1.17 Provisions, Contingent Liabilities and Contingent
Assets
Provisions are recognised when the Company has a
present obligation (legal or constructive) as a result
of a past event, it is probable that the Company will
be required to settle the obligation, and a reliable
estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best
estimate of the consideration required to settle the
present obligation at the end of the reporting period,
taking into account the risks and uncertainties
surrounding the obligation. When a provision is
measured using the cash flows estimated to settle the
present obligation, its carrying amount is the present
value of those cash flows (when the effect of the time
value of money is material).
Contingent liabilities are recognised at their fair value
only, if they were assumed as part of a business
combination. Contingent assets are not recognised.
However, when the realisation of income is virtually
certain, then the related asset is no longer a contingent
asset, and is recognised as an asset. Information on
contingent liabilities is disclosed in the notes to the
financial statements, unless the possibility of an
outflow of resources embodying economic benefits is
remote. The same applies to contingent assets where
an inflow of economic benefits is probable.
1.18 Borrowing Cost
General and specific borrowing costs that are
directly attributable to the acquisition, construction
or production of a qualifying asset are capitalised
during the period of time that is required to complete
and prepare the asset for its intended use. Qualifying
assets are assets that necessarily take a substantial
period of time to get ready for their intended use.
Other borrowing costs are expensed in the period in
which they are incurred.
1.19 Dividend
Dividend distributed to Equity shareholders is
recognised as distribution to owners of capital in the
Statement of Changes in Equity, in the period in which
it is paid.
1.20 Fair value measurement
The Company measures financial instruments, such
as, certain investments 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.
All assets and liabilities for which fair value is
measured or disclosed in the 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
1.21 Financial Instruments
(i) Recognition
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.
Financial instruments are recognised on the
balance sheet when the Company becomes
a party to the contractual provisions of the
instrument.
Initial measurement
Financial instruments are initially recognised
at its fair value. Transaction costs directly
attributable to the acquisition or issue of
financial instruments are recognised in
determining the carrying amount, if it is not
classified as at fair value through profit or loss.
However, trade receivables that do not contain a
significant financing component are measured at
transaction price. Transaction costs of financial
instruments carried at fair value through profit or
loss are expensed in the statement of profit and
loss.
Subsequently, financial instruments are
measured according to the category in which
they are classified.
Classification and measurement - financial
assets
Classification of financial assets is based on the
business model in which the instruments are held
as well as the characteristics of their contractual
cash flows. The business model is based on
management's intentions and past pattern of
transactions. Financial assets with embedded
derivatives are considered in their entirety when
determining whether their cash flows are solely
payment of principal and interest. The Company
reclassifies financial assets when and only when
its business model for managing those assets
changes.
Financial assets are classified into three
categories
Financial assets at amortised cost: Financial
assets having contractual terms that give rise
on specified dates to cash flows that are solely
payments of principal and interest on the
principal outstanding and that are held within
a business model whose objective is to hold
such assets in order to collect such contractual
cash flows are classified in this category.
Subsequently, these are measured at amortised
cost using the effective interest method less any
impairment losses.
Equity investments at fair value through other
comprehensive income (Equity instruments):
These include financial assets that are equity
instruments and are designated as such upon
initial recognition irrevocably. Subsequently,
these are measured at fair value and changes
therein are recognised directly in other
comprehensive income, net of applicable income
taxes
Dividends from these equity investments are
recognised in the statement of Profit and Loss
when the right to receive payment has been
established.
When the equity investment is derecognised, the
cumulative gain or loss in equity is transferred to
retained earnings.
Financial assets at fair value through other
comprehensive income (Debt instruments):
Financial assets having contractual terms that
give rise on specified dates, to cash flows that
are solely payments of principal and interest
on the principal outstanding and that are held
within a business model whose objective is
to hold such assets in order to collect such
contractual cash flows as well as to sell the
financial asset, are classified in this category.
Subsequently, these are measured at fair value,
with unrealised gains or losses being recognised
in other comprehensive income apart from any
expected credit losses or foreign exchange gains
or losses, which are recognised in profit or loss
Financial assets at fair value through profit and
loss: 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 and loss are immediately
recognised in profit and loss
Classification and measurement - financial
liabilities:
Financial liabilities are classified as measured at
amortised cost or FVTPL. A financial liability is
classified as at FVTPL if it is classified as held-
for-trading, it is a derivative or it is designated as
such on initial recognition. Financial liabilities
at FVTPL are measured at fair value and
net gains and losses, including any interest
expense, are recognised in profit or loss. Other
financial liabilities are subsequently measured
at amortised cost using the effective interest
method. Interest expense and foreign exchange
gains and losses are recognised in profit or
loss. Any gain or loss on derecognition is also
recognised in profit or loss.
Financial guarantee contracts: These are
initially measured at their fair values and, are
subsequently measured at the higher of the
amount of loss allowance determined or the
amount initially recognised less, the cumulative
amount of income recognised.
Other financial liabilities: These are measured
at amortised cost using the effective interest
method.
1i) Determination of 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
The fair value of a financial instrument on initial
recognition is normally the transaction price (fair
value of the consideration given or received).
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 characteristics
into account when pricing the asset or liability at
the measurement date.
Subsequent to initial recognition, the Company
determines the fair value of financial instruments
that are quoted in active markets using the
quoted bid prices (financial assets held) or
quoted ask prices (financial liabilities held) and
using valuation techniques for other instruments.
Valuation techniques include discounted cash
flow method and other valuation methods.
(iii) Derecognition of financial assets and financial
liabilities
The Company derecognises a financial asset
only when the contractual rights to the cash
flows from the asset expires or it transfers
the financial asset and substantially all the
risks and rewards of ownership of the asset
to another entity. 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 and
an associated liability for amounts it may have
to pay. If the Company retains substantially
all the risks and rewards of ownership of
a transferred financial asset, the Company
continues to recognise the financial asset and
also recognises a collateralised borrowing for
the proceeds received. Any gain or loss arising
on derecognition is recognised in profit or loss.
When a financial instrument is derecognised, the
cumulative gain or loss in equity is transferred
to the statement of profit and loss unless it was
an equity instrument electively held at fair value
through other comprehensive income. In this
case, any cumulative gain or loss in equity is
transferred to retained earnings. Financial assets
are written off when there is no reasonable
expectation of recovery. The Company reviews
the facts and circumstances around each asset
before making a determination. Financial assets
that are written off could still be subject to
enforcement activities.
Financial liabilities are derecognised when these
are extinguished, that is when the obligation is
discharged, cancelled or has expired.
(iv) Impairment of financial Assets
The Company recognises a loss allowance for
expected credit losses on a financial asset that
is at amortised cost or at fair value through other
comprehensive income. Expected credit losses
are forward looking and are measured in a way
that is unbiased and represents a probability-
weighted amount, takes into account the time
value of money (values are discounted using
the applicable effective interest rate) and uses
reasonable and supportable information.
1.22 Operating Cycle
Based on the nature of activities of the Company
and the normal time between acquisition of assets
and their realisation in cash or cash equivalents, the
Company has determined its operating cycle as 12
months for the purpose of classification of its assets
and liabilities as current and non-current.
1.23 Current and non Current classification
i. The assets and liabilities in the Balance
Sheet are based on current/ non - current
classification. An asset 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 reporting period, or
4 Cash or cash equivalents 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.
ii A liability is current when:
1. Expected to be settled in normal operating
cycle
2. Held primarily for the purpose of trading
3. Due to be settled within 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
All other liabilities are treated as non - current. Deferred
tax assets and liabilities are classified as non - current
assets and liabilities.
Note- 1.24 Critical and significant accounting judgements,
estimates and assumptions
(i) Critical estimates and judgements
The following are the critical judgements, apart from
those involving estimations that the management
have made in the process of applying the Company's
accounting policies and that have the most
significant effect on the amounts recognised in the
financial statements. Actual results may differ from
these estimates. These estimates and underlying
assumptions are reviewed on an ongoing basis.
Revisions to the accounting estimates 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.
Useful lives of property, plant and equipment and
intangible assets:
Management reviews the useful lives of depreciable
assets at each reporting. As at 31st March, 2025
management assessed that the useful lives represent
the expected utility of the assets to the Company.
Further, there is no significant change in the useful
lives as compared to previous year.
Allowance for expected credit losses:
The expected credit allowance is based on the aging
of the days receivables are due and the rates derived
based on past history of defaults in the provision
matrix.
Income taxes:
Significant judgements are involved in determining
the provision for income taxes, including amount
expected to be paid/recovered for uncertain tax
positions.
ii) Significant accounting judgements, estimates and
assumptions
The preparation of the Company's financial statements
requires management to make judgements, estimates
and assumptions that affect the reported amounts
of revenues, expenses, assets and liabilities, and
the accompanying disclosures, and the disclosure
of contingent liabilities. Uncertainty about these
assumptions and estimates could result in outcomes
that require a material adjustment to the carrying
amount of assets or liabilities affected in future
periods.
Judgements
In the process of applying the Company's accounting
policies, management has made the following
judgements, which have the most significant effect on
the amounts recognised in the standalone financial
statements:
Determination of lease term & discount rate:
Ind AS 116 leases requires lessee to determine the
lease term as the non-cancellable period of a lease
adjusted with any option to extend or terminate the
lease, if the use of such option is reasonably certain.
The Company makes assessment on the expected
lease term on lease by lease basis and thereby
assesses whether it is reasonably certain that any
options to extend or terminate the contract will be
exercised. In evaluating the lease term, the Company
considers factor such as any significant leasehold
improvements undertaken over the lease term, costs
relating to the termination of lease and the importance
of the underlying to the Company's operations taking
into account the location of the underlying asset and
availability of the suitable alternatives. The lease term
in future period is reassessed to ensure that the lease
term reflects the current economic circumstances.
The discount rate is generally based on the incremental
borrowing rate specific to the lease being evaluated or
for a portfolio of leases with similar characteristics.
Estimates and assumptions
The key assumptions concerning the future and other
key sources of estimation uncertainty at the reporting
date, that have a significant risk of causing a material
adjustment to the carrying amounts of assets and
liabilities within the next financial year, are described
below. The Company based on its assumptions and
estimates on parameters available when the financial
statements were prepared. Existing circumstances
and assumptions about future developments, however,
may change due to market changes or circumstances
arising that are beyond the control of the Company.
Such changes are reflected in the assumptions when
they occur.
Impairment of non-financial assets
Impairment exists when the carrying value of an
asset or cash generating unit exceeds its recoverable
amount, which is the higher of its fair value less costs
of disposal and its value in use. The fair value less
costs of disposal calculation is based on available data
from binding sales transactions, conducted at arm's
length, for similar assets or observable market prices
less incremental costs for disposing of the asset.
The value in use calculation is based on a Discounted
Cash Flow model. The cash flows are derived from
the budget for the next five years and do not include
activities that the Company is not yet committed to
or significant future investments that will enhance
the asset's performance of the Cash Generating Unit
being tested. The recoverable amount is sensitive to
the discount rate used for the Discounted Cash Flow
model as well as the expected future cash-inflows
and the growth rate used for extrapolation purposes.
Taxes
Deferred tax assets are recognised for unused tax
losses to the extent that it is probable that taxable
profit will be available against which the losses can
be utilized. Significant management judgement is
required to determine the amount of deferred tax
assets that can be recognised, based upon the likely
timing and the level of future taxable profits together
with future tax planning strategies.
Provision and contingent liability
On an ongoing basis, Company reviews pending
cases, claims by third parties and other contingencies.
For contingent losses that are considered probable,
an estimated loss is recorded as an accrual in
financial statements. Loss Contingencies that
are considered possible are not provided for but
disclosed as Contingent liabilities in the financial
statements. Contingencies the likelihood of which is
remote are not disclosed in the financial statements.
Gain contingencies are not recognised until the
contingency has been resolved and amounts are
received or receivable.
.25 Recent pronouncements
"Ministry of Corporate Affairs ("MCA") notifies new
standards or amendments to the existing standards
under Companies (Indian Accounting Standards)
Rules as issued from time to time. For the year ended
31st March, 2025, MCA has not notified any new
standards or amendments to the existing standards
applicable to the Company"
31 FINANCIAL INSTRUMENTS
(a) Financial risk management objective and policies
This section gives an overview of the significance of financial instruments for the Company and provides additional
information on the balance sheet. Details of significant accounting policies, including the criteria for recognition, the
basis of measurement and the basis on which income and expenses are recognised, in respect of each class of financial
asset, financial liability and equity instrument.
Financial Instruments - Accounting Classification and Fair Value Measurements
The fair value of the financial assets and liabilities are 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:
1. Fair value of cash and short terms deposits, trade and other short receivables, trade payables , other current
liabilities , short term loans from banks and other financial institutions approximate their carrying amounts largely
due to the short term maturities of these instruments
2. Financial instruments with fixed and variable interest rates are evaluated by the Company based on parameter such
as interest rates and individual credit worthiness of the counterparty. Based on this evaluation, allowances are
taken to account for the expected losses of these receivables.
The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by
valuation technique:
Level: 1 Quoted (unadjusted) prices in active markets for identical assets or liabilities.
Level 2 Other techniques for which all inputs which have a significant effect on the recorded fair value are observables,
either directly or indirectly
Level 3 Techniques which use inputs that have a significant effect on the recorded fair value that are not based on
observable market data
Financial assets and liabilities:
The accounting classification of each category of financial instruments, and their carrying amounts, are set out below:
(b) Financial Risk Management Objective and Policies:
The Company's principal financial liabilities, other than derivatives, borrowings, comprise trade and other payables and
advances from Customers. The Company's principal financial assets include Investment, loans and advances, trade
and other receivables and cash and bank balances that derive directly from its operations. The Company is exposed to
market risk, credit risk and liquidity risk. The Company's senior management oversees the management of these risks.
The Board of Directors reviews and agrees policies for managing each of these risks, which are summarized below.
Market Risk
Market risk is the risk that the fair value of future cash flows of a financial assets will fluctuate because of changes in
market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as
equity price risk and commodity risk. The Company monitors the risks arising out of long term debt on a regular basis
with the help of the treasury team. Further the Company may enter into derivatives if the exposure arising out of these
risks exceeds significantly.
Interest Rate Risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in market interest rates. Company has interest rate risk exposure mainly from changes in rate of interest on
borrowing & on deposits with bank/financial institutions.
Interest Rate Risk Exposure:
The Exposure of the Company to change in interest rate at the end of reporting periods are as follows:
Credit Risk
Credit risk is the risk that a counter party 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).
Company deals with reputed manufactures hence chances of credit risk is minimized to that extent. Further part portion of
the order is taken in advance, hence credit risk is already mitigated to that extent.
Trade Receivables
Customer credit risk is managed by each business unit subject to the Company's established policy, procedures and control
relating to customer credit risk management. Outstanding customer receivables are regularly monitored. An impairment
analysis is performed at each reporting date for outstanding customers.
Financial Instruments and Cash Deposits
Credit risk from balances with banks and financial institutions is managed by the Company's treasury department in
accordance with the Company's policy. Investments of surplus funds are made only with approved authorities. Credit limits of
all authorities are reviewed by the Management on regular basis.
33 CAPITAL MANAGEMENT
The Company considers the following components of its Balance Sheet to be managed capital:
1. Total equity - Share Capital, Retained Profit/ (Loss) and Other Equity.
2. Working capital.
The Company manages its capital so as to safeguard its ability to continue as a going concern. The capital structure
of the Company is based on management's judgement of the appropriate balance of key elements in order to meet its
strategic and day-to-day needs. The Company considers the amount of capital in proportion to risk and manage the
capital structure in light of changes in economic conditions and the risk characteristics of the underlying assets.
The Company's policy is to maintain a stable and strong capital structure with a focus on total equity so as to maintain
investor, creditor, and market confidence and to sustain future development and growth of its business. The Company's
focus is on keeping strong total equity base to ensure independence, security, as well as a high financial flexibility
for potential future borrowings, if required, without impacting the risk profile of the Company. The Company will take
appropriate steps in order to maintain, or if necessary adjust, its capital structure.
The management monitors the requirement of capital to meet the operational cost of the Company from time to time
and infuse the capital through sub-ordinate debt, which is classified as other equity.
Non-current assets include property, plant and equipment, capital work in progress, intangible assets, Rou Assets. It is
allocated based on the geographic location of the respective assets.
35.5 The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the
Group towards Provident Fund and Gratuity. The Ministry of Labour and Employment has released draft rules for the
Code on Social Security, 2020 on 13 November, 2020, and has invited suggestions from stakeholders which are under
active consideration by the Ministry. The Company will assess the impact and its evaluation once the subject rules are
notified and will give appropriate impact in its financial statements in the period in which, the Code becomes effective
and the related rules to determine the financial impact are published.
35.6 Balances of Sundry Creditors, Sundry debtors, Loans & advances, etc. are subject to confirmation and reconciliation, if
any.
35.7 There have been no events after reporting date that requires disclosure in financial statement.
35.8 The financial statements were approved for issue by Board of Directors, at its meeting held on 26th May, 2025.
35.9 Previous Years Figures have been regrouped/reclassified wherever necessary to correspond with current year's
classification/disclosures.
35.10 Additional Regulatory Information
A. Title deed of immovable property:
The title deeds of all the immovable properties are held in the name of the Company. Except disclosed in note no 2.
B. Valuation of Property Plant & Equipment, intangible asset:
The Company has not revalued its property, plant and equipment or intangible assets or both during the current or
previous year.
C. Details of benami property held:
No proceedings have been initiated on or are pending against the Company for holding benami property under the
Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.
D. Borrowing secured against current assets
The Company has borrowings from banks on the basis of security of current assets. The quarterly returns or
statements of current assets filed by the Company with banks are in agreement with the books of accounts.
E. Wilful defaulter:
The Company has not been declared wilful defaulter by any bank or financial institution or other lender.
F. Relationship with struck off companies:
The Company has no transactions with the companies struck off under Section 248 of the Companies Act, 2013
or Section 560 of the Companies Act, 1956.
G. Registration of charges or satisfaction with Registrar of Companies (ROC):
There are no charges or satisfaction yet to be registered with Registrar of Companies (ROC) beyond the statutory
period.
H. Compliance with number of layers of companies:
The Company has complied with the number of layers prescribed under the Section 2(87) of the Companies Act,
2013 read with Companies (Restriction on number of layers) Rules, 2017.
I. Utilisation of borrowed funds and share premium:
No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any
other sources or kind of funds) by the Company to or in any other person or entity, including foreign entities
("Intermediaries") with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend
or invest in party identified by or on behalf of the Company (Ultimate Beneficiaries). The Company has not received
any fund from any party(Funding Party) with the understanding that the Company shall whether, directly or indirectly
lend or invest in other persons or entities identified by or on behalf of the Company ("Ultimate Beneficiaries") or
provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
J. Undisclosed income:
There is no income surrendered or disclosed as income during the current or previous year in the tax assessments
under the Income Tax Act, 1961, that has not been recorded previously in the books of account.
K. Details of crypto currency or virtual currency:
The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.
L. Utilisation of borrowings availed from banks and financial institutions:
The borrowings obtained by the Company from banks and financial institutions have been applied for the purposes
for which such loans were taken.
For Maheshwari & Co For and on behalf of the Board of Directors of
Chartered Accountants Venus Pipes & Tubes Limited
Firm Reg. No.: 105834W
Ramesh Totla Mr. Arun Kothari Mr. Dhruv M Patel
Partner Chairman & Managing Director Whole Time Director
Membership No.: 416169 Din: 00926613 Din: 07098080
Mr. Kunal Bubna Mr. Pavan Jain
(Chief Financial Officer) (Company Secretary)
Membership No: A66752
Place: Surat Place: Gandhidham Place: Gandhidham
Date: 26th May, 2025 Date: 26th May, 2025 Date: 26th May, 2025
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