k. Provisions and Contingent liability
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result
of a past event, it is probable that an outflow of resources embodying economic benefits will be required
to settle the obligation and a reliable estimate can be made of the amount of the obligation.
Contingent liabilities are disclosed in the notes, if any. Contingent liabilities are disclosed for
i. possible obligations which will be confirmed only by future events not wholly within the control of the
Company or
ii. 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.
l. Employee benefits
Short-term obligations
Short-term employee benefits are expensed as the related service is provided. Liabilities for wages and
salaries, including non-monetary benefits that are expected to be settled wholly within one year after the
end of the period in which the employees render the related service are the end of the reporting period
and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are
presented as current employee benefit obligations in the balance sheet.
Other long-term employee benefits obligations
The liabilities for earned leave and sick leave are not expected to be settled wholly within 12 months
after the end of the period in which the employees render the related service. They are therefore
measured as the present value of expected future payments to be made in respect of services provided
by employees up to the end of the reporting period using the projected unit credit method. The benefits
are discounted using the market yields at the end of the reporting period on government bonds that have
terms approximating to the terms of the related obligation. Re-measurements as a result of experience
adjustments and changes in actuarial assumptions are recognised in profit or loss.
The company does not have an unconditional right to defer settlement for any of these obligations.
However, based on past experience, the company does not expect all employees to take the full amount
of accrued leave or require payment within the next 12 months and accordingly amounts have been
classified as current and non-current based on actuarial valuation report.
Post-employment obligations
The Company operates the following post-employment schemes:
i. defined benefit plan - gratuity; and
ii. defined contribution plans such as provident fund.
Defined benefit plans
The liability or asset recognised in the balance sheet in respect of defined benefit gratuity plans is the
present value of the defined benefit obligation at the end of the reporting period less the fair value of plan
assets. The defined benefit obligation is calculated annually by actuaries using the projected unit credit
method. If the fair value of plan assets exceeds the present value of the defined benefit obligation at the
end of the balance sheet date, then excess is recognized as an asset to the extent that it will lead to, for
example, a reduction in future contribution to plan asset.
The present value of the defined benefit obligation is determined by discounting the estimated future cash
outflows by reference to market yields at the end of the reporting period on government bonds that have
terms approximating to the terms of the related obligation. The net interest cost is calculated by applying
the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This
cost is included in employee benefit expense in the statement of profit and loss. Re-measurement gains
and losses arising from experience adjustments and changes in actuarial assumptions are recognised
in the period in which they occur, directly in other comprehensive income. They are included in retained
earnings in the statement of changes in equity and in the balance sheet. Changes in the present value of
the defined benefit obligation resulting from plan amendments or curtailments are recognised immediately
in profit or loss as past service cost.
Defined contribution plans
Retirement benefit in the form of provident fund and superannuation fund are defined contribution
schemes. The Company has no obligation, other than the contribution payable to the provident fund
and superannuation fund. The Company recognizes contribution payable to the provident fund and
superannuation fund as an expense, when an employee renders the related service. If the contribution
payable to the scheme for service received before the balance sheet date exceeds the contribution already
paid, the deficit payable to the scheme is recognized as a liability after deducting the contribution already
paid.
m. Financial instruments
Financial assets
Initial recognition and measurement
All financial assets are recognised initially at fair value, except for investment in associates where the
Company has availed option to recognise the same at cost in separate financial statements.
The classification depends on the Company’s business model for managing the financial asset and
the contractual terms of the cash flows. The Company classifies its financial assets in the following
measurement categories:
i. those to be measured subsequently at fair value (either through other comprehensive income, or
through profit or loss),
ii. those measured at amortised cost, and
iii. those measured at cost, in separate financial statements.
Subsequent measurement
For assets measured at fair value, gains and losses will either be recorded in profit or loss or other
comprehensive income. For investments in equity instruments, this will depend on whether 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. All other financial assets are measured at amortised
cost, using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account
any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR
amortisation is included in finance income in the statement of profit or loss.
Impairment of financial assets
The Company applies expected credit loss (ECL) model for measurement and recognition of impairment
loss financial assets that are not fair valued.
The Company follows ‘simplified approach’ for recognition of impairment loss allowance on Trade
receivables or contract revenue receivables; and all lease receivables resulting from transactions within
the scope of Ind AS 116. The application of simplified approach does not require the Company to track
changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each
reporting date, right from its initial recognition.
For recognition of impairment loss on other financial assets and risk exposure, the Company determines
that whether there has been a significant increase in the credit risk since initial recognition. If credit risk
has not increased significantly, 12-month ECL is used to provide for impairment loss. However, if credit
risk has increased significantly, lifetime ECL is used.
The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the
reporting date to the amount that is required to be recognized, is recognized under the head ‘other
expenses’ in the statement of profit and loss.
The Company does not have any purchased or originated credit-impaired (POCI) financial assets, i.e.,
financial assets which are credit impaired on purchase/ origination.
De-recognition of financial assets
The Company derecognizes a financial asset when -
i. the contractual rights to the cash flows from the financial asset expire or it transfers the financial
asset and the transfer qualifies for de-recognition under IND AS 109.
ii. it retains 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.
When the entity has neither transferred a financial asset nor retained substantially all risks and rewards
of ownership of the financial asset, the financial asset is de-recognised if the Company has not retained
control of the financial asset. Where the Company retains control of the financial asset, the asset is
continued to be recognised to extent of continuing involvement in the financial asset.
Financial liabilities
Initial recognition
All financial liabilities are recognized initially at fair value and, in the case of loans and borrowings and
payables, net of directly attributable transaction costs.
Subsequent measurement
The subsequent measurement of financial liabilities depends on their classification, as described below:
Trade and other payables
These amounts represent liabilities for goods and services provided to the Company prior to the end
of financial year which are unpaid. The amounts are unsecured and are usually paid within 45 days of
recognition. Trade and other payables are presented as current liabilities unless payment is not due within
one year after the reporting period.
n. Earnings per share
The basic earnings per share is computed by dividing the net profit for the year attributable to equity
shareholders by the weighted average number of equity shares outstanding during the period. The
Company does not have any potential equity share or warrant outstanding for the periods reported, hence
diluted earnings per share is same as basic earnings per share of the Company.
o. Segment reporting
Where a financial report contains both consolidated financial statements and separate financial statements
of the parent, segment information needs to be presented only in case of consolidated financial statements.
Accordingly, segment information has been provided only in the consolidated financial statements.
p. Critical accounting estimates and judgements
Impairment of financial assets
The Company estimates the collectability of Loan receivables and Investments carried at cost by analysing
historical payment patterns, credit-worthiness of party and current economic trends. If the financial
condition of the party deteriorates, additional allowances may be required.
Defined benefit obligation
The cost of the defined benefit plans and the present value of the defined benefit obligation are based on
actuarial valuation using the projected unit credit method. 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, employee turnover rate and mortality rates. Due to the
complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly
sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.
Estimation of fair value
The frequency of valuations depends upon the changes in fair values of the items of investment property being valued.
Since frequent valuations are unnecessary, with only insignificant changes in fair value, the company obtains
independent valuation for its investment properties once in five years, from registered valuers as defined under rule
2 of Companies (Registered Valuers and Valuation) Rules, 2017. The fair values of investment properties have
been determined by A.D. Joshi Chartered Engineers and Valuers LLP. The fair market value is done by valuers is
based on physical inspection of properties and using comparable transfer instances of the similar type of properties
of nearby locations, and with the prevailing market rates. Appropriate depreciation is considered for buildings.
ab Through its defined benefit plans, the Company is exposed to number of risks, the most significant of which
are detailed below:
Asset Volatility: The Plan liabilities are calculated using a discount rate set with reference to government
bond yields. If plan assets underperform, this yield will create a deficit. The plan asset investments are in
funds managed by insurer. These are subject to interest rate risk.
Changes in bond yield: A decrease in government bond yields will increase plan liabilities, although this
may be partially offset by an increase in the returns from plan asset.
b Defined benefit liability and employer contributions:
ba The Company ensures that the investment positions are managed within an asset-liability matching (ALM)
framework that has been developed to achieve long-term investments that are in line with the obligations
under the employee benefit plans. Within the framework, the Company's ALM objective is to match assets to
the gratuity obligations by investing in funds with LIC in the form of a qualifying insurance policy.
The Company actively monitors how the duration and the expected yield of the investments are matching the
expected cash outflows arising from the employee benefit obligations. The Company has not changed the
process used to manage its risks from previous periods.
bb The Company expects to contribute Rs. Nil lakhs to the defined benefit plan during the next annual reporting
period.
b) Fair Value Hierarchy:-
This section explains the judgements and estimates made in determining the fair values of the financial
instruments that are recognised and measured at fair value. To provide an indication about the reliability of
the inputs used in determining fair value, the Company has classified its financial instruments into three levels
prescribed under the accounting standard. An explanation of each level follows underneath the table.
c) Valuation technique used to determine fair value
Level 1: This hierarchy includes financial instruments measured using quoted prices. This includes listed equity
instruments and mutual funds that have quoted price. The fair value of all equity instruments which are traded
in the stock exchange is valued using the closing price as at the reporting period. The fair value of all mutual
funds are arrived at by using closing Net Asset Value published by the respective mutual fund houses.
Level 2: Fair value of financial instruments that are not traded in an active market is determined using valuation
techniques which maximize the use of observable market data and rely as little as possible on entity-specific
estimates. If all significant inputs required to fair value an instrument as observable, the instrument is included
in level 2.
Level 3: If one or more of the significant inputs is not based on observable data, the instrument is included in
level.
d) As per Ind AS 107 "Financial Instrument:Disclosure", fair value disclosures are not required when the carrying
amounts reasonably approximate the fair value. Accordingly fair value disclosures have not been made for
the following financial instruments:-
1. Cash and cash equivalent
2. Other receivables
3. Other financial liabilities
4. Loans
Note 23:-FINANCIAL RISK MANAGEMENT
The Company’s business activities are exposed to a variety of financial risks, namely liquidity risk, market risks
and credit risk. The Company’s senior management has the overall responsibility for establishing and governing
the Company’s risk management framework. The Company’s risk management policies are established to
identify and analyze the risks faced by the Company, to set and monitor appropriate risk limits and controls,
periodically review the changes in market conditions and reflect the changes in the policy accordingly. The
key risks and mitigating actions are also placed before the Audit Committee of the Company.
a. MANAGEMENT OF CREDIT RISK
Credit risk is the risk that a counterparty will not meet its obligations under a contract, leading to a financial loss.
The Company is exposed to credit risk from its operating activities and from its investing activities, including
loans, deposits with banks and other financial instruments.
i) Other financial assets:-
The Company maintains exposure in cash and cash equivalents, loans to Associate and investment in
Associate and Group Companies. Investments of surplus funds are made only with approved counterparties
and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the
Company on an annual basis, and may be updated throughout the year. The limits are set to minimise
the concentration of risks and therefore mitigate financial loss through counterparty’s potential failure to
make payments.
Other financial assets that are potentially subject to credit risk consists of inter corporate loans. The
company assesses the recoverability from these financial assets on regular basis. Factors such as business
and financial performance of counterparty, their ability to repay, regulatory changes and overall economic
conditions are considered to assess future recoverability. The Company charges interest on such loans
is at arms length rate considering counterparty's credit rating. Based on the assessment performed, the
company considers all the outstanding balances of such financial assets to be recoverable as on balance
sheet date and no provision for impairment is considered necessary.
The Company’s maximum exposure to credit risk is the carrying value of each class of financial assets.
ii) Financial Guarantee given:
The Company has given a corporate financial guarantee to banks on behalf of Pudumjee Paper Products
Limited (the "Group Company") for credit facility of 180 crores (31-Mar-24: 180 crores). The credit facility
of the Group Company is short term for 12 months (renewable after expiry with mutual consent and
negotiations).
As per Ind AS 109, the Company is required to recognise financial guarantee commission income and
financial guarantee liability based on fair value of such financial guarantee. However, the Company has
not directly or indirectly received any commission or benefit by whatever name called, for providing such
guarantee. Also there is no future right to receive any benefit/ commission. As per the Management's
assessment, there would not be any change in rate of interest, commission, other charges charged by
the banks to the Group Company on the said credit facility or in any if the terms of the credit facility,
with or without the corporate financial guarantee given by the Company. Further the Group Company is
neither a subsidiary nor an associate of the Company. Hence based on the Management's assessment,
the Company has not recorded any guarantee commission income on the corporate financial guarantee
given to the Group Company.
Based on expected credit loss assessment, the Management does not estimate any liability to arise in
future on account of the corporate financial guarantee given. Hence no liability recognised in books for
such corporate financial guarantee contract.
b. MANAGEMENT OF LIQUIDITY RISK
Liquidity risk is the risk that the Company will face in meeting its obligations associated with its financial
liabilities. The Company’s approach in managing liquidity is to ensure that it will have sufficient funds to meet
its liabilities when due without incurring unacceptable losses or risking damage to company’s reputation. In
doing this, management considers both normal and stressed conditions.
Management monitors the rolling forecast of the company’s liquidity position on the basis of expected cash
flows. This monitoring includes financial ratios and takes into account the accessibility of cash and cash
equivalents.
The following table shows the maturity analysis of the Company’s financial liabilities based on contractually
agreed undiscounted cash flows along with its carrying value as at the Balance Sheet date.
c. MANAGEMENT OF MARKET RISK:
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because
of fluctuation in market prices. These comprise three types of risk i.e. currency rate, interest rate and other
price related risks. Financial instruments affected by market risk include loans and borrowings, deposits and
investments.
i. ) Currency Risk and sensitivity:-
The Company does not have any currency risk as all operations and assets/liabilities are within India.
ii. ) Interest Rate Risk and Sensitive-
Interest rate risk is the risk that the fair value or future cash flows on a financial instrument will fluctuate
because of changes in market interest rates. The management is responsible for the monitoring of the
company’s interest rate position. Various variables are considered by the management in structuring the
company’s investment to achieve a reasonable, competitive, cost of funding.
Cash flow sensitivity analysis for variable rate instruments:-
The Company does not have any variable rate instrument/loan. Hence there will be no change in profit due to
change in interest rates.
iii) Price Risk and Sensitivity:
The company have investment in equities of group companies. The company treats the investment as
strategic and thus fair value the investment through OCI. Thus the changes in the market price of the
securities are reflected under OCI and hence not having impact on profit and loss. The profit or loss on
sale will be considered at the time of final disposal or transfer of the investment. investment in associate
are not fair valued, but accounted using equity method in consolidated financial statements as explained
in note 2(a).
Note 24:- Capital Risk Management
(a) Risk management
The Company’s policy is to maintain an adequate capital base so as to maintain creditor and market confidence
and to sustain future development. In order to maintain or adjust the capital structure, the Company may
adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares. The
Company monitors capital using gearing ratio, which is net debt divided by total capital plus net debt. Net debt
comprises of long term and short term borrowings less cash and bank balances. Equity includes equity share
capital and other equity that are managed as capital.
The Company has not pledged any assets current or non-current, as security.
Note 29: Operating lease as Leasor
The company has given certain industrial land and buildings and Machinery on operating lease. The leases are
renewable for further period on mutually agreeable terms. Management has placed appropriate safeguard for rights
the Company retains on asstes given on operating lease. Further as per indeminity clauses of the lease agreement,
the Company will be compensated for any loss resulting from whatever reason on the assets given on operating
lease other then normal wear and tear.
During the year ended March 31,2025 the Company did not have any transactions with companies struck off
under section 248 of the Companies Act 2013 or section 560 of Companies Act 1956. Hence no further disclosure
required.
Note 31: Benami Property Details
No proceddings has been initiated or pending against the Company for holding any benami property under the
Benami Transaction (Prohibition) Act 1988 or rules made thereunder.Hence no further disclosure required.
Note 32: Layers of Companies
The Company is not in non compliance with number of layers of companies prescribed under clause (87) of section
2 of the Companies Act 2013 read with the Companies (Restriction on number of layers) Rules, 2017. Hence no
further disclosure required.
Note 33: Reclassification
Previous year figure's have been reclassified to conform to this year's classification
The accompanying notes are integral part of the financial statements.
As per our Report of date attached For and on behalf of the Board of Directors
For J M Agrawal & Co. of 3P Land Holdings Limited.
Firm Registration No.100130W
Chartered Accountants
BHAVANI SINGH SHEKHAWAT G. N. JAJODIA
Director Chairman & Executive Director
PUNIT AGRAWAL
Partner
Membership No.148757 J. W. PATIL
Company Secretary & C.F.O
Place : Pune Place : Pune
Dated : 10th May, 2025 Dated : 10th May, 2025
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