1 SIGNIFICANT ACCOUNTING POLICIES

TO FINANCIAL STATEMENTS FORTHE YEAR ENDED 31.03.201S

(Attached to and forming part of the financial statement asat 31st March 2015)

a) Financial Statements have been brpared at historical cost and in accordance with the generally accepted accounting principles on Going Concern basis.

b) WIP & Consumables are stated at cost and Raw Material and Finished Goods are valued at cost or market value whichever is lower as per AS- 2. Finished Goods and Process stock include cost of conversion and other cost incurred in bringing the inventories to their brsent location and condition after considering the credit of VAT and Cenvat.

c) Cash Flow Statement is brpared by the "Indirect method" set out in AS 3 on "Cash Flow Statement" and brsents the cash flow by operating, investing and financing activities of the company. Cash and Cash equivalents brsented in Cash Flow Statement consist of Cash on Hand and demand deposits with banks.

d) Payment related to earlier years booked as expenses in the current year are classified as "Prior Period Item" as per AS-S, as these are clearly distinct from ordinary activities of the company. Further, Accounting policies have been changed in respect of Debrciation on Fixed Assets. The Changes has been made in the estimated useful life of the assets. The revised estimation of useful life of the assets has been taken on the basis useful life of the assets as brscribed under Schedule II to the Companies Act 2013.

e) Fixed Assets are stated at cost less debrciation charged on "Straight Line Method" in accordance with the schedule HtoCompaniesAct2013.

f) Debrciation on fixed assets has been charged on "Straight Line Method" on Pro-rata basis and has been realigned in accordance with schedule II to the Companies Act, 2013. Life span of all the assets have been recalculate and taken as per schedule II. Carrying value of assets is now debrciated over its remaining useful life. Residual value of the assets has been taken as nil in case of all assets which is also with the provisions of Schedule II. The assets of which residual life remains nil as on 01.04.2014, the book value of these assets has been transferred to retained earnings, which is a deviation from AS 6.

g) All expenses and income are accounted for on accrual basis and accordingly company follows the Mercantile System of Accounting except stated otherwise as per AS 9. Claims / refunds not ascertainable with reasonable certainty are accounted for on settlement basis.

h) No Transactions in foreign currency done during the year. Previous year there was Income arise on account of foreign exchange fluctuation of Rs. 39,048/- which was booked as income as per AS 11, issued by ICAI.

i) As per AS-15, Employee Benefits, provisions of employee benefits are to be done on accrual basis, but in the absence of actuarial valuation it is not possible to quantify the amount payable on account of Gratuity and Leave Encashment benefits and are to be accounted for on cash basis. Its effect on Profit and Loss of the company is not determined.

j) Borrowing costs are interest and other costs incurred by an enterprise in connection with the borrowing of funds for acquisition of qualifying asset. A qualifying asset is an asset that necessarily takes a "substantial period of time" to get ready for its intended use or sale. The company has not acquired any "qualifying asset" during the financial year as per AS-16, Borrowing Cost issued by ICAI.

k) The company does not have separate segment that are subject to separate risk and returns. Hence, the provisions of clause 41 of listing agreement and AS-17 issued by ICAI with regard to segmental reporting are not applicable to the company.

I) Transactions entered by the company with the related parties, has been disclosed by way of notes as defined under AS -18 issued by ICAI.

m) Basic earnings per share is calculated by dividing Net profit after tax for the year attributable to Equity Shareholders of the company by the weighted average number of equity shares outstanding during the year. Diluted earning per share is calculated by dividing Net profit after tax for the year attributable to Equity Shareholders of the company(after adjustment of diluted earnings) by the weighted average number of equity shares outstanding during the year. Basic earning per share is Rs. (-) 2.35 per share and diluted earnings per share is Rs. (-) 2.35 per share. [Previous Year Basic EPS Rs. (-) 0.94 Per Share and Diluted EPS Rs. (-J0.94].

n) There is no subsidiary company of the company, also the company has neither obtained any economic benefit from its activities nor did the company entered into any joint venture with any entity. Hence, the provisions of AS-21,23 and 27 issued by ICAI not applicable to the company.

o) As per AS-22, "Taxes on Income", company has Deferred Tax Asset. The company has been reporting negative income during the year and also over the last few years. Considering the past trend and in the absence of reasonable certainty that sufficient future taxable income would be available against which deferred tax assets would be realized. Hence deferred tax assets has not been accounted for which is in accordance with AS-22 issued by ICAI.

p) Due to having loss in the current financial year and accumulated carried forward loss under the income tax act, no provision for current year taxation is made for the year.

q) During the year the company has again started its commercial production after the production activity was closed since long. The company has introduced new production line in addition of earlier one. The board is of the opinion that the company is still in the line of operation and not discontinued its line of operation as per AS 24.

r} Asset is treated as impaired when carrying cost of the assets exceeds its recoverable amount. No asset is impaired during the year. Also inventory and other assets have realizable value at which it is stated in the books of accounts; hence no impairment loss needs to be booked as per AS-28, issued by ICAI.

s) Contingent liabilities are not provided for but disclosed, if any by way of notes on account and will be accounted for in the year of occurrence as per AS 29.

2 NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31.03.201S

a) Gratuity and Leave Encashment benefits are accounted for on cash basis. In the absence of actuarial valuation it is not possible to quantify the amount payable on this account and its effect on Profit and Loss of the company.

b) In opinion of Board, there is no unpaid amount due to Small Scale Industrial Undertaking and SMEs for more than45 days and also there is no interest paid or payable during the year towards unpaid amount or delayed payment to such enterprises.

e) Service Tax and Penalty amount of Rs. 48,874/- paid under protest during the year was considered as expenses on being lapse of reasonable time for appeal. Further Rs. 44,57B/- was also paid in the same matter to discharge the whole liability of demand order and the amount paid is classified as "extraordinary items" in final accounts.

f) Extraordinary items and prior period items contains Rs. 16,611/- towards PF Penalty, Rs. 1,70,82B/- towards Maintenance charges to Govt. Agency for prior period and Rs. 93,452/- towards Service Tax as detailed above.

g) No contract on capital account is remaining to be executed duringand at the close of the year.

h) Debrciation on fixed assets has been charged on "Straight Line Method" on Pro-rata basis and has been realigned in accordance with schedule II to the Companies Act, 2013. Life span of all the assets have been recalculate and taken as per schedule II. Carrying value of assets is now debrciated over its remaining useful life. Residual value of the assets has been taken as Nil in case of all assets which is also with the provisions of Schedule II. The assets of which residual life remains nil as on 01.04.2014, the book value of these assets has been transferred to retained earnings.

i) The Fixed assets items of which residual life remains nil as on 01.04.2014) book value of these assets has been transferred to retained earnings. Accordingly the debrciation has been less charged by Rs. 27,80,047/- in the Profit and Loss Statement and Loss is less computed by the same amount.

j) Plant Building construction is completed during the year and the amount stood as Capital Work in progress which relates to Building construction is being capitalized by transferring the amount to Building A/c and debrciation has been charged on the addition from current financial year.

k) Other income includes sale of scrap of building to the tune of Rs. 5.79 Lacs.

I) In the opinion of the Board of Directors, the current Assets have a value on realization in the ordinary course of business at least equal to the amount at which these are stated above. Provisions for known liabilities are adequate and not in excess of the amount considered reasonable and necessary.

m} Account statements of in-operative bank accounts held in the name of the company are not available hence balances in such accounts subject to confirmation.

n) Disclosures as required under "Related Part Disclosures" (AS 18) issued by The Institute of Chartered Accountants of India are as below;

o) Balances of Sundry Debtors, Creditors and Loans & advances are subject to confirmation, p) brvious year figures have been rearranged/regrouped wherever necessary.

IN TERMSOF OUR REPORT OF EVEN DATE ANNEXED HERETO

For NITIN VASANT GARUD & CO.

Chartered Accountants

Firm Regn. No. : 014133C

Sd/- CA Abizer Pithewan,

Partner

Membership No. 400753

For and on Behalf of the Board

RAAJ MEDISAFE INDIA LTD.

Shri Arpit Bangur (DIN-02600716) (Chairman)

Shri Ajay Kasat (D1N-05269584) (Managing Director)

Shri R. K. Gupta (DIN-00774786) (Director)

Shri V. K. Sood (DIN-02612644) (Director)

Place: Pithampur

Date: 27th May 2015