2 Material accounting policies and critical
accounting estimate and judgments

2.1 Basis of preparation, measurement and significant
accounting policies

The material accounting policies applied in the preparation
of these financial statements are set out below. These
policies have been consistently applied to all the years
presented, unless otherwise stated.

(a) Basis of preparation
Compliance with Ind AS

The financial statements of the Company have been
prepared in accordance with Indian Accounting
Standards (“Ind AS”) notified under the Companies
(Indian Accounting Standards) Rules, 2015 as
amended and relevant provisions of the Companies
Act, 2013 (“the Act”).

Historical cost convention

The financial statements have been prepared
under the historical cost convention, as modified
by the following:

• Certain financial assets and financial
liabilities at fair value;

• Assets held for sale - measured at fair value
less cost to sell;

• Defined benefit plans - plan assets that are
measured at fair value;

• Equity instruments in subsidiaries at fair value.

Fair value measurement

Fair value is the price that would be received to sell
an asset or paid to transfer a liability in an orderly
transaction between market participants on the
measurement date. The Company uses valuation
techniques that are appropriate in the circumstances
for which sufficient data is available to measure fair
value, maximising the use of relevant observable
inputs and minimising the use of unobservable inputs.

All assets and liabilities for which fair value is
measured or disclosed in the financial statements are
categorised 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

Current vis-a-vis non-current classification

The assets and liabilities reported in the balance
sheet are classified on a “current/non-current basis”,
with separate reporting of assets held for sale and
liabilities. Current assets, which include cash and cash
equivalents, are assets that are intended to be realized,
sold or consumed during the normal operating cycle of
the Company or in the 12 months following the balance
sheet date; current liabilities are liabilities that are
expected to be settled during the normal operating cycle
of the Company or within the 12 months following the
close of the financial year.

Offsetting financial instruments

Financial assets and liabilities are offset and the net
amount is reported in the balance sheet where there
is a legally enforceable right to offset the recognised
amounts and there is an intention to settle on a
net basis or realise the asset and settle the liability
simultaneously. The legally enforceable right must
not be contingent on future events and must be
enforceable in the normal course of business and in
the event of default, insolvency or bankruptcy of the
Company or the counterparty.

(b) Recent accounting pronouncements:

Ministry of Corporate Affairs (“MCA”) notifies new
standards or amendments to the existing standards
under Companies (Indian Accounting Standards)
Rules as issued from time to time. For the year ended
March 31, 2025, MCA has notified Ind AS - 117
Insurance Contracts and amendments to Ind AS 116
- Leases, relating to sale and leaseback transactions,
applicable to the Company w.e.f. April 1, 2024. The
Company has reviewed the new pronouncements and
based on its evaluation has determined that it does not
have any significant impact in its financial statements.

(c) Property, plant and equipment

The Company has changed its accounting policy, w.e.f.
January 01,2025, in respect of freehold land from cost
model to revaluation model. Fair value of freehold land
to be ascertained at regular intervals. A revaluation
surplus will be recorded in other comprehensive
income and credited to the revaluation reserve in equity.
However, to the extent that it reverses a revaluation
deficit of the same asset previously recognised in the
statement of profit or loss, the increase is recognised in
the statement of profit and loss. A revaluation deficit is
recognised in the statement of profit and loss, except to
the extent that it offsets an existing surplus on the same
asset recognised in the asset revaluation reserve. All
other items of property, plant and equipment are stated
at cost which includes capitalised borrowing cost, less
accumulated depreciation and impairment loss, if any.
Cost includes expenditure that is directly attributable
to the acquisition of the items. Subsequent costs are
included in the asset’s carrying amount or recognised
as a separate asset, as appropriate, 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. The carrying amount
of any component accounted for as a separate asset
is derecognised when replaced. All other repairs and
maintenance are charged to statement of profit and loss
during the reporting period in which they are incurred.

Expenditure incurred on assets which are not ready
for their intended use comprising direct cost, related
incidental expenses and attributable borrowing cost
are disclosed under Capital Work-in-Progress.

Depreciation methods, estimated useful life and
residual value

Depreciation is provided to the extent of depreciable
amount on Straight Line Method (SLM) based on

useful life of the following class of assets as prescribed
in Part C of Schedule II to the Companies Act, 2013
except in case of motor vehicles where the estimated
useful life has been considered as five years based
on a technical evaluation by the management.

Estimated useful life, residual values and depreciation
methods are reviewed annually, taking into account
commercial and technological obsolescence as well
as normal wear and tear and adjusted prospectively,
if appropriate.

(d) Lease

The Company is the lessee

The Company lease assets primarily consists of office
premises which are of short term lease with the term
of twelve months or less and low value leases. For
these short term and low value leases, the Company
recognizes the lease payments as an expense in the
Statement of Profit and Loss on a straight line basis
over the term of lease.

(e) Impairment of non-financial assets

Assets which are subject to depreciation or amortisation
are tested for impairment whenever events or changes
in circumstances indicate that the carrying amount may
not be recoverable. An impairment loss is recognised
for the amount by which the asset’s carrying amount
exceeds its recoverable amount. The recoverable
amount is the higher of an asset’s fair value less
costs of disposal and value in use. For the purposes
of assessing impairment, assets are grouped at the
lowest levels for which there are separately identifiable
cash inflows which are largely independent of the cash
inflows from other assets or groups of assets (cash¬
generating units). Non-financial assets that suffered an
impairment are reviewed for possible reversal of the
impairment at the end of each reporting period.

(f) Trade receivable

Trade receivable represents the Company’s right to
an amount of consideration that is unconditional i.e.
only the passage of time is required before payment
of consideration is due and the amount is billable.

(g) Financial instruments

A financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability
or equity instruments of another entity.

Investments and other financial assets

(i) Classification

The Company classifies its financial assets in
the following measurement categories:

• those to be measured subsequently at fair
value (either through Other Comprehensive
Income or through profit or loss) and

• those measured at amortised cost.

The classification depends on the entity’s
business model for managing the financial assets
and the contractual terms of the cash flows.

For assets measured at fair value, gains and
losses will either be recorded in statement of
profit or loss or Other Comprehensive Income.
For investments in debt instruments, this will
depend on the business model in which the
investment is held. For investments in equity
instruments in subsidiaries, the Company
has made an irrevocable election at the
time of initial recognition to account for the
equity investment at fair value through Other
Comprehensive Income.

The Company reclassifies debt investments
when and only when its business model for
managing those assets changes.

(ii) Measurement

At initial recognition, the Company measures
financial assets at its fair value plus, in the case
of a financial assets not at fair value through
profit or loss, transaction costs that are directly
attributable to the acquisition of the financial
assets. Transaction costs of financial assets
carried at fair value through profit or loss are
expensed in Statement of Profit and Loss.

However, trade receivables that do not contain
a significant financing component are measured
at transaction price.

Debt instruments

Subsequent measurement of debt instruments
depends on the Company’s business model
for managing the asset and the cash flow
characteristics of the asset. There are three
measurement categories into which the
Company classifies its debt instruments:

Amortised cost

Assets that are held for collection of contractual
cash flows where those cash flows represent
solely payments of principal and interest are
measured at amortised cost. A gain or loss on a
debt investment that is subsequently measured
at amortised cost is recognised in profit or loss
when the asset is derecognised or impaired.
Interest income from these financial assets
is included in other income using the effective
interest rate method.

Fair value through Other Comprehensive
Income (FVOCI)

Assets that are held for collection of contractual
cash flows and for selling the financial assets,
where the asset’s cash flows represent solely
payments of principal and interest, are measured
at FVOCI. Movements in the carrying amount are
taken through OCI, except for the recognition of
impairment gains or losses, interest revenue and
foreign exchange gains and losses which are
recognised in profit and loss. When the financial
asset is derecognised, the cumulative gain or
loss previously recognised in OCI is reclassified
from equity to profit or loss and recognised in
other gains/ (losses). Interest income from these
financial assets is included in other income
using the effective interest rate method.

Fair Value through Profit or Loss (FVTPL)
Assets that do not meet the criteria for amortised
cost or FVOCI are measured at FVTPL.
A gain or loss on a debt investment that is
subsequently measured at fair value through
profit or loss is recognised in Statement of Profit
and Loss in the period in which it arises. Interest
income from these financial assets is included
in other income.

Equity investments

The Company subsequently measures all equity
investments in subsidiaries at fair value. The
Company’s management has elected to present
fair value gains and losses on equity investments
in Other Comprehensive Income, there is no
subsequent reclassification of fair value gains
and losses to profit or loss. Dividends from such
investments are recognised in Statement of Profit
and Loss as other income when the Company’s
right to receive payments is established.

Changes in the fair value of financial assets at
FVTPL are recognised in the Statement of Profit
and Loss. Impairment losses (and reversal
of impairment losses) on equity investments
measured at FVOCI are not reported separately
from other changes in fair value.

(iii) Impairment of financial assets

The Company assesses on a forward looking
basis the expected credit losses associated
with its assets carried at amortised cost. The
impairment methodology applied depends on
whether there has been a significant increase
in credit risk.

For trade receivables only, the Company applies
the simplified approach permitted by Ind AS
109- ‘Financial Instruments’, which requires
expected lifetime losses to be recognised from
initial recognition of the receivables.

(iv) Derecognition of financial assets

A financial asset is derecognised only when:

• the Company has transferred the
rights to receive cash flows from the
financial asset, or

• the rights to receive cash flows from the
financial asset have expired, or

• retains the contractual rights to receive
the cash flows of the financial asset, but
assumes a contractual obligation to pay
the cash flows to one or more recipients.

Where the entity has transferred an asset, the
Company evaluates whether it has transferred
substantially all risks and rewards of ownership
of the financial asset. In such cases, the
financial asset is derecognised. Where the entity

substance of the contractual arrangements
and the definition of a financial liability and an
equity instrument.

An equity instrument is any contract that
evidences a residual interest in the assets of an
entity after deducting all of its liabilities.

(ii) Initial recognition and measurement

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.

The Company’s financial liabilities include trade
and other payables, loans and borrowings
including bank overdrafts and financial
guarantee contracts.

(iii) Subsequent measurement

The measurement of financial liabilities depends
on their classification, as described below:

Borrowings

Borrowings are subsequently carried at amortised
cost; any difference between the proceeds (net
of transaction costs) and the redemption value
is recognised in the Statement of Profit and
Loss over the period of the borrowings using the
effective interest rate method.

Fees paid on the establishment of loan facilities
are recognised as transaction costs of the loan
to the extent that it is probable that some or all
of the facility will be drawn. In this case, the fee
is deferred until the drawdown occurs. To the
extent there is no evidence that it is probable
that some or all of the facility will be drawdown,
the fee is capitalised as a pre-payment for
liquidity services and amortised over the period
of the facility to which it relates.

Trade and other payables

These amounts represent obligations to pay for
goods or services that have been acquired in
the ordinary course of business from suppliers.
Those payable are classified as current
liabilities if payment is due within one year
or less otherwise they are presented as non-

current liabilities. Trade and other payables are
subsequently measured at amortised cost using
the effective interest rate method.

Financial guarantee contracts

Financial guarantee contracts are recognised as
a financial liability at the time when guarantee
is issued. The liability is initially recognised at
fair value and subsequently at the higher of
the amount determined in accordance with Ind
AS 37 and the amount initially recognised less
cumulative amortisation, where appropriate.

Where guarantees in relation to loans of
subsidiaries are provided for no compensation,
the fair values are credited to the Statement of
Profit and Loss over the guarantee period using
the systematic method. Financial guarantee
contract issued by the Company are measured
at fair value at the time of issue of guarantee or
amendment in terms of guarantees.

(iv) Derecognition

Borrowings are removed from the Balance Sheet
when the obligation specified in the contract is
discharged, cancelled or expired. The difference
between the carrying amount of a financial
liability that has been extinguished or transferred
to another party and the consideration paid,
including any non-cash assets transferred or
liabilities assumed, is recognised in statement of
profit or loss as other gains / (losses). 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 the derecognition of
the original liability and the recognition of a new
liability. The difference in the respective carrying
amounts is recognised in the Statement of
Profit and Loss.

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 entity 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.

(j) Borrowing costs

General and specific borrowing costs that are
directly attributable to the acquisition, construction
or production of a qualifying asset are capitalised
during the period of time that is required to complete
and prepare the asset for its intended use or sale.
Qualifying assets are assets that necessarily take
a substantial period of time to get ready for their
intended use or sale.

Investment income earned on the temporary
investment of specific borrowings pending their
expenditure on qualifying assets is deducted from the
borrowing costs eligible for capitalisation.

Other borrowing costs are expensed in the period in
which they are incurred.