Provisions, contingent liabilities and contingent assets

Provisions: Provisions are recognized in respect of
liabilities, which can be measured only by using a
substantial degree of estimates when:

(i) the Company has a present obligation as a result
of a past event;

(ii) a probable outflow of resources embodying
economic benefits will be required to settle the
obligation; and

(iii) the amount of the obligation can be reliably
estimated.

Reimbursement expected in respect of expenditure
required to settle a provision is recognized only when
it is virtually certain that the reimbursement will be
received.

Contingent Liability: Contingent liability is disclosed in
the case of:

(i) a present obligation arising from a past event,
when it is not probable that an outflow of
resources embodying economic benefits will be
required to settle the obligation; and

(ii) a possible obligation, that arises out of past events
and the existence of which will be confirmed only
by one or more uncertain future events unless the
probability of outflow of resources is remote.

Contingent Assets: Contingent assets are neither
recognized nor disclosed. However, when realization of
income is virtually certain, related asset is recognized.

XVIII. Cash & cash equivalents

Cash and cash equivalents for the purposes of cash
flow statement comprise cash at bank and in hand and
short-term investments with an original maturity of
twelve months or less. Cash flow statement is prepared
using the indirect method.

XIX. 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. The weighted
average numbers of equity shares outstanding during
the period are adjusted for events of bonus issue, a
share split and share warrants conversion.

Diluted earnings per share is calculated by adjusting
net profit or loss for the period attributable to equity
shareholders and the weighted number of shares
outstanding during the period for the effect of all
dilutive potential equity shares.

Further, where the statement of profit and loss includes
extraordinary items, the Company discloses basic and
diluted earnings per share computed on the basis of
earnings excluding extraordinary items (net of tax
expenses).

XX. Fair value measurement

The Company is required to measure the financial
instruments at fair value at each Balance Sheet date.
Fair value is the price that would be received to sell
an asset or paid to transfer a liability in an ordinary
transaction between market participants at the
measurement date. The fair value measurement is
based on the presumption that the transaction to sell
the asset or transfer the liability takes place either:

(i) In the principal market for the asset or liability, or

(ii) In the absence of a principal market, in the most
advantageous market for the asset or liability.

A fair value measurement of a non-financial asset
takes into account a market participant's ability to
generate economic benefits by using the asset in its
highest and best use or by selling it to another market
participant that would use the asset in its highest and
best use. The Company uses valuation techniques that
are appropriate in the circumstances and for which
sufficient data are available to measure fair value,
maximizing the use of relevant observable inputs and
minimizing the use of unobservable inputs. All assets
and liabilities, for which fair value is measured or
disclosed in the financial statements, are categorized
within the fair value hierarchy, described as follows,
based on the lowest level input that is significant to the
fair value measurement as a whole:

Level 1: Quoted (unadjusted) market prices in

active markets for identical assets or liabilities.

Level 2: Valuation techniques for which the

lowest level input that is significant to the fair value
measurement is directly or indirectly observable.

Level 3: Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
unobservable.

For the purpose of fair value disclosures, the Company
has determined classes of assets & liabilities on the
basis of the nature, characteristics and the risks of the
asset or liability and the level of the fair value hierarchy
as explained above.

XXI. Financial instrument

A financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability
or equity instrument of another entity. Financial assets
includes trade receivable, loan to body corporate, loan
to employees, security deposits and other eligible
current and non-current assets. Financial liabilities
include Loans, trade payables and eligible current and
non-current liabilities.

(1) Classification

The Company classifies financial assets as
subsequently measured at amortized cost, fair
value through other comprehensive income or fair
value through profit or loss on the basis of both:

(i) the entity's business model for managing
the financial assets; and

(ii) the contractual cash flow characteristics of
the financial asset.

A financial asset is measured at amortized cost if
both of the following conditions are met:

(i) the financial asset is held within a business
model whose objective is to hold financial
assets in order to collect contractual cash
flows; and

(ii) the contractual terms of the financial asset
give rise on specified dates to cash flows that
are solely payments of principal and interest
on the principal amount outstanding.

A financial asset is measured at fair value through
other comprehensive income if both of the
following conditions are met:

(i) the financial asset is held within a business
model whose objective is achieved by both
collecting contractual cash flows and selling
financial assets; and

(ii) the contractual terms of the financial asset
give rise on specified dates to cash flows that
are solely payments of principal and interest
on the principal amount outstanding.

A financial asset is measured at fair value through
profit or loss unless it is measured at amortized
cost or at fair value through other comprehensive
income.

All financial liabilities are subsequently measured
at amortized cost using the effective interest
method or fair value through profit or loss.

(2) Initial recognition and measurement

The Company recognizes financial assets and
financial liabilities when it becomes a party to
the contractual provisions of the instrument. All
financial assets and liabilities are recognized at
fair value at initial recognition, plus or minus,
any transaction costs that are directly attributable
to the acquisition or issue of financial assets
and financial liabilities that are not at fair value
through profit or loss.

(3) Financial assets subsequent measurement

Financial assets are subsequently measured
at amortized cost, fair value through other
comprehensive income (FVOCI) or fair value
through profit or loss (FVTPL), as the case
may be, except for the investments where no
information is available with the Company. Such
investments are subsequently measured at cost.
Financial liabilities are subsequently measured at
amortized cost or fair value through profit or loss.

(4) Effective interest method

The effective interest method is a method of
calculating the amortized cost of a debt instrument
and allocating interest income over the relevant
period. The effective interest rate is the rate that
exactly discounts estimated future cash receipts
through the expected life of the debt instrument,
or, where appropriate, a shorter period, to the net
carrying amount on initial recognition. Income
is recognized on an effective interest basis for
debt instruments other than those financial
assets classified as at FVTPL. Interest income is
recognized in profit or loss and is included in the
"Other income" line item.

(5) Trade receivables

Trade receivables are the contractual right
to receive cash or other financial assets and
recognized initially at fair value. These are
subsequently measured at amortized cost (Initial
fair value less expected credit loss). Expected
credit loss is the difference between all contractual
cash flows that are due to the Company and all
that the Company expects to receive (i.e. all cash
shortfall), discounted at the effective interest rate.

(6) Equity investments

All equity investments in the scope of IND AS 109
are measured at fair value other than investments

in subsidiary, associate & Joint Venture which are
stated at cost as per IND AS 27 'separate financial
statement'. For all other equity instruments, the
Company may make an irrevocable election
to present in other comprehensive income
subsequent changes in the fair value. The
Company makes such election on an instrument -
by - instrument basis. For other equity instrument
due to non-availability of sufficient and recent
information, cost is taken as appropriate estimate
of fair value with reference to IND AS 109 'financial
instrument'.

(7) Cash and cash equivalents

Cash and cash equivalent in the balance sheet
comprise cash at banks and on hand and short¬
term deposits with an original maturity of
twelve months or less, which are subject to an
insignificant risk of changes in value.

(8) Financial liabilities

Financial liabilities are recognized initially at fair
value less any directly attributable transaction
costs. These are subsequently carried at
amortized cost using the effective interest method
or fair value through profit or loss. For trade and
other payables maturing within one year from
the balance sheet date, the carrying amounts
approximate fair value due to the short maturity
of these instruments.

(9) Trade payables

Trade payables represent liabilities for goods
and services provided to the Company prior to
the end of financial year and which are unpaid.
Trade payables are presented as current liabilities
unless payment is not due within 12 months after
the reporting period or not paid/ payable within
operating cycle. They are recognized initially at
their fair value and subsequently measured at
amortized cost using the effective interest method.

(10) Borrowings

Borrowings are initially recognized at fair value,
net of transaction costs incurred. Borrowings
are subsequently measured at amortized cost.
Any difference between the proceeds (net of
transaction costs) and the redemption amount is
recognized in profit or loss over the period of the
borrowings using the effective interest method.
Fees paid on the establishment of loan facilities
are recognized as transaction costs of the loan.

Borrowings are classified as current liabilities
unless the Company has an unconditional right
to defer settlement of the liability for at least 12
months after the reporting period. Where there

is a breach of a material provision of a long-term
loan arrangement on or before the end of the
reporting period with the effect that the liability
becomes payable on demand on the reporting
date, the Company does not classify the liability
as current, if the lender agreed, after the reporting
period and before the approval of the financial
statements for issue, not to demand payment as
a consequence of the breach.

(11) Equity Instruments

An equity instrument is any contract that evidences
a residual interest in the assets of Company after
deducting all of its liabilities. Equity instruments
are recognized at the proceeds received, net of
direct issue costs.

(12) Derecognition of financial instrument

The Company de-recognizes a financial asset
when the contractual rights to the cash flows
from the financial asset expire or it transfers the
financial asset and the transfer qualifies for de¬
recognition under IND AS 109. A financial liability
(or a part of a financial liability) is de-recognized
from the Company's balance sheet when the
obligation specified in the contract is discharged
or cancelled or expires.

(13) Offsetting of financial instruments

Financial assets and financial liabilities are offset
and the net amount is reported in the balance
sheet if there is a currently enforceable legal right
to offset the recognized amounts and there is an
intention to settle on a net basis, to realize the
assets and settle the liabilities simultaneously.

(14) Financial guarantee

Financial guarantee contracts issued by the
entities are those contracts that require a
payment to be made to reimburse the holder
for a loss it incurs because the specified debtor
fails to make a payment when due in accordance
with the terms of a debt instrument. Financial
guarantee contracts are recognized initially as a
liability at fair value, adjusted for transaction costs
that are directly attributable to the issuance of the
guarantee. Subsequently, the liability is measured
at the higher of the amount of loss allowance
determined as per impairment requirements
of IND AS 109 and the amount recognized less
cumulative amortization.

XXII. Non-current assets held for sale/ distribution to

owners and discontinued operations

The Company classifies non-current assets (or disposal

groups) as held for sale if their carrying amounts will
be recovered principally through a sale rather than
through continuing use. Held for sale is classified only if
the asset (or disposal group) is available for immediate
sale in its present condition subject only to the terms
that are usual and customary for sale for such assets
(or disposal group) and its sale is highly probable i.e.
management is committed to sale, which is expected
to be completed within the period of contract, as
may have been extended by the term of the contract
or otherwise. Sale transactions include exchanges of
non-current assets for other non-current assets when
the exchange has commercial substance. Non-current
assets (or disposal group) that is to be abandoned are
not classified as held for sale. Non-current assets held
for sale and disposal groups are measured at cost as
the fair value is not available with the Company the
lower of their carrying amount and the fair value less
costs to sell. Assets and liabilities classified as held for
sale are presented separately in the balance sheet.

Interest and other expenses attributable to the liabilities
of a disposal group classified as 'held for sale' will
continue to be recognized.

Non-current asset (or disposal group) is reclassified
from 'held to sale' if the criteria are no longer met and
measured at lower of:

(i) Its carrying amount before the asset (or Disposal
group) was classified as held for sale, adjusted
for any depreciation, amortization or revaluations
that would have been recognized had the asset
(or disposal group) not been classified as held for
sale; and

(ii) Its recoverable amount at the date of the
subsequent decision not to sell.

Any adjustment to the carrying amount of a non-current
asset that ceases to be classified as held for sale is
charged to profit or loss from continuing operations in
the period in which criteria are no longer met.

A disposal group qualifies as discontinued operation
if it is a component of an entity that either has been
disposed-off, or is classified as held for sale, and:

(i) represents a separate major line of business or
geographical area of operations;

(ii) is part of a single coordinated plan to dispose of
a separate major line of business or geographical
area of operations; or

(iii) is a subsidiary acquired exclusively with a view to
re-sell.