Provisions Liabilty
A provision is recognized when the Company has a present obligation as a result of past event and it is
probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable
estimate can be made. These are reviewed at each balance sheet date and adjusted to reflect the current
best estimates.
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.
Contingent liabilities are disclosed when there is a possible obligation arising from past events, the
existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain
future events not wholly within the control of the Company or a present obligation that arises from past
events where it is either not probable that an outflow of resources will be required to settle the obligation or a
reliable estimate of the amount cannot be made. Contingent assets are neither recognized nor disclosed in
the standalone financial statements.
A contingent liability recognized in a business combination is initially measured at its fair value.
Subsequently, it is measured at the higher of the amount that would be recognized in accordance with the
requirements for provisions above or the amount initially recognized less, when appropriate, cumulative
amortization recognized in accordance with the requirements for revenue recognition.
6. Use of estimates
The preparation of these financial statements in conformity with the recognition and measurement
principles of Ind AS requires the management of the Company to make estimates and assumptions that
affect the reported balances of asset and liabilities, disclosures relating to contingent liabilities as at the date
of the financial statements and the reported amounts of income and expense for the period presented.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognized in the period in which estimates are revised if the revision affects only that period
or in the period of the revision and future periods if the revision affects both current and future periods.
The following are the key assumptions concerning the future, and other sources of estimation uncertainty at
the end of the reporting period that may have a significant risk of causing a material adjustment to the
carrying amounts of assets and liabilities in future are:
i) Useful lives and residual value of property, plant and equipment: Useful life and residual value are
determined by the management based on a technical evaluation considering nature of asset, past
experience, estimated usage of the asset, vendor's advice etc and same is reviewed at each financial year
end.
ii) Deferred tax assets: The Company reviews the carrying amount of deferred tax assets at the end of each
reporting period and reduces to the extent that it is no longer probable that sufficient taxable profits will be
available to allow all or part of the asset to be recovered.
Deferred income tax assets and liabilities are recognized for deductible and taxable temporary differences
arising between the tax base of assets and liabilities and their carrying amount, except when the deferred
income tax arises from the initial recognition of an asset or liability in a transaction that is not a business
combination and affects neither accounting nor taxable profit or loss at the time of the transaction. Deferred
income tax assets are recognized 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 utilized.
The carrying amount of deferred income 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 income tax asset to be utilized. Deferred tax assets and liabilities are measured using
substantively enacted tax rates expected to apply to taxable income in the years in which the temporary
differences are expected to be received or settled.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off assets against
liabilities representing the current tax and where the deferred tax assets and liabilities relate to taxes on
income levied by the same governing taxation laws.
7. Earnings Per Share
Basic earnings per share (EPS) are calculated by dividing the net profit / (loss) after tax for the year
attributable to equity shareholders by the weighted average number of equity shares outstanding during the
year.
Diluted earnings per share is computed by adjusting the number of shares used for basic EPS with the
weighted average number of shares that could have been issued on the conversion of all dilutive potential
equity shares.
Dilutive potential equity shares are deemed converted as of the beginning of the year, unless they have
been issued at a later date. The diluted potential equity shares have been adjusted for the proceeds
receivable had the shares been actually issued at fair value i.e. average market value of outstanding shares.
The number of shares and potentially dilutive shares are adjusted for share splits and bonus shares, as
appropriate. In calculating diluted earnings per share, the effects of anti-dilutive potential equity shares are
ignored. Potential equity shares are anti-dilutive when their conversion to equity shares would increase
earnings per share or decrease loss per share.
8. Revenue
The Company’s contracts with customers could include promises to transfer multiple products and services
to a customer. The Company assesses the products / services promised in a contract and identify distinct
performance obligations in the contract. Identification of distinct performance obligation involves judgement
to determine the deliverables and the ability of the customer to benefit independently from such
deliverables.
• Judgement is also required to determine the transaction price for the contract and to ascribe the
transaction price to each distinct performance obligation. The transaction price could be either a fixed
amount of customer consideration or variable consideration with elements such as volume discounts,
service level credits, performance bonuses, price concessions and incentives. The transaction price is
also adjusted for the effects of the time value of money if the contract includes a significant financing
component. Any consideration payable to the customer is adjusted to the transaction price, unless it is a
payment for a distinct product or service from the customer. The estimated amount of variable
consideration is adjusted in the transaction price only to the extent that it is highly probable that a
significant reversal in the amount of cumulative revenue recognized will not occur and is reassessed at
the end of each reporting period. The Company allocates the elements of variable considerations to all
the performance obligations of the contract unless there is observable evidence that they pertain to one
or more distinct performance obligations.
• The Company exercises judgement in determining whether the performance obligation is satisfied at a
point in time or over a period of time. The Company considers indicators such as how customer
consumes benefits as services are rendered or who controls the asset as it is being created or
existence of enforceable right to payment for performance to date and alternate use of such product or
service, transfer of significant risks and rewards to the customer, acceptance of delivery by the
customer, etc.
• Revenue for fixed-price contract is recognized using percentage-ofcompletion method. The Company
uses judgement to estimate the future cost-to-completion of the contracts which is used to determine
the degree of completion of the performance obligation.
For Jain & Associates
Chartered Accountants
FRN: 001361N
Sd/- Sd/- Sd/- Sd/-
Krishan Mangawa Akhil j Dada Harvinder Singh Chopra Balinder Kumar
(Partner) (Chairman) (Managing Director) (Chief Financial Officer)
M.No. 513236 DIN No. 02321706 DlN No. 00129891
Sd/-
Niraj Kumar Sehgal
Date: 26/05/2023 (Company Secretary)
Place: Chandigarh M. No. A8019
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