4. Significant Accounting Policies
4.1. Use of Estimates

The preparation of financial statements are in conformity with the recognition and measurement principles of Ind AS which
requires management to make critical judgments, estimates and assumptions that affect the reporting of assets, liabilities,
income and expenditure. Estimates and underlying assumptions are reviewed on an ongoing basis and any revisions to
the estimates are recognised in the period in which the estimates are revised and future periods are affected.

Key source of estimation of uncertainty at the date of financial statements, which may cause material adjustment to the
carrying amount of assets and liabilities within the next financial year, is in respect of:

(i) Useful lives and residual value of property, plant and equipment: Property, plant and equipment / intangible assets
are depreciated / amortised over their estimated useful lives, after taking into account estimated residual value.
Management reviews the estimated useful lives and residual values of the assets annually in order to determine the
amount of depreciation / amortisation to be recorded during any reporting period. The useful lives and residual values
are based on the Company''s historical experience with similar assets and take into account anticipated
technological changes. The depreciation / amortisation for future periods is revised if there are significant changes
from previous estimates.

(ii) Impairment of financial assets: The impairment provisions for financial assets are based on assumptions about risk of
default and expected cash loss. The Company uses judgement in making these assumptions and selecting the inputs
to the impairment calculation, based on Company''s past history, existing market conditions as well as forward looking
estimates at the end of each reporting period.

(iii) Impairment of non-financial assets: Impairment exists when the carrying value of an asset or cash generating unit
exceeds its recoverable amount, which is the higher of its fair value less costs of disposal and its value in use. The fair
value less costs of disposal calculation is based on available data for similar assets or observable market prices less
incremental costs for disposing of the asset. The value in use calculation is based on a DCF model. The cash flows are
derived from the budget for the next five years and do not include restructuring activities that the Company is not
yet committed to or significant future investments that will enhance the asset''s performance being tested. The
recoverable amount is sensitive to the discount rate used for the DCF model as well as the expected future cash-
inflows and the growth rate used for extrapolation purposes.

(iv) Employee benefits: The cost of the defined benefit and long-term employee benefit plans and the present value of
the related obligations are determined using actuarial valuations. An actuarial valuation involves making various
assumptions that may differ from actual developments in the future. These include the determination of the discount
rate; future salary increases and mortality rates. Due to the complexities involved in the valuation, a defined benefit
and long-term employee benefit obligations are highly sensitive to changes in these assumptions. All assumptions are
reviewed at each reporting period.

(v) Expense Provisions & Contingent liabilities: The assessments undertaken in recognising provisions and contingencies
have been made in accordance with the applicable Ind AS. A provision is recognized if, as a result of a past event,
the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that
an outflow of economic benefits will be required to settle the obligation. Where the effect of time value of money is
material, provisions are determined by discounting the expected future cash flows.

The Company has capital commitments in relation to various capital projects which are not recognized on the
balance sheet. In the normal course of business, contingent liabilities may arise from litigation and other claims against
the Company. There are certain obligations which management has concluded, based on all available facts and
circumstances, are not probable of payment or are very difficult to quantify reliably, and such obligations are treated
as contingent liabilities and disclosed in the notes but are not reflected as liabilities in the financial statements.
Although there can be no assurance regarding the final outcome of the legal proceedings in which the Company
involved, it is not expected that such contingencies will have a material effect on its financial position or profitability.

(vi) Valuation of deferred tax assets: Deferred tax assets are recognised for unused tax credits to the extent that it is
probable that taxable profit will be available against which the credits can be utilised. Significant management
judgment is required to determine the amount of deferred tax assets that can be recognised, based upon the likely
timing and the level of future taxable profits together with future tax planning strategies.

4.2. Property Plant and Equipment and Intangible Assets

Property, Plant and Equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if
any. Cost includes all expenses related to the acquisition and installation of Property, Plant and Equipment which
comprises its purchase price net of any trade discounts and rebates, any import duties and other taxes (other than those
subsequently recoverable from the tax authorities), any directly attributable expenditure on making the asset ready for its
intended use and other incidental expenses.

Capital Work in Progress: Properties in the course of construction for production, supply or administrative purposes are
carried at cost, less any recognised impairment loss. Cost comprises direct cost, related incidental expenses, pre-operative
expenses, project expenses and for qualifying assets, borrowing costs capitalised in accordance with the Company''s
accounting policy. Such properties are classified to the appropriate categories of property, plant and equipment when
completed and ready for intended use. Depreciation of these assets, on the same basis as other property assets,
commences when the assets are ready for their intended use.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are
expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of
property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of
the asset and is recognised in Statement of Profit and Loss.

Depreciation on assets is provided on the Written down Value (WDV) Method over the estimated useful life of the assets
according to the classification and as per useful life specified in Schedule II to the Companies Act, 2013 except in following
cases, in whose case the life of the assets has been assessed based on technical advice, taking into account the nature
of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement,
anticipated technological changes, etc.

4.4. Impairment of Assets

The Company, at each balance sheet date, assesses whether there is any indication of impairment of any asset and / or
cash generating unit. If such indication exists, assets are impaired by comparing carrying amount of each asset and / or
cash generating unit to the recoverable amount being higher of the net selling price or value in use. Value in use is
determined from the present value of the estimated future cash flows from the continuing use of the assets.

4.5. Foreign Exchange Transactions and Translation

Foreign currency transactions are recorded at exchange rates prevailing on the date of the transaction. The net gain or
loss on account of exchange differences arising on settlement of foreign currency transactions are recognized as income
or expense of the period in which they arise. Monetary assets and liabilities denominated in foreign currency as at the
balance sheet date are translated at the closing rate. The resultant exchange rate differences are recognized in the
statement of profit and loss. Non-monetary assets and liabilities are carried at the rates prevailing on the date of
transaction.

4.6. Inventory

Inventories consist of Raw Material, Stock in trade and Finished Goods and Stores. Inventories are valued at lower of cost
or net realisable value. The cost is determined on the weighted average method and is net of tax credits and after
providing for obsolescence and other losses. Cost includes all charges in bringing the goods their existing location and
conditions, including various tax levies (other than those subsequently recoverable from the tax authorities), transit
insurance and receiving charges. Net realizable value is the contracted selling value less the estimated costs of
completion and the estimated costs necessary to make the sales. The Cost of finished goods includes material and
packing cost, portion of labour and manufacturing overhead.

4.7. Financial Instruments
Financial Assets

Initial recognition and measurement:

The Company recognizes a financial asset in its Balance Sheet when it becomes party to the contractual provisions of
the instrument. All financial assets are recognized initially at fair value, plus in the case of financial assets not recorded at
fair value through profit or loss (FVTPL), transaction costs that are attributable to the acquisition of the financial asset.

Where the fair value of a financial asset at initial recognition is different from its transaction price, the difference between
the fair value and the transaction price is recognized as a gain or loss in the Statement of Profit and Loss at initial
recognition if the fair value is determined through a quoted market price in an active market for an identical asset (i.e.
level 1 input) or through a valuation technique that uses data from observable markets (i.e. level 2 input).

In case the fair value is not determined using a level 1 or level 2 input as mentioned above, the difference between the
fair value and transaction price is deferred appropriately and recognized as a gain or loss in the Statement of Profit and
Loss only to the extent that such gain or loss arises due to a change in factor that market participants take into account
when pricing the financial asset.

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

For subsequent measurement, the Company classifies a financial asset in accordance with the below criteria:

(i) The Company''s business model for managing the financial asset and

(ii) The contractual cash flow characteristics of the financial asset.

Based on the above criteria, the Company classifies its financial assets into the following categories:

(i) Financial assets measured at amortized cost.

(ii) Financial assets measured at fair value through other comprehensive income (FVTOCI).

(iii) Financial assets measured at fair value through profit or loss (FVTPL)

Financial assets measured at amortized cost:

A financial asset is measured at the amortized cost if both the following conditions are met:

a) The Company''s business model objective for managing the financial asset is to hold financial assets in order to collect
contractual cash flows, and

b) 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.

This category applies to cash and bank balances, trade receivables and other financial assets of the Company. Such
financial assets are subsequently measured at amortized cost using the effective interest method.

Under the effective interest method, the future cash receipts are exactly discounted to the initial recognition value
using the effective interest rate. The cumulative amortization using the effective interest method of the difference
between the initial recognition amount and the maturity amount is added to the initial recognition value (net of
principal repayments, if any) of the financial asset over the relevant period of the financial asset to arrive at the
amortized cost at each reporting date. The corresponding effect of the amortization under effective interest method
is recognized as interest income over the relevant period of the financial asset. The same is included under other
income in the Statement of Profit and Loss.

The amortized cost of a financial asset is also adjusted for loss allowance, if any.

Financial assets measured at FVTOCI:

Financial assets that are held within a business model whose objective is achieved by both, selling financial assets and
collecting contractual cash flows that are solely payments of principal and interest, are subsequently measured at fair
value through other comprehensive income. Fair value movements are recognized in the other comprehensive income
(OCI). Interest income measured using the EIR method and impairment losses, if any are recognised in the Statement of
Profit and Loss.

Financial assets measured at FVTPL:

A financial asset is measured at FVTPL unless it is measured at amortized cost or at FVTOCI as explained above. Such
financial assets are subsequently measured at fair value at each reporting date. Fair value changes are recognized in
the Statement of Profit and Loss.

Financial Liabilities

Initial recognition and measurement:

The Company recognizes a financial liability in its Balance Sheet when it becomes party to the contractual provisions of
the instrument. All financial liabilities are recognized initially at fair value minus, in the case of financial liabilities not
recorded at fair value through profit or loss (FVTPL), transaction costs that are attributable to the acquisition of the
financial liability.

Where the fair value of a financial liability at initial recognition is different from its transaction price, the difference
between the fair value and the transaction price is recognized as a gain or loss in the Statement of Profit and Loss at initial
recognition if the fair value is determined through a quoted market price in an active market for an identical asset (i.e.
level 1 input) or through a valuation technique that uses data from observable markets (i.e. level 2 input).
In case the fair value is not determined using a level 1 or level 2 input as mentioned above, the difference between the
fair value and transaction price is deferred appropriately and recognized as a gain or loss in the Statement of Profit and
Loss only to the extent that such gain or loss arises due to a change in factor that market participants take into account
when pricing the financial liability.

Subsequent measurement:

All financial liabilities of the Company are subsequently measured at amortized cost using the effective interest method.
Under the effective interest method, the future cash payments are exactly discounted to the initial recognition value
using the effective interest rate. The cumulative amortization using the effective interest method of the difference
between the initial recognition amount and the maturity amount is added to the initial recognition value (net of principal
repayments, if any) of the financial liability over the relevant period of the financial liability to arrive at the amortized cost
at each reporting date. The corresponding effect of the amortization under effective interest method is recognized as
interest expense over the relevant period of the financial liability. The same is included under finance cost in the
Statement of Profit and Loss.

Equity Instruments

An equity instrument is a contract that evidences residual interest in the assets of the company after deducting all of its
liabilities. Incremental costs directly attributable to the issuance of equity instruments are recognised as a deduction from
equity, net of any tax effects.

De-recognition of financial assets and liabilities

The Company derecognizes a financial asset when the contractual right to the cash flows from the asset expires or it
transfers the rights to receive the contractual cash flows on the financial asset in a transaction which substantially all the
risk and rewards of ownership of the financial asset are transferred. If the Company retains substantially all the risk and
rewards of ownership of a transferred financial asset, the Company continues to recognize the financial asset and also
recognizes a collateralized borrowing for the proceeds received. The Company derecognizes a financial liability when
its contractual obligations are discharged, cancelled or expired; the difference between the carrying amount of
derecognized financial liability and the consideration paid is recognized as profit or loss.

Impairment of financial assets

At each balance sheet date, the Company assesses whether a financial asset is to be impaired. Ind AS 109 requires
expected credit losses to be measured through loss allowance. The Company measures the loss allowance for financial
assets at an amount equal to lifetime expected credit losses if the credit risk on that financial asset has increased
significantly since initial recognition. If the credit risk on a financial asset has not increased significantly since initial
recognition, the Company measures the loss allowance for financial assets at an amount equal to 12-month expected
credit losses. The Company uses both forward-looking and historical information to determine whether a significant
increase in credit risk has occurred.

Offsetting of Financial Instruments

Financial assets and financial liabilities are offset, and the net amount is reported in financial statements if there is a
currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to
realise the assets and settle the liabilities simultaneously.

Trade Receivables

Trade receivables are amounts due from customers for sale of goods and services in the ordinary course of business.
Trade receivables are initially recognized at its transaction price which is considered to be its fair value and are classified
as current assets as it is expected to be received within the normal operating cycle of the business.

Cash & Cash Equivalents

Cash and cash equivalents consists of cash on hand, balance with banks, short demand deposits. Short term means
investments with original maturities / holding period of three months or less from the date of investments. Bank overdrafts
that are repayable on demand and form an integral part of the Company''s cash management are included as a
component of cash and cash equivalent for the purpose of statement of cash flow.

Trade Payables

Trade payables are amounts due to vendors for purchase of goods or services acquired in the ordinary course of business
and are classified as current liabilities to the extent it is expected to be paid within the normal operating cycle of the
business.

Other financial assets and liabilities

Other non-derivative financial instruments are initially recognized at fair value and subsequently measured at amortized
costs using the effective interest method.

4.8. Revenue Recognition

Revenue from contracts with customers is recognized on transfer of control of promised goods or services to a customer
at an amount that reflects the consideration to which the Company is expected to be entitled to in exchange for those
goods or services. Revenue towards satisfaction of a performance obligation is measured at the amount of transaction
price allocated to that performance obligation. The transaction price of goods sold and services rendered is net of
variable consideration on account of various discounts and schemes offered by the Company as part of the contract.

Revenue from sale of products is recognized when the control on the goods have been transferred to the customer. The
performance obligation in case of sale of product is satisfied at a point in time i.e., when the material is dispatched to
the customer or on delivery to the customer, as may be specified in the contract.

Rendering of services:

Revenue from services is recognized on satisfaction of performance obligation for the services rendered.
If the services rendered / goods sold by the Company exceed the payment, a contract asset is recognised. If the
payments by customer exceeds the services rendered / goods sold, a contract liability is recognised.

Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the
Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference
to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts
estimated future cash receipts through the expected life of the financial asset to that asset''s net carrying amount on
initial recognition.

4.9. Employee Benefits

Employee benefits include Salary, wages and gratuity expense.

Defined benefit plan:

For defined benefit plan in the form of gratuity, the cost of providing benefits is determined using the projected unit credit
method, with actuarial valuations being carried out at the end of each annual reporting period. Remeasurement,
comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan
assets (excluding net interest), is reflected immediately in the balance sheet with a charge or credit recognised in other
comprehensive income in the period in which they occur. Remeasurement recognised in other comprehensive income
is reflected immediately in retained earnings and is not reclassified to Statement of Profit and Loss. Past service cost is
recognised in profit or loss in the period of a plan amendment. Net interest is calculated by applying the discount rate at
the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorised as follows:

• service cost (including current service cost, past service cost, as well as gains and losses on curtailments and
settlements);

• net interest expense or income; and

• remeasurement

The Company presents the first two components of defined benefit costs in Statement of Profit and Loss in the line item
‘Employee benefits expense''. Curtailment gains and losses are accounted for as past service costs. The retirement benefit
obligation recognised in the balance sheet represents the actual deficit or surplus in the Company''s defined benefit plans.
Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of
refunds from the plans or reductions in future contributions to the plans. A liability for a termination benefit is recognised at
the earlier of when the entity can no longer withdraw the offer of the termination benefit and when the entity recognises
any related restructuring costs.

Short-term employee benefits:

A liability is recognised for benefits accruing to employees in respect of wages and salaries, annual leave and other short
term employee benefits in the period the related service is rendered at the undiscounted amount of the benefits expected
to be paid in exchange for that service.

4.10. Operating Expenses

Operating Expenses are charged to statement of Profit and Loss on accrual basis.

4.11. Leases

As a lessee, the company recognises a right-of-use asset and a lease liability at the lease commencement date. The right-
of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease
payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to
dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any
lease incentives received.

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the
earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-
of-use assets are determined on the same basis as those of property, plant and equipment. In addition, the right-of-use
asset is periodically reduced by impairment losses, if any, and adjusted for certain re-measurements of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement
date, discounted using the interest rate as suggested by Ind AS 116.

Lease payments included in the measurement of the lease liability comprise the Fixed payments, including in-substance
fixed payments.

The lease liability is measured at amortised cost using the effective interest method. When the lease liability is remeasured,
a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the
carrying amount of the right-of-use asset has been reduced to zero. The company presents right-of-use assets as separate
line item in Non-current Assets and lease liabilities in ‘borrowings'' in the balance sheet.

Short-term leases and leases of low-value assets:

The company has elected not to recognise right-of-use assets and lease liabilities for short-term leases of real estate
properties that have a lease term of less than 12 months. The company recognises the lease payments associated with
these leases as an expense on a straight-line basis over the lease term.

1. CORPORATE INFORMATION

Kotyark Industries Limited (the Company) was originally
incorporated as private limited Company on December 30,
2016. The Company was converted to public limited Company
w.e.f. August 05, 2021. The Company in the business of bio¬
diesel manufacturing and other by products. The equity shares
of the Company are listed on NSE Emerge Platform of National
Stock Exchange of India Limited.

2. BASIS OF PREPARATION OF FINANCIAL
STATEMENTS

2.1 Basis of preparation:

The accompanying Standalone Financial Statements have
been prepared and presented under the historical cost
convention on the accrual basis of accounting and comply
with the requirements of Accounting Standards as specified
under Section 133 of the Companies Act, 2013(Act), read
with the Companies (Accounting Standards) Rules, 2021 and
other accounting principles generally accepted in India. The
accounting policies have been consistently applied except
where a newly issued Accounting Standard is initially adopted or
a revision to an existing Accounting Standard requires a change
in the accounting policy hereto in use.

2.2 System of Accounting:

The Standalone Financial Statements are prepared on historical
cost basis. The Company follows the mercantile system of
accounting and recognizes income and expenditure on the
accrual basis.

2.3 Use of Estimates:

The preparation of Financial Information requires the management
of the Company to make estimates and assumptions that affect
the balances of assets and liabilities and disclosures relating to
the contingent liability as at the date of the financial information
and reported amounts of income and expenses like useful lives
of property, plant and equipment, provision for taxation, etc.,
during the year. Management believes the estimates used in
the preparation of the financial information are prudent and
reasonable. Future results may vary from these estimates.

3. SIGNIFICANT ACCOUNTING POLICIES

3.1 Property, Plant and Equipment:

"Property, plant and equipment and Intangible Assets are stated
at their cost of acquisition less accumulated depreciation. The
cost of acquisition includes freight, installation cost, duties,
taxes and other incidental expenses, identifiable with the asset,
incurred during the installation/construction stage in order to
bring the assets to their working condition for intended use,
including borrowing costs capitalized, if any, but are net of Input
Tax Credits availed for the relevant element in the Cost.

Property, plant and equipment include Lease hold Land, which
is amortized equally over the tenure of Lease. The value of
Lease hold Land includes cost of premium and other expenses

incurred in order to meet the condition of lease agreement and
get the Land on Lease. Intangible assets comprise of Trademark.

An item of property, plant and equipment is derecognised upon
disposal or when no future economic benefits are expected
to arise from the continued use of the asset. Any gain or loss
arising on the disposal or retirement of an item of property,
plant and equipment is determined as the difference between
the sales proceeds and the carrying amount of the asset and is
recognised in statement of profit & loss.

3.2 Depreciation and Amortisation:

Depreciation on assets is provided on the Written down Value
(WDV) Method over the estimated useful life of the assets
according to the classification and as per useful life specified
in Schedule II to the Companies Act, 2013 except in following
cases, in whose case the life of the assets has been assessed
based on technical advice, taking into account the nature of
the asset, the estimated usage of the asset, the operating
conditions of the asset, past history of replacement, anticipated
technological changes, etc. Lease hold Land is amortised over a
tenure of Lease on straight line basis.

On the additions/disposal during the year, depreciation is
provided pro-rata on the basis of number of days for which the
asset was used during the year. Intangible assets are amortised
over a period of 5 Years on straight line basis.

3.3 Operating expenses:

Operating expenses are accounted in financial statements on
accrual basis.

3.4 Inventories:

Inventories of raw material and finished goods are valued at
lower of the cost or net realizable value. Obsolete, defective and
unserviceable Inventory, if any, are duly provided for.

3.5 Revenue Recognition:

Revenue from sale of products are recognised when the risk
and rewards of ownership of products are passed on to the
customers. Revenue is recorded exclusive of GST and net of
trade and quantity discounts or rebates granted.

Income from Services rendered are booked based on
agreements/arrangements with the concerned parties.

Interest is recognized on a time proportion basis taking into
account the amount outstanding and the rate applicable.
Dividend income is recognised if the right to receive payment is
established by the Balance Sheet date.

3.6 Borrowing Costs:

Borrowing costs that are directly attributable to the acquisition of
qualifying assets are to be capitalized for the year until the asset
is ready for its intended use. A qualifying asset being, an asset
that necessarily takes a substantial period of time to get ready
for its intended use. Other borrowing costs are to be recognized
as an expense in the year in which they are incurred.

3.7 Employee Benefits:

(a) Short term benefits

All employee benefits payable wholly within twelve months of
rendering the service are classified as short-term employee
benefits. These benefits include compensated absences
such as privilege leave and sickness leave. The undiscounted
amount of short-term employee benefits expected to be paid in
exchange for the services rendered by employees is recognized
during the period.

(b) Post-employment benefits - Defined contribution
plan

The Company’s provident fund scheme is defined contribution
plan. The Company’s contribution paid/payable under the
schemes is recognised as expense in the statement of Profit
and Loss during the period in which the employee renders the
related service.

3.8 Accounting for Taxes on Income:

(a) Income tax expense comprises current tax (i.e. amount of
tax for the year determined in accordance with the Income
Tax Act, 1961) and deferred tax charge or credit (reflecting
the tax effects of timing differences between accounting
income and taxable income for the year).

(b) The deferred tax charge or credit and the corresponding
deferred tax liabilities or assets are recognised using the
rates and laws that have been enacted or substantively
enacted at the balance sheet date. Deferred tax assets are
recognised only to the extent there is reasonable certainty
the assets can be realised in future; however, where there
is unabsorbed depreciation and carry forward loss under
taxation laws, deferred tax assets are recognised only
if there is a virtual certainty of realisation of such assets.
Deferred tax assets are reviewed at each balance sheet
date and written down or written up to reflect the amount
that is reasonably/virtually certain (as the case may be) to
be realised.

3.9 Impairment of Assets:

The Company assesses at each balance sheet date whether
there is any indication that an asset may be impaired. If any such
indication exists, the Company estimates the recoverable amount
of the asset. The recoverable amount is the greater of the net
selling price and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value
based on an appropriate discount factor. If such recoverable
amount of the asset or the recoverable amount of the cash
generating unit to which the asset belongs is less than its carrying
amount, the carrying amount is reduced to its recoverable
amount. The reduction is treated as an impairment loss and is
recognized in the profit and loss account. If at the balance sheet
date there is an indication that a previously assessed impairment
loss no longer exists, the recoverable amount is reassessed and

Property, plant and equipment include Lease hold Land, which is amortized equally over the tenure of Lease. The value of Lease hold Land includes cost of premium and other expenses incurred in order to meet the condition of lease agreement and get the Land on Lease. Intangible assets comprise of Trademark.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in statement of profit & loss.

II. Depreciation and Amortisation:

Depreciation on assets is provided on the Written down Value (WDV) Method over the estimated useful life of the assets according to the classification and as per useful life specified in Schedule II to the Companies Act, 2013 except in following cases, in whose case the life of the assets has been assessed based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, etc. Lease hold Land is amortised over a tenure of Lease on straight line basis.

3. significant accounting policies

I. Property, Plant and Equipment and Intangible Assets:

Property, plant and equipment and Intangible Assets are stated at their cost of acquisition less accumulated depreciation. The cost of acquisition includes freight, installation cost, duties, taxes and other incidental expenses, identifiable with the asset, incurred during the installation / construction stage in order to bring the assets to their working condition for intended use, including borrowing costs capitalized, if any, but are net of Input Tax Credits availed for the relevant element in the Cost.

On the additions/disposal during the year, depreciation is provided pro-rata on the basis of number of days for which the asset was used during the year. Intangible assets are amortised over a period of 5 Years on straight line basis.

III. Operating expenses:

Operating expenses are accounted in financial statements on accrual basis.

IV. Inventories:

Inventories of raw material and finished goods are valued at lower of the cost or net realizable value. Obsolete, defective and unserviceable Inventory, if any, are duly provided for.

V. Revenue Recognition:

Revenue from sale of products are recognised when the risk and rewards of ownership of products are passed on to the customers. Revenue is recorded exclusive of GST and net of trade and quantity discounts or rebates granted.

Income from Services rendered are booked based on agreements/ arrangements with the concerned parties.

Interest is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable. Dividend income is recognised if the right to receive payment is established by the Balance Sheet date.

VI. Borrowing Costs:

Borrowing costs that are directly attributable to the acquisition of qualifying assets are to be capitalized for the year until the asset is ready for its intended use. A qualifying asset being, an asset that necessarily takes a substantial period of time to get ready for its intended use. Other borrowing costs are to be recognized as an expense in the year in which they are incurred.

VII. Employee Benefits:

(a) Short-term benefits:

All employee benefits payable wholly within twelve months of rendering the service are classified as short-term employee benefits. These benefits include compensated absences such as privilege leave and sickness leave. The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees is recognized during the period.

(b) Post-employment benefits:

Defined contribution plan

The Company''s provident fund scheme is defined contribution plan. The Company''s contribution paid/payable under the schemes is recognised as expense in the statement of Profit and Loss during the period in which the employee renders the related service.

VIII. Accounting for Taxes on Income:

(a) Income tax expense comprises current tax (i.e. amount of tax for the year determined in accordance with the Income Tax Act, 1961) and deferred tax charge or credit (reflecting the tax effects of timing differences between accounting income and taxable income for the year).

(b) The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognised using the rates and laws that have been enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty the assets can be realised in future; however, where there is unabsorbed depreciation and carry forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of such assets. Deferred tax assets are reviewed at each balance sheet date and written down or written up to reflect the amount that is reasonably /virtually certain (as the case may be) to be realised.

IX. Impairment of Assets:

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. The recoverable amount is the greater of the net selling price and value in use. In assessing value in use,

the estimated future cash flows are discounted to their present value based on an appropriate discount factor. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the profit and loss account. If at the balance sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of depreciable historical cost.

1. CORPORATE INFORMATION

The Kotyark Industries Limited (the Company) was originally incorporated on December 30, 2016, as “Kotyark Industries Private Limited” vide Registration No. 094939/2016-2017 under the provisions of the Companies Act, 2013 with the Registrar of Companies, Central Registration Centre. Further, the Company was converted into Public Limited Company and consequently name of Company was changed from “Kotyark Industries Private Limited” to “Kotyark Industries Limited” vide Special resolution passed by the Shareholders at the Extra-Ordinary General Meeting held on July 24, 2021 and a fresh certificate of incorporation dated August 5, 2021 issued by the Registrar of Companies, Ahmedabad. The Company in the business of bio-diesel manufacturing

2. BASIS OF PREPARATION OF STANDALONE FINANCIAL STATEMENTS

2.1 Basis of preparation:

The accompanying Standalone Financial Statements have been prepared and presented under the historical cost convention on the accrual basis of accounting and comply with the requirements of Accounting Standards as specified under section 133 of the Companies Act, 2013 (Act), read with the Companies (Accounting Standards) Rules, 2021 and other accounting principles generally accepted in India. The accounting policies have been consistently applied except where a newly issued Accounting Standard is initially adopted or a revision to an existing Accounting Standard requires a change in the accounting policy hereto in use.

2.2 System of Accounting:

The Standalone Financial Statements are prepared on historical cost basis. The Company follows the mercantile system of accounting and recognizes income and expenditure on the accrual basis.

2.3 Use of Estimates:

The preparation of Financial Information requires the management of the Company to make estimates and assumptions that affect the balances of assets and liabilities and disclosures relating to the contingent liability as at the date of the financial information and reported amounts of income and expenses like useful lives of property, plant and equipment, provision for taxation, etc., during the year. Management believes the estimates used in the preparation of the financial information are prudent and reasonable. Future results may vary from these estimates.

3. SIGNIFICANT ACCOUNTING POLICIES I. Property, Plant and Equipment and Intangible Assets:

Property, plant and equipment and Intangible Assets are stated at their cost of acquisition less accumulated

depreciation. The cost of acquisition includes freight, installation cost, duties, taxes and other incidental expenses, identifiable with the asset, incurred during the installation/construction stage in order to bring the assets to their working condition for intended use, including borrowing costs capitalized, if any, but are net of Input Tax Credits availed for the relevant element in the Cost.

Property, plant and equipment include Lease hold Land, which is amortized equally over the tenure of Lease. The value of Lease hold Land includes cost of premium and other expenses incurred in order to meet the condition of lease agreement and get the Land on Lease. Intangible assets comprise of Trademark.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in statement of profit & loss.

II. Depreciation and Amortisation:

Depreciation on assets is provided on the Written down Value (WDV) Method over the estimated useful life of the assets according to the classification and as per useful life specified in Schedule II to the Companies Act, 2013 except in following cases, in whose case the life of the assets has been assessed based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, etc. Lease hold Land is amortised over a tenure of Lease on straight line basis.

On the additions/disposal during the year, depreciation is provided pro-rata on the basis of number of days for which the asset was used during the year. Intangible assets are amortised over a period of 5 Years on straight line basis.

III. Operating expenses:

Operating expenses are accounted in financial statements on accrual basis.

IV. Inventories:

Inventories of raw material and finished goods are valued at lower of the cost or net realizable value. Obsolete, defective and unserviceable Inventory, if any, are duly provided for.

V. Revenue Recognition:

Revenue from sale of products are recognised when the risk and rewards of ownership of products are passed on to the customers. Revenue is recorded exclusive of GST and net of trade and quantity discounts or rebates granted.

Income from Services rendered are booked based on agreements/arrangements with the concerned parties.

Interest is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable. Dividend income is recognised if the right to receive payment is established by the Balance Sheet date.

VI. Borrowing Costs:

Borrowing costs that are directly attributable to the acquisition of qualifying assets are to be capitalized for the year until the asset is ready for its intended use. A qualifying asset being, an asset that necessarily takes a substantial period of time to get ready for its intended use. Other borrowing costs are to be recognized as an expense in the year in which they are incurred.

VII. Employee Benefits:

(a) Short term benefits:

All employee benefits payable wholly within twelve months of rendering the service are classified as short-term employee benefits. These benefits include compensated absences such as privilege leave and sickness leave. The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees is recognized during the period.

(b) Post-employment benefits:

Defined contribution plan

The Company''s provident fund scheme is defined contribution plan. The Company''s contribution paid/ payable under the schemes is recognised as expense in the statement of Profit and Loss during the period in which the employee renders the related service.

VIII. Accounting for Taxes on Income:

(a) Income tax expense comprises current tax (i.e. amount of tax for the year determined in accordance with the Income Tax Act, 1961) and deferred tax charge or credit (reflecting the tax effects of timing differences between accounting income and taxable income for the year).

(b) The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognised using the rates and laws that have been enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty the assets can be realised in future; however, where there is unabsorbed depreciation and carry forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of such assets. Deferred tax assets are reviewed at each balance sheet date and written down or written up to reflect the amount that is reasonably/virtually certain (as the case may be) to be realised.

IX. Impairment of Assets:

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. The recoverable amount is the greater of the net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value based on an appropriate discount factor. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the profit and loss account. If at the balance sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of depreciable historical cost.

X. Provisions, Contingent Liabilities and Contingent Assets:

The Company creates a provision when there is 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. When 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. A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity. Contingent assets are neither recognised nor disclosed in standalone financial statements.

XI. Leases:

Lease, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased asset during the lease term, are classified as operating leases. Lease payments under operating lease are recognised as an expense in the profit and loss account

on a straight-line basis over the lease term, considering the renewal terms, if appropriate.

XII. Earnings Per Share (EPS):

Basic EPS is computed using the weighted average number of equity shares outstanding during the year. Diluted EPS is computed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the year-end, except where the results would be anti-dilutive.

XIII. Cash and Cash Equivalents:

Cash and Cash Equivalents comprises Cash-in-Hand, Short term Deposits and Balance in Current Accounts with Banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

XIV. Goods and Service Tax:

Goods and service tax is accounted for in the books of accounts in accordance with the provisions of the goods and service tax law for the time being in force, and the liability or the credits are accordingly disclosed in the financial information.

XV. Events occurring after the Reporting Date:

Adjusting events (that provides evidence of condition that existed at the balance sheet date) occurring after the balance sheet date are recognized in the standalone financial statements. Material non adjusting events (that are inductive of conditions that arose subsequent to the balance sheet date) occurring after the balance sheet date are disclosed in the Board''s Report.

XVI. General:

Any other accounting policy not specifically referred to are consistent with generally accepted accounting principles.