vi) Provisions, Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events
and it is probable that there will be an out flow of resources. Provisions are not recognised for future operating losses.
Contingent liabilities are disclosed when there is a possible obligation arising from past events the existence of which will be confirmed only by the
occurrence or non -occurrence of one or more uncertain future events not wholly within the control of the company or a present obligation that
arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount
cannot be made.
Contingent Assets are disclosed , where an inflow of economic benefits is probable.
viQ Tax Expense
The tax expense for the period comprises current and deferred tax. Current and deferred tax is recognized in the Statement of Profit and Loss except
to the extent it relates to items recognized directly in equity or other comprehensive income, in which case it is recognized in equity or other
comprehensive income respectively.
Current Tax:
Current tax charge is based on taxable profit for the year. The tax rates and tax laws used to compute the amount are those that are enacted or
substantially enacted , at the reporting date where the Company operates and generates taxable income. Management periodically evaluates
positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation . It establishes provisions
where appropriate on the bias of amounts expected to be paid to the tax authorities.
Current tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and
Company intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.
Deferred Tax:
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the
corresponding tax bases used in the computation of taxable profit.
Deferred tax assets and liabilities are measured based on the tax rates that are expected to apply in the period when the asset is realised or the
liability is settled , based on tax rates and tax laws that have been enacted or substantively enacted by the end of reporting period. The carrying
amount of deferred tax assets is reviewed at each reporting date.
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 taxes relate to the same taxable entity and the same taxation authority.
viii) Borrowing Cost
Borrowing costs includes interest, amortization of ancillary cost incurred in connection with the arrangement of borrowings and exchange
differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost. Borrowing costs that are
attributable to the acquisition or construction of qualifying assets are considered as a part of cost of such assets less interest earned on the
temporary investment. A qualifying asset is one that necessarily takes substantial period of time to get ready for the intended use. All other
borrowing costs are charged to the Statement of Profit t and Loss in the year in which they are incurred.
ix) Foreign Currency Transactions
Foreign exchange transactions are recorded at the rate prevailing on the dates of the respective transaction. Exchange difference arising on foreign
exchange transactions settled during the year is recognized in the Profit t and Loss Account.
Monetary assets and liabilities denominated in foreign currencies are converted at the closing rate as on Balance Sheet date. The resultant exchange
difference is recognized in the Profit t and Loss Account.
Exchange rate differences arising on a monetary item that, in substance, forms part of the Company's net investment in a nonintegral foreign
operation are accumulated in a foreign currency translation reserve in the Company's financial statements until the disposal of the net investment.
Non monetary assets and liabilities denominated in foreign currencies are carried at the exchange rate prevalent on the date of the transaction.
The company has valued its Current Assets, Current Liabilities and loans in foreign currency in respect of projects in Iraq at the rate prevailing as on
30.06.1984.
x) Functional and presentation currency
Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the
Company operates (the functional currency). The financial statements are presented in Indian rupee (') , which is Company's functional and
presentation currency.
xi) Lease Transactions:
The Company evaluates if an arrangement qualifies to be a lease as per the requirements of Ind AS 116. Identification of a lease requires significant
judgment. The Company uses significant judgement in assessing the lease term (including anticipated renewals) and the applicable discount rate
The Company determines the lease term as the non-cancellable period of a lease, together with both periods covered by an option to extend the lease
if the Company is reasonably certain to exercise that option; and periods covered by an option to terminate the lease if the Company is reasonably
certain not to exercise that option. In assessing whether the Company is reasonably certain to exercise an option to extend a lease, or not to exercise
an option to terminate a lease, it considers all relevant facts and circumstances that create an economic incentive for the Company to exercise the
option to extend the lease, or not to exercise the option to terminate the lease. The Company revises the lease term if there is a change in the non¬
cancellable period of a lease
The discount rate is generally based on the incremental borrowing rate specific to the lease being evaluated or for a portfolio of leases with similar
characteristics.
3) CRITICAL ACCOUNTING IIIDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY
The preparation of the Company's financial statements requires management to make judgement, estimates and assumptions that affect the reported
amount of revenue, expenses, assets and liabilities and the accompanying disclosures. Uncertainty about these assumptions and estimates could
result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.
4) GOING CONCERN
The Company is a going concern in spite of the accumulated losses since there is scope for wiping out these losses in view of the potentiality for
developing existing assets, expected settlements with creditors, the projects under negotiation as well as the future prospects of the company.
35) Leases
A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for
consideration.
Company as a lessee
The Company has elected not to apply the requirements of Ind AS 116 as there is no any contract in writing, further pending litigation with the lessor
the company has treated the transactions as short-term leases for which the underlying asset is of low value. The lease payments associated with
these leases are recognized as an expense in the profit & loss account.
Company as a lessor
At the inception of the lease the Company classifies each of its leases as either an operating lease or a finance lease. The Company recognises lease
payments received under operating leases as income on a straight-line basis over the lease term. In case of a finance lease, finance income is
recognised over the lease term based on a pattern reflecting a constant periodic rate of return on the lessor's net investment in the lease. When the
Company is an intermediate lessor it accounts for its interests in the head lease and the sub-lease separately. It assesses the lease classification of a
sub-lease with reference to the right-of-use asset arising from the head lease, not with reference to the underlying asset. If a head lease is a short
term lease to which the Company applies the exemption described above, then it classifies the sub-lease as an operating lease.
36) Balances in respect of Trade receivables, Loans & advances and Liabilities in most of the cases are subject to confirmations, reconciliations and
adjustments, if any.
37) In the opinion of the management, Loans & Advances and trade receivables have a value on realization in the ordinary course of the business at
least equal to the amount at which they are stated in the books of accounts.
38) In view of carried forward Business loss and unabsorbed depreciation, provision for taxation is not made in the financial statements.
39) As the Company does not fulfil the criteria specified in section 135 of the companies Act read with rule 3 of the Companies (Corporate Social
Responsibility Policy) Rule,2014 ('CSR Rules') CSR Provisions is not applicable to the company.
40) The operation of the Company represents wholly one segment of activity relating to construction. Accordingly all company's assets and liabilities
relate to this activity only.
41) In accordance with the Ind AS 12 "Income Taxes" issued by the Institute of Chartered Accountants of India Deferred tax assets and liabilities
should be recognised for all timing difference in accordance with the said standard. However considering the present financial position and the
requirement of the accounting standard regarding certainty/virtual certainty the same is not provided for as an asset (Net). Deferred tax asset in
relation to carried forward losses and other items is recognised/offset to the extent of deferred tax liability per the requirements of AS22 ,
accordingly there is no any impact on profit and loss account for the year .However the same will be reassessed at a subsequent balance sheet date
and will be accounted for in the year of certainty/virtual certainty in accordance with the aforesaid accounting standard.
42) Computation of Net Profit under Section 197 of the Companies Act has not been given as no remuneration is paid to Directors.
43) Additional Regulatory Informations
a) Disclosure of ratios.
b) The Company has not advanced any loans or advances in the nature of loans to specified persons viz. promoters, directors, KMPs, related parties
and hence reporting requirement with respect to repayment of loan is not appplicable.
c) The Company has not borrowed any funds from banks and financial institutions and according, reporting requirement for utilisation of the same is
not applicable.
d) The Company has not been declared as a wilful defaulter by any lender who has powers to declare a company as a wilful defaulter at any time
during the financial year or after the end of reporting period but before the date when financial statements are approved.
e) The Company has not advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) to or
in any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding, whether recorded in writing or otherwise,
that the Intermediary shall :
(i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate
Beneficiaries) or
(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
f) The Company has not received any funds from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding,
whether recorded in writing or otherwise, that the Company shall :
(i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party
(Ultimate Beneficiaries) or
(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
g) The Company does not have any transactions with struck-off companies.
h) The Company does not have any transaction which is not recorded in the books of accounts but has been surrendered or disclosed as income
during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax
i) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
j) The Company does not hav any subsidiary company/ies and hence reporting requirement with respect to compliance with the number of layers
prescribed under clause (87) of section 2 of the Companies Act, 2013 read with Companies (Restriction on number of Layers) Rules, 2017. is not
applicable.
k) The Company does not have any charges or satisfaction which is required to be registered with the Registrar of Companies (ROC) and hence
reporting requirement for satisfaction of charge beyond the statutory period is not applicable.
l) The company does not have any Immovable property whose Title deeds are not held in the name of the company.
m) The company has not revalued its Property, Plant and Equipment & Intengible Assets during the year.
n) The company does not have any capital work in progress for Intangible Assets under development.
o) The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any
Benami property.
p) The company has not applied for any Scheme of Arrangements to be approved by the Competent Authority in terms of sections 230 to 237 of the
Companies Act, 2013, hence the reporting requirement for disclosure of the same is not applicable.
q) The company does not have any investment property Hence reporting required of fair value of Investment property of the Company is not
applicable.
r) The company does not have any capital-work-in-progres, whose completion is overdue. Further there are no any projects which is temporarily
suspended.
s) The company has not borrowed any funds from banks or financial institution on the basis of Security Assets hence disclouser for the same is not
applicable.
44) Capital Management
The Company's policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future
development of the business. Management monitors the return on capital. The Company adheres to a disciplined Capital Management framework in
order to maintain a strong balance sheet. The main objectives are as follows:
a) Manage interest rates and minimise the impact of market volatility on earnings.
b) Diversify sources of financing in order to manage liquidity risk.
c) Leverage optimally in order to maximise shareholder returns.
45) The previous year's figures have been regrouped & recast wherever necessary to make them comparable.
As per our report of even date attached
For and on behalf of the Board of Directors of
Chartered Accountants Shah Construction Company Limited
Mittal and Associates
FRN 106456W
Mehul J. Shah Mahendra K. Savaliya
Hemant Bohra Chairman & MD Chief Financial
Partner DIN: 00933528 Officer
M.No. : 165667
UDIN:- 24165667BKEZEL3430
Dinesh K. Poddar Anita Vyas Sanjay D. Shah
Place : Mumbai Director Company Director
DATED: 30/05/2024 DIN: 00158597 Secretary DIN:00292226
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