Indo Gulf Industries Ltd. కంపెనీ అకౌంటింగ్ విధానాలు

Mar 31, 2024

NOTE 1: SIGNIFICANT ACCOUNTING POLICIES

1. Corporate information

Indo Gulf Industries Limited (“IGIL” or “The Company”) is a Public Limited Company incorporated and
domiciled in India. The registered office of the company is situated at 4237/11, II^nd floor, Narendra Bhawan 1,
Ansari Road, Daryaganj, New Delhi-110017, India. It was incorporated on March 05^th, 1981.

The company’s shares are listed on the BSE Ltd and Ahmedabad Stock Exchange.

The principal activities of the company is manufacturing of explosives, ammunitions and fireworks.

The Company’s controlling interest aggregating to 53.96% is held by Ganesh Explosives Private Limited (‘the
holding company’) with effect from November 08^th, 2017 post the approval letter sanctioned by BSE.

These Ind AS Financial Statements were approved for issue by the Board of Directors of the Company on 30^th
May, 2024 and are subject to the approval by the shareholders in the ensuing Annual General Meeting.

2. Application of Indian Accounting Standards

All the Indian Accounting Standards issued under section 133 of the Companies Act, 2013 and notified by the
Ministry of CorporateAffairs (MCA) under the Companies (Indian Accounting Standards) Rules, 2015 (as
amended) till the financial statements are approvedhave been considered in preparation of these Financial
Statements.

2.1 The MCA has notified the Companies (Indian Accounting Standards / Ind AS) Amendment Rules, 2022 on
March 23, 2022, whereby the amendments to various Indian Accounting Standards has been made
applicable with effect from April 1, 2022 onwards. The amendments made vide aforesaid notification dated
March 23, 2022 has brought few additions and substitutions in Indian Accounting Standards (Ind AS)
particularly in Ind AS 101- First-time Adoption of Indian Accounting Standards, Ind AS 103- Business
Combinations, Ind AS 109- Financial Instruments, Ind AS 16- Property, plant and Equipment, Ind AS 37-
Provisions, Contingent Liabilities and Contingent Assets and Ind AS 41- Agriculture, the Company is
evaluating the requirements of the same and its effect on the Financial Statements is not likely to be
material.

3. Significant Accounting Policies

3.1. Statement of Compliance

These Financial Statements have been prepared in accordance with the Indian Accounting Standards
(“Ind AS”) as per the Companies (Indian Accounting Standards) Rules, (Amended) 2015 and notified by
Ministry of Corporate Affairs(“MCA”) pursuant to Section 133 of the Companies Act, 2013 read with
Rule 3.

3.2. Basis of preparation

The financial statements of the Company have been prepared on an accrual basis and under the historical
cost convention except for certain financial instruments (including derivative instruments) and defined
benefit plans which have been measured at fair value. The accounting policies are consistently applied by
the Company to all the period mentioned in the financial statements.

The financial statements of the Company have been prepared on an accrual basis and under the historical
cost convention except for certain financial instruments (including derivative instruments) and defined
benefit plans which have been measured at fair value. The accounting policies are consistently applied by
the Company to all the period mentioned in the financial statements.

Current and 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:

(a) Expected to be realized or intended to be sold or consumed in normal operating cycle.

(b) Held primarily for the purpose of trading.

(c) Expected to be realized within twelve months after the reporting period, or

(d) 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 treated as current when it is:

(a) Expected to be settled in normal operating cycle

(b) Held primarily for the purpose of trading

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

(d) 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.

Fair value measurement

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 under current market conditions.

The Company categorizes assets and liabilities measured at fair value into one of three levels depending
on the ability to observe inputs employed in their measurement which are described as follows:

(a) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

(b) Level 2 inputs are inputs that are observable, either directly or indirectly, other than quoted prices
included within level 1 for the asset or liability.

(c) Level 3 inputs are unobservable inputs for the asset or liability reflecting significant modifications to
observable related market data or Company’s assumptions about pricing by market participants.

All assets and liabilities have been classified as Current and Non-Current as per the Company’s normal
operating cycle and other criteria set out in Schedule III to the Companies Act, 2013. Based on the nature
of products/ services rendered and the time between the rendering of the products/services and their
realization in cash and cash equivalent, the Company has ascertained its operating cycle as twelve months
for the purpose of Current and Non Current classification of assets and liabilities.

All the Indian Accounting Standards issued and notified by the MCA are effective and considered for the
significant accounting policies to the extent relevant and applicable for the Company. The Financial

Statements are presented in Indian Rupee (“INR”), which is the Company’s functional currency and all
values are rounded to the nearest lacs up to two decimals, except per share data and otherwise indicated.

3.3. Use of estimates

The preparation of the financial statements requires the management to make judgements, estimates and
assumptions that affect the reported amounts of revenue, expenses, assets and liabilities, and the
accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these
assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying
amounts of assets or liabilities in future periods.

3.4. Revenue Recognition

The Company applies five step model and derives revenues primarily from sale of products andservices,
such as industrial explosives, safety fuses, ammonium nitrate.

Revenue from contracts with customers is recognized at the point in time when the Company satisfies a
performance obligation by transferring control of a promised product or service to a customer at an
amount that reflects the consideration to which the Company expects to be entitled in exchange for the sale
of products and service, net of discount, taxes or duties as per Ind AS 115.

The Company’s customers pay for products received in accordance with payment terms that are customary
in the industry and do not have significant financing components.

3.5. Property, Plant and Equipment

(a) Initial and Subsequent Recognition

All Property, Plant and Equipment are measured at cost less depreciation and impairment losses. The
cost of an asset includes the purchase cost of materials, including import duties and non-refundable
taxes, and any direct cost of bringing an asset to the location and condition of its intended use.
Accounting of Property, Plant and Equipment is guided under Ind AS 16. Interest on borrowings used
to finance the construction of qualifying assets are capitalized as part of the cost of the asset until such
time that the asset is ready for its intended use by the management.

Subsequent costs are included in the asset’s carrying amount only when it is probable that future
economic benefits associated with the item will flow to the entity and the cost of the item can be
measured reliably.

The present value of the expected cost for decommissioning of an asset after its use if any, is included
in the cost of the respective asset if the recognition criteria for a provision are met.

The costs and related accumulated depreciation are eliminated from the financial statements upon sale
or retirement of the asset and the resultant gains or losses are recognized in the Statement of Profit and
Loss.

Gains or losses arising from disposal 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 disposed.

(b) Depreciation

Depreciation on Property, Plant and Equipment is provided using the Straight Line Method (‘SLM’)
over the useful lives of the assets estimated by the management. The management estimates the useful
lives for the Property, Plant and Equipment as follows:

Residual value has been considered as 5% of the cost of the respective asset.

Leasehold land in the nature of perpetual lease is not amortised.

Depreciation /amortization on assets added, sold or discarded during the year is provided on pro-rata
basis.

Management reviews the useful lives of property, plant and equipment at least once a year. Such lives
are dependent upon an assessment of both the technical lives of the assets and also their likely
economic lives based on various internal and external factors including relative efficiency and
operating costs. Accordingly, depreciable lives are reviewed annually using the best information
available to the Management.

(c) Impairment

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 as guided
by Ind AS 36.

The 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.

In assessing value in use, the estimated future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset.

In determining fair value less costs of disposal, recent market transactions are taken into account. If no
such transactions can be identified, an appropriate valuation model is used. These calculations are
corroborated by valuation multiples, quoted share prices for publicly traded companies or other
available fair value indicators.

(d) Borrowing costs

Borrowing costs that are directly attributable to acquisition, construction or production of an asset
which necessarily take a substantial period of time to get ready for their intended use are capitalized
as part of the cost of that asset. All other borrowing costs are recognized as an expense in the period
in which they are incurred. Borrowing costs consist of interest and other costs that an entity incurs in
connection with the borrowing of funds Borrowing cost also includes exchange differences to the
extent regarded as an adjustment to the borrowing costs

3.6. Capital Work in Progress

The cost of a self-constructed item of property, plant and equipment comprises the cost of materials and
direct labour, any other costs directly attributable to bringing the item to working condition for its
intended use, and estimated costs of dismantling and removing the item and restoring the site on which it
is located. If significant parts of an item of property, plant and equipment have different useful lives, then
they are accounted for as separate items (major components) of property, plant and equipment. All other
repair and maintenance costs are recognized in profit or loss as incurred. Capital Work in Progress
includes cost of property including construction stores, Materials in Transit/Equipment/Services, etc
received at site for use in the projects as at the balance sheet date.

All revenue expenses incurred during construction period, which are exclusively attributable to
acquisition/construction of fixed assets, are capitalized at the time of commissioning of such assets.

3.7. Leases

The Company evaluates if an arrangement qualifies to be a lease as per the requirements of Ind AS 116.
Identification of a lease requires significant judgement. The Company uses significant judgement in
assessing the lease term (including anticipated renewals) and the applicable discount rate.

The Company determines the lease term as the noncancellable period of a lease, together with both
periods covered by an option to extend the lease if the Company is reasonably certain to exercise that
option; and periods covered by an option to terminate the lease if the Company is reasonably certain not
to exercise that option. In assessing whether the Company is reasonably certain to exercise an option to
extend a lease, or not to exercise an option to terminate a lease, it considers all relevant facts and
circumstances that create an economic incentive for the Company to exercise the option to extend the
lease, or not to exercise the option to terminate the lease.

The Company revises the lease term if there is a change in the non-cancellable period of a lease. The
discount rate is generally based on the incremental borrowing rate specific to the lease being evaluated or
for a portfolio of leases with similar characteristics.

The Company applies a single recognition and measurement approach for all leases, except for short-term
leases. The Company recognizes lease liabilities to make lease payments and right-of-use assets representing
the right to use the underlying assets. A lease is classified at the inception date as a finance lease or an
operating lease. Leases under which substantially all of the risks and rewards of ownership are transferred to
the Company are classified as financial leases.

(a) Right-of-use assets:

The Company recognises right-of-use assets at the commencement date of the lease (i.e., the date the
underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated
depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of
right-of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred, and lease
payments made at or before the commencement date less any lease incentives received. Right-of-use assets
are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the
assets, as follows:

• Leasehold Land - 99 years

The Company has entered a lease arrangement with U.P. State Industrial Development Corporation Limited
(‘lessor’) dated 17^th, December, 1984 vide which the lessor has transferred the possession to the
company.The same has been considered as perpetual lease in nature and hasn’t been amortised.

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Mar 31, 2015

1.1 Basis of preparation of Financial Statements

The Financial Statements of the Company are prepared in accordance with the Generally Accepted Accounting Principles (GAAP) in India.

The Financial Statements have been prepared on an accrual basis and under the historical cost convention.

GAAP comprises applicable Accounting Standards specified under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014, other pronouncements of the Institute of Chartered Accountants of India, relevant applicable provisions of the Companies Act, 1956, and Companies Act, 2013 to the extent applicable and the applicable guidelines issued by Securities and Exchange Board of India (SEBI).

Accounting policies have been consistently applied except where a newly issued Accounting Standard is initially adopted or a revision to an existing Accounting Standard requires a change in the accounting policy hitherto in use.

All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013. The Company has ascertained its operating cycle as 12 months for the purpose of current and non-current classification of assets and liabilities.

2. Use of estimates

The preparation of the Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported balances of assets, liabilities and disclosures relating to contingent liabilities as at the date of the Financial Statements and reported amounts of revenue and expenses during the period. Actual results might differ from the estimates. Difference between the actual results and estimates are recognised in the period in which the results are known/ materialise.

3. Fixed assets and capital work-in-progress

a) Tangible fixed assets are stated at their original cost less accumulated depreciation. Cost includes acquisition price, import duties, other non- refundable taxes and levies, directly attributable expenses and pre-operational expenses including finance costs, wherever applicable for bringing the assets to its working condition for their intended use.

b) Expenditure during construction period: Directly attributable expenditure (including finance costs relating to borrowed funds for construction or acquisition of fixed assets) incurred on projects under implementation are treated as Pre-operative expenses pending allocation to the assets and are shown under "Capital work-inprogress". Capital work-in-progress is stated at the amount expended upto the date of Balance Sheet for the cost of fixed assets that are not yet ready for their intended use.

4. Depreciation and amortisation

a) Depreciation on tangible fixed assets is provided on straight line basis so as to charge the cost of the assets less its residual value over the useful life of the respective asset as prescribed under Part C of Schedule II to the Companies Act, 2013, other than for Mobile Phones.

Residual value has been considered as 5% of the cost of the respective asset. The management is of the view that the useful life of Mobile Phones is three years. Hence, Mobile Phones are depreciated over a period of three years on straight line basis.

b) Lease hold land in the nature of perpetual lease are not amortised.

c) Depreciation/amortisation on assets added, sold or discarded during the year is provided on pro-rata basis.

d) Useful life and residual value of the assets are reviewed at each Balance Sheet date.

5. Revenue recognition

a) Interest income is recognized on time proportion basis taking into account the amount outstanding and the interest rate applicable.

b) All other income are accounted for on accrual basis.

6. Expenses

All the expenses are accounted for on accrual basis.

7. Provisions, contingent liabilities and contingent assets

A provision is recognised in respect of obligations where, based on the evidence available, their existence at the Balance Sheet date is considered probable as a result of a past event, and the Company has a present legal obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are measured by best estimate of the outflow of economic benefits required to settle the obligation at the Balance Sheet date.

Provisions, contingent liabilities and contingent assets are reviewed at each Balance Sheet date.

Re-imbursement expected in respect of expenditure to settle a provision is recognised only when it is virtually certain that the re-imbursement will be received.

A Contingent Asset is neither recognised nor disclosed in the Financial Statements.

8. Impairment of assets

An asset is treated as impaired when the carrying amount of asset exceeds its recoverable value.

The Company assesses at each Balance Sheet date whether there is an indication that an asset may be impaired. Impairment loss, if any, is recognised to the extent, the carrying amount of assets exceed its recoverable value being higher of an asset's net selling price and its value in use. Value in use is computed at net present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life.

The Company also assesses at each Balance Sheet date whether there is an indication that the impairment losses recognised in earlier years no longer exist or have decreased. If such indication is there, then impairment losses recognised in prior years are reversed.

Such reversals are recognised as an increase in carrying amount of assets to the extent that it does not exceed the carrying amount that would have been determined (net of depreciation or amortization) had no impairment loss been recognised in previous years.

9. Taxes on income

Tax expense for the period comprises of current income tax and deferred tax.

Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

Deferred tax is recognised, subject to the consideration of prudence in respect of deferred tax assets, 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. Deferred tax assets are recognised only to the extent there is reasonable certainty that the assets can be realized in future. However, when there is a brought forward loss or unabsorbed depreciation under taxation laws, deferred tax assets are recognised only if there is virtual certainty of realization of such assets. Deferred tax assets are reviewed at each Balance Sheet date and written down or written up to reflect the amount that is reasonably/virtually certain to be realized.

The deferred tax for timing differences between the book and tax profit for the period is accounted for using the tax rates and laws that have been enacted or substantively enacted as of the Balance Sheet date.

10. Earnings per share

Basic earnings per share are computed by dividing the net profit/(loss) after tax (including the post-tax effect of extra ordinary items, if any) by the weighted average number of equity shares outstanding during the year.

Diluted earnings per share are computed by dividing the net profit/(loss) after tax (including the post-tax effect of extra ordinary items, if any) by the weighted average number of equity shares considered for deriving basic earnings per share and also the weighted average number of equity shares which could be issued on the conversion of all dilutive potential equity shares. Dilutive potential equity shares are determined as at the end of each period presented.

11. Cash flow statement

Cash flows are reported using the indirect method, whereby profit/loss before tax is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing flows. The cash flows from operating, investing and financing activities of the Company are segregated.

12. Cash and cash equivalents

Cash and cash equivalents include cash in hand, cheques in hand, balance with banks on current accounts and short term, highly liquid investments with an original maturity of three months or less and which carry insignificant risk of changes in value.

(c) The Company has only one class of equity shares. The Company declares and pays dividend in Indian Rupees. The holders of equity shares are entitled to receive dividend as declared from time to time and are entitled to one vote per share.

(d) In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amount. The distribution will be in proportion to the number of equity shares held by the shareholders.

(e) 51,62,470 equity shares of par value Rs. 1/- each are held by Balrampur Chini Mills Ltd., the Holding Company.

Notes:

1) Lease deed for 50 acres of land (Out of total land of 705 acres) for Jhansi plant has not been executed. In respect of some other land, the registration formalities are under process.

2) No depreciation has been provided on plant and equipment as the same has been depreciated upto 95% of its value.

3) Other disclosure

4) Depreciation for the current year has been aligned to meet the requirements of Schedule -II to the Companies Act, 2013 and accordingly an amount of Rs. 33,610.37 in relation to the assets whose useful life has already exhausted has been adjusted with Retained Earnings.

Had the Company continued to charge depreciation based on rates and manner as specified under the erstwhile Schedule XIV to the Companies Act, 1956, depreciation expense for the year ended 31st March, 2015 would have been lower by Rs. 18,42,616.23, Profit before Tax and the net value of Fixed Assets as at that date would have been higher by like amount.

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Mar 31, 2014

1.1 Basis of preparation of financial statements

The Financial Statements are prepared under the historical cost convention and in accordance with the Generally Accepted Accounting Principles (GAAP) in India and the relevant provisions of Companies Act, 1956. The significant accounting policies followed by the Company are stated below:

All assets and liabilities have been classified as current or non-current as per the company''s normal operating cycle and other criteria set out in the Schedule VI to the Companies'' Act, 1956. The company has ascertained its operating cycle as 12 months for the purpose of current and non-current classification of assets and liabilities.

1.2 Fixed Assets

a) Tangible fixed Assets are stated at cost less accumulated depreciation. Cost of acquisition or construction is inclusive of freight, duties, taxes, financial costs and other related expenses up to the date of commissing of the assets.

b) The company is following the straight line method of depreciation in respect of all assets at the rates specified in Schedule XIV to the Companies Act, 1956 (as amended).

c) Expenditure during construction period :

Expenditure (including financing cost relating to borrowed funds for construction or acquisition of fixed assets) incurred on projects under implementation are treated as Pre-operative expenses pending allocation to the assets and are shown under "Capital-work-in-progress".

d) Lease hold land is not amortized in view of the long term nature of the lease.

1.3 Revenue Recognition

a) Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

b) All other income are accounted for on accrual basis.

1.4 Expenses

All the expenses are accounted for on accrual basis

1.5 Taxes on Income

Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

Deferred tax is recognized, subject to the consideration of prudence in respect of deferred tax assets, 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. Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in future; however, when there is a brought forward loss or unabsorbed depreciation under taxation laws, deferred tax assets are recognized only if there is virtual certainty of realization of such assets.

1.6 Impairment of Assets

Impairment loss, if any, is recognised to the extent, the carrying amount of assets exceed their recoverable amount. Recoverable amount is higher of an asset''s net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life.

Impairment losses recognised in prior years are reversed when there is an indication that the impairment losses recognised no longer exist or have decreased. Such reversals are recognised as an increase in carrying amount of assets to the extent that it does not exceed the carrying amount that would have been determined (net of depreciation) had no impairment loss been recognised in previous years.

After impairment, depreciation on assets is provided on the revised carrying amount of the respective asset over its remaining useful life.

1.7 Provisions, Contingent Liabilities and Contingent Assets

A provision is recognized in respect of obligations where, based on the evidence available, their existence at the Balance Sheet date is considered probable.

A provision is recognized if, as a result of a past event, and the Company has a present legal obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are measured by the best estimate of the outflow of economic benefits required to settle the obligation at the reporting date.

Provisions, contingent liabilities and contingent assets are reviewed at each balance sheet date.

Re-imbursement expected in respect of expenditure to settle a provision is recognized only when it is virtually certain that the re-imbursement will be received.

A Contingent Asset is neither recognized nor disclosed in the financial statements.

1.9 Earnings Per share

Basic earnings per share are computed by dividing the net profit/(loss) after tax (including the post tax effect of extra ordinary items, if any) by the weighted average number of equity shares outstanding during the year.

Diluted earnings per share are computed by dividing the net profit/(loss) after tax (including the post tax effect of any extra ordinary items, if any) by the weighted average number of equity shares considered for deriving basic earnings per share and also the weighted average number of equity shares which could be issued on the conversion of all dilutive potential equity shares.

1.9 Cash flow statement

Cash flows are reported using the indirect method, whereby profit/loss before tax is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing flows. The cash flows from operating, investing and financing activities of the Company are segregated.

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Mar 31, 2013

1.1 Basis of preparation of financial statements

The Financial Statements are prepared under the historical cost convention and in accordance with the Generally Accepted Accounting Principles (GAAP) in India and the provisions of the Companies Act, 1956. The significant accounting policies followed by the Company are stated below:

All assets and liabilities have been classified as current or non-current as per the company''s normal operating cycle and other criteria set out in the Schedule VI to the Companies'' Act, 1956. The company has ascertained its operating cycle as 12 months for the purpose of current and non-current classification of assets and liabilities.

1.2 Fixed Assets

a) Fixed Assets are stated at cost less accumulated depreciation. Cost of acquisition or construction is inclusive of freight, duties, taxes, financial costs and other related expenses up to the date of commissioning of the assets.

b) The company is following the straight line method of depreciation in respect of all assets at the rates specified in Schedule XIV to the Companies Act, 1956 (as amended).

c) Expenditure during construction period :

Expenditure (including financing cost relating to borrowed funds for construction or acquisition of fixed assets) incurred on projects under implementation are treated as Pre-operative expenses pending allocation to the assets and are shown under "Capital-work-in-progress".

d) Lease hold land is not amortized in view of the long term nature of the lease.

1.3 Revenue Recognition

a) Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

b) All other income are accounted for on accrual basis.

1.4 Expenses

All the expenses are accounted for on accrual basis.

1.5 Insurance Claims

Insurance claims are accounted for on the basis of claims admitted/expected to be admitted and to the extent that there is no uncertainty in receiving the claims.

1.6 Taxes on Income

Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

Deferred tax is recognized, subject to the consideration of prudence in respect of deferred tax assets, 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. Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in future; however, when there is a brought forward loss or unabsorbed depreciation under taxation laws, deferred tax assets are recognized only if there is virtual certainty of realization of such assets.

1.7 Impairment of Assets

Impairment loss, if any, is recognised to the extent, the carrying amount of assets exceed their recoverable amount. Recoverable amount is higher of an asset''s net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life.

Impairment losses recognised in prior years are reversed when there is an indication that the impairment losses recognised no longer exist or have decreased. Such reversals are recognised as an increase in carrying amount of assets to the extent that it does not exceed the carrying amount that would have been determined (net of depreciation) had no impairment loss been recognised in previous years.

After impairment, depreciation on assets is provided on the revised carrying amount of the respective asset over its remaining useful life.

1.8 Provisions, Contingent Liabilities and Contingent Assets

Provision is recognized in respect of obligations where, based on the evidence available, their existence at the Balance Sheet date is considered probable.

A provision is recognized if, as a result of a past event, the Company has a present legal obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by the best estimate of the outflow of economic benefits required to settle the obligation at the reporting date.

Provisions, contingent liabilities and contingent assets are reviewed at each balance sheet date.

Re-imbursement expected in respect of expenditure to settle a provision is recognized only when it is virtually certain that the re-imbursement will be received.

A Contingent Asset is not recognized in the Accounts.

1.9 Earnings Per share

Basic earnings per-share is computed by dividing the profit/(loss) after tax (including the post tax effect of extra ordinary items, if any) by the weighted average number of equity shares outstanding during the year.

Diluted earnings per share is computed by dividing the profit/(loss) after tax (including the post tax effect of any extra ordinary items, if any) by the weighted average number of equity shares considered for deriving basic earnings per share and also the weighted average number of equity shares which could be issued on the conversion of all dilutive potential equity shares.

1.10 Cash flow statement

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing flows. The cash flows from operating, investing and financing activities of the Company are segregated.

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Mar 31, 2012

1.1 Basis of preparation of financial statements

The accounts are prepared under the historical cost convention and are in accordance with the generally accepted accounting principles in India and the provisions of the Companies Act, 1956. The significant accounting policies followed by the Company are stated below:

1.2 Fixed Assets

a) Fixed Assets are stated at cost less accumulated depreciation. Cost of acquisition or construction is inclusive of freight, duties, taxes, financial costs and other related expenses up to the date of commission of the assets.

b) The company is following the straight line method of depreciation in respect of all assets at the rates specified in Schedule XIV to the Companies Act, 1956 (as amended). Depreciation is not provided on assets sold, discarded etc. in the year of sale.

c) Expenditure during construction period :

Expenditure (including financing cost relating to borrowed funds for construction or acquisition of fixed assets) incurred on projects under implementation are treated as Pre-operative expenses pending allocation to the assets and are shown under "Capital-work-in-progress.

d) Lease hold land value is not amortized in view of the long term nature of the lease.

1.3 Revenue Recognition

a) Interest income is recognized on time proportion basis taking into account the amount outstanding and rate applicable.

b) All other income are accounted for on accrual basis.

1.4 Expenses

All the expenses are accounted for on accrual basis.

1.5 Insurance Claims

Insurance claims are accounted for on the basis of claims admitted/expected to be admitted and to the extent that there is no uncertainty in receiving the claims.

1.6 Taxes on Income

Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

Deferred tax is recognized, subject to the consideration of prudence in respect of deferred tax assets, 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. Deferred tax assets are recognized only to the extent there is reasonable certainty that the assets can be realized in future; however, when there is a brought forward loss or unabsorbed depreciation under taxation laws, deferred tax assets are recognized only if there is virtual certainty of realization of such assets.

1.7 Impairment of Assets

Impairment loss, if any, is recognized to the extent, the carrying amount of assets exceed their recoverable amount. Recoverable amount is higher of an asset's net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life.

Impairment losses recognized in prior years are reversed when there is an indication that the impairment losses recognized no longer exist or have decreased. Such reversals are recognized as an increase in carrying amount of assets to the extent that it does not exceed the carrying amount that would have been determined (net of depreciation) had no impairment loss been recognized in previous years.

After impairment, depreciation on assets is provided on the revised carrying amount of the respective asset over its remaining useful life.

1.8 Provisions, Contingent Liabilities and Contingent Assets

Provision is recognized in respect of obligations where, based on the evidence available, their existence at the Balance Sheet date is considered probable.

A provision is recognized if, as a result of a past event, the Company has a present legal obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by the best estimate of the outflow of economic benefits required to settle the obligation at the reporting date.

Provisions, contingent liabilities and contingent assets are reviewed at each balance sheet date.

Re-imbursement expected in respect of expenditure to settle a provision is recognized only when it is virtually certain that the re-imbursement will be received.

A Contingent Asset is not recognized in the Accounts.

1.9 Earnings Per share

Basic earnings per share is computed by dividing the profit/(loss) after tax (including the post tax effect of extra ordinary items, if any) by the weighted average number of equity shares outstanding during the year.

Diluted earnings per share is computed by dividing the profit/(loss) after tax (including the post tax effect of any extra ordinary items, if any) by the weighted average number of equity shares considered for deriving basic earnings per share and also the weighted average number of equity shares which could be issued on the conversion of all dilutive potential equity shares.

1.10 Cash flow statement

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing flows. The cash flows from operating, investing and financing activities of the Company are segregated.

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Mar 31, 2011

The accounts are prepared under the historical cost convention and are in accordance with the generally accepted accounting principles in India and provisions of the Companies Act, 1956. The significant accounting policies followed by the Company are stated below: 1. Fixed Assets

a) Fixed Assets are stated at cost less accumulated depreciation. Cost of Acquisition or construction is inclusive of freight, duties, taxes, financial costs and other related expenses up to the date of commissing of the assets.

b) The company is following the straight line method of depreciation in respect of all assets at the rates specified in Schedule XIV to the Companies Act, 1956 (as amended). Depreciation is not provided on assets sold, discarded etc. in the year of sale.

c) Expenditure during construction period : Expenditure (including financing cost relating to borrowed funds for construction or acquisition of fixed assets) incurred on projects under implementation are treated as Pre-operative expenses pending allocation to the assets and are shown under "Capital-Work-in-Progress".

d) Lease hold land value is not amortized in view of the long term nature of the lease.

2 Investments

Long Term Investments are carried at cost. Provision for diminution is made to recognize a decline, other than temporary, in the value of long term investments, script wise. Current Investments are valued at lower of cost or fair value, category wise. Cost of investments includes acquisition cost such as brokerage, stamp duty etc.

3 Inventories

a) Inventories including Finished Goods (other than By-products, Scrap and Standing crop) are valued at lower of cost and net realizable value. Selling price includes Excise Duty but excludes Sales Tax. Cost is determined by using FIFO method and does not include recoverable taxes. The cost of Finished goods and work-in-process include cost of conversion and other cost incurred in bringing the Inventories to their present location and condition.

b) By-products (Molasses & Bagasse), Scrap and Standing Crop are valued at net realizable value.

4 Revenue Recognition

a) Sale of goods is recognized at the time of transfer of substantial risk and rewards of ownership to the buyer for a consideration.

b) Gross turnover includes excise duty but exclude sales tax.

c) Dividend income is accounted for in the year it is declared.

d) All other income are accounted for on accrual basis.

5 Expenses

All the expenses are accounted for on accrual basis except interest on calls in arrears, which is accounted for on receipt basis.

6 Excise Duty

Excise Duty is paid on clearance of goods from the factory, however liability for the same is provided on the finished good stock lying in the factory.

7 Material In Transit

All the materials which are purchased before the closing date of the financial year but are not received by the Company, are accounted for as material in transit. CENVAT on such material in transit is also accounted for as CENVAT receivable.

8 Employee Benefits

a) Short-term employee benefits are recognized as an expense at the undiscounted amount in the Profit & Loss Account of the year in which the related service is rendered.

b) Long-term employee benefits i.e. Gratuity, Leave Encashment, Contribution to Provident Fund & pension Fund etc., are recognized as an expense in the Profit & Loss Account for the year in which the employees have rendered service. The expense is recognized at the present value of the amount payable as per actuarial valuations. Actuarial gains and losses in respect of such benefits are recognized in the Profit and loss account.

9 Borrowing Costs

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes a substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

10 Insurance Claims

Accounted for on settlement of claims.

11 Government Grants & Subsidies

a) Government grants related to specific fixed assets are adjusted with the value of the fixed asset. If not relating to a specific fixed asset, it is credited to Capital Reserve.

b) Government grants related to revenue items are adjusted with the related expenditure. If not relating to a specific expenditure, it is taken as income.

12 Taxes on Income

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred tax is recognized, subject to the consideration of prudence in respect of deferred tax assets, 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.

13 Impairment of Assets

Impairment losses, if any, are recognized in accordance with the accounting standard issued in this regard by The Institute of Chartered Accountants of India.

14 Provisions, Contingent Liabilities and Contingent Assets

Provision are recognized in respect of obligations where, based on the evidence available, their existence at the Balance Sheet date is considered probable.

Contingent Liabilities are shown by way of notes to the Accounts in respect of obligations where, based on the evidence available, their existence at the Balance Sheet date is considered not probable.

A Contingent Asset is not recognized in the Accounts.

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Sep 30, 2009

The accounts are prepared under the historical cost convention and are in accordance with the generally accepted accounting principles in India and provisions of the Companies Act, 1956. The significant accounting policies followed by the Company are stated below:

1 Fixed Assets

a) Fixed Assets are stated at cost less accumulated depreciation. Cost of Acquisition or construction is inclusive of freight, duties, taxes, financial costs and other related expenses up to the date of commissing of the assets.

b) The company is following straight line method of depreciation in respect of all fixed assets at the rates specified in Schedule XIV to the Companies Act, 1956 (as amended).

c) Expenditure during construction period :

Expenditure (including financing cost relating to borrowed funds for construction or acquisition of fixed assets) incurred on projects under implementation are treated as Pre-operative expenses pending allocation to the assets and are shown under "Capital-Work-in- Progress".

d) Lease hold land value is not amortized in view of the long term nature of the lease.

2 Investments

Trade investments are the investments made to enhance the Companys business interest. Investments are either classified as current or long-term based on Managements intention at the time of purchase. Long-term investments are carried at cost less provisions recorded to recognize any decline, other than temporary, in the carrying value of each investment. Current investments are carried at the lower of cost and fair value, category wise. Cost includes acquisition charges such as brokerage fee and duties.

3 Inventories

a) Inventories including Finished Goods (other than By-products, Scrap and Standing crop) are valued at lower of cost or net realizable value. The cost of Finished goods and work-in-process include cost of conversion and other cost incurred in bringing the Inventories to their present location and condition. Cost is determined by using FIFO method and does not include recoverable taxes.

b) By-products (Molasses & Bagasse), Scrap and Standing Crop are valued at net realizable value.

4 Share Issue Expenses

These are equally amortized over a period of five years.

5 Revenue Recognition

a) Sale of goods is recognized at the time of transfer of substantial risk and rewards of ownership to the buyer for a consideration.

b) Gross turnover includes excise duty but excludes sales tax.

c) Dividend income is accounted for in the year it is declared.

d) All other income are accounted for on accrual basis except interest on calls in arrears, which is accounted for on receipt basis.

6 Expenses

All the expenses are accounted for on accrual basis.

7 Employee Benefits

a) Short-term employee benefits are recognized as an expense at the undiscounted amount in the Profit & Loss Account for the year in which the related service is rendered.

b) Long-term employee benefits are recognized as an expense in the Profit & Loss Account for the year in which the employee has rendered service. The expense is recognized at the present value of the amount payable as per actuarial valuations. Actuarial gains and losses in respect of such benefits are recognized in the Profit & Loss Account.

8 Borrowing Costs

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets till such time assets are ready for its intended use. A qualifying asset is one that necessarily takes a substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue in the period in which it is incurred.

9 Insurance Claims

Accounted for on settlement of claims.

10 Government Grants & Subsidies

a) Government grants related to specific fixed assets are adjusted with the value of the fixed asset. If not relating to a specific fixed asset, it is credited to Capital Reserve.

b) Government grants related to revenue items are adjusted with the related expenditure. If not relating to a specific expenditure, it is taken as income.

11 Taxes on Income

Current tax is determined as the amount of tax payable in respect of taxable income. Deferred tax is recognized, subject to the consideration of prudence in respect of deferred tax assets, 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.

12 Impairment of Assets

Impairment losses, if any, are recognised in accordance with the Accounting Standard notified under The Companies (Accounting Standard) Rules, 2006.

13 Provisions, Contingent Liabilities and Contingent Assets

Provision is recognized in respect of obligations where, based on the evidence available, their existence at the Balance Sheet date is considered probable.

Contingent Liabilities are shown by way of notes to the Accounts in respect of obligations where, based on the evidence available, their existence at the Balance Sheet date is considered not probable.

Re-imbursement expected in respect of expenditure incurred to settle a provision is recognized only when it is virtually certain that the re- imbursement will be received.

A Contingent Asset is not recognized in the Accounts.

14 Foreign Currency Transactions

a) Transactions in Foreign currency are initially recorded at the exchange rate at which the transaction is carried out.

b) Monetary Assets and Liabilities related to foreign currency transactions remaining outstanding at the year end are translated at the year end rate.

c) In case of items which are covered by forward exchange contracts, the difference between the year end rate and the rate on the date of the contract is recognized as exchange difference. The premium or discount on forward exchange contracts is amortized over the period of the respective contract.

d) Any income or expense on account of exchange difference either on settlement or on translation at the year end is recognized in the Profit & Loss Account.