Dharani Finance Ltd. కంపెనీ అకౌంటింగ్ విధానాలు

Mar 31, 2025

1 Corporate Information

The Company is registered with the Reserve Bank of India as a Non-Banking Finance Company (NBFC) Base Layer NBFC not accepting public deposits and carrying on non banking financial services.

2 Basis of preparation of financial statements Statement of compliance

These financial statements are prepared in accordance with Indian Accounting Standards (Ind AS) under the historical cost convention on the accrual basis except for certain financial instruments which are measured at fair values, the provisions of the Companies Act, 2013 (''the Act'') (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.

Basis of preparation and presentation

These financial statements are prepared in accordance with Indian Accounting Standards (Ind AS), the provisions of the Companies Act, 2013 (''the Act'') (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016. The material accounting policy information related to preparation of the standalone financial statements have been discussed in the respective notes.

Use of estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles (GAAP) requires management to make judgments, estimates and assumptions that affect the application of accounting policies and reported amounts of assets, liabilities, income and expenses and the disclosure of contingent liabilities on the date of the financial statements. Actual results could differ from those estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Any revision to accounting estimates is recognised prospectively in current and future periods. Functional and presentation currency “These financial statements are presented in Indian Rupees (INR), which is the Company''s functional

currency. All financial information presented in INR has been rounded to the nearest Lakhs (up to two decimals).

The financial statements are approved for issue by the Company''s Board of Directors on May 28, 2025”

2A Critical accounting estimates and manage ment judgments

In application of the accounting policies, which are described in note 2, the management of the Company is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and assumptions are based on historical experience and other factors that are considered to be relevant.

Information about significant areas of estimation, uncertainty and critical judgements used in applying accounting policies that have the most significant effect on the amounts recognised in the financial statements is included in the following notes:

Property, Plant and Equipment (PPE/Intangible assets)

The residual values and estimated useful life of PPEs and Intangible Assets are assessed by the technical team at each reporting date by taking into account the nature of asset, the estimated usage of the asset, the operating condition of the asset, past history of replacement and maintenance support. Upon review, the management accepts the assigned useful life and residual value for computation of depreciation/amortisation. Also, management judgement is exercised for classifying the asset as investment properties or vice versa.

Current tax

Calculations of income taxes for the current period are done based on applicable tax laws and management''s judgement by evaluating positions taken in tax returns and interpretations of relevant provisions of law.

Deferred Tax Assets

Significant management judgement is exercised by reviewing the deferred tax assets at each reporting date to determine the amount of deferred tax assets that can be retained/ recognised, based upon the likely timing and the level of future taxable profits together with future tax planning strategies.

Fair value

Management uses valuation techniques in measuring the fair value of financial instruments where active market quotes are not available. In applying the valuation techniques, management makes maximum use of market inputs and uses estimates and assumptions that are, as far as possible, consistent with observable data that market participants would use in pricing the instrument. Where applicable data is not observable, management uses its best estimate about the assumptions that market participants would make. These estimates may vary from the actual prices that would be achieved in an arm''s length transaction at the reporting date.

Impairment of Trade Receivables

The impairment for trade receivables are done based on assumptions about risk of default and expected loss rates. The assumptions, selection of inputs for calculation of impairment are based on management judgement considering the past history, market conditions and forward looking estimates at the end of each reporting date.

Impairment of Non-financial assets - PPE

The impairment of non-financial assets is determined based on estimation of recoverable amount of such assets. The assumptions used in computing the recoverable amount are based on management judgement considering the timing of future cash flows, discount rates and the risks specific to the asset.

Defined Benefit Plans and Other long term employee benefits

“The cost of the defined benefit plan and other long term employee benefits, and the present value of such obligation are determined by the independent actuarial valuer. An actuarial valuation involves making various assumptions that may differ from actual developments in future. Management believes that the assumptions used by the actuary in determination of the discount rate, future salary increases, mortality rates and attrition rates are reasonable. Due to the complexities involved in the valuation and its long term nature, this obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

Fair value measurement of financial instrments

When the fair values of financial assets and financial liabilities could not be measured based on quoted prices in active markets, management uses valuation techniques including the Discounted Cash Flow (DCF) model, to determine its fair value The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is exercised in establishing fair values. Judgements include considerations of inputs such as liquidity risk, credit risk and volatility.

Provisions and contingencies

The recognition and measurement of other provisions are based on the assessment of the probability of an outflow of resources, and on past experience and circumstances known at the reporting date. The actual outflow of resources at a future date may therefore vary from the figure estimated at end of each reporting period.

2B Recent pronouncements The 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 March 31,2025, MCA has not notified any new standards or amendments to the existing standards applicable to the Company.

3 Accounting Policies

a) Current versus non-current classification The Company presents assets and liabilities in the balance sheet based on current/ non-current classification.

An asset is treated as current when it is:

I) Expected to be realised or intended to be sold or consumed in normal operating cycle

ii) Held primarily for the purpose of trading

iii) xpected to be realised within twelve months after the reporting period, or

iv) Cash or cash equivalent 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.

A liability is current when:

I) It is expected to be settled in normal operating cycle

ii) It is held primarily for the purpose of trading.

iii) It is due to be settled within twelve months after

the reporting period, or’

iv) 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 classified as non-current. Deferred tax assets and liabilities are classified as non-current assets and liabilities. The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents. The Company has identified 3 months as its operating cycle.

b) Fair value measurement The Company has applied the fair value measurement wherever necessitated at each reporting period.

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:

I) In the principal market for the asset or liability; ii) 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 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.

A fair value measurement of a non - financial asset takes into account a market participant''s ability to generate economic benefits by using the asset in its highest and the best use or by selling it to another market participant that would use the asset in its highest and best use.

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 minimising 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 market 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; and

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 reassessing 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 has designated the respective team leads to determine the policies and procedures for both recurring and non - recurring fair value measurement. External valuers are involved, wherever necessary with the approval of Company''s board of directors. Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained.

For the purpose of fair value disclosure, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risk of the asset or liability and the level of the fair value hierarchy as explained above. The component wise fair value measurement is disclosed in the relevant notes.

c) Revenue Recognition (I) Interest income

Interest income is recognised in Statement of profit and loss using the effective interest method for all financial instruments measured at amortised cost, debt instruments measured at FVTOCI and debt instruments designated at FVTPL. The ''effective interest rate'' is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument.

(ii) Dividends

Dividends are recognised in Statement of profit and loss only when the right to receive payment is established, it is probable that the economic benefits associated with the dividend will flow to the Company and the amount of the dividend can be measured reliably.

(iii) Sale of services (lease income)

Sale of services representing lease income for vehicles arising out of operating lease is recognised on a straight line basis over the term of the relevant lease as per Ind AS 116.

d) Property, plant and equipment and capital work in progress

Deemed cost option for first time adopter of Ind AS

Under the previous GAAP (Indian GAAP), the property, plant and equipment were carried in the balance sheet at cost less accumulated depreciation. The company has elected to use the previous GAAP carrying amount as the deemed cost as at the date of transition, viz.,1 April 2018

Presentation

Property, plant and equipment is stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. Such cost includes the cost of replacing part of the plant and equipment and borrowing costs of a qualifying asset, if the recognition criteria are met. When significant parts of plant and equipment are required to be replaced at intervals, the Company depreciates them separately based on their specific useful lives. All other repair and maintenance costs are recognised in profit or loss as incurred.

Advances paid towards the acquisition of tangible assets outstanding at each balance sheet date, are disclosed as capital advances under long term loans and advances and the cost of the tangible assets not ready for their intended use before such date, are disclosed as capital work in progress.

Machinery spares/ insurance spares that can be issued only in connection with an item of fixed assets and their issue is expected to be irregular are capitalised. Replacement of such spares is charged to revenue. Other spares are charged as revenue expenditure as and when consumed.

Derecognition

Gains or losses arising from derecognition of property, plant and equipment are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is derecognized.

e) Depreciation on property, plant and equipment

Depreciation is the systematic allocation of the depreciable amount of an asset over its useful life on

a straight line method. The depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its residual value. Depreciation is provided on straight line method, over the useful lives specified in Schedule II to the Companies Act, 2013.

Depreciation for PPE on additions is calculated on pro-rata basis from the date of such additions. For deletion/ disposals, the depreciation is calculated on pro-rata basis up to the date on which such assets have been discarded/ sold.

The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.

f) Leases

The Company has elected not to apply the requirements of Ind AS 116 Leases to short term leases of all assets that have a lease term of 12 months or less and leases for which the underlying asset is of low value. The lease payments associated with these leases are recognised as an expense on a straightline basis over the lease term.

As a lessee

a) Initial measurement

Lease liability is initially recognised and measured at an amount equal to the present value of minimum lease payments during the lease term that are not yet paid. Right-of-use asset is recognized and measured at cost, consisting of initial measurement of lease liability plus any lease payments made to the lessor at or before the commencement date less any lease incentives received, initial estimate of restoration costs and any initial direct costs incurred by the lessee.

b) Subsequent measurement

The lease liability is measured in subsequent periods using the effective interest rate method. Right-of-use asset is depreciated in accordance with requirements in Ind AS 16, Property, Plant and equipment.

As a lessor

At the inception of the lease the Company classifies each of its leases as either an operating lease or a finance lease. The Company recognises lease payments received under operating leases as income on a straight-line basis over the lease term. In case of a finance lease, finance income is recognised over the lease term based on a pattern reflecting a constant periodic rate of return on the

lessor''s net investment in the lease.

g) Financial Instruments

Financial assets and financial liabilities are

recognised when an entity becomes a party to the

contractual provisions of the instruments.

Financial assets

Initial recognition and measurement

All financial assets are recognised initially at fair value. However, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset are also added to the cost of the financial asset. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Company commits to purchase or sell the asset.

Subsequent measurement

For purposes of subsequent measurement, financial assets are classified on the basis of their contractual cash flow characteristics and the entity''s business model of managing them.

Financial assets are classified into the following categories:

• Financial instruments other than equity

instruments at amortised cost

• Financial instruments other than equity

instruments at fair value through other com

prehe sive income (FVTOCI)

• Financial instruments other than equity

instruments, derivatives and equity instruments a t fair value through profit or loss (FVTPL)

• Equity instruments measured at fair value through other comprehensive income (FVTOCI)

Financial instruments other than equity instruments at amortised cost

The Company classifies a financial instruments other than equity instruments as at 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.

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.

Financial instruments other than equity instruments at FVTOCI

The Company classifies a financial instrument other than equity at FVTOCI, if both of the following criteria are met:

a) The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets, and

b) The asset''s contractual cash flows represent SPPI.

Financial instruments other than equity instruments included within the FVTOCI category are measured as at each reporting date at fair value. Fair value movements are recognized in the other comprehensive income (OCI). However, the Company recognizes finance income, impairment losses and reversals and foreign exchange gain or loss in the profit and loss statement. On derecognition of the asset, cumulative gain or loss previously recognised in OCI is reclassified from the equity to profit and loss. Interest earned whilst holding FVTOCI debt instrument is reported as interest income using the EIR method.

Financial instruments other than equity instruments at FVTPL

The Company classifies all financial instruments other than equity instruments, which do not meet the criteria for categorization as at amortized cost or as FVTOCI, as at FVTPL.

Financial instruments other than equity instruments included within the FVTPL category are measured at fair value with all changes recognized in the profit and loss.

Equity investments

All equity investments in scope of Ind AS 109 are measured at fair value. Equity instruments which are held for trading are classified as at FVTPL. Where the Company makes an irrevocable election of classifying the equity instruments at FVTOCI, it recognises all subsequent changes in the fair value in OCI, without any recycling of the amounts from OCI to profit and loss, even on sale of such investments.

Derecognition

A financial asset is primarily derecognised 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 at 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

Equity instruments included within the FVTPL category are measured at fair value with all changes recognized in the profit and loss.

Financial assets are measured at FVTPL except for those financial assets whose contractual terms give rise to cash flows on specified dates that represents SPPI, are measured as detailed below depending on the business model:

Classification	Name of the financial asset
Amortised cost	Trade receivables, Loans given to employees and others, deposits, interest receivable and other advances recoverable in cash.
FVTOCI	Equity investments in companies other than subsidiaries and associates if an option exercised at the time of initial recognition.
FVTPL	Other investments in equity instruments

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 In accordance with Ind AS 109, 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, receivables and bank

balance.

b) Financial assets that are debt instruments and are measured at 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 115.

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 116

The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime Expected Credit Loss (ECL) 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 since initial recognition. If credit risk has not increased significantly, 12 months ECL is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime ECL is used. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognising impairment loss allowance based on 12-month ECL.

Lifetime ECL are the expected credit losses resulting from all possible default events over the expected life of a financial instrument. The 12 months ECL is a portion of the lifetime ECL which results from default events that are possible within 12 months after the reporting date.

ECL is the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the entity expects to receive (i.e., all cash shortfalls), discounted at the original EIR. When estimating the cash flows, the Company considers all contractual terms of the financial instrument (including prepayment, extension, call and similar options) over the expected life of the financial instrument and Cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.

ECL allowance (or reversal) recognized during the period is recognized as income/ expense in the statement of profit and loss. This amount is reflected under the head ''other expenses'' in the profit and loss. The balance sheet presentation of ECL for various financial instruments is described below:

• Financial assets measured as at amortised cost, contractual revenue receivables and lease

receivables: ECL is presented as an allowance, which reduces the net carrying amount. Until the asset meets write-off criteria, the Company does not reduce impairment allowance from the gross carrying amount.

• Financial instruments other than equity instruments measured at FVTOCI: Since

financial assets are already reflected at fair value, impairment allowance is not further reduced from its value. Rather, ECL amount is presented as ''accumulated impairment amount'' in the OCI.

For assessing increase in credit risk and impairment loss, the company combines financial instruments on the basis of shared credit risk characteristics with the objective of facilitating an analysis that is designed to enable significant increases in credit risk to be identified on a timely basis. designed to enable significant increases in credit risk to be identified on a timely basis.

For impairment purposes, significant financial assets are tested on individual basis at each reporting date. Other financial assets are assessed collectively in groups that share similar credit risk characteristics. Accordingly, the impairment testing is done on the following basis:

Name of the financial asset Impairment Testing Methodology

Trade Receivables

Expected Credit Loss model (ECL) is applied. The ECL over lifetime of the assets are estimated by using a provision matrix which is based on historical loss rates reflecting current conditions and forecasts of future economic conditions which are grouped on the basis of similar credit characteristics such as nature of industry, customer segment, past due status and other factors that are relevant to estimate the expected cash loss from these assets.

Other financial assets

When the credit risk has not increased significantly, 12 month ECL is used to provide for impairment loss. When there is significant change in credit risk since initial recognition, the impairment is measured based on probability of default over the life time. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognising impairment loss allowance based on 12 month ECL.

Financial liabilities

Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at FVTPL and as at amortised cost.

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.

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.

The measurement of financial liabilities depends on their classification, as described below:

Financial liabilities at FVTPL

Financial liabilities at FVTPL 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. This category also includes derivative financial instruments entered into by the Company that are not designated as hedging instruments in hedge relationships as defined by Ind AS 109. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments.

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 profit and loss. 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 fair value through profit and loss.

Classification	Name of the financial liability
Amortised cost	Borrowings, Trade payables, Interest accrued, Unclaimed dividends, Security deposits and other financial liabilities not for trading.

Loans and borrowings

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.

Derecognition of financial liabilities

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 assets The Company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. 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. The Company''s senior management determines change in the business model as a result of external or internal changes which are significant to the Company''s operations. Such changes are evident to external parties. A change in the business model occurs when the Company either begins or ceases to perform an activity that is significant to its operations. If the Company reclassifies 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 business model. The Company does not restate any previously recognised gains, losses (including impairment gains or losses) or interest.

The following table shows various reclassification and how they are accounted for:
S. No.	Original classification	Revised classification	Accounting treatment
1	Amortised cost	FVTPL	Fair value is measured at reclassification date. Difference between
2	FVTPL	Amortised Cost	Fair value at reclassification date becomes its new gross carrying
3	Amortised cost	FVTOCI	Fair value is measured at reclassification date. Difference between previous amortised cost and fair value is recognised in OCI. No change in EIR due to reclassification.
4	FVTOCI	Amortised cost	Fair value at reclassification date becomes its new amortised cost carrying amount. However, cumulative gain or loss in OCI is adjusted against fair value. Consequently, the asset is measured as if it had always been measured at amortised cost.
5	FVTPL	FVTOCI	Fair value at reclassification date becomes its new carrying amount. No other adjustment is required.
6	FVTOCI	FVTPL	Assets continue to be measured at fair value. Cumulative gain or loss previously recognized in OCI is reclassified to P&L at the reclassification date.
Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet, if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.

h) Borrowing Costs

Borrowing cost include interest computed using Effective Interest Rate method, amortisation of ancillary costs incurred and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs that are directly attributable to the acquisition, construction, production of a qualifying asset are capitalised as part of the cost of that asset which takes substantial period of time to get ready for its intended use. All other borrowings costs are expensed in the period in which they occur.

Interest income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation. All other borrowing costs are recognised in the statement of profit and loss in the period in which they are incurred.

I) Taxes Current income tax

Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the

reporting date in the countries where the Company operates and generates taxable income.

Current income tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive income or in equity). Current tax items are recognised in correlation to the underlying transaction either in OCI or directly in equity. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

Deferred tax

Deferred tax is provided using the liability method on temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date. Deferred tax liabilities are recognised for all taxable temporary differences.

Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised. Where there is deferred tax assets arising from carry forward of unused tax losses and unused tax created, they are recognised to the extent of deferred tax liability.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive income or in equity). Deferred tax items are recognised in correlation to the underlying transaction either in OCI or directly in equity.

Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

j) Retirement and other employee benefits Short-term employee benefits

A liability is recognised for short-term employee benefit in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchange for that service.

Defined contribution plans

Retirement benefit in the form of provident fund is a defined contribution scheme. The Company has no obligation, other than the contribution payable to the provident fund. The Company recognizes contribution payable to the provident fund scheme as an expense, when an employee renders the related service. If the contribution payable to the scheme for service received before the balance sheet date exceeds the contribution already paid, the deficit payable to the scheme is recognized as a liability after deducting the contribution already paid. If the contribution already paid exceeds the contribution due for services received before the balance sheet date, then excess is recognized as an asset to the extent that the pre-payment will lead to, for example, a reduction in future payment or a cash refund.

Defined benefit plans

The Company operates a defined benefit gratuity plan in India, which requires contributions to be

made to a separately administered fund. The cost of providing benefits under the defined benefit plan is determined using the projected unit credit method.

Remeasurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through OCI in the period in which they occur. Remeasurements are not reclassified to profit or loss in subsequent periods.

Compensated absences

The Company has a policy on compensated absences which are both accumulating and nonaccumulating in nature. The expected cost of accumulating compensated absences is determined by actuarial valuation performed by an independent actuary at each balance sheet date using projected unit credit method on the additional amount expected to be paid/ availed as a result of the unused entitlement that has accumulated at the balance sheet date. Expense on non-accumulating compensated absences is recognized in the period in which the absences occur.

k) Impairment of non financial assets

The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating unit''s (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

l) Provisions, contingent liabilities and contingent asset

Provisions

Provisions are recognised when the Company has 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 obliga-

tion. Provisions are discounted, if the effect of the time value of money is material, using pre-tax rates that reflects the risks specific to the liability. When discounting is used, an increase in the provisions due to the passage of time is recognised as finance cost. These provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

Contingent liabilities

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. Contingent liabilities are disclosed separately.

Show cause notices issued by various Government authorities are considered for evaluation of contingent liabilities only when converted into demand.

Contingent assets

Where an inflow of economic benefits is probable, the Company discloses a brief description of the nature of the contingent assets at the end of the reporting period, and, where practicable, an estimate of their financial effect. Contingent assets are disclosed but not recognised in the financial statements.

m) Cash and cash equivalents

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term

balances with original maturity of less than 3 months, highly liquid investments that are readily convertible into cash, which are subject to insignificant risk of changes in value.

n) Cash Flow Statement

Cash flows are presented using indirect method, whereby profit / (loss) before tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments.

Bank borrowings are generally considered to be financing activities. However, where bank overdrafts which are repayable on demand form an integral part of an entity''s cash management, bank overdrafts are included as a component of cash and cash equivalents for the purpose of Cash flow statement.

o) Earnings per share

"The basic earnings per share are computed by dividing the net profit for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

Diluted EPS is computed by dividing the net profit after tax by the weighted average number of equity shares considered for deriving basic EPS and also weighted average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless issued at a later date. Dilutive potential equity shares are determined independently for each period presented. The number of equity shares and potentially dilutive equity shares are adjusted for bonus shares, as appropriate.

---

Mar 31, 2024

3 Significant Accounting Policies

a) Current versus non-current classification

The Company presents assets and liabilities in

the balance sheet based on current/ non-current

classification.

An asset is treated as current when it is:

i) Expected to be realised or intended to be sold or
consumed in normal operating cycle

ii) Held primarily for the purpose of trading

iii) Expected to be realised within twelve months after
the reporting period, or

iv) Cash or cash equivalent 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.

A liability is current when:

i) It is expected to be settled in normal operating
cycle

ii) It is held primarily for the purpose of trading

iii) It is due to be settled within twelve months after the
reporting period, or

iv) 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 classified as non-current.

Deferred tax assets and liabilities are classified as
non-current assets and liabilities.

The operating cycle is the time between the acquisition
of assets for processing and their realisation in cash
and cash equivalents. The Company has identified 3
months as its operating cycle.

b) Fair value measurement

The Company has applied the fair value measurement
wherever necessitated at each reporting period.

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:

i) In the principal market for the asset or liability;

ii) 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 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.

A fair value measurement of a non - financial asset
takes into account a market participant''s ability to
generate economic benefits by using the asset in its
highest and the best use or by selling it to another
market participant that would use the asset in its
highest and best use.

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
minimising 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
market 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; and

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 has designated the respective team
leads to determine the policies and procedures for both
recurring and non - recurring fair value measurement.
External valuers are involved, wherever necessary
with the approval of Company''s board of directors.
Selection criteria include market knowledge,
reputation, independence and whether professional
standards are maintained.

For the purpose of fair value disclosure, the Company
has determined classes of assets and liabilities on
the basis of the nature, characteristics and risk of the
asset or liability and the level of the fair value hierarchy
as explained above. The component wise fair value
measurement is disclosed in the relevant notes.

c) Revenue Recognition

(i) Interest income

Interest income is recognised in Statement of profit
and loss using the effective interest method for all
financial instruments measured at amortised cost, debt
instruments measured at FVTOCI and debt instruments
designated at FVTPL. The ‘effective interest rate'' is
the rate that exactly discounts estimated future cash
payments or receipts through the expected life of the
financial instrument.

(ii) Dividends

Dividends are recognised in Statement of profit
and loss only when the right to receive payment is
established, it is probable that the economic benefits
associated with the dividend will flow to the Company
and the amount of the dividend can be measured
reliably.

(iii) Sale of services (lease income)

Sale of services representing lease income for
vehicles arising out of operating lease is recognised
on a straight line basis over the term of the relevant
lease as per Ind AS 116.

d) Property, plant and equipment and capital work
in progress

Deemed cost option for first time adopter of Ind AS

Under the previous GAAP (Indian GAAP), the property,
plant and equipment were carried in the balance sheet
at cost less accumulated depreciation. The company
has elected to use the previous GAAP carrying
amount as the deemed cost as at the date of transition,
viz.,1 April 2018

Presentation

Property, plant and equipment is stated at cost,
net of accumulated depreciation and accumulated
impairment losses, if any. Such cost includes the
cost of replacing part of the plant and equipment and
borrowing costs of a qualifying asset, if the recognition
criteria are met. When significant parts of plant and
equipment are required to be replaced at intervals, the
Company depreciates them separately based on their
specific useful lives. All other repair and maintenance
costs are recognised in profit or loss as incurred.

Advances paid towards the acquisition of tangible
assets outstanding at each balance sheet date, are
disclosed as capital advances under long term loans
and advances and the cost of the tangible assets not
ready for their intended use before such date, are
disclosed as capital work in progress.

Machinery spares/ insurance spares that can be issued
only in connection with an item of fixed assets and
their issue is expected to be irregular are capitalised.
Replacement of such spares is charged to revenue.
Other spares are charged as revenue expenditure as
and when consumed.

Derecognition

Gains or losses arising from derecognition of
property, plant and equipment are measured as the
difference between the net disposal proceeds and
the carrying amount of the asset and are recognized
in the statement of profit and loss when the asset is
derecognized.

e) Depreciation on property, plant and
equipment

Depreciation is the systematic allocation of the
depreciable amount of an asset over its useful life
on a straight line method. The depreciable amount
for assets is the cost of an asset, or other amount
substituted for cost, less its residual value.

Depreciation is provided on straight line method,
over the useful lives specified in Schedule II to the
Companies Act, 2013.

Depreciation for PPE on additions is calculated on pro¬
rata basis from the date of such additions. For deletion/
disposals, the depreciation is calculated on pro-rata
basis up to the date on which such assets have been
discarded/ sold.

The residual values, useful lives and methods of
depreciation of property, plant and equipment are
reviewed at each financial year end and adjusted
prospectively, if appropriate.

f) Leases

The Company has elected not to apply the requirements
of Ind AS 116 Leases to short term leases of all assets
that have a lease term of 12 months or less and leases
for which the underlying asset is of low value. The
lease payments associated with these leases are
recognised as an expense on a straight-line basis over
the lease term.

As a lessee

a) Initial measurement

Lease liability is initially recognised and measured
at an amount equal to the present value of minimum
lease payments during the lease term that are not yet
paid. Right-of-use asset is recognized and measured
at cost, consisting of initial measurement of lease
liability plus any lease payments made to the lessor
at or before the commencement date less any lease
incentives received, initial estimate of restoration costs
and any initial direct costs incurred by the lessee.

b) Subsequent measurement

The lease liability is measured in subsequent periods
using the effective interest rate method. Right-of-use
asset is depreciated in accordance with requirements
in Ind AS 16, Property, Plant and equipment.

As a lessor

At the inception of the lease the Company classifies
each of its leases as either an operating lease or
a finance lease. The Company recognises lease
payments received under operating leases as income
on a straight-line basis over the lease term. In case
of a finance lease, finance income is recognised over
the lease term based on a pattern reflecting a constant
periodic rate of return on the lessor''s net investment
in the lease.

g) Financial Instruments

Financial assets and financial liabilities are recognised
when an entity becomes a party to the contractual
provisions of the instruments.

Financial assets

Initial recognition and measurement

All financial assets are recognised initially at fair value.
However, in the case of financial assets not recorded
at fair value through profit or loss, transaction costs
that are attributable to the acquisition of the financial
asset are also added to the cost of the financial asset.
Purchases or sales of financial assets that require
delivery of assets within a time frame established by
regulation or convention in the market place (regular
way trades) are recognised on the trade date, i.e., the
date that the Company commits to purchase or sell the
asset.

Subsequent measurement

For purposes of subsequent measurement, financial
assets are classified on the basis of their contractual
cash flow characteristics and the entity''s business
model of managing them.

Financial assets are classified into the following
categories:

• Financial instruments other than equity instruments
at amortised cost

• Financial instruments other than equity instruments
at fair value through other comprehensive income
(FVTOCI)

• Financial instruments other than equity
instruments, derivatives and equity instruments at
fair value through profit or loss (FVTPL)

• Equity instruments measured at fair value through
other comprehensive income (FVTOCI)

Financial instruments other than equity instruments at
amortised cost

The Company classifies a financial instruments other
than equity instruments as at 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.

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.

Financial instruments other than equity
instruments at FVTOCI

The Company classifies a financial instrument other
than equity at FVTOCI, if both of the following criteria
are met:

a) The objective of the business model is achieved
both by collecting contractual cash flows and
selling the financial assets, and

b) The asset''s contractual cash flows represent
SPPI.

Financial instruments other than equity instruments
included within the FVTOCI category are measured
as at each reporting date at fair value. Fair value
movements are recognized in the other comprehensive
income (OCI). However, the Company recognizes
finance income, impairment losses and reversals and
foreign exchange gain or loss in the profit and loss
statement. On derecognition of the asset, cumulative
gain or loss previously recognised in OCI is reclassified
from the equity to profit and loss. Interest earned whilst
holding FVTOCI debt instrument is reported as interest
income using the EIR method.

Financial instruments other than equity
instruments at FVTPL

The Company classifies all financial instruments other
than equity instruments, which do not meet the criteria
for categorization as at amortized cost or as FVTOCI,
as at FVTPL.

Financial instruments other than equity instruments
included within the FVTPL category are measured at
fair value with all changes recognized in the profit and
loss.

Equity investments

All equity investments in scope of Ind AS 109 are
measured at fair value. Equity instruments which are
held for trading are classified as at FVTPL. Where the
Company makes an irrevocable election of classifying
the equity instruments at FVTOCI, it recognises all
subsequent changes in the fair value in OCI, without
any recycling of the amounts from OCI to profit and
loss, even on sale of such investments.

Equity instruments included within the FVTPL category
are measured at fair value with all changes recognized
in the profit and loss.

Financial assets are measured at FVTPL except for
those financial assets whose contractual terms give
rise to cash flows on specified dates that represents
SPPI, are measured as detailed below depending on
the business model::

Derecognition

A financial asset is primarily derecognised 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

In accordance with Ind AS 109, 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, receivables and bank
balance.

b) Financial assets that are debt instruments and are
measured at 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 115.

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 116

The application of simplified approach does not require
the Company to track changes in credit risk. Rather,
it recognises impairment loss allowance based on
lifetime Expected Credit Loss (ECL) 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 since initial recognition. If credit risk has
not increased significantly, 12 months ECL is used
to provide for impairment loss. However, if credit risk
has increased significantly, lifetime ECL is used. If, in
a subsequent period, credit quality of the instrument
improves such that there is no longer a significant
increase in credit risk since initial recognition, then the
entity reverts to recognising impairment loss allowance
based on 12-month ECL.

Lifetime ECL are the expected credit losses resulting
from all possible default events over the expected
life of a financial instrument. The 12 months ECL is a
portion of the lifetime ECL which results from default
events that are possible within 12 months after the
reporting date.

ECL is the difference between all contractual cash
flows that are due to the Company in accordance
with the contract and all the cash flows that the entity
expects to receive (i.e., all cash shortfalls), discounted
at the original EIR. When estimating the cash flows,
the Company considers all contractual terms of the
financial instrument (including prepayment, extension,
call and similar options) over the expected life of the
financial instrument and Cash flows from the sale of
collateral held or other credit enhancements that are
integral to the contractual terms.

ECL allowance (or reversal) recognized during the
period is recognized as income/ expense in the
statement of profit and loss. This amount is reflected
under the head ‘other expenses'' in the profit and loss.
The balance sheet presentation of ECL for various
financial instruments is described below:

• Financial assets measured as at amortised
cost, contractual revenue receivables and lease
receivables: ECL is presented as an allowance,
which reduces the net carrying amount. Until the
asset meets write-off criteria, the Company does
not reduce impairment allowance from the gross
carrying amount.

• Financial instruments other than equity

instruments measured at FVTOCI: Since
financial assets are already reflected at fair value,
impairment allowance is not further reduced from
its value. Rather, ECL amount is presented as
‘accumulated impairment amount'' in the OCI.

For assessing increase in credit risk and impairment
loss, the company combines financial instruments on
the basis of shared credit risk characteristics with the
objective of facilitating an analysis that is designed
to enable significant increases in credit risk to be
identified on a timely basis.

For impairment purposes, significant financial assets
are tested on individual basis at each reporting date.
Other financial assets are assessed collectively in
groups that share similar credit risk characteristics.
Accordingly, the impairment testing is done on the
following basis:

Name of the financial asset Impairment Testing
Methodology

Financial liabilities

Initial recognition and measurement

Financial liabilities are classified, at initial recognition,
as financial liabilities at FVTPL and as at amortised
cost.

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.

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.

The measurement of financial liabilities depends on
their classification, as described below:

Financial liabilities at FVTPL

Financial liabilities at FVTPL 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. This category also includes derivative
financial instruments entered into by the Company that
are not designated as hedging instruments in hedge
relationships as defined by Ind AS 109. Separated
embedded derivatives are also classified as held
for trading unless they are designated as effective
hedging instruments.

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 profit and loss. 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 fair value through profit and loss.

Loans and borrowings

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.

Derecognition of financial liabilities

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 assets

The Company determines classification of financial
assets and liabilities on initial recognition. After
initial recognition, no reclassification is made for
financial assets which are equity instruments and
financial liabilities. 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. The Company''s senior management
determines change in the business model as a result
of external or internal changes which are significant to
the Company''s operations. Such changes are evident
to external parties. A change in the business model
occurs when the Company either begins or ceases to
perform an activity that is significant to its operations. If
the Company reclassifies 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 business
model. The Company does not restate any previously
recognised gains, losses (including impairment gains
or losses) or interest.

Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet, if there is a
currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis,
to realise the assets and settle the liabilities simultaneously.

h. Borrowing Costs

Borrowing cost include interest computed using Effective Interest Rate method, amortisation of ancillary
costs incurred and exchange differences arising from foreign currency borrowings to the extent they are
regarded as an adjustment to the interest cost.

Borrowing costs that are directly attributable to the acquisition, construction, production of a qualifying asset are
capitalised as part of the cost of that asset which takes substantial period of time to get ready for its intended use.
All other borrowings costs are expensed in the period in which they occur.

Interest income earned on the temporary investment of specific borrowings pending their expenditure on qualifying
assets is deducted from the borrowing costs eligible for capitalisation. All other borrowing costs are recognised in
the statement of profit and loss in the period in which they are incurred.

I. Taxes

Current income tax

Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to
the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or
substantively enacted, at the reporting date in the countries where the Company operates and generates taxable
income.

Current income tax relating to items recognised outside profit or loss is recognised outside profit or loss (either
in other comprehensive income or in equity). Current tax items are recognised in correlation to the underlying
transaction either in OCI or directly in equity. Management periodically evaluates positions taken in the tax
returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes
provisions where appropriate.

Deferred tax

Deferred tax is provided using the liability method on
temporary differences between the tax bases of assets
and liabilities and their carrying amounts for financial
reporting purposes at the reporting date.

Deferred tax liabilities are recognised for all taxable
temporary differences.

Deferred tax assets are recognised to the extent that it
is probable that taxable profit will be available against
which the deductible temporary differences, and the
carry forward of unused tax credits and unused tax
losses can be utilised. Where there is deferred tax
assets arising from carry forward of unused tax losses
and unused tax created, they are recognised to the
extent of deferred tax liability.

The carrying amount of deferred tax assets is reviewed
at each reporting date and reduced to the extent that
it is no longer probable that sufficient taxable profit will
be available to allow all or part of the deferred tax asset
to be utilised. Unrecognised deferred tax assets are
re-assessed at each reporting date and are recognised
to the extent that it has become probable that future
taxable profits will allow the deferred tax asset to be
recovered.

Deferred tax assets and liabilities are measured at the
tax rates that are expected to apply in the year when
the asset is realised or the liability is settled, based
on tax rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.

Deferred tax relating to items recognised outside profit
or loss is recognised outside profit or loss (either in
other comprehensive income or in equity). Deferred tax
items are recognised in correlation to the underlying
transaction either in OCI or directly in equity.

Deferred tax assets and deferred tax liabilities are
offset, if a legally enforceable right exists to set off
current tax assets against current tax liabilities and the
deferred taxes relate to the same taxable entity and
the same taxation authority.

j. Retirement and other employee benefits

Short-term employee benefits

A liability is recognised for short-term employee benefit
in the period the related service is rendered at the
undiscounted amount of the benefits expected to be
paid in exchange for that service.

Defined contribution plans

Retirement benefit in the form of provident fund is a
defined contribution scheme. The Company has no
obligation, other than the contribution payable to the
provident fund. The Company recognizes contribution
payable to the provident fund scheme as an expense,
when an employee renders the related service. If
the contribution payable to the scheme for service
received before the balance sheet date exceeds the
contribution already paid, the deficit payable to the
scheme is recognized as a liability after deducting
the contribution already paid. If the contribution
already paid exceeds the contribution due for services
received before the balance sheet date, then excess
is recognized as an asset to the extent that the pre¬
payment will lead to, for example, a reduction in future
payment or a cash refund.

Defined benefit plans

The Company operates a defined benefit gratuity plan
in India, which requires contributions to be made to a
separately administered fund. The cost of providing
benefits under the defined benefit plan is determined
using the projected unit credit method.

Remeasurements, comprising of actuarial gains
and losses, the effect of the asset ceiling, excluding
amounts included in net interest on the net defined
benefit liability and the return on plan assets (excluding
amounts included in net interest on the net defined
benefit liability), are recognised immediately in the
balance sheet with a corresponding debit or credit to
retained earnings through OCI in the period in which
they occur. Remeasurements are not reclassified to
profit or loss in subsequent periods.

Compensated absences

The Company has a policy on compensated absences
which are both accumulating and non-accumulating
in nature. The expected cost of accumulating
compensated absences is determined by actuarial
valuation performed by an independent actuary at
each balance sheet date using projected unit credit
method on the additional amount expected to be paid/
availed as a result of the unused entitlement that has
accumulated at the balance sheet date. Expense
on non-accumulating compensated absences is
recognized in the period in which the absences occur.

I k. Impairment of non financial assets

The Company assesses, at each reporting date,
whether there is an indication that an asset may be
impaired. If any indication exists, or when annual
impairment testing for an asset is required, the
Company estimates the asset''s recoverable amount.
An asset''s recoverable amount is the higher of an
asset''s or cash-generating unit''s (CGU) fair value less
costs of disposal and its value in use. Recoverable
amount is determined for an individual asset, unless
the asset does not generate cash inflows that are
largely independent of those from other assets or
groups of assets. When the carrying amount of an
asset or CGU exceeds its recoverable amount, the
asset is considered impaired and is written down to its
recoverable amount.

---

Mar 31, 2023

Significant Accounting Policies

a) Current versus non-current classification

The Company presents assets and liabilities in
the balance sheet based on current/ non-current
classification.

An asset is treated as current when it is:

i) Expected to be realised or intended to be sold or
consumed in normal operating cycle

ii) Held primarily for the purpose of trading

iii) Expected to be realised within twelve months after
the reporting period, or

iv) Cash or cash equivalent 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.

A liability is current when:

i) It is expected to be settled in normal operating
cycle

ii) It is held primarily for the purpose of trading

iii) It is due to be settled within twelve months after the
reporting period, or

iv) 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 classified as non-current.

Deferred tax assets and liabilities are classified as
non-current assets and liabilities.

The operating cycle is the time between the acquisition
of assets for processing and their realisation in cash
and cash equivalents. The Company has identified 3
months as its operating cycle.

b) Fair value measurement

The Company has applied the fair value measurement
wherever necessitated at each reporting period.

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:

i) In the principal market for the asset or liability;

ii) 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 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.

A fair value measurement of a non - financial asset
takes into account a market participant''s ability to
generate economic benefits by using the asset in its
highest and the best use or by selling it to another
market participant that would use the asset in its
highest and best use.

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
minimising 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
market 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; and

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 has designated the respective team
leads to determine the policies and procedures for both
recurring and non - recurring fair value measurement.
External valuers are involved, wherever necessary
with the approval of Company''s board of directors.
Selection criteria include market knowledge,
reputation, independence and whether professional
standards are maintained.

For the purpose of fair value disclosure, the Company
has determined classes of assets and liabilities on
the basis of the nature, characteristics and risk of the
asset or liability and the level of the fair value hierarchy
as explained above. The component wise fair value
measurement is disclosed in the relevant notes.

c) Revenue Recognition(i) Interest income

Interest income is recognised in Statement of profit
and loss using the effective interest method for all
financial instruments measured at amortised cost, debt
instruments measured at FVTOCI and debt instruments
designated at FVTPL. The ‘effective interest rate'' is
the rate that exactly discounts estimated future cash

payments or receipts through the expected life of the
financial instrument.

(ii) Dividends

Dividends are recognised in Statement of profit
and loss only when the right to receive payment is
established, it is probable that the economic benefits
associated with the dividend will flow to the Company
and the amount of the dividend can be measured
reliably.

(iii) Sale of services (lease income)

Sale of services representing lease income for
vehicles arising out of operating lease is recognised
on a straight line basis over the term of the relevant
lease as per Ind AS 116.

d) Property, plant and equipment and capital work
in progress

Deemed cost option for first time adopter of Ind AS

Under the previous GAAP (Indian GAAP), the property,
plant and equipment were carried in the balance sheet
at cost less accumulated depreciation. The company
has elected to use the previous GAAP carrying
amount as the deemed cost as at the date of transition,
viz.,1 April 2018

Presentation

Property, plant and equipment is stated at cost,
net of accumulated depreciation and accumulated
impairment losses, if any. Such cost includes the
cost of replacing part of the plant and equipment and
borrowing costs of a qualifying asset, if the recognition
criteria are met. When significant parts of plant and
equipment are required to be replaced at intervals, the
Company depreciates them separately based on their
specific useful lives. All other repair and maintenance
costs are recognised in profit or loss as incurred.

Advances paid towards the acquisition of tangible
assets outstanding at each balance sheet date, are
disclosed as capital advances under long term loans
and advances and the cost of the tangible assets not
ready for their intended use before such date, are
disclosed as capital work in progress.

Machinery spares/ insurance spares that can be issued
only in connection with an item of fixed assets and
their issue is expected to be irregular are capitalised.
Replacement of such spares is charged to revenue.
Other spares are charged as revenue expenditure as
and when consumed.

Derecognition

Gains or losses arising from derecognition of
property, plant and equipment are measured as the
difference between the net disposal proceeds and
the carrying amount of the asset and are recognized
in the statement of profit and loss when the asset is
derecognized.

e) Depreciation on property, plant and
equipment

Depreciation is the systematic allocation of the
depreciable amount of an asset over its useful life
on a straight line method. The depreciable amount
for assets is the cost of an asset, or other amount
substituted for cost, less its residual value.

Depreciation is provided on straight line method,
over the useful lives specified in Schedule II to the
Companies Act, 2013.

Depreciation for PPE on additions is calculated on pro¬
rata basis from the date of such additions. For deletion/
disposals, the depreciation is calculated on pro-rata
basis up to the date on which such assets have been
discarded/ sold.

The residual values, useful lives and methods of
depreciation of property, plant and equipment are
reviewed at each financial year end and adjusted
prospectively, if appropriate.

f) Leases

The Company has elected not to apply the requirements
of Ind AS 116 Leases to short term leases of all assets
that have a lease term of 12 months or less and leases
for which the underlying asset is of low value. The
lease payments associated with these leases are
recognised as an expense on a straight-line basis over
the lease term.

As a lessee

a) Initial measurement

Lease liability is initially recognised and measured
at an amount equal to the present value of minimum
lease payments during the lease term that are not yet
paid. Right-of-use asset is recognized and measured
at cost, consisting of initial measurement of lease
liability plus any lease payments made to the lessor
at or before the commencement date less any lease
incentives received, initial estimate of restoration costs
and any initial direct costs incurred by the lessee.

b) Subsequent measurement

The lease liability is measured in subsequent periods
using the effective interest rate method. Right-of-use
asset is depreciated in accordance with requirements
in Ind AS 16, Property, Plant and equipment.

As a lessor

At the inception of the lease the Company classifies
each of its leases as either an operating lease or
a finance lease. The Company recognises lease
payments received under operating leases as income
on a straight-line basis over the lease term. In case
of a finance lease, finance income is recognised over
the lease term based on a pattern reflecting a constant
periodic rate of return on the lessor''s net investment
in the lease.

g) Financial Instruments

Financial assets and financial liabilities are recognised
when an entity becomes a party to the contractual
provisions of the instruments.

Financial assetsInitial recognition and measurement

All financial assets are recognised initially at fair value.
However, in the case of financial assets not recorded
at fair value through profit or loss, transaction costs
that are attributable to the acquisition of the financial
asset are also added to the cost of the financial asset.
Purchases or sales of financial assets that require
delivery of assets within a time frame established by
regulation or convention in the market place (regular
way trades) are recognised on the trade date, i.e., the
date that the Company commits to purchase or sell the
asset.

Subsequent measurement

For purposes of subsequent measurement, financial
assets are classified on the basis of their contractual
cash flow characteristics and the entity''s business
model of managing them.

Financial assets are classified into the following
categories:

• Financial instruments other than equity instruments
at amortised cost

• Financial instruments other than equity instruments
at fair value through other comprehensive income
(FVTOCI)

• Financial instruments other than equity
instruments, derivatives and equity instruments at
fair value through profit or loss (FVTPL)

• Equity instruments measured at fair value through
other comprehensive income (FVTOCI)

Financial instruments other than equity instruments at
amortised cost

The Company classifies a financial instruments other
than equity instruments as at 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.

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.

Financial instruments other than equity instruments at
FVTOCI

The Company classifies a financial instrument other
than equity at FVTOCI, if both of the following criteria
are met:

a) The objective of the business model is achieved
both by collecting contractual cash flows and
selling the financial assets, and

b) The asset''s contractual cash flows represent
SPPI.

Financial instruments other than equity instruments
included within the FVTOCI category are measured
as at each reporting date at fair value. Fair value
movements are recognized in the other comprehensive
income (OCI). However, the Company recognizes
finance income, impairment losses and reversals and
foreign exchange gain or loss in the profit and loss
statement. On derecognition of the asset, cumulative
gain or loss previously recognised in OCI is reclassified
from the equity to profit and loss. Interest earned whilst
holding FVTOCI debt instrument is reported as interest
income using the EIR method.

Financial instruments other than equity instruments at
FVTPL

The Company classifies all financial instruments other
than equity instruments, which do not meet the criteria
for categorization as at amortized cost or as FVTOCI,
as at FVTPL.

Financial instruments other than equity instruments
included within the FVTPL category are measured at
fair value with all changes recognized in the profit and
loss.

Equity investments

All equity investments in scope of Ind AS 109 are
measured at fair value. Equity instruments which are
held for trading are classified as at FVTPL. Where the
Company makes an irrevocable election of classifying
the equity instruments at FVTOCI, it recognises all
subsequent changes in the fair value in OCI, without
any recycling of the amounts from OCI to profit and
loss, even on sale of such investments.

Equity instruments included within the FVTPL category
are measured at fair value with all changes recognized
in the profit and loss.

Financial assets are measured at FVTPL except for
those financial assets whose contractual terms give
rise to cash flows on specified dates that represents
SPPI, are measured as detailed below depending on
the business model:

Derecognition

A financial asset is primarily derecognised 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

In accordance with Ind AS 109, 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, receivables and bank
balance.

b) Financial assets that are debt instruments and are
measured at 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 115.

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 116

The application of simplified approach does not require
the Company to track changes in credit risk. Rather,
it recognises impairment loss allowance based on
lifetime Expected Credit Loss (ECL) 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 since initial recognition. If credit risk has
not increased significantly, 12 months ECL is used
to provide for impairment loss. However, if credit risk
has increased significantly, lifetime ECL is used. If, in
a subsequent period, credit quality of the instrument
improves such that there is no longer a significant
increase in credit risk since initial recognition, then the
entity reverts to recognising impairment loss allowance
based on 12-month ECL.

Lifetime ECL are the expected credit losses resulting
from all possible default events over the expected
life of a financial instrument. The 12 months ECL is a
portion of the lifetime ECL which results from default
events that are possible within 12 months after the
reporting date.

ECL is the difference between all contractual cash
flows that are due to the Company in accordance
with the contract and all the cash flows that the entity
expects to receive (i.e., all cash shortfalls), discounted
at the original EIR. When estimating the cash flows,
the Company considers all contractual terms of the
financial instrument (including prepayment, extension,
call and similar options) over the expected life of the
financial instrument and Cash flows from the sale of
collateral held or other credit enhancements that are
integral to the contractual terms.

ECL allowance (or reversal) recognized during the
period is recognized as income/ expense in the
statement of profit and loss. This amount is reflected
under the head ‘other expenses'' in the profit and loss.
The balance sheet presentation of ECL for various
financial instruments is described below:

• Financial assets measured as at amortised
cost, contractual revenue receivables and lease
receivables: ECL is presented as an allowance,
which reduces the net carrying amount. Until the
asset meets write-off criteria, the Company does
not reduce impairment allowance from the gross
carrying amount.

• Financial instruments other than equity instruments
measured at FVTOCI: Since financial assets

are already reflected at fair value, impairment
allowance is not further reduced from its value.
Rather, ECL amount is presented as ‘accumulated
impairment amount'' in the OCI.

For assessing increase in credit risk and impairment
loss, the company combines financial instruments on
the basis of shared credit risk characteristics with the
objective of facilitating an analysis that is designed
to enable significant increases in credit risk to be
identified on a timely basis.

For impairment purposes, significant financial assets
are tested on individual basis at each reporting date.
Other financial assets are assessed collectively in
groups that share similar credit risk characteristics.
Accordingly, the impairment testing is done on the
following basis:

Name of the financial asset Impairment Testing

Methodology

Financial liabilitiesInitial recognition and measurement

Financial liabilities are classified, at initial recognition,
as financial liabilities at FVTPL and as at amortised
cost.

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.

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.

The measurement of financial liabilities depends on
their classification, as described below:

Financial liabilities at FVTPL

Financial liabilities at FVTPL 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. This category also includes derivative
financial instruments entered into by the Company that
are not designated as hedging instruments in hedge
relationships as defined by Ind AS 109. Separated
embedded derivatives are also classified as held
for trading unless they are designated as effective
hedging instruments.

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 profit and loss. 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 fair value through profit and loss.

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.

Derecognition of financial liabilities

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 assets

The Company determines classification of financial
assets and liabilities on initial recognition. After
initial recognition, no reclassification is made for
financial assets which are equity instruments and
financial liabilities. 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. The Company''s senior management
determines change in the business model as a result
of external or internal changes which are significant to
the Company''s operations. Such changes are evident
to external parties. A change in the business model
occurs when the Company either begins or ceases to
perform an activity that is significant to its operations. If
the Company reclassifies 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 business
model. The Company does not restate any previously
recognised gains, losses (including impairment gains
or losses) or interest.

The following table shows various reclassification and
how they are accounted for:

Borrowing cost include interest computed using
Effective Interest Rate method, amortisation of
ancillary costs incurred and exchange differences
arising from foreign currency borrowings to the extent
they are regarded as an adjustment to the interest
cost.

Borrowing costs that are directly attributable to the
acquisition, construction, production of a qualifying
asset are capitalised as part of the cost of that asset
which takes substantial period of time to get ready
for its intended use. All other borrowings costs are
expensed in the period in which they occur.

Interest income earned on the temporary investment
of specific borrowings pending their expenditure on
qualifying assets is deducted from the borrowing costs
eligible for capitalisation. All other borrowing costs are
recognised in the statement of profit and loss in the
period in which they are incurred.

I. TaxesCurrent income tax

Current income tax assets and liabilities are measured
at the amount expected to be recovered from or paid
to the taxation authorities. The tax rates and tax
laws used to compute the amount are those that are
enacted or substantively enacted, at the reporting date
in the countries where the Company operates and
generates taxable income.

Current income tax relating to items recognised
outside profit or loss is recognised outside profit or loss
(either in other comprehensive income or in equity).
Current tax items are recognised in correlation to the
underlying transaction either in OCI or directly in equity.
Management periodically evaluates positions taken
in the tax returns with respect to situations in which
applicable tax regulations are subject to interpretation
and establishes provisions where appropriate.

Deferred tax

Deferred tax is provided using the liability method on
temporary differences between the tax bases of assets
and liabilities and their carrying amounts for financial
reporting purposes at the reporting date.

Deferred tax liabilities are recognised for all taxable
temporary differences.

Deferred tax assets are recognised to the extent that it
is probable that taxable profit will be available against
which the deductible temporary differences, and the
carry forward of unused tax credits and unused tax
losses can be utilised. Where there is deferred tax
assets arising from carry forward of unused tax losses
and unused tax created, they are recognised to the
extent of deferred tax liability.

The carrying amount of deferred tax assets is reviewed
at each reporting date and reduced to the extent that
it is no longer probable that sufficient taxable profit will
be available to allow all or part of the deferred tax asset
to be utilised. Unrecognised deferred tax assets are
re-assessed at each reporting date and are recognised
to the extent that it has become probable that future
taxable profits will allow the deferred tax asset to be
recovered.

Deferred tax assets and liabilities are measured at the
tax rates that are expected to apply in the year when
the asset is realised or the liability is settled, based
on tax rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.

Deferred tax relating to items recognised outside profit
or loss is recognised outside profit or loss (either in
other comprehensive income or in equity). Deferred tax
items are recognised in correlation to the underlying
transaction either in OCI or directly in equity.

Deferred tax assets and deferred tax liabilities are
offset, if a legally enforceable right exists to set off
current tax assets against current tax liabilities and the
deferred taxes relate to the same taxable entity and
the same taxation authority.

j. Retirement and other employee benefitsShort-term employee benefits

A liability is recognised for short-term employee benefit
in the period the related service is rendered at the
undiscounted amount of the benefits expected to be
paid in exchange for that service.

Defined contribution plans

Retirement benefit in the form of provident fund is a
defined contribution scheme. The Company has no
obligation, other than the contribution payable to the
provident fund. The Company recognizes contribution
payable to the provident fund scheme as an expense,
when an employee renders the related service. If
the contribution payable to the scheme for service
received before the balance sheet date exceeds the
contribution already paid, the deficit payable to the
scheme is recognized as a liability after deducting
the contribution already paid. If the contribution
already paid exceeds the contribution due for services

received before the balance sheet date, then excess
is recognized as an asset to the extent that the pre¬
payment will lead to, for example, a reduction in future
payment or a cash refund.

Defined benefit plans

The Company operates a defined benefit gratuity plan
in India, which requires contributions to be made to a
separately administered fund. The cost of providing
benefits under the defined benefit plan is determined
using the projected unit credit method.

Remeasurements, comprising of actuarial gains
and losses, the effect of the asset ceiling, excluding
amounts included in net interest on the net defined
benefit liability and the return on plan assets (excluding
amounts included in net interest on the net defined
benefit liability), are recognised immediately in the
balance sheet with a corresponding debit or credit to
retained earnings through OCI in the period in which
they occur. Remeasurements are not reclassified to
profit or loss in subsequent periods.

Compensated absences

The Company has a policy on compensated absences
which are both accumulating and non-accumulating
in nature. The expected cost of accumulating
compensated absences is determined by actuarial
valuation performed by an independent actuary at
each balance sheet date using projected unit credit
method on the additional amount expected to be paid/
availed as a result of the unused entitlement that has
accumulated at the balance sheet date. Expense
on non-accumulating compensated absences is
recognized in the period in which the absences occur.

k. Impairment of non financial assets

The Company assesses, at each reporting date,
whether there is an indication that an asset may be
impaired. If any indication exists, or when annual
impairment testing for an asset is required, the
Company estimates the asset''s recoverable amount.
An asset''s recoverable amount is the higher of an
asset''s or cash-generating unit''s (CGU) fair value less
costs of disposal and its value in use. Recoverable
amount is determined for an individual asset, unless
the asset does not generate cash inflows that are
largely independent of those from other assets or
groups of assets. When the carrying amount of an
asset or CGU exceeds its recoverable amount, the
asset is considered impaired and is written down to its
recoverable amount.

---

Mar 31, 2014

I. INCOME RECOGNITION:

(a) Income from hire purchase contracts is reckoned on a progressive basis (diminishing return method) over the period of the contract on time basis.

(b) Lease Rental Income is recognized on the basis of implicit rate of return as per the Guidance Note on Accounting for Leases issued by the ICAI.

Income from sale of leased assets, after completion of the lease period, is recognized on Cash basis.

(c) Interest accrued on Investments and Deposits are accounted for on accrual basis.

(d) Delayed payment charges are accounted on receipt basis.

II. FIXED ASSETS:

(a) Fixed Assets are stated at cost.

(b) Fixed Assets are depreciated on straight-line method in accordance with Schedule XIV of the Companies Act, 1956.

Depreciation has been charged proportionately for the period the Assets had been in use.

The cost of all the leased assets are amortized fully during lease period and lease equalization charge is accordingly provided.

III. INVESTMENTS:

Investments are classified as long term investments and are stated at cost. However provision has been made for diminution, wherever the decline in the value is other than temporary, in accordance with Accounting Standard 13

IV. RETIREMENT BENEFITS:

The Company''s Liability towards Gratuity to the employees is provided on the basis of an actuarial valuation at the year end.

V. TAXATION

a) Provision for Income tax for the Current year is made for the amount of tax payable in respect of taxable income for the year under Income Tax Act, 1961.

b) Deferred Tax is recognized on timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods, subject to consideration of prudence.

The Status and Break up as of 31.03.2014 is given below

(Rs.in Lakhs)

DESCRIPTION ASSET

Timing Difference in Depreciable Asset 31.60

Timing difference in Provision against NPA 0.74

Timing Difference in Provision for Bonus 1.36

Timing Difference in Provision for Gratuity & Leave Encashment 4.84

Total 38.54

Net Deferred Tax Asset 38.54

VI. SEGMENT REPORT

The Company has adopted Accounting Standard 17 "Segment Reporting" issued by The Institute of Chartered Accountants of India, which requires disclosure of financial and descriptive information about the Company''s reportable operating segments. The operating segments reported below are the segments of the Company for which separate financial information is available.

---

Mar 31, 2012

I. INCOME RECOGNITION:

(a) Income from hire purchase contracts is reckoned on a progressive basis (diminishing return method) over the period of the contract on time basis.

(b) Lease Rental Income is recognized on the basis of implicit rate of return as per the Guidance Note on Accounting for Leases issued by the ICAI.

Income from sale of leased assets, after completion of the lease period, is recognized on Cash basis.

(c) Interest accrued on Investments and Deposits are accounted for on accrual basis.

(d) Delayed payment charges are accounted on receipt basis.

II. FIXED ASSETS:

(a) Fixed Assets are stated at cost.

(b) Fixed Assets are depreciated on straight-line method in accordance with Schedule XIV of the Companies Act, 1956.

Depreciation has been charged proportionately for the period the Assets had been in use.

The cost of all the leased assets are amortized fully during lease period and lease equalization charge is accordingly provided.

III. INVESTMENTS:

Investments are classified as long term investments and are stated at cost. However provision has been made for diminution, wherever the decline in the value is other than temporary, in accordance with Accounting Standard 13.

IV. RETIREMENT BENEFITS:

The Company's Liability towards Gratuity to the employees is provided on the basis of an actuarial valuation at the year end.

V. TAXATION

a) Provision for Income tax for the Current year is made for the amount of tax payable in respect of taxable income for the year under Income Tax Act, 1961.

b) Deferred Tax is recognized on timing differences being the difference between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods, subject to consideration of prudence.

VI. SEGMENT REPORT

The Company has adopted Accounting Standard 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India, which requires disclosure of financial and descriptive information about the Company's reportable operating segments. The operating segments reported below are the segments of the Company for which separate financial information is available.

---

Mar 31, 2011

I. INCOME RECOGNITION:

(a) Income from hire purchase contracts is reckoned on a progressive basis (diminishing return method) over the period of the contract on time basis.

(b) Lease Rental Income is recognized on the basis of implicit rate of return as per the Guidance Note on Accounting for Leases issued by the ICAI.

Income from sale of leased assets, after completion of the lease period, is recognized on Cash basis.

(c) Interest accrued on Investments and Deposits are accounted for on accrual basis.

(d) Delayed payment charges are accounted on receipt basis.

II.FIXEDASSETS:

(a) Fixed Assets are stated at cost.

(b) Fixed Assets are depreciated on straight-line method in accordance with Schedule XIV of the Companies Act, 1956.

Depreciation has been charged proportionately for the period the Assets had been in use. The cost of all the leased assets are amortized fully during lease period and lease equalization charge is accordingly provided.

III.INVESTMENTS:

Investments are classified as long as term investments and are stated at cost. However provision has been made for diminution, wherever the decline in the value is other than temporary, in accordance with Accounting Standard 13

IV.RETIREMENT BENEFITS:

The Company's Liability towards Gratuity to the employees is provided on the basis of an actuarial valuation at the year end. V. TAXATION

a) Provision for Income tax for the Current year is made for the amount of tax payable in respect of taxable income for the year under I ncome Tax Act, 1961.

b) Deferred Tax is recognized on timing differences being the difference between taxable fncome and accounting income that originate in one period and are capable of reversal in one or more subsequent periods, subject to consideration of prudence.

VI. SEGMENT REPORT

The Company has adopted Accounting Standard 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India, which requires disclosure of financial and descriptive information about the Company's reportable operating segments. The operating segments reported below are the segments of the Company for which separate financial information is available.

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Mar 31, 2010

I. INCOME RECOGNITION:

(a) Income from hire purchase contracts is reckoned on a progressive basis (diminishing return method) overthe period of the contract on time basis.

(b) Lease Rental Income is recognized on the basis of implicit rate of return as per the Guidance Note on Accounting for Leases issued by the ICAI.

Income from sale of leased assets, after completion of the lease period, is recognized on Cash basis.

(c) Interest accrued on Investments and Deposits are accounted for on accrual basis.

(d) Delayed payment charges are accounted on receipt basis. II.FIXED ASSETS:

(a) Fixed Assets are stated at cost.

(b) Fixed Assets are depreciated on straight-line method in accordance with Schedule XIV of the Companies Act, 1956.

Depreciation has been charged proportionately for the period the Assets had been in use. The cost of all the leased assets are amortized fully during lease period and lease equalization charge is accordingly provided.

III. INVESTMENTS:

Investments are classified as long term investments and are stated at cost. However provision has been made for diminution, wherever the decline in the value is other than temporary, in accordance with Accounting Standard 13 IV.RETIREMENT BENEFITS:

The Companys Liability towards Gratuity to the employees is provided on the basis of an actuarial valuation at the year end.

V. TAXATION

a) Provision for Income tax for the Current year is made for the amount of tax payable in respect of taxable income for the year under Income TaxAct, 1961.

VI. SEGMENT REPORT

The Company has adopted Accounting Standard 17 "Segment Reportingth issued by the Institute of Chartered Accountants of India, which requires disclosure of financial and descriptive information about the Companys reportable operating segments. The operating segments reported below are the segments of the Company for which separate financial information is available.