2. Significant accounting policies:

2.1. Statement of Compliance

These financial statements are prepared in accordance with Indian Accounting Standard
(Ind AS), and the provisions of the Companies Act, 2013 ('the Act') (to the extent notified)
The Ind AS are prescribed under Section 133 of the Act read with Rule 3 of the
Companies (Indian Accounting Standards) Rules, 2015 and relevant amendment rules
issued thereafter.

2.2. Basis of preparation

These financial statements have been prepared under the historical cost basis and on
the accrual basis except for certain financial instruments that are measured at fair value
in accordance with Ind AS and certain items of property plant and equipment that were
revalued in earlier years in accordance with the previous GAAP principles and the
provisions of the Companies Act, 2013 ('Act') (to the extent notified). The Ind AS are
prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian
Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards)
Amendment Rules, 2016. Historical cost is generally based on the fair value of the
consideration given in exchange for goods and services

2.3. Presentation of financial statements

The Balance Sheet and the Statement of Profit and Loss are prepared and presented in
the format prescribed in the Schedule III to the Companies Act, 2013 (“the Act”). The
statement of cash flows has been prepared and presented as per the requirements of Ind
AS 7 “Statement of Cash flows”. The disclosure requirements with respect to items in the
Balance Sheet and Statement of Profit and Loss, as prescribed in the Schedule III to the
Act, are presented by way of notes forming part of the financial statements along with the
other notes required to be disclosed under the notified Indian Accounting Standards.

2.4. Cash flow statement:

Cash flow statement is prepared segregating the cash flows from operating, investing and
financing activities. Cash flow from operating activities is reported using indirect method
under the indirect method, the net profit / (loss) is adjusted for the effects of:

2.4.1. Changes during the period in inventories and operating receivables and
payables and transactions of a non-Cash nature.

2.4.2. Non-cash items such as depreciation, provisions, unrealized foreign currency
gains and losses, and undistributed profits of associates; and

2.4.3. All other items for which the cash effects are investing or financing cash flows.

2.4.4. The cash flows from operating, investing and financing activities of the
Company is segregated based on the available information. Cash and cash

2.5. Use of Accounting Estimates:

The preparation of the financial statements requires that the management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent liabilities as at the date of financial statements and the results
of operation during the reported period. Although these estimates are based upon
management’s best knowledge of current events and actions, actual results could differ
from these estimates which are recognised in the period in which they are determined.

2.6. Property, Plant and Equipment:

Property, Plant and Equipment are stated at cost of acquisition including applicable
duties and taxes, any directly attributable expenditure on making the asset ready for its
intended use, attributable interest and finance costs, if any, till the date of acquisition/
installation of the assets less accumulated depreciation and impairment losses, if any.
Subsequent expenditure relating to Property, Plant and Equipment is capitalized only
when it is probable that future economic benefits associated with the item will flow to the
Company and the cost of the item can be measured reliably. An item of property, plant
and equipment is derecognized upon disposal or when no future economic benefits are
expected to arise from the continued use of the asset.

2.7. Intangible Assets:

Identifiable intangible assets are recognised when the Company controls the asset, it is
probable that future economic benefits attributed to the asset will flow to the Company
and the cost of the asset can be reliably measured. Intangible assets are stated at cost,
less accumulated amortization and accumulated impairment losses, if any. The
estimated useful life and amortization method reviewed at the end of each reporting
period, with the effect of any changes in estimate being accounted for on a prospective
basis.

2.8. Depreciation/ Amortization:

Depreciable amount for assets is the cost of an asset, or other amount substituted for
cost less its estimated residual value. Depreciation on Property, Plant and equipment has
been provided on Straight -Line method in accordance with the Schedule II of the
Companies Act, 2013, based on the useful life estimated on the technical assessment as
in force and proportionate depreciation are charged for additions/deletions during the
year. In respect of additions / deletions to the fixed assets / leasehold improvements,
depreciation is charged from the date the asset is ready to use / up to the date of
deletion. The asset’s useful lives are reviewed and adjusted, if appropriate, at the end of
each reporting period.

2.9. Financial instruments:

Financial assets and financial liabilities are recognised when the Company becomes a
party to the contractual provisions of the instrument. Financial assets and financial
liabilities are initially measured at transaction values and where such values are
different from the fair value, at fair value. Transaction costs that are directly attributable
to the acquisition or issue of financial assets and financial liabilities (other than financial
assets and financial liabilities at fair value through profit or loss) are added to or
deducted from the fair value of the financial assets or financial liabilities, as appropriate,
on initial recognition. Transaction costs directly attributable to the acquisition of
financial assets or financial liabilities at fair value through profit or loss are recognised
immediately in profit or loss.

2.9.1. Financial Assets

Financial assets are recognised when the Company becomes a party to the
contractual provisions of the instruments. Financial assets other than trade
receivables are initially recognised at fair value plus transaction costs for all
financial assets not carried at fair value through profit or loss. Financial assets
carried at fair value through profit or loss is initially recognised at fair value, and
transaction costs are expensed in the Statement of Profit and Loss.

Subsequent Measurement

For purposes of subsequent measurement, financial assets are classified in
following categories.

2.9.1.1. Financial Assets at Amortized Cost

A financial asset is subsequently measured at amortized cost if it is held
within a business model whose objective is to hold the asset in order to
collect contractual cash flows and 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.

2.9.1.2. Financial Assets Measured at Fair Value

A financial asset is subsequently measured at fair value through other
comprehensive income if it is held within a business model whose objective is
achieved by both collecting contractual cash flows and selling financial
assets and 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. Further, in case where the company has
made an irrevocable selection based on its business model, for its
investments which are classified as equity instruments, the subsequent
changes in fair value are recognized in other comprehensive income. In any
other case, financial asset is fair valued through profit and loss.

2.9.1.3.Impairment of Financial Assets

The Company recognizes loss allowances using the expected credit loss (ECL)
model for the financial assets which are not fair valued through profit or loss.
Loss allowance for trade receivables with no significant financing component
is measured at an amount equal to lifetime ECL. For all other financial
assets, expected credit losses are measured at an amount equal to the 12-
month ECL, unless there has been a significant increase in credit risk from
initial recognition in which case those are measured at lifetime ECL. The
amount of expected credit losses (or reversal) that is required to adjust the
loss allowance at the reporting date to the amount that is required to be
recognised is recognized as an impairment gain or loss in statement of profit
or loss.

2.9.1.4. De-recognition of Financial Assets

The Company de-recognizes a financial asset only when the contractual
rights to the cash flows from the asset expire, or it transfers the financial
asset and substantially all risks and rewards of ownership of the asset to
another entity. If the Company neither transfers nor retains substantially all
the risks and rewards of ownership and continues to control the transferred
asset, the Company recognizes its retained interest in the assets and an
associated liability for amounts it may have to pay. If the Company retains

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asset, the Company continues to recognise the financial asset and also
recognizes a collateralized borrowing for the proceeds received.

2.9.2. Equity Instruments and Financial Liabilities

Financial liabilities and equity instruments issued by the Company are classified
according to the substance of the contractual arrangements entered into and the
definitions of a financial liability and an equity instrument.

2.9.2.1. Equity Instruments

An equity instrument is any contract that evidences a residual interest in
the assets of the Company after deducting all of its liabilities. Equity
instruments which are issued for cash are recorded at the proceeds
received, net of direct issue costs. Equity instruments which are issued for
consideration other than cash are recorded at fair value of the equity
instrument.

2.9.2.2. Financial Liabilities

Financial liabilities are classified, at initial recognition, as financial
liabilities at FVPL, loans and borrowings and payables as appropriate. All
financial liabilities are recognised initially at fair value and, in the case of
loans and borrowings and payables, net of directly attributable transaction
costs.

2.9.2.3. Subsequent Measurement

Financial liabilities are subsequently carried at amortized cost using the
effective interest method. For trade and other payables maturing within one
year from the balance sheet date, the carrying amounts approximate the
fair value due to the short maturity of these instruments.

2.9.2.4. De-recognition of Financial Liabilities

Financial liabilities are de -recognised when the obligation specified in the
contract is discharged, cancelled or expired. When an existing financial
liability is replaced by another from the same lender on substantially
different terms, or the terms of an existing liability are substantially
modified, such an exchange or modification is treated as de-recognition of
the original liability and recognition of a new liability. The difference in the
respective carrying amounts is recognized in the Statement of Profit and
Loss.

2.10. Investment property

Investment properties are properties held to earn rentals and/or for capital
appreciation (including property under construction for such purposes).
Investment properties are measured initially at cost, including transaction costs.
Subsequent to initial recognition, investment properties are measured in
accordance with the Ind AS16’s requirement for cost model.

An investment property is derecognized upon disposal or when the investment
property is permanently withdrawn from use and no further economic benefits
expected from disposal. Any gain or loss arising on de-recognition of the property
is included in profit or loss in the period in which the property is derecognized.

The company does not have any Investment properties.

2.11. Inventories:

2.11.1. Raw Materials:

Raw Materials, construction materials and stores & spares are valued at
weighted average cost or under. Cost includes all charges in bringing the
materials to the place of usage, excluding refundable duties and taxes.

2.11.2. Work in Progress:

Work-in-Progress is valued at the contracted rates less profit
margin/estimates.

2.11.3. Stock in Trade:

Stock in trade are valued at Cost or NRV whichever is Lower.

2.12. Cash and cash equivalent:

Cash and cash equivalent in the balance sheet comprise cash at banks and on
hand and demand deposits with an original maturity of three months or less and
highly liquid investments that are readily convertible into known amounts of cash
and which are subject to an insignificant risk of changes in value net of
outstanding bank overdrafts as they are considered an integral part of the
company’s cash management.

2.13. Provisions, Contingent Liabilities and Contingent Assets:

The Company recognizes provisions when there is present obligation as a result of
past event and it is probable that there will be an outflow of resources and reliable
estimate can be made of the amount of the obligation. A disclosure for Contingent
liabilities is made in the notes on accounts when there is a possible obligation or
present obligations that may, but probably will not, require an outflow of
resources.

Contingent assets are disclosed in the financial statements when flow of economic
benefit is probable.

2.14. Revenue Recognition

Revenue from construction /project related activity and contracts for
supply/commissioning of complex plant and equipment is recognised as follows:

2.14.1. Cost plus contracts: Revenue from cost plus contracts is
determined with reference to the recoverable costs incurred during the period and
the margin as agreed with the customer.

2.14.2. Fixed price contracts: Contract revenue is recognised only to the
extent of cost incurred till such time the outcome of the job cannot be ascertained
reliably subject to condition that it is probable that such cost will be recoverable.
When the outcome of the contract is ascertained reliably, contract revenue is
recognised at cost of work performed on the contract plus proportionate margin,
using the percentage of completion method. Percentage of completions the
proportion of cost of work performed to-date, to the total estimated contract costs.

The estimated outcome of a contract is considered reliable when all the following
conditions are satisfied:

i. the amount of revenue can be measured reliably.

ii. it is probable that the economic benefits associated with the contract will
flow to the company.