Essex Marine Ltd. ಖಾತೆಯ ಉಪಯುಕ್ತ ಮಾಹಿತಿ

3.11 Provision and Contingent Liabilities:

The Company recognizes a provision when there is a present obligation as a result of a
past event that probably requires an outflow of resources and a reliable estimate can be
made of the amount of the obligation'' A disclosure for a contingent liability is 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 provisions or
disclosure is made.

Provisions for onerous contracts, i.e. contracts where the expected unavoidable costs of
meeting the obligations under the contract exceed the economic benefits expected to be
received under it, are recognized when it is probable than an outflow of resources

embodying economic benefits will be required to settle a present obligation as a result of
an obligating event, based on a reliable estimate of such obligation.

3.12 Inventories:

Raw materials and stores and spare parts are carried at cost. Cost includes purchase price,
duties and taxes (other than those subsequently recoverable by the enterprise from the
taxing authorities), freight inwards and other expenditure incurred in bringing such
inventories to their present location and condition. In determining the cost, weighted
average cost method is used. The carrying costs of raw materials and stores and spare
parts are appropriately written down when there is a decline in replacement cost of such
materials and the finished products in which they will be incorporated are expected to be
sold below cost.

Work in progress and manufactured finished goods are valued at the lower of cost and net
realisable value. The comparison of cost and net realisable value is made on an item by
item basis. Cost of work in progress, and manufactured finished goods comprises of direct
material and labor expenses and an appropriate portion of production overheads incurred
in bringing the inventory to their present location and condition. Fixed production
overheads are allocated on the basis of normal capacity of the production facilities.

Traded finished goods are valued at the lower of cost of procurement and net realisable
value.

3.13 Income Taxes:

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. The amount of current tax reflects the best estimate of the tax amount expected to
be paid or received after considering the uncertainty, if any relating to income taxes. It is
measured using tax rates enacted for the relevant reporting period. It is determined as the
amount of tax payable under the provisions of Income Tax Act, 1961, in respect of taxable
income for the year.

Deferred Tax

Deferred Tax is recognized, subject to the consideration of prudence, on timing
differences, being the difference between taxable incomes and accounting income that
originate in one period and are capable of reversal in one or more subsequent periods.
Deferred tax assets and liabilities are measured using the tax rates and tax laws that have
been enacted or substantively enacted by the balance sheet date. Deferred income tax
relating to items recognized directly in equity is recognized in equity and not in the
statement of profit and loss. Deferred tax assets and deferred tax liabilities are offset, if a
legally enforceable right exists to set off current tax assets against current tax liabilities
and the deferred tax assets and deferred tax liabilities relate to the taxes on income levied
by the same governing taxation laws.

Deferred tax assets are not recognized unless there is virtual certainty that sufficient future
taxable income will be available against which such deferred tax assets can be realized.

3.14 Lease:

Operating Lease:

Leases where the lessor retains substantially all the risks and rewards incidental to
ownership of the leased asset are classified as operating leases.

For Lessees:

Payments made under operating leases are charged to the profit & loss statement on a
straight-line basis over the lease term unless another systematic basis is more
representative of the time pattern of the user’s benefit.

For Lessors:

Rental income from operating leases is recognized on a straight-line basis over the lease
term unless another systematic basis better represents the pattern in which benefits from
the leased asset are derived. The leased asset remains on the lessor’s balance sheet and is
depreciated over its estimated useful life.

Initial direct costs incurred in negotiating and arranging an operating lease are added to
the carrying amount of the leased asset and recognized as an expense over the lease term
on the same basis as the lease income.

Finance Lease:

A finance lease is a lease that transfers substantially all the risks and rewards of ownership
of an asset to the lessee, even though the legal title may not transfer. Whether a lease is a
finance lease or an operating lease depends on the substance of the transaction rather than
its form. Examples of situations which would normally lead to a lease being classified as
a finance lease are:

a) the lease transfers ownership of the asset to the lessee by the end of the lease term;

b) the lessee has the option to purchase the asset at a price which is expected to be
sufficiently lower than the fair value at the date the option becomes exercisable such that,
at the inception of the lease, it is reasonably certain that the option will be exercised;

c) the lease term is for the major part of the economic life of the asset even if title is not
transferred;

d) at the inception of the lease the present value of the minimum lease payments amounts
to at least substantially all of the fair value of the leased asset; and

e) the leased asset is of a specialised nature such that only the lessee can use it without
major modifications being made.

For Lessees:

At the inception of a finance lease, the lessee recognises the lease as an asset and a liability.
Such recognised amount are equal to the fair value of the leased asset at the inception of
the lease. However, if the fair value of the leased asset exceeds the present value of the
minimum lease payments from the standpoint of the lessee, the amount recorded as an
asset and a liability should be the present value of the minimum lease payments from the
standpoint of the lessee. In calculating the present value of the minimum lease payments
the discount rate is the interest rate implicit in the lease, if this is practicable to determine;
if not, the lessee’s incremental borrowing rate should be used.

Lease payments are apportioned between the finance charge and the reduction of the
outstanding liability. The finance charge are allocated to periods during the lease term so
as to produce a constant periodic rate of interest on the remaining balance of the liability
for each period.

The depreciation policy for a leased asset is consistent with that for depreciable assets
which are owned, and the depreciation recognized are calculated on the basis set out in
Accounting Standard (AS) 10, Property, Plant and Equipment. There is no reasonable
certainty that the lessee will obtain ownership by the end of the lease term, the asset will
be fully depreciated over the lease term or its useful life, whichever is shorter.

For Lessors:

The lessor recognizes assets under a finance lease in the balance sheet as a receivable, at
a amount to the net investment in the lease.

Under a finance lease substantially all the risks and rewards incident to legal ownership
are transferred by the lessor, and thus the lease payment receivable is treated by the lessor

as repayment of principal, i.e., net investment in the lease, and finance income to reimburse
and reward the lessor for its investment and services.

The recognised finance income should be based on a pattern reflecting a constant periodic
rate of return on the net investment of the lessor outstanding in respect of the finance lease.

3.15 Earnings per share:

Basic earnings per share is calculated by dividing the net profit or loss for the year
attributable to equity share holder, by weighted average number of equity share
outstanding during the period.

Diluted earnings per share is computed by dividing the net profit or loss attributable to
equity share holder by weighted average number of equity and equivalent diluted equity
share outstanding during the year except where the result would be antidilutive.

3.16 Cash and Bank Balances

Cash and bank balances includes Cash and Cash Equivalents and Other Bank Balances in
which Cash and cash equivalents comprise cash at bank, cash/cheques in hand and short¬
term investments with an original maturity of three months or less and those with more
than three months to 12 months maturity are classified as ‘Other bank balances’. 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 or financing cash flows. Cash flows from operating, investing and financing
activities of the Company are segregated, accordingly.

3.17 Government Grants and Subsidies:

Grants and subsidies from the government are recognized when there is reasonable
assurance that:

(i) the company will comply with the conditions attached to them, and

(ii) the grant/subsidy will be received.

When the grant or subsidy relates to revenue, it is recognized as income on a systematic
basis in the statement of profit and loss over the periods necessary to match them with the
related costs, which they are intended to compensate. Where the grant relates to an asset,
it is recognized as deferred income and released to income in equal amounts over the
expected useful life of the related asset. Government grants of the nature of promoters’
contribution are credited to capital reserve and treated as a part of the shareholders’ funds.

a) Rights, preferences and restrictions attached to equity shares

The Company has only 1 Class of Equity Shares having a par value of Rs 10/- per share. Each holder of Equity Share is entitled to one vote per share.The Dividend proposed by
the Board of Directors is subject to the approval of the Shareholderin the ensuring Annual General Meeting except in case of interim dividend.In the event of liquidation of the
Company, the holders of Equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in the
proportion to the No. of shares held by the shareholder.

b) The Company has issued and allotted 42,62.600 Equity Shares of face value of Rs. 10 each at the price of Rs. 54 each (including Rs. 44 Security Premium) for total
consideration of Rs. 2,301.48/- Lakhs through SME IPO (Initial Public Offer) on Bombay Stock Exchange of India (BSE). The equity share of the Company was Listed on the
BSE platform on 11th August, 2025

c) The Board of Directors of the Company in the Board meeting dated February 05, 2025 and Shareholders of the company in the Extra Ordinary General Meeting dated February
06, 2025 have approved the increase of Authorized Share Capital of the Company from existing Rs. 570.00 Lakhs divided into 57,00.000 equity shares of Rs. 10/- each to Rs.
1700.00 Lakhs divided into 1,70,00,000 equity shares Rs. 10/- each ranking pari passu in all respect with the existing equity shares of the Company as per the Memorandum
and Articles of Association of the Company.

d) The Board of Directors of the Company in the Board meeting dated February 06, 2025 have approved and hereby, have alloted 55.00.000 Bonus shares of face value of Rs. 10/-
each in the ratio of 1 (One) Bonus Shares for every l(One) existing fully paid up equity share held by the shareholders of the Company whose names appear in the Register of
Members of the Company at the close of business hours on February 7, 2025 out of the sum standing to Profit & Loss Account of the Company, for an aggregate nominal value
of Rs. 550.00 lakhs.

The estimates of future salaiy increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as
^ supply and demand in the employment market.

g Sensitivity Analysis

The sensitivity analyses below have been determined based on a method that extrapolates the impact on defined benefit obligation as a result of reasonable
changes in key assumptions occurring at the end of the reporting period. Reasonably possible changes at the reporting date to one of the relevant actuarial
assumptions, holding other assumptions constant, would have affected the defined benefit obligation by the amounts shown below:

Note 35 Leases

Finance Lease - As a Lessee

i) The Company has taken a Land on lease situated at Kolkata Municipal Corporation, Ward No. 57, being part of Udayan Industrial Estate,
Kolkata from West Bengal Small Industries Development Corporation Limited for 83 years since 13th April, 2017.

ii) The Company has taken a property on lease situated in the Project "SILVER SPRING" being Premises No. 5, Kolkata from Mr. Debashish
Sen, the Managing Director of the Company for 30 years since 1st July, 2024.

Operating Lease - As a Lessee

i) The Company has taken a Land on rent for running a factory situated in J.L. No. 227, Mouza Kuliatta, Dag No. 120(P) and 121(P), P.O. and
P.S.: Ramnagar, District: East Medinipur from Mr. Debashish Sen, the Managing Director of the Company for 30 years since 1st January,
2014. Each renewal is at the option of lessee. The total rental expenses during the year ended as on March 31, 2026 was Rs. 0.12 lacs (FY
24-25 = 0.12 lacs; FY 23-24 = 0.12 lacs; FY 22-23 = 0.12 lacs) debited in the Statement of Profit and Loss.

It is considered as Operating Lease as the Lease Term does not cover complete economic life(i.e. 99 years) of the asset. The Company (the
Lessee) does not have the option to purchase the asset from Mr. Debashish Sen (the Lessor) at the price which is lower than fair price on the
date when option become exercisable. The Asset will not be transferred to lessee at the end of the lease term.

Operating Lease - As a Lessor

i) The Company has given its Multi Storied Cold and Dry Storage on Rent to more than one parties for a period of 5 years with renewal of
every 11 months.