7. Provisions and contingent liabilities
A provision is recognized when the Group has a present obligation as a result of past events 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. Provisions (excluding retirement benefits) are discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.
Contingent liabilities are disclosed in the notes. Contingent liabilities are disclosed for:
i) possible obligations which will be confirmed only by future events not wholly within the control of the Group; or
(1) present obligations arising from past events where it is not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount of the obligation cannot be made.
8. Leases
Leases under which the company assumes substantially all the risks and rewards of ownership are classified as finance leases. When acquired, such assets are capitalized at fair value or present value of the minimum lease payments at the inception of the lease, whichever is lower. Lease under which the risks and rewards incidental to ownership are not transferred to lessee is classified as operating lease. Lease payments under operating leases are recognized as an expense on a straight line basis in net profit in the statement of profit and loss over the lease term.
9. Borrowing costs
Borrowing costs that are directly attributable to the acquisition / construction of qualifying assets or for long - term project development are capitalized as part of their costs.
Borrowing costs are considered as part of the asset cost when the activities that are necessary to prepare the assets for their intended use are in progress.
Borrowing costs consist of interest and other costs that incurs in connection with the borrowing of funds. Other borrowing costs are recognized as an expense, in the period in which they are incurred.
10. Segment Reporting
The Company has only one segment i.e. "Real Estate". Hence there are no reportable segments under IND AS-108 (Operating Segments). During the year under Report, the company has carried out all the business operations in India. The conditions prevailing in India being uniform, no separate geographic disclosure are considered necessary Hence segment reporting is not required.
11. Cash and cash equivalents
Cash and cash equivalent in the financial statement comprise cash at banks and on hand, demand deposit and short-term deposits, which are subject to an insignificant risk of changes in value.
For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short term deposits, as defined above.
12. Employee benefits
i) Short term employee benefits
Short-term employee benefits are measured on an undiscounted basis and are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.
ii) Defined contribution plans
Obligations for contributions to defined contribution plans such as Provident Fund and Employee State Insurance Corporations are expensed as the related service is provided.
iii) Defined Benefit Plans
The liability for the Gratuity is debited to the Profit & Loss Account is charged as and when the liability is crystalized and paid and to that extent IND AS -19 is deviated. However its effect on financial statements is not material.
13. Revenue Recognition
The revenue from the project related to real estate developments is recognized on the basis of conveyance deed executed with the members of the scheme and possession given to the members, on a year to year basis in pursuance of Indian Accounting Standard - 115 (Ind AS - 115) and Guidance Note on Real Estate Developers (Revised), 2012, issued by ICAI.
The revenue from the Works Contract related projects is recognized as per the terms and conditions of the "Works Contract Agreement" and accordingly periodic invoices are raised.
Interest Income is recognized on time proportion basis taking into account outstanding balance and rate of interest agreed upon with the parties.
14. Income tax
Income tax expense comprises current tax expense and the net change in the deferred tax asset or liability during the year. Current and deferred taxes are recognized in statement of profit and loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the
current and deferred tax are also recognized in other comprehensive income or directly in equity, respectively.
i) Current tax
Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any adjustment to the tax payable or receivable in respect of previous years. It is measured using tax rates enacted or substantively enacted at the reporting date.
ii) Deferred tax
Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.
Deferred tax assets are recognized for unused tax losses, unused tax credits and deductible temporary differences to the extent there is convincing evidence that sufficient taxable profit will be available against which such deferred tax asset can be realized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized; such reductions are reversed when the probability of
future taxable profits improves.
Unrecognized deferred tax assets are reassessed at each reporting date and recognized to the extent that it has become probable that future taxable profits will be available against which they can be used.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date.
The measurement of deferred tax reflects the tax consequences that would follow from the manner in which the Company expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities
iii) Minimum Alternative Tax (MAT)
MAT credit is recognized as a deferred tax asset only when and to the extent there is convincing evidence that the Company will pay normal tax during specified period. MAT credit is reviewed at each balance sheet date and written down to the extent the aforesaid convincing evidence no longer exists.
Note 1: Net Account Receivable as on 31/3/23 and 31/03/24 taken as Average of closing balance shown in Financials.
Note 2: Net Account Payable as on 31/3/23 and 31/03/24 taken as Average of closing balance shown in Financials.
*There are no debt having fixed repayment obligation and hence DSCR not reported.
For, Arpan Shah & Associates Fo r and on behalf of the Board of
Chartered Accountants ART NIRMAN LIMITED
FRN No: 125049W
Ashokkumar Thakker Piyushkumar Thakkar
CA Arpan Shah Chairman & MD Executive Director
Proprietor (DIN: 02842849) (DIN: 07555460)
Membership No: 116736 UDIN:24116736BKELXB3879
PLACE: AHMEDABAD Chetan Kumar Modi Yesha Shah
Date: 14/08/2024 Chief Financial Officer Company Secretary
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