3.12. PROVISIONS, CONTINGENT LIABILITIES AND CONTIGENT ASSETS
Provisions
Provisions are recognized when there is a present obligation (legal or constructive) as a result of a past event and it is
probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a
reliable estimate can be made of the amount of the obligation. Provisions are determined by discounting the expected
future cash flows (representing the best estimate of the expenditure required to settle the present obligation at the
balance sheet date) at a pre-tax rate that reflects current market assessments of the time value of money and the risks
specific to the liability. The unwinding of the discount is recognized as finance cost.
Contingent Liabilities
Contingent liability is a possible obligation arising from past events and the existence of which will be confirmed only
by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the
Company or a present obligation that arises from past events but is not recognized because it is not possible that an
outflow of resources embodying economic benefit will be required to settle the obligations or reliable estimate of the
amount of the obligations cannot be made. The Company discloses the existence of contingent liabilities in Other Notes
to Financial Statements.
Contingent Assets
Contingent assets usually arise from unplanned or other unexpected events that give rise to the possibility of an inflow
of economic benefits. Contingent Assets are not recognized though are disclosed, where an inflow of economic benefits
is probable.
3.13. NON CURRENT ASSET HELD FOR SALE
Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered
principally through a sale transaction rather than through continuing use. This condition is regarded as met only when
the asset (or disposal group) is available for immediate sale in its present condition subject only to terms that are usual
and customary for sales of such asset (or disposal group) and its sale is highly probable. Management must be
committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from
the date of classification.
Non-current assets (and disposal groups) classified as held for sale are measured at the lower of their carrying amount
and fair value less costs to sell. Non-current assets are not depreciated or amortised.
4. SIGNIFICANT JUDGEMENTS AND KEY SOURCES OF ESTIMATION IN APPLYING ACCOUNTING POLICIES
Estimates and judgements are continually evaluated. They are based on historical experience and other factors,
including expectations of future events that may have a financial impact on the Company and that are believed to be
reasonable under the circumstances. Information about Significant judgements and Key sources of estimation made in
applying accounting policies that have the most significant effects on the amounts recognized in the financial statements
is included in the following notes:
Recognition of Deferred Tax Assets: The extent to which deferred tax assets can be recognized is based on an
assessment of the probability of the Company's future taxable income against which the deferred tax assets can be
utilized. In addition, significant judgement is required in assessing the impact of any legal or economic limits.
Useful lives of deprecia b le/a mortiza b le assets: Management reviews its estimate of the useful lives of
depreciable/amortizable assets at each reporting date, based on the expected utility of the assets. Uncertainties in these
estimates relate to actual normal wear and tear that may change the utility of plant and equipment.
Classification of Leases: The Company enters into leasing arrangements for various assets. The classification of the
leasing arrangement as a finance lease or operating lease is based on an assessment of several factors, including, but not
limited to, transfer of ownership of leased asset at end of lease term, lessee's option to purchase and estimated certainty
of exercise of such option, proportion of lease term to the asset's economic life, proportion of present value of minimum
lease payments to fair value of leased asset and extent of specialized nature of the leased asset.
Defined Benefit Obligation (DBO): Employee benefit obligations are measured based on actuarial assumptions which
include mortality and withdrawal rates as well as assumptions concerning future developments in discount rates,
medical cost trends, anticipation of future salary increases and the inflation rate. The Company considers that the
assumptions used to measure its obligations are appropriate. However, any changes in these assumptions may have a
material impact on the resulting calculations.
Provisions and Contingencies: The assessments undertaken in recognizing provisions and contingencies have been
made in accordance with Indian Accounting Standards (Ind AS) 37, 'Provisions, Contingent Liabilities and Contingent
Assets'. The evaluation of the likelihood of the contingent events is applied best judgement by management regarding
the probability of exposure to potential loss.
Impairment of Financial Assets: The Company reviews its carrying value of investments carried at amortized cost
annually, or more frequently when there is indication of impairment. If recoverable amount is less than its carrying
amount, the impairment loss is accounted for.
Allowances for Doubtful Debts: The Company makes allowances for doubtful debts through appropriate estimations
of irrecoverable amount. The identification of doubtful debts requires use of judgment 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.
Fair value measurement of financial Instruments: When the fair values of financial 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. The input to these models are taken from
observable markets where possible, but where this not feasible, a degree of judgement is required in establishing fair
values. Judgements include considerations of inputs such as liquidity risk, credit risk and volatility.
33 EMPLOYEE BENEFITS
Employee benefits of short term nature comprising annual encashment of unavailed leave of upto 30 days for each year
and medical expenses are recognised as expenses as and when they accrue. Post employment long term benefits are
funded through defined contribution and defined benefit plans as detailed below :
DEFINED CONTRIBUTION PLAN
The Compaany makes contribution towards provident fund to a defined contribution retirement plan for qualifying
employees. The Provident Fund plan is operated by duly constituted and approved independent trustees/government.
Under the said scheme the Company is required to contribute a specific percentage of pay roll costs in respect of elligible
employees to the retirement benefit schemed to the fund the benefits.
DEFINED BENEFIT PLAN
Gratuity
The Company makes annual contribution of gratuity to gratuity funds duly constituted and administered by independent
trustees and funded with Life Insurance Corporation of India/ independent trust for the qualifying employees. The
scheme provides for a lump sum payment to vested employees upon retirement, death while in employment or on
termination of employment of an amount equivalent to 15 days salary payable for each completed year of service. Vesting
occurs upon completion of 5 years of continuous service.
The present value of defined obligation and related current cost are measured using the projected unit credit method with
actuarial valuation being carried out at each balance sheet date.
35 DISCLOSURES RELATED TO GOODS & SERVICE TAX
(a) In terms of Notification No. 22/2017 CGST - Rates dated 22.08.2017 and other applicable provision of Goods &
Service Tax laws, the company opted to operate under Forward Charge Mechanism wef 1st April 2018.
(b) Assets purchased and expenses recognised in the accounts are net of elligble input credits of Goods & Service Tax
("GST"). However, GST input credits to the extent not admissible being attributable to exempted incomes have been
debited to Profit & Loss Account under the head Administration Expenses.
(c) Earnings includes unbilled revenue recognised on consignments remaining unbilled as on 31st March due to non
receipt of unqualifed acknowledgements and are net of deductions made by customers on account of transit and other
issues as set out below
The management assessed that the fair values of cash and cash equivalents, trade receivables, trade payables, short term
borrowings, and other financial liabilities approximates their carrying amounts largely due to the short-term maturities
of these instruments.
For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to their fair values.
The fair value of the financial assets and financial liabilities is included at the amount at which the instruments could be
exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.
The following methods and assumptions were used to estimate the fair values:
The fair values for loans, security deposits were calculated based on cash flows discounted using a current lending rate.
They are classified as Level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs
including counterparty credit risks, which has been assessed to be insignificant.
The fair values of non-current borrowings are based on the discounted cash flows using a current borrowing rate. They
are classified as Level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs including own
credit risks, which was assessed as on the balance sheet date to be insignificant.
38 FINANCIAL RISK MANAGEMENT
Financial risk management of the Company has been receiving attention of the top management of the Company. The
management considers finance as the lifeline of the business and therefore, financial management is carried out
meticulously on the basis of detailed management information systems and reports at periodical intervals extending
from daily reports to long-term plans. Importance is laid on liquidity and working capital management with a view to
reduce over-dependence on borrowings and reduction in interest cost. Various kinds of financial risks and their
mitigation plans are as follows:
Credit Risk
Credit risk is the risk that counterparty will not meet its obligations leading to financial loss. The Company has an
established credit policy and a credit review mechanism. Credit exposure is undertaken only with large reputed
business houses and with no history of default against payments. Based on the business model, macro economic
enviroment of the business and past trends, the management has determined nil percentage for any class of financial
asset under expected credit loss.
Liquidity Risk
The Company determines its liquidity requirement in the short, medium and long term. This is done by drawings up
cash forecast for short term and long term needs.
The Company manages its liquidity risk in a manner so as to meet its normal financial obligations without any
significant delay or stress. Such risk is managed through ensuring operational cash flow while at the same time
maintaining adequate cash and cash equivalent position. The management has arranged for diversified funding sources
and adopted a policy of managing assets with liquidity monitoring future cash flow and liquidity on a regular basis.
Surplus funds not immediately required are invested in fixed deposit which provide flexibility to liquidate. Besides, it
generally has certain prompt payment and bill purchase agreements with customers/their bankers which can be
assessed as and when required; such credit facilities are reviewed at regular basis.
The amounts are gross and undiscounted, and include contractual interest payments and exclude the impact of netting
agreements (if any). The interest payments on variable interest rate loans in the tables above reflect market forward
interest rates at the respective reporting dates and these amounts may change as market interest rates change. Except
for these financial liabilities, it is not expected that cash flows included in the maturity analysis could occur
significantly earlier, or at significantly different amounts. When the amount payable is not fixed, the amount disclosed
has been determined with reference to conditions existing at the reporting date.
Market Risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in market prices. Market risk comprises two type of risks: Foreign Exchange Risk, Interest Rate Risk.
Foreign Exchange Risk
Foreign Exchange Risk is the exposure of the Company to the potential impact of movements in foreign exchange
rates. The management has assessed that exposure of the Company in foreign currency at the end of the year is ? Nil
(Previous Year: ? Nil).
Interest Rate Risk
The company's borrowings comprise of vehicle loans only which carries fixed rate of interest. The management has
assessed that exposure of the Company in interest rate risk at the end of the year is ? Nil (Previous Year ? Nil)
39 CAPITAL MANAGEMENT
The Company's objective to manage its capital is to ensure continuity of business while at the same time provide
reasonable returns to its various stakeholders but keep associated costs under control. In order to achieve this,
requirement of capital is reviewed periodically with reference to operating and business plans that take into account
capital expenditure and strategic Investments. Sourcing of capital is done through judicious combination of
equity/internal accruals and borrowings, both short term and long term. Net debt (total borrowings less investments
and cash and cash equivalents) to equity ratio is used to monitor capital.
42 OTHER STATUTORY INFORMATION
i. The Company does not have any Benami property, where any proceeding has been initiated or pending against the
company for holding any Benami property.
ii. The Company does not have any transactions with companies struck off.
iii. The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory
period.
iv. The Company has not traded or invested in Crypto Currency or Virtual Currency during the financial year.
v. The Company has not been declared wilful defaulter by any bank or financial institution or government or any
government authority.
vi. The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign
entities (Interemediaries) with the understanding that the Intermediary shall:
(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsover by or on behalf
of the company (Ultimate Beneficiaries ) or
(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries
vii. The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party)
with the understanding (whether recorded in writing or otherwise) that the Company shall :
(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsover by or on behalf
of the Funding Party (Ultimate Beneficiaries ) or
(b) Provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries
viii. The Company has not undertaken any such transaction which is not recorded in the books of accounts that has been
surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as,
search or survey or any other relevant provisions of the Income Tax Act, 1961.
43 The Code of Social Security, 2020 ('Code') relating to employee benefits during employment and post-employment
received Presidential assent in September 2020 and its effective date is yet to be notified. The Company will assess and
record the impact of the Code, once it is effective.
44 Previous year's figures have been regrouped and rearranged wherever necessary, to conform to current period's
Accompanying notes 1 to 44 form an integral part of the financial statements
Kanhaiya Kumar Todi Dipak Dey
In terms of our report of even date
r Chairman, Managing Director Director
& CEO - DIN-00112633 DIN-01141084
V irat Sharma
Partner Udit Todi Raja Saraogi
Membership No.061553 Direct°r Director & CFO
For & on behalf of DIN-0°268484 DIN-°0:271334
Patanjali & Co ~ , T •
1 Sneha Jain
Chartered Accountants Company Secretary
FRN 308163E ACS-38991
Kolkata, the 18th day of May 2024
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