1. BASIS OF PREPARATION
The financial statements have been prepared to comply in all material
respect with the Notified Accounting Standards pursuant to Companies
(Accounting Standard) Rules, 2006 and the relevant provisions of the
Companies Act, 1956. The financial statements have been prepared under
trre historical cost convention on an accrual basis except in case of
assets for which provision for impairment is made and revaluation is
carried out. The accounting policies have been consistently applied by
2. USE OF ESTIMATES
The presentation of financial statements requires estimates and
assumptions that affect the reported amount of assets and liabilities
and disclosure of contingent liabilities on the date of the financial
statements and the reported amount of revenues and expenses during the
reporting period. Differences between the actual results and estimates
are recognised in the period in which the results are known/
3. REVENUE RECOGNITION
Revenue is recognized to the extent it is probable that the economic
benefits will flow to the company and the revenue can be reliably
Sale of Goods - Revenue is recognized when the significant risks and
rewards of ownership of the goods have passed to the buyer and is
stated net of trade discount, returns and Sales Tax / VAT but includes
Interest - Revenue is recognized on a time proportion basis taking into
account the amount outstanding and the rate applicable.
Export Benefits / Incentives - Export entitlement under Duty
Entitlement Pass Book (''DEPB'') Scheme are recognised in the Profit &
Loss Account when the right to receive credit as per terms of the
scheme is established in respect of export made and where there is no
significant uncertainty regarding the ultimate collection of the
relevant export proceeds.
Rebate, claims & settlement on goods sold are accounted for as and when
these are ascertained with reasonable accuracy.
5. FIXED ASSETS AND DEPRECIATION
a) Fixed Assets are stated at cost or as revalued, less accumulated
depreciation and impairment losses, if any. Cost comprises the purchase
price and any attributable cost of bringing the asset to its working
condition for its intended use. Borrowing costs relating to acquisition
of fixed assets, if material, are also included in cost to the extent
they relate to the period till such assets are ready to be put to use.
b) Depreciation on Fixed Assets is provided on Written Down Value
method at the rates specified en in Schedule XIV to the Companies Act,
6. INTANGIBLE ASSETS
The company has intangible assets acquired on amalgamation except this
Intangible asset is not recognized by the company.
7. IMPAIRMENT OF ASSETS
An asset is treated as impaired when the carrying cost of assets
exceeds its recoverable value. An impairment loss is charged to the
profit & loss account in the year in which an asset is identified as
impaired. The impairment loss recognised in prior accounting period is
reversed if there has been a change in the estimate of recoverable
After impairment, depreciation is provided on the revised carrying
amount of the assets over its remaining useful life.
a) Inventories of Finished Goods, Work in progress, Raw materials,
Packing materials and Stores & Spares are stated at lower of cost and
net realisable value.
b) Cost of Raw Materials, Packing Materials, Stores and Spares, Trading
and other products are determined on weighted average basis and are net
of Cenvat credit.
c) Cost of Work in progress and Finished Goods is determined
considering direct material cost and appropriate portion of
manufacturing overheads based on normal operating capacity.
d) Obsolete, slow moving and defective inventories are identified at
the time of physical verification of inventories and where necessary,
either written off or provision is made for such inventories.
9. EMPLOYEE BENEFITS
a) Defined Contribution Plan :
Employees benefits in the form of the Company''s contribution to
Provident Fund, Pension scheme, Superannuation Fund and Employees State
Insurance is a defined contribution scheme and contributions are
charged to the Profit & Loss Account of the year when the contribution
to the respective fund is due.
b) Defined Benefit Plan :
Retirement benefits in the form of gratuity and leave encashment are
considered as defined benefit obligations and are provided for on the
basis of actual valuation as at the date of Balance Sheet.
10. DEFERRED REVENUE EXPENDITURE
Company do not recognize Deferred Revenue Expenditure. 11 FOREIGN
CURRENCY TRANSACTIONS a) Initial Recognition
Foreign currency transactions are recorded in the reporting currency,
by applying to the foreign currency amount the exchange rate between
the reporting currency and the foreign currency at the date of the
Foreign currency monetary items are reported using the closing rate.
c) Exchange Difference
Any gain or loss on account of exchange difference arising either on
the settlement or on reinstatement of foreign currency monetary items
is recognised in the Profit & Loss account.
12. RESEARCH AND DEVELOPMENT
Equipment purchased for research and development is capitalised when
commissioned and included in the gross block of fixed assets. Revenue
expenditure on research and development is charged to Profit & Loss
account in the period in which it is incurred.
13. PRIOR PERIOD ADJUSTMENTS
Earlier year items, adjustment/Claims, arisen / settled / noted during
the year are, if material in nature, are debited / credited to the
prior period Expenses/Income or respective heads of account if not
material in the nature.
Investments that are readily realisable and intended to be held for not
more than a year classified as current investments. All other
investments are classified as long-term investments. Current
investments are carried at lower of cost and fair value. Long -term
investments are stated at cost. Provision fofdiminution in the value
of investments is made, if it is other than temporary.
15. BORROWING COST
Borrowing costs that are attributable to the acquisition or
construction of a qualifying asset are capitalised as part of the cost
of such asset. A qualifying asset is one that necessarily takes a
substantial period of time to get ready for intended use. All other
borrowing costs are recognised as an expense in the period in which
they are incurred.
a) Provision for Current Tax is made after considering benefits,
exemptions and deductions available under the Income Tax Act, 1961.
b) Deferred tax is recognised subject to consideration of prudence, on
timing differences, representing the difference between the taxable
income/(loss) and accounting income/(loss) that originated in one
period and are capable of reversal in one or more subsequent periods.
Deferred tax assets and liabilities are measured.using the tax rates
and tax laws that have been enacted or substantively enacted by the
Balance Sheet date.
Operating Lease: Lease rentals in respect of assets taken on operating
teases are charged to the profit and loss account with reference to
lease terms and other consideration.
18. PROVISIONS, CONTINGENT LIABILITIES & CONT-^\''T ASSETS''
Provisions involving substantial degree of estimation in measurement
are recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent liabilities are not recognised but are disclosed in notes.
Contingent assets are neither recognised nor disclosed in the financial
19. SEGMENT REPORTING
The accounting policies adopted by the company for segment reporting
are in line with the accounting standard on Segmental Reporting.
Primary Segment :
Business Segment: The Company''s operating business are organized and
managed separately according to the nature of products, with each
segment representing a strategic business unit that offers different
products. The company operate in only one segment of business.
Secondary Segment :
Geographical Segment: The analysis of geographical segment is based on
the geographical location of the customers. The geographical segments
considered for disclosure are as follows:
(a) Sales within India
(b) Sales outside India
Segment Assets denotes for debtors only.
20. CASH FLOW STATEMENTS
Cash-flow statements are prepared in accordance with Indirect Method
as explained in the Accounting Standard on Cash Flow Statements (AS-3)
notified under the Companies (Accounting Standards) Rules, 2006. The
Cash flows from regular revenue generating, financing and investing
activity of the company are segregated.
21. EARNING PER SHARE
Basic earning per share is calculated by dividing the net profit or
loss for the period attributable to equity shareholders by the weighted
average number of equity shares outstanding during the period.
For the purpose of calculating diluted Earning per Share, the net
profit or loss for the period attributable to Equity Shareholders and
the weighted average number of Shares outstanding during the period are
adjusted for the effects of all dilutive potential Equity Shares.
22. DERIVATIVE INSTRUMENTS
As per announcement of Institute of Chartered Accountants of India,
accounting for derivatives contracts, other than those covered under
AS-11, are marked to market on a portfolio basis, and the net loss
after considering the offsetting effect on the underlying hedge item is
charged to Profit and Loss Account. Net Gain is ignored.