unit) is reduced to its recoverable amount. An impairment loss is recognized
immediately in the statement profit and loss.
When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash generating unit) is increased
to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying
amount that would have been determined had no impairment loss been recognized for the asset (or cash generating unit)
in prior years. A reversal of an impairment loss is recognized immediately in the statement of profit and loss.
h) Leases
The determination of whether an arrangement is (or contains) a lease is based on the substance of the arrangement at the
inception of the lease. The arrangement is, or contains, a lease if fulfilment of the arrangement is dependent on the use of
a specific asset or assets and the arrangement conveys a right to use the asset or assets, even if that right is not explicitly
specified in an arrangement.
Company as a lessee :
(i) Right-of-use assets
The Company recognises right-of-use assets at the commencement date of the lease (i.e., the date the underlying
asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and
impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes
the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the
commencement date less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis
over the shorter of the lease term and the estimated useful lives of the assets, as follows:
If ownership of the leased asset transfers to the Company at the end of the lease term or the cost reflects the exercise
of a purchase option, depreciation is calculated using the estimated useful life of the asset. The right-of-use assets
are also subject to impairment. Refer to the accounting policies in relating to Impairment of non-financial assets.
(ii) Lease Liabilities
At the commencement date of the lease, the Company recognises lease liabilities measured at the present value of
lease payments to be made over the lease term. The lease payments include fixed payments (including in substance
fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and
amounts expected to be paid under residual value guarantees. Variable lease payments that do not depend on an
index or a rate are recognised as expenses (unless they are incurred to produce inventories) in the period in which
the event or condition that triggers the payment occurs.
In calculating the present value of lease payments, the Company uses its incremental borrowing rate at the
lease commencement date because the interest rate implicit in the lease is not readily determinable. After the
commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for
the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification,
a change in the lease term, a change in the lease payments (e.g., changes to future payments resulting from a
change in an index or rate used to determine such lease payments) or a change in the assessment of an option to
purchase the underlying asset.
(iii) Short-term leases and leases of low-value assets
The Company applies the short-term lease recognition exemption to its short-term leases. (i.e., those leases that
have a lease term of 12 months or less from the commencement date and do not contain a purchase option). It also
applies the lease of low-value assets recognition exemption that are considered to be low value. Lease payments
on short-term leases and leases of low-value assets are recognised as expense on a straight-line basis over the lease
term.
i) Financial Instruments
Financial assets and financial liabilities are recognized when a Company becomes a party to the contractual provisions of
the instruments. Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly
attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial
liabilities at fair value through profit or loss) are added to or deducted from the fair value measured on initial recognition
of financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the
acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in the
statement of profit and loss.
Financial assets at amortised cost
Financial assets are subsequently measured at amortised cost if these financial assets are held within a business whose
objective is to hold these assets in order 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.
Financial assets at fair value through profit or loss (FVTPL)
Financial assets are measured at fair value through profit and loss unless it is measured at amortised cost or at fair value
through other comprehensive income on initial recognition. The transaction costs directly attributable to the acquisition of
financial assets and liabilities at fair value through profit or loss are immediately recognised in statement of profit and loss.
Derecognition of Financial Assets
The Company derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or when
it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party. If the
Company neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the
transferred asset, the Company recognises its retained interest in the asset.
On derecognition of a financial asset in its entirety, the difference between the asset's carrying amount and the sum of the
consideration received and receivable and the cumulative gain or loss that had been recognized in other comprehensive
income and accumulated in equity is recognized in profit and loss if such gain or loss would have otherwise been recognized
in profit and loss on disposal of that financial asset.
Financial liabilities
Financial liabilities are subsequently measured at amortised cost using effective rate of return method.
Equity instruments
An equity instrument is a contract that evidences residual interest in the assets of the Company after deducting all of its
liabilities. Equity instruments recognised by the Company are measured at the proceeds received net off direct issue cost.
Derecognition of Financial Liabilities
The Company derecognises financial liabilities when, and only when, the Company's obligations are discharged, cancelled
or have expired. An exchange between a lender of debt instruments with substantially different terms is accounted for as
an extinguishment of the original financial liability and the recognition of a new financial liability. Similarly, a substantial
modification of the terms of an existing financial liability (whether or not attributable to the financial difficulty of the
debtor) is accounted for as an extinguishment of the original financial liability and the recognition of a new financial
liability. The difference between the carrying amount of the financial liability derecognized and the consideration paid and
payable is recognized in profit and loss.
Derivative Contracts
The Company enters into derivative financial instruments to hedge foreign currency, price risk and interest rate on
unexecuted firm commitments and highly probable forecast transactions.
For derivatives liabilities of cash flow hedges, the effective portion of the change in the fair value of the derivative is
recognised directly in other comprehensive income and the ineffective portion is recognised 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 financial statements if there is a currently
enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the
assets and settle the liabilities simultaneously.
j) Inventories
Inventories are stated at lower of cost and net realizable value. Cost of inventories are determined on the basis of weighted
average cost Method. Net realisable value represents the estimated selling price for inventories less all estimated costs of
completion and costs necessary to make the sale.
k) Cash and cash equivalents
The Company considers all highly liquid financial instruments, which are readily convertible into known amounts of cash
that are subject to an insignificant risk of change in value and having maturities of three months or less from the date of
purchase, to be cash equivalents.
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