1. Corporate Information
Baheti Recycling Industries Limited (Formaly Known as Baheti Metal and Ferro Allyos Limited) aluminium recycling company, primarily engaged in processing aluminium based metal scrap to manufacture (I) Aluminium alloys in the form of ingots and (II) Aluminium de-ox alloys in the form of cubes, ingots, shots and notch bar. The versatile properties of aluminium and its alloys, results in it being used in various industries, which include automobiles, construction, electrical transmission application, food packaging etc. Aluminium alloys ar<* used in automobile components due to its stiffness, corrosion resistance and excellent strength to weight ratio. The Aluminium de-ox alloys are used as deoxidizer in steel manufacturing units.
Baheti Recycling Industries Limited ( was originally incorporated as a public limited company under the name of “Baheti Metal and Ferro Alloys Limited” on December 28,1994 under the provisions] of The Companies act,1956 with the Registrar of Companies, Gujarat, Dadra and Nagar Haveli bearing registration number as 04-24001.Subsequently ,the name of our company was changed from “Baheti Metal and Ferro Alloys Limited” to “Baheti Recycling Industries Limited vide a fresh certificate of incorporation dated January 25,2022,issued by the Registrar of the Companies, Ahmedabad, Gujarat bearing CIN as U37100GJ1994PLC024001.
2. Significant Accounting Policies
2.1 Basis of Preparation of Financial statements
There financial statements are prepared in accordance with Indian Generally Accepted Accounting principles (GAAP) under the historical cost convention on the accrual basis. GAAP comprises mandatory accounting standards as prescribed under Section 133 of the Companies Act,2013(“the act”) read with Rule 7 of the Companies (Account) Rules,2014, the provisions of the act.
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2.2 Use of Estimates: '
The preparation of financial statements in conformity with Indian GAAP requires judgements, estimates and assumptions to be made that effect the reported amount of assets and liabilities, disclosure of contingent liabilities on the date of financial statement and the reported amount of revenues and - expenses during the reporting period. Difference between the actual results and estimates are recognised in the period in which the results are known/materialised.-
2.3 Accounting Convention
The company follows the mercantile system of accounting, recognizing income and expenditure on accrual basis. The accounts are prepared on historical cost basis and as a going concern basis. Accounting policies not referred to specifically otherwise, are consistent with the generally accepted accounting principles. \
2.4 Property. Plant & Equipment Tangible Assets
Property, plant and equipment are stated as per cost model.i.e.at cost less accumulated depreciation and impairment, if any, costs directly attributable to acquisition are capitalised until the property, plant and equipment are ready for use, as intended by the managemenfc^Bistxomprises the purchase
price and any attributable cost of bringing the asset to its working condition for its intended use. Input tax credit of GST, grants on capital goods are accounted for by reducing the cost of capital goods.
Subsequent expenditures relating to property, plant and equipment are capitalised only when it is probable that future economic benefits associated with them will flow to the company and the cost of expenditure can be measured reliably. Repairs and maintenance costs are recognized in the statement of profit and loss when they are incurred. /
When assets are disposed or retired, their cost is removed from the financial statements. The gain or loss arising on the disposal or retirement of an asset is determined as the difference between sales proceeds and the carrying amount of the asset and is recognized in statement of profit and loss for the relevant financial year.
Intangible Assets
Intangible assets purchased are initially measured at cost. The cost of an intangible asset comprises its purchase price including any cost directly attributable to making the asset ready for their intended use.
2.5 Denreciation
Depreciation on property, plant and equipment, tangible and intangible assets has been provided under straight line method over the useful life of assets estimated by the management which is in line with the terms prescribed in schedule II to the Companies act,2013. Depreciation for assets purchased/sold during the period is proportionately charged. Depreciation method, useful life and residual value are reviewed periodically.
2.6 Revenue Recognition _
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Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliable measured.
Sale of Goods _____
Revenue is recognized when the significant risks and rewards of ownership of the goods have been passed to the buyer. Sales are disclosed net of GST, trade discounts and returns as applicable.
Income from services
Revenue from services is recognized when services have been rendered and there should be no uncertainty regarding consideration and its ultimate collection.
Interest Income
Interest income is recognized on a time proportionate basis taking into account the amount outstanding and the rate applicable.
Dividend Income
Dividend income is recognised on receipt basis.
2.7 Inventories
Raw materials including store item and packing material have been valued at cost. Cost is determined on FIFO basis.
Cost of finished goods and semi-finished goods includes all cost of purchase, conversion cost and other cost incurred in bringing the inventories to their present location and condition. The net realizable value is estimated selling price in the ordinary course of business less , the estimated costs of completion and estimated cost necessary to make the finished goods/product ready for sale.
2.8 Investment
Investment which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as noncurrent investments.
On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.
2.9 Retirement benefits and other employee benefits
All Short-term employee benefits are accounted on undiscounted basis during the accounting period based on services rendered by employees. The company’s contribution to provident fund is charged to the statement of profit and loss on accrual basis. The company’s obligation is limited to the amount to be contributed by it. The liability in respect of gratuity is recognized on the basis of actuarial valuation.
2.10 Borrowing cost i
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Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets till such time the asset is readyjor its intended use. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. Costs incurred in raising funds are amortized equally over the period for which the funds are acquired. All other borrowing costs are charged to profit and loss account.
2.11 Cash Flow Statement
Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing and financing cash flows. The cash flows from operating, investing and financing activities are segregated.
2.12 Taxation
The accounting treatment for the income tax in respect of the company’s income is based on the accounting standard on “accounting for taxes on Income” (AS-22). The provision made for income tax in accounts comprises both, the current tax and deferred tax. Provision for current tax is made on the assessable income as per Income tax rate is applicable to the relevant assessment year after considering various deductions available under income tax act,1961.
Deferred tax is recognised for all timing differences, being the differences between the taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Such deferred tax is quantified using the tax rates and laws enacted or substantively enacted as on the balance sheet date. The carrying amount of deferred tax asset/liability is reviewed at each balance sheet date and consequential adjustments are carried out.
2.13 Provisions. Contingent liabilities and Contingent assets
A provision is recognized, if as a result of a past event, the company has a present legal obligation that is reasonably estimable and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by the best estimate of the likely future outflow of economic benefits required to settle the obligation at the reporting date.
Where no reliable estimate can be made, a disclosure is made as contingent liability. A disclosure for a contingent liability is also made when there is a possible obligation or a present obligation that may but probably will not require an outflow of resources. Where 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.
Contingent assets are neither recognized nor disclosed in the financial statements.
However, Contingent assets are assessed regularly and when it becomes reasonably certain that inflow of economic benefit will arise then same is recognised in books of accounts.
2.14 Contingencies and events occurring after the balance sheet date
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Events that occur between balance sheet date and date on which these are approved, might suggest the requirement for and adjustment(s) to the assets and the liabilities as at balance sheet date or might need disclosure. Adjustments are required to assets andjiabilities for events which occur after balance sheet date which offer added information substantially affecting the determination of the amounts which relates to the conditions that existed at balance sheet date.
2.1$ Impairment of Assets
Ah asset is treated as impaired when carrying cost of assets exceeds its recoverable value. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flows. An impairment loss is charged off to profit and loss account as and when asset is identified for impairment. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount: An asset is treated as impaired when carrying cost of assets exceeds its recoverable value. The recoverable amount is measured as the higher of the net selling price and the value in use determined by the present value of estimated future cash flow.
2.16 Foreign Currency Transactions
a. Initial Recognition:
Foreign currency transactions are recorded in the reporting currency by applying the exchange rate between the reporting currency and the foreign currency at the date of transaction.
b. Conversion:
Foreign currency monetary items are reported using the closing rate.
c. Exchange Difference:
Exchange differences arising on the settlement of monetary items at rates different from those at which they are initially recorded during the year or reported in previous financial statement are recognized as income or as expenses at the end of the year by applying closing rate.
2.17 Earnings per Share
Basic earnings per share is calculated by dividing the net profit after tax by the weighted average number of equity shares outstanding during the period. Diluted earnings per share is computed by dividing the net profit after tax by the weighted average number of equity shares considered for deriving basic earnings per share and also the weighted average number of shares that could have been issued upon conversion of all dilutive potential equity shares.
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The diluted potential equity shares are adjusted for the proceeds receivable had the shares have been actually issued at fair value which is the average market value of the outstanding shares. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless issued at a later date. Dilutive potential equity shares are determined independently for each period presented.
In case of bonus issue the weighted average number of equity shares outstanding during the period and for all periods presented should be adjusted for events, other than the conversion of potential equity shares, that have changed the numbeir of equity shares outstanding, without a corresponding change in resources.
2.18 Government Grants:
Government grants are recognized when there is reasonable assurance that the company will comply with the conditions attached to them and the grants will be received. '
Government grants whose primary conditions that company should purchase, construct or otherwise acquired capital assets are presented by deducting them from carrying value of assets.
Grants related to the revenue are adjusted against expenses to the extent there is certainty to receive.
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