3.8 Provisions
A provision is recognized when the company has a present obligation as a result of 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.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects current
market assessments of the time value of money and the risks specific to the liability. When discounting is used, the increase in the
provision due to the passage of time is recognized as a finance cost.
Provisions are not discounted to their present value and are determined based on the best estimate required to settle the
obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best
estimates.
3.9 Contingent Liability
A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or
non-occurrence of one or more uncertain future events beyond the control of the company or a present obligation that is not
recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also
arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The
company does not recognize a contingent liability but discloses its existence in the financial statements.
3.10 Contingent Asset
A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only be occurrence or
non-occurrence of one or more uncertain future events not wholly within the control of the company. The company does not
recognize a contingent asset but discloses its existence in the financial statements.
3.11 Foreign Currency
a. Initial recognition
Foreign currency transactions are recorded in the functional currency, by applying to the foreign currency amount the exchange
rate between the functional currency and the foreign currency at the date of the transaction.
b. Conversion
Foreign currency monetary items are retranslated using the exchange rate prevailing at the reporting date. Non-monetary items,
which are measured in terms of historical cost denominated in a foreign currency, are reported using the exchange rate at the date
of the transaction.
c. Exchange difference
The company accounts for exchange differences arising on translation / settlement of foreign currency monetary items as below:
I. Exchange differences arising from translation of long term foreign currency monetary items
- Long-term foreign currency monetary items recognized in the financial statements as on March 31,2018 related to acquisition of
a fixed asset are capitalized and depreciated over the remaining useful life of the asset.
Other Long-term foreign currency monetary items are accumulated in the "Foreign currency monetary Item Translation Difference
Account” and amortized over the remaining life of the concerned monetary item.
ii. Exchange differences on other monetary items
All other exchange differences are recognized as income or as expenses in the year in which they arise.
3.12 Cash and cash equivalent
Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank (including demand deposits) and in
hand and short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known
amounts of cash and which are subject to an insignificant risk of changes in value.
3.13 Earnings per share
Basic earnings per share is calculated by dividing the net profit or loss for the year attributable to equity shareholders by the
weighted average number of equity shares outstanding during the year.
For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equity shareholders and
the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity
shares.
3.14 Inventories
Inventories are valued at lower of cost and net realizable value. Cost of materials is determined on first-in-first-out basis. Net
realizable value is the estimated selling price less estimated cost necessary to make the sale.
3.15 Segment Reporting
An operating segment is component of the company that engages in the business activity from which the company earns
revenues and incurs expenses, for which discrete financial information is available and whose operating results are regularly
reviewed by the chief operating decision maker, in deciding about resources to be allocated to the segment and assess its
performance. The company's chief operating decision maker is the Chief Executive Officer and Managing Director and it is
disclosed as per Ind As 108 Segment Reporting.
Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other
assets and liabilities are disclosed as un-allocable.
Revenue and expenses directly attributable to segments are reported under each reportable segment. All other expenses which
are not attributable or allocable to segments have been disclosed as un-allocable expenses.
The company prepares its segment information in conformity with the accounting policies adopted for preparing and presenting
the financial statements of the company as a whole.
The accruing liability on account of retirement benefit plans (in the nature of defined benefits plan) is accounted as per Ind-AS 19 "Employee Benefits".
General description of the plan :
The Company operates a defined benefit plan (the gratuity plan) covering eligible employees, which provides a lump sum payment to vested employees at
retirement, death, incapacitation or termination of employment, of an amount based on the respective employees basic salary and the tenure of employment.
Interest risk:
"A fall in the discount rate which is linked to the Government Security Rate will increase the present value of the liability requiring higher provision. A fall in the
discount rate generally increases the mark to market value of the assets depending on the duration of asset."
Investment risk:
"The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting year
on government bonds. If the return on plan asset is below this rate, it will create plan deficit."
Longevity risk:
"Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.”
Salary risk:
"The present value of the defined benefit plan liability is calculated by reference to the future salaries of members. As such, an increase in the salary of the members more
than assumed level will increase the plan's liability."
(I) Financial Instrument measured at Amortised Cost:
“The carrying amount of financial assets and financial liabilities measured at amortised cost in the financial statements are reasonable approximation of their
fair valuessince the company does not anticipate that the carrying amounts would be significantly different from the values that would eventually be received or
settled.”
(ii) Levels 1,2 and 3
"Level 1 : It includes Investment in equity shares and mutual fund that has a quoted price and which are actively traded on the stock exchanges. It is been
valued usingthe closing price as at the reporting period on the stock exchanges."
Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of
observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the
instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3.
(iii) There have been no transfers between Level 1 and Level 2 during the years.
Note 41: Financial risk management:
"The Company's activities are exposed to variety of financial risks. These risks include market risk (including foreign exchange risk and interest rate risks),
credit risks and
liquidity risk. The Company's overall risk management program seeks to minimize potential adverse effects on the financial performance of the
Company through established policies and processes which are laid down to ascertain the extent of risks, setting appropriate limits, controls, continuous
monitoring and its compliance.”
(a) Market risk :
“Market risk refers to the possibility that changes in the market rates may have impact on the Company's profits or the value of its holding of financial
instruments. The Company is exposed to market risks on account of foreign exchange rates and interest rates.”
(a1) Foreign currency exchange rate risk :
The Company's foreign currency risk arises from its foreign currency transactions. The fluctuation in foreign currency exchange rates may have potential
impact on the income statement and equity, where any transaction references more than one currency or where assets/liabilities are denominated in a
currency other than the functional currency of the Company.
The Company's revenue is partially comes in foreign currency and major part of the costs are in Indian Rupees, any movement in currency rates would have
impact on the Company's performance. Consequently, the overall objective of the foreign currency risk management is to minimize the short term currency
impact on its revenue and cash-flow in order to improve the predictability of the financial performance.
(b) Credit risk :
Credit risk is the risk of financial loss arising from counterparty failure to repay or service debt according to the contractual terms or obligations.
Credit risk encompasses of both, the direct risk of default and the risk of deterioration of creditworthiness as well as concentration of risks. Financial
instruments that are subject to concentrations of credit risk materially consists of trade receivables, loans, balances with bank and bank deposits.
All trade receivables are subject to credit risk exposure. The Company's exposure to credit risk is influenced mainly by the individual characteristics of each
customer. The demographics of the customer, including the default risk of the industry and country, in which the customer operates, also has an
influence on credit risk assessment. Credit risk is managed through established policies, controls relating to credit approvals and procedures for
continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. There are 1 customers
amounting to ? 641.28 Lakhs, 1 customers amounting to ? 486.31 Lakhs contributes to more than 10 % of outstanding accounts receivable as at 31 March
2025, 31 March 2024 respectively.
Exposure to credit risk
The Company's maximum exposure to credit risk, representing the carrying value of financial assets, was ?10,245.38 Lakhs as at 31 March 2025 and
?10,673.47 Lakhs as at 31 March 2024, comprising trade receivables, bank balances, loans, deposits, advances, and other financial assets.
In respect of financial guarantees provided by the Company to banks/financial institutions, the maximum exposure which the Company is exposed to is the
maximum amount which the Company would have to pay if the guarantee is called upon. Based on the expectation at the end of the reporting period, the
Company considers that it is more likely than not that such an amount will not be payable under the guarantees provided.
© Liquidity risk :
Liquidity risk refers to the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by
delivering cash or another financial asset. The objective of liquidity risk management is to maintain sufficient liquidity and ensure that funds are
available for use as per requirements. The Company generates cash flows from operations to meet its financial obligations, maintains adequate
liquid assets in the form of cash & cash equivalents and has undrawn short term line of credits from banks to ensure necessary liquidity.
Contractual maturities of significant financial liabilities are as below:
Note 42: Capital management
The Company's capital management is intended to create value for shareholders by facilitating the achievement of long-term and short-term goals of the Company.
The Company determines the amount of capital required on the basis of annual business plan coupled with long-term and short term strategic investment
and expansion plans. The funding needs are met through equity, cash generated from operations, long-term and short-term bank borrowings and issue of non-convertible
debt securities.
The Company monitors the capital structure on the basis of net debt to equity ratio and maturity profile of the overall debt portfolio of the Company! Net debt includes
interest bearing borrowings including lease liabilities less cash and cash equivalents, other bank balances (including non-current earmarked balances).
The table below summarises the capital, net debt and net debt to equity ratio of the Company.
Note 44: Segment information:
As permitted by Ind AS - 108 - “ Operating Segments”, if a single financial report contains both consolidated financial statement and the separate
financial statements of the parent, segment information need be presented only on the basis of the consolidated financial statements. This financial
report contains both standalone & consolidated financial statements of the parent, hence segment wise Revenue Results and Capital employed are
given in consolidated financial
Note 45 : Additional regulatory information pursuant to the requirement in Division II of schedule III to the Companies Act, 2013:
(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 charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
(iii) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
(iv) The Company has not advanced or loaned or invested funds to any other person(s) or entity(is), including foreign entities (Intermediaries) with the
understanding that the Intermediary shall: (a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever 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.
(v) The Company has not received any fund from any person(s) or entity(is), 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 whatsoever by
or on behalf of the Funding Party (Ultimate Beneficiaries) or (b) provide any guarantee, security or the like on behalf ofthe Ultimate Beneficiaries.
(vi) The Company does not have any 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.
(vii) The Company is not declared as wilful defaulter by any bank or financial institution (as defined under the Companies Act, 2013) or consortium thereof or other
lender in accordance with the guidelines on wilful defaulters issued by the Reserve Bank of India.
(viii) The Company has not revalued any of its Property, Plant and Equipment (including Right-of-Use Assets) during the year.
(ix) The Company doesn't have any co-owned properties or the properties for which title deed are held by the others.
(x) The Company has not granted any Loans or Advances in the nature of loans to promoters, Directors, KMPs and the related parties (as defined
under Companies Act, 2013), either severally or jointly with any other person (except disclosed in note 39).
(xi) The Company has used the borrowings from the banks for its intended purpose during the financial year.
(xii) The Company did not have any transaction with companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of Companies
Act, 1956 during the current and previous financial year.
Note 46: These financial statements were authorised for issuance by the Company's Board of Directors on 30th May, 2025
Note 47: The Indian Parliament has approved the Code on Social Security, 2020 (‘Code’) which may impact the contributions made by the Company
towards Provident Fund and Gratuity. The Company will evaluate the impact once the corresponding rules are notified and will give
appropriate effect in the financial statements in the period in which the Code becomes effective and the related rules are notified.
Note 48: Events occurring after the Balance sheet Date
The Company evaluates events and transactions that occur subsequent to the balance sheet date but prior to approval of the financial statements to
determine the necessity for recognition and/or reporting of any of these events and transactions in the financial statements. As of 30th May, 2025,
there are no subsequent events to be recognized or reported.
FOR & ON BEHALF OF THE BOARD
TIRUPATI SARJAN LIMITED
For M/s. MAAK & Associates Sd/- Sd/-
Chartered Accountants Jitendrabhai I. Patel Ruchirbhai R Patel
Firm Reg.No.135024W Managing Director Whole Time Director
[DIN No. 00262902] [DIN No. 03185133]
Sd/-
CA Marmik G. Shah
Partner
Membership No - 133926
Place : Ahmedabad Place : Ahmedabad
Date : 30th May, 2025 Date : 30th May, 2025
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