N. Provisions and Contingencies:

a) Provisions are recognized based on the best estimate of probable outflow of resources
which would be required to settle obligations arising out of past events.

b) Contingent liabilities not provided for as per (a) above are disclosed in notes forming part
of the Financial Statements If the effect of the time value of money is material, provisions
are discounted using a current pre-tax rate that reflects, when appropriate, the risks
specific to the liability. When discounting is used, the increase in the provision due to the
passage of time is recognized as a finance cost.

c) Contingent Assets are disclosed, where the inflow of economic benefits is probable.

O. Earnings per Share:

a) Basic earnings per share are calculated by dividing the net profit or loss for the period
attributable to equity shareholders (after deducting preference dividends, if any, and
attributable taxes) by the weighted average number of equity shares outstanding during the
period.

b) For the purpose of calculating diluted earnings 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 effect of all dilutive potential equity shares.

P. Leases:

A contract is, or contains, a lease if the contract conveys the right to control the use of an

identified asset for a period of time in exchange for consideration.

Company as a lessee

(A) Lease Liability

At the commencement date, the Company measures the lease liability at the present
value of the lease payments that are not paid at that date. The lease payments shall be
discounted using incremental borrowing rate.

(B) Right-of-use assets

Initially recognised at cost, which comprises the initial amount of the lease liability
adjusted for any lease payments made at or prior to the commencement date of the
lease plus any initial direct costs less any lease incentives.

Subsequent measurement

(A) Lease Liability

Company measure the lease liability by (a) increasing the carrying amount to reflect
interest on the lease liability; (b) reducing the carrying amount to reflect the lease
payments made; and (c) remeasuring the carrying amount to reflect any reassessment
or lease modifications.

(B) Right-of-use assets

Subsequently measured at cost less accumulated depreciation and impairment losses.
Right-of-use assets are depreciated from the commencement date on a straight line
basis over the shorter of the lease term and useful life of the under lying asset.

Impairment

Right of use assets are evaluated for recoverability whenever events or changes in
circumstances indicate that their carrying amounts may not be recoverable. For the purpose
of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to
sell and the value-in-use) is determined on an individual asset basis unless the asset does not
generate cash flows that are largely independent of those from other assets. In such cases, the
recoverable amount is determined for the Cash Generating Unit (CGU) to which the asset
belongs.

Short term Lease

Short term lease is that, at the commencement date, has a lease term of 12 months or less. A
lease that contains a purchase option is not a short-term lease. If the company elected to apply
short term lease, the lessee shall recognise the lease payments associated with those leases as
an expense on either a straight-line basis over the lease term or another systematic basis. The

lessee shall apply another systematic basis if that basis is more representative of the pattern
of the lessee's benefit.

As a lessor

Leases for which the company is a lessor is classified as a finance or operating lease.
Whenever, the terms of the lease transfers substantially all the risks and rewards of ownership
to the lessee, the contract is classified as a finance lease. All other leases are classified as
operating leases.

Lease income is recognised in the statement of profit and loss on straight line basis over the
lease term.

Q. Exceptional items:

Certain occasions, the size, type or incidence of an item of income or expense, pertaining to
the ordinary activities of the Company is such that its disclosure improves the understanding
of the performance of the Company, such income or expense is classified as an exceptional
item and accordingly, disclosed in the notes accompanying to the financial statements.

1.3 USE OF JUDGEMENTS, ESTIMATES AND ASSUMPTIONS

While preparing financial statements in conformity with Ind AS, the management has made
certain estimates and assumptions that require subjective and complex judgments. These
judgments affect the application of accounting policies and the reported amount of assets,
liabilities, income and expenses, disclosure of contingent liabilities at the statement of
financial position date and the reported amount of income and expenses for the reporting
period. Financial reporting results rely on the management estimate of the effect of certain
matters that are inherently uncertain. Future events rarely develop exactly as forecasted and
the best estimates require adjustments, as actual results may differ from these estimates
under different assumptions or conditions. Estimates and underlying assumptions are
reviewed on an ongoing basis. Revisions to accounting estimates are recognized
prospectively Judgment, estimates and assumptions are required in particular for:

a) Determination of the estimated useful life of tangible assets

Useful life of tangible assets is based on the life prescribed in Schedule II of the
Companies Act, 2013. In cases, where the useful life are different from that prescribed in
Schedule II, they are based on technical advice, taking into account the nature of the asset,
the estimated usage of the asset, the operating conditions of the asset, past history of
replacement, anticipated technological changes, manufacturers’ warranties and
maintenance support.

b) Recognition and measurement of defined benefit obligations

The obligation arising from defined benefit plan is determined on the basis of actuarial
assumptions. Key actuarial assumptions include discount rate, trends in salary escalation,
actuarial rates and life expectancy. The discount rate is determined by reference to market
yields at the end of the reporting period on government bonds. The period to maturity of
the underlying bonds correspond to the probable maturity of the post-employment benefit
obligations. Due to complexities involved in the valuation and its long-term nature,
defined benefit obligation is highly sensitive to changes in these assumptions. All
assumptions are reviewed at each reporting period.

c) Recognition of deferred tax liabilities

Deferred tax assets and liabilities are recognized for the future tax consequences of
temporary differences between the carrying values of assets and liabilities and their
respective tax bases, and unutilized business loss and depreciation carryforwards and tax
credits. Deferred tax assets are recognized to the extent that it is probable that future
taxable income will be available against which the deductible temporary differences,
unused tax losses, depreciation carry-forwards and unused tax credits could be utilized.

d) Discounting of financial assets / liabilities

All financial assets / liabilities are required to be measured at fair value on initial
recognition. In case of financial assets / liabilities which are required to be subsequently
measured at amortized cost, interest is accrued using the effective interest method.