q) Provisions, contingent liabilities and contingent assets
General
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, 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. The expense relating to a provision is presented in the statement of profit and loss.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks
specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
Contingent liabilities and contingent assets
Contingent liabilities is disclosed in the case of :
a present obligation arising from past events, when it is not probable that an outflow of resources embodying economic benefits will be required to
settle the obligation.
a present obligation arising from past events, when no reliable estimate can be made.
a possible obligation arising from past events, unless the probability of outflow of resources is remote.
Commitments includes the amount of purchase order (net of advances) issued to parties for completion of assets.
Provisions, contingent liabilities, contingent assets and commitments are reviewed at each balance sheet date.
Expenditure
Expenditures are accounted net of taxes recoverable, wherever applicable.
r) Fair value measurement
The Company measures financial instruments, such as, derivatives 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.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value,
maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.
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:
> 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 recognized 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 Company's management determines the policies and procedures for both recurring fair value measurement, such as derivative instruments and
unquoted financial assets measured at fair value.
External valuer are involved for valuation of unquoted financial assets and financial liabilities, such as contingent consideration. Involvement of
external valuer is decided upon annually by the management. Selection criteria includes market knowledge, reputation, independence and whether
professional standards are maintained. The management decides, after discussions with the company’s external valuer, which valuation techniques
and inputs to use for each case.
At each reporting date, the company analyses the movements in the values of assets and liabilities which are required to be remeasured or re¬
assessed as per the company’s accounting policies. For this analysis, the Company verifies the major inputs applied in the latest valuation by
agreeing the information in the valuation computation to contracts and other relevant documents.
The Company , in conjunction with the Company’s external valuers, also compares the change in the fair value of each asset and liability with
relevant external sources to determine whether the change is reasonable on a yearly basis.
For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and
risks of the asset or liability and the level of the fair value hierarchy as explained above.
This note summarises accounting policy for fair value. Other fair value related disclosures are given in the relevant notes.
s) 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.
The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of the instrument. It is
broadly classified in financial assets, financial liabilities, derivatives & equity.
A) Financial assets
Initial recognition and measurement
All financial assets, except investment in subsidiaries, associates and joint ventures are recognised initially at fair value.
Subsequent measurement
For purposes of subsequent measurement, financial assets are classified in four categories:
> Debt instruments at amortised cost.
> Debt instruments at fair value through other comprehensive income (FVTOCI).
> Debt instruments, derivatives and equity instruments at fair value through profit or loss (FVTPL).
> Equity instruments measured at fair value through other comprehensive income (FVTOCI).
i) Debt instruments at amortised cost
A ‘debt instrument’ 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.
This category is the most relevant to the Company. 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. This category generally applies to trade and other receivables.
ii) Debt instrument at FVTOCI
A debt instrument is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective
is achieved by both collecting contractual cash flows and selling financial assets 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. The Company has not classified
any financial asset into this category.
ii) Debt instrument at FVTPL
FVTPL is a residual category for debt instruments. Any debt instrument, which does not meet the criteria for categorization as at amortized cost or
as FVTOCI, is classified as at FVTPL.
In addition, the Company may elect to designate a debt instrument, which otherwise meets amortized cost or FVTOCI criteria, as at FVTPL.
However, such election is allowed only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as ‘accounting
mismatch’). The Company has not designated any debt instrument as at FVTPL.
Debt instruments included within the FVTPL category are measured at fair value with all changes recognized in the P&L.
B) Equity instruments
All equity instruments in scope of Ind AS 109 are measured at fair value. Equity instruments which are held for trading and contingent
consideration recognised by an acquirer in a business combination are classified as at FVTPL. For all other equity instruments, the Company may
make an irrevocable election to present in other comprehensive income subsequent changes in the fair value. The Company makes such election on
an instrument-by-instrument basis. The classification is made on initial recognition and is irrevocable.
If the Company decides to classify an equity instrument as at FVTOCI, then all fair value changes on the instrument, excluding dividends, are
recognized in the OCI. There is no recycling of the amounts from OCI to P&L, even on sale of investment. However, The Company may transfer
the cumulative gain or loss within equity.
Equity instruments included within the FVTPL category are measured at fair value with all changes recognized in the P&L.
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) 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.
When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and
to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and
rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company’s
continuing involvement. 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.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the
asset and the maximum amount of consideration that the Company could be required to repay.
Impairment of financial assets
The Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the following financial assets and
credit risk exposure ;
a) Financial assets that are debt instruments, and are measured at amortised cost e.g. loans, debt securities, deposits, trade receivables and bank
balances.
b) Financial assets that are debt instruments and are measured as at other comprehensive income (FVTOCI).
c) Trade receivables or any contractual right to receive cash or another financial asset that result from transactions that are within the scope of Ind
AS 11 and Ind AS 18.
The Company follows ‘simplified approach’ for recognition of impairment loss allowance on:
> Trade receivables or contract revenue receivables; and
> All lease receivables resulting from transactions within the scope of Ind AS 17.
Under the simplified approach the Company does not track changes in credit risk. Rather, it recognises impairment loss allowance based on
lifetime ECLs at each reporting date, right from its initial recognition.
For recognition of impairment loss on other financial assets and risk exposure, the Company determines that whether there has been a significant
increase in the credit risk said initial recognition. If credit risk has not increased significantly, 12 month ECL is used to provide for impairment
loss. However, if credit risk has increased significantly, lifetime ECL is used.
ECL is the difference between all contracted cash flows that are due to the Company in accordance with the contract and all the cash flows that the
Company expects to receive, discounted at the original EIR. ECL impairment loss allowance ( or reversal) recognised during the period is
recognised as (expense) / income in the statement of profit and loss (P&L). This amount is reflected under the head " Other Expense" in the P&L.
Financial liabilities
Initial recognition and measurement
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.
The Company’s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts.
Subsequent Measurement
The measurement of financial liabilities depends on their classification, as described below:
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial
recognition as at fair value through profit or loss. Financial liabilities are classified as held for trading if they are incurred for the purpose of
repurchasing in the near term.
Gains or losses on liabilities held for trading are recognised in the profit or loss.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated as such at the initial date of recognition,
and only if the criteria in Ind AS 109 are satisfied. For liabilities designated as FVTPL, fair value gains/ losses attributable to changes in own credit
risk are recognized in OCI. These gains/ loss are not subsequently transferred to P&L. However, The Company may transfer the cumulative gain or
loss within equity. All other changes in fair value of such liability are recognised in the statement of profit or loss. The Company has not designated
any financial liability as at FVTPL.
Loans and borrowings
This is the category most relevant to the Company. After initial recognition, interest-bearing loans and borrowings are subsequently measured at
amortised cost using the 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. Loan Processing fees amortisation during the period of loan
tennure.
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial
liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified,
such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the
respective carrying amounts is recognised in the statement of profit or loss.
Reclassification of financial instruments
After initial recognition, no reclassification is made for financial assets which are equity instruments. For financial assets, which are debt
instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are
expected to be infrequent. If the Company reclassifies the financial assets, it applies the reclassification prospectively from the reclassification date
which is the first day of the immediately next reporting period following the change in the business model.
Offsetting financial assets and financial liabilities
Financial assets and liabilities are offset and the net amount is reported in the balance sheet if there is a currently enforceable legal right to offset
the recognized amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.
t) Leases
The Company has applied Ind AS 116 'Leases' for the first time for annual reporting period commencing from April 01, 2019. Set out below are the
new accounting policies of the Company upon adoption of Ind AS 116:
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. Unless the Company is reasonably certain to obtain ownership of the leased asset at the
end of the lease term, the recognised right-of-use assets are depreciated on a straight-line basis over the shorter of its estimated useful life and the
lease term. Right-of-use assets are subject to impairment.
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. The lease payments also
include the exercise price of a purchase option reasonably certain to be exercised by the Company and payments of penalties for terminating a
lease, if the lease term reflects the Company exercising the option to terminate. The variable lease payments that do not depend on an index or a
rate are recognised as expense in the period on which the event or condition that triggers the payment occurs.
In calculating the present value of lease payments, the Company uses the incremental borrowing rate at the lease commencement date if 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 in-substance fixed lease payments or a change in the assessment to purchase the
underlying asset.
Lease liabilities
The Company applies the short-term lease recognition exemption to its short-term leases of property, plant and equipment (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 to leases of office equipment that are considered of low value. Lease payments on short-term leases and leases oflow-
value assets are recognised as expense on a straight-line basis over the lease term.
Significant judgement in determining the lease term of contracts with renewal options
The Company determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option to extend the lease
if it is reasonably certain to be exercised, or any periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised.
Additional regulatory information
(a)
Title deeds of immovable property not held in name of the Company
There is no such Properties for which title deeds are not in the name of the Company.
(b)
Revaluation of property, plant and equipment:
The Company has not revalued its Property, Plant and Equipment and hence the Company shall not be required to
disclose as to whether the revaluation is based on the valuation by a registered valuer as defined under rule 2 of the
Companies (Registered Valuers and Valuation) Rules, 201 7.
(c)
Loans or advances - Additional disclosures:
The Company has granted loans or advances in nature of loans to promoters, directors, key managerial personnel and
related parties or Subsidiary Company as defined under the Companies Act, 2013
(d)
Capital Work In Progress (CWIP)
The Company is not having any capital work-in-progress during the year or previous year.
(e)
Intangible assets under development:
The Company is not having any intangible asset under development during the year or previous year.
(f)
Where the Company has borrowings from banks or financial institutions on the basis of current assets
The company has been sanctioned working capital limit in the form of term loans and overdraft facilities, however,
according to information and explanation given by the management the terms and conditions of the sanctions does not
specify to submit any monthly or quarterly statements of current assets of the company, hence the Company is not
submitting such statements to the lending banks and financial institutions and hence this clause is not applicable for the
year
(g)
Wilful Defaulter:
The Company has borrowings from banks or financial institutions or other lenders. However, the Company has not been
declared a wilful defaulter at any time during the year or after the end of reporting period, but before the date when
financial statements are approved or in an earlier period and the default has continued for the whole or part of the
current year by any bank or financial institution or other lender.
(h)
Relationship with Struck off Companies
The Company has no transaction during the year with companies struck off under section 248 of the Companies Act, 2013
or section 560 of the Companies Act, 1956.
(i)
Registration of charges or satisfaction with Registrar of Companies
The Company has taken the credit facilities from Union Bank Limited and all legal formalities related to registration of
charges has been complied as required.
(j)
Compliance with number of layers of companies
The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with
Companies (Restriction on number of Layers) Rules, 201 7. Hence, requirements of disclosing the name and CIN of the
companies beyond the specified layers and the relationship / extent of holding of the company in such downstream
companies are not applicable.
(k)
Compliance with approved Scheme(s) of Arrangements
No Scheme of Arrangements has been approved by the Competent Authority in terms of sections 230 to 237 of the
Companies Act, 2013 during the year. Hence, the requirements of disclosure of effect of such Scheme of Arrangements in
the books of account in accordance with the Scheme and in accordance with accounting standards are not
a) l
Utilisation of Borrowed funds and share premium:
The Company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other
sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) during the year with
the understanding (whether recorded in writing or otherwise) that the Intermediary shall:
(i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf
(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) during
the year with the understanding (whether recorded in writing or otherwise) that the Company shall:
(i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the
Funding Party (Ultimate Beneficiaries) or
(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
(i) Interest rate risk
The Companyis exposed to changes in market interest rates due to financing, investing and cash management activities. Currentlythe Company’s exposure to the risk of
changes in market interest rates relates primarilyto the Company’s short-term debt obligations with fixed interest rates. As at December 31, 2024, all the borrowings are at
fixed rate of interest.
(ii) Credit risk
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed
to credit risk from its operating activities (primarily trade receivables and other financial assets), including deposits with banks and other financial instruments.
Customer credit risk is managed by the Company’s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is
assessed based on an extensive evaluation and individual credit limits are defined in accordance with this assessment.
An impairment analysis is performed at each reporting date on an individual basis for major clients. In addition, a large number of minor receivables are grouped into
homogenous groups and assessed for impairment collectively. The calculation is based on historical data.
Credit risk from balances with banks is managed by the Company’s treasury department in accordance with the Company’s policy.
(iii) Concentrations of Credit Risk form part of Credit Risk
Considering that the Company provides land on lease and related infrastructure facilities to various companies to develop Electronics Manufacturing Clusters at Mundra,
the Company is significantly dependent on few customers. A loss of any of these customers could adversely affect the operating result or cash flow of the Company.
(iv) Liquidity risk
Liquidityrisk is the risk that the Company will encounter difficultyin raising funds to meet commitments associated with financial instruments that are settled by delivering
cash or another financial asset. Liquidity risk may result from an inability to sell a financial asset quickly at close to its fair value.
The Company has an established liquidity risk management framework for managing its short term, medium term and long term funding and liquidity management
requirements. The Company’s exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. The Company manages the
liquidity risk by maintaining adequate funds in cash and cash equivalents. The Company also has adequate credit facilities agreed with banks to ensure that there is
sufficient cash to meet all its normal operating commitments in a timely and cost-effective manner.
The table below analysis derivative and non-derivative financial liabilities of the Company into relevant maturity groupings based on the remaining period from the
reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.
26.4 No transaction to report against the following disclousre requirement as nofitied by MCA pusuant to amendment in Schedule III
1. Crupto Currency or virtual Currency
2. Benami Property held under Prohibition of Benami transaction Act 1988
3. Registration of Charges or Statifaction with Register of Companies
26.4 Previous year figures are regrouped wherever necessary.
The accompanying notes form an integral part of financials statements
As per our report of even date
FOR J S SHAH & Co For and on behalf of
Chartered Accountants Laxmi Goldorna House Limited
(F.R.NO. 132059W)
Sd/- Sd/- Sd/-
Jaimin S. Shah Dhaval Parekh Jayesh C Shah
Partner C ompany Secretary (DIN: 02479665)
Mem. No. : 138488 Mem.No.: A50314 Managing Director
Place : Ahmedabad
UDIN:25138488BMIAZC3674 Sd/- Sd/-
Date: 18/04/2025 Jay Patel Rupal J Shah
(Chief Financial Officer ) (DIN: 02479662)
Wholetime Director
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