Provisions and Contingent Liabilities

The Company creates a provision when there is present obligation as a result of a past event that probably requires an
outflow of resources and a reliable estimate can be made of the amount of the obligation such as product warranty costs. A
disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but
probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of
which the likelihood of outflow of resources is remote, no provision or disclosure is made.

1.12 Operating lease including Investment Properties
As a Lessor

The company has leased out its assets and such leases where the company has substantially retained all the risks and
rewards of ownership are classified as operating leases. Lease income on such operating leases are recognised in the
statement of profit & loss on a straight line basis over the lease term in a manner which is representative of the time
pattern in which benefit derived from the use of the leased asset is diminished. Initial direct costs are recognised as an
expense in the statement of profit & loss in the period in which they are incurred.

Under operating lease, the asset is capitalised within property plant & equipment and depreciated over its useful economic
life. Therefore, Ind AS 116 does not have an impact for leases where the company is the lessor.

As a Lessee

Ind AS 116 requires lessees to determine the lease term as the non-cancellable period of a lease adjusted with any option
to extend or terminate the lease. The Company's lease asset primarily consists of Building. The company assesses
whether a contract contains a lease, at inception of contract. 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. To assess whether a
contract conveys the right to control the use of an identified asset, the Company assesses whether:

(i) the contract involves the use of an identified asset

(ii) the Company has substantially all the economic benefits from use of the asset through the period of the lease and

(iii) the Company has the right to direct the use of the asset.

At the date of commencement of the lease, the Company recognizes a right-of-use (ROU) asset and a corresponding lease
liability for all lease arrangements in which it is a lessee, except for leases with a term of 12 months or less (short-term
leases), and lease contract for which the underlying asset is of low value (low-value assets). For these short-term, the
Company recognizes the lease payments as an operating expense on a straight-line basis over the term of the lease.

The right-of-use assets are initially recognised at cost, which comprises the initial measurement of the lease liability
adjusted plus any initial direct costs less any lease incentives. They are subsequently measured at cost less accumulated
depreciation and impairment losses, if any. 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 underlying asset.The lease liability is initially
measured at the present value of the future lease payments. The lease payments are discounted using the interest rate of
cost of capital. The lease liability is subsequently remeasured by increasing the carrying amount to reflect interest on the
lease liability, reducing the carrying amount to reflect the lease payments made.

In calculating the present value of lease payments, the company uses its incremental borrowing rate at the lease
commencement date because the interest rate implicit in the lease is not readily determinable.

1.13 Government Grants

Grants and subsidies from the government are recognized when there is reasonable assurance that

(i) the company will comply with the conditions attached to them, and (ii) the grant/subsidy will be received.

When the grant or subsidy relates to revenue, it is recognized as income on a systematic basis in the statement of profit and
loss over the periods necessary to match them with the related costs, which they are intended to compensate. Where the
grant relates to an asset, it is recognized as deferred income and transfer to income in equal amounts over the expected
useful life of the related asset.

Where the company receives non-monetary grants, the asset is accounted for on the basis of its acquisition cost. In case a
non-monetary asset is given free of cost, it is recognized at a nominal value.

1.14 Dividends

Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion
of the entity, on or before the end of the reporting period but not distributed at the end of the reporting period.

1.15 Cash and Cash Equivalents

For the purpose of presentation in the Statement of Cash Flows, cash and cash equivalents includes cash on hand, balance
with banks.

1.16 Employee benefits

Employee benefits include salaries, wages, contribution to provident fund, gratuity, leave encashment towards un-availed
leave, compensated absences, and other terminal benefits.

(i) Gratuity

Payment for present liability of future payment of gratuity is being made to approved gratuity fund, which fully covers the
same under Cash Accumulation Policy and Debt fund of the Life Insurance Corporation of India (LIC). However, any deficit
in plan assets managed by LIC as compared to the liability based on an independent actuarial valuation is recognised as a
liability.

The liability or asset recognised in the Balance Sheet in respect of defined benefit gratuity plans is the present value of the
defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined benefit obligation
is calculated annually by actuaries using the projected unit credit method in conformity with the principles and manner of
computation specified in Ind AS 19.

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.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the
fair value of plan assets. This cost is included in employee benefit expense in the Statement of Profit and Loss.

(ii) Provident fund contributions are made to Company's Provident Fund . The contributions are accounted for as defined
benefit plans and the contributions are recognised as employee benefit expense when they are due.

(iii) Defined contribution to superannuation fund is being made as per the scheme of the Company and recognised as expense
as and when due.

1.17 Earnings per Share

Basic earnings 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. Earnings considered in ascertaining the
Company's earnings per share is the net profit for the period. The weighted average number of equity shares outstanding
during the period and all periods presented is adjusted for events, such as bonus shares, other than the conversion of
potential equity shares, that have changed the number of equity shares outstanding, without a corresponding change in
resources. 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 share outstanding during the period is adjusted for the effects of
all dilutive and anti-dilutive potential equity shares.

1.18 Segment Reporting

The company is engaged mainly in the business of automobile products. These, in the context of Indian Accounting
Standard 108 on Operating Segment, as speci ed in the Companies (Indian Accounting Standards) Rules, 2015, are
considered to constitute one single primary segment. Operating segments are reported in a manner consistent with the
internal reporting provided to the Core Management Committee which includes the Managing Director who is the Chief
Operating Decision Maker.

1.19 Borrowing Cost

Borrowing cost includes interest, amortization of ancillary costs incurred in connection with the arrangement of
borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an
adjustment to the interest cost.

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a
substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective asset.
All other borrowing costs are expensed in the period they occur.