1. Significant accounting policies

A. Basis of brparation of financial statements

The financial statements of the Company have been brpared under the historical cost convention, on the accrual basis of accounting in accordance with the Generally Accepted Accounting Principles ('GAAP') in India, to comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 ("the 2013 Act") / Companies Act, 1956 ("the 1956 Act"), as applicable and other accounting requirements pronouncements of the Institute of Chartered Accountant of India. The financial statements have been brpared on accrual basis under the historical cost convention. The accounting policies adopted in the brparation of the financial statements are consistent with those followed in the brvious year.

B. Use of estimates

The brparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the year. Example of such estimates includes future obligations under employee retirement benefit plans, estimated useful life of fixed assets, warranty on sales, provision for obsolete and slow moving inventory, etc. Actual results could differ from those estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

C. Current-Non-current classification

All assets and liabilities are classified into current and non-current. Assets

An asset is classified as current when it satisfies any of the following criteria:

a. It is expected to be realized in, or is intended for sale or consumption in ,the company's normal operating cycle;

b. It is held primarily for the purpose of being traded;

c. It is expected to be realized within 12 months after the reporting date; or

d. It is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting date.

Current assets include the current portion of non-current financial assets. All other assets are classified as non-current.

Liabilities

A liability is classified as current when it satisfies any of the following criteria:

a. It is expected to be settled in the company's normal operating cycle;

b. It is held primarily for the purpose of being traded;

c. It is due to be settled within 12 months after the reporting date; or

d. The company does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date. Terms of liability that could, at option of the counterparty, result in its settlement by the issue of equity instruments do not affects its classification.

Current liabilities include current portion of non-current financial liabilities. All other liabilities are classified as non-current.

D. Revenue recognition

Revenue from sale of goods is recognized on the basis of terms and conditions with respective customers which coincides with the transfer of significant risks and rewards to the customer. Sales are stated at invoice value net of sales tax, turnover/trade discount, returns and claims, if any.

Interest income is recognized on time proportion basis considering the amount outstanding and the rate applicable.

E. Inventories

The stock in trade is valued at the lower of cost and net realizable value. Cost includes purchase price including duties and taxes (other than those subsequently recoverable by the enterprise from tax authorities) freight inward and other expenditure directly attributable to bring the inventory to the brsent location and condition. Cost is determined on first in first out basis.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs necessary to make the sale.

F. Fixed assets Tangible fixed assets

Tangible fixed assets are recorded at cost of acquisition less accumulated debrciation and less accumulated impairment loss, if any. Cost is inclusive of inward freight, duties, taxes and incidental expenses related to acquisition and installation expenses incurred to bring the assets to their working condition for intended use. Tangible fixed assets under construction and cost of assets not put to use before the year end are disclosed as capital work in progress.

Subsequent expenditures related to an item of tangible fixed asset are added to its book value only if they increase the future benefits from the existing asset beyond its brviously assessed standard of performance.

During the year, pursuant to the notification of Schedule II to the Companies Act, 2013 with effect from April 1, 2014,the Company has revised the estimated useful life of some of its assets to align the useful life with those specified in Schedule II. Further, assets individually costing Rs. 5,000/- or less that were debrciated fully in the year of purchase are now debrciated based on the useful life considered by the Company for the respective category of assets.

Assets individually costing Rs. 5,000 or less are fully debrciated in the year of the purchase.

Debrciation on additions is being provided on pro rata basis from the date of such additions. Similarly, debrciation on assets sold/disposed off during the year is being provided up to the dates on which such assets are sold/disposed off. Modification or extension to an existing asset, which is of capital nature and which becomes an integral part thereof is debrciated prospectively over the remaining useful life of that asset.

Intangible fixed assets

Intangible assets which are acquired by the Company are measured initially at cost. After initial recognition, an intangible asset is carried at its cost less any accumulated amortization and/or less accumulated impairment loss, if any. Subsequent expenditure is capitalized only when it increases the future economic benefits from the specific asset to which it relates.

G. Impairment

The carrying value of assets is reviewed at each Balance Sheet date to determine whether there is any indication of impairment. If any such indication exists, the amount recoverable towards such assets is estimated. An impairment loss is recognised whenever the carrying amount of an asset, or its cash generating unit exceeds its recoverable amount. Impairment losses are recognised in the Profit and Loss Account. An impairment loss is reversed if there is a change in the estimate used to determine the recoverable amount. An impairment loss is reversed only to the extent the carrying amount of the asset that does not exceed the carrying amount that would have been determined net off debrciation or amortisation, if no impairment loss had been recognised.

H. Foreign currency transactions

Foreign currency transactions are recorded at the rate of exchange brvailing on the date of the respective transactions. Monetary foreign currency assets and liabilities remaining unsettled at the balance sheet date

are translated at the rates of exchange brvailing on that date. Gains/ (losses) arising on account of realisation/ settlement of foreign exchange transactions and on translation of foreign currency assets and liabilities are recognised in the statement of Profit and Loss. During the year no foreign currency transactions had taken place.

I. Leases

Where the lesser effectively retains substantially all the risks and benefits of ownership of the leased assets are classified as operating leases. Operating lease charges are recognised as an expense in the statement of Profit and Loss.

J. Employee benefits

Short term employee benefits

All employee benefits payable/available within twelve months of rendering the service are classified as short-term employee benefits. Benefits such as salaries, wages and bonus etc., are recognised in the Profit and Loss Account in the period in which the employee renders the related service, if any.

Defined benefit plan

Gratuity is a defined benefit plan. The brsent value of obligations under such defined benefit plans is determined based on actuarial valuation carried out by an independent actuary at the end of the year using the projected unit credit method. The obligation is measured at the brsent value of estimated future cash flows. The discount rates used for determining the brsent value of obligation under defined benefit plans, is based on the market yields on Government securities as at the balance sheet date, having maturity periods approximating to the terms of related obligations. Actuarial gains and losses are recognised immediately in the Profit and Loss Account.

K. Taxation

Income tax expenses comprise current tax (i.e. the amount of tax for the period determined in accordance with the income tax laws) and deferred tax charge or credit (reflecting the tax effects of timing differences between the accounting income and the taxable income for the period). The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognised using tax rates that have been enacted, or substantively enacted, by the Balance Sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty that the assets can be realised in the future, however, where there is unabsorbed debrciation or carry forward loss under taxation laws, deferred tax assets are recognised only if there is virtual certainty of realisation of such assets. Deferred tax assets are reviewed as 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.

L. Provisions and contingent liabilities

A provision is created when there is a brsent 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. Provisions are not discounted to their brsent value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. A disclosure for a contingent liability is made when there is a possible obligation or a brsent obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a brsent obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

M. Earnings per share

Basic earnings per share are calculated by dividing the net profit/ (loss) attributable to equity shareholders for the year by the weighted average number of equity shares outstanding during the year.

N. Cash and cash equivalents

Cash and cash equivalents include cash in hand, demand deposit with banks, other short term highly liquid investments with original maturities of three months or less.

2 . Scheme of Amalgamation

I Amalgamation of freesia construction private limited ( hereinafter referred as transferor company ) with the company, in terms of the scheme of amalgamation framed under section 391 and 394 of the Companies Act, 1956, has been approved by the Hon'ble High Court of Delhi at New Delhi vide its order dated 12th day of March ,2013. The scheme of amalgamation has been approved with effect from the appointed date i.e 01st day of April ,2011

II Transferor Company is primarily engaged in the business of construction.

III The amalgamation is accounted for under the "pooling of interest method'' as brscribed by the Accounting standards-14 'Accounting for Amalgamations' notified under Company (Accounting Standards) Rules.

IV In terms of the scheme of Amalgamation, as approved by the Hon'ble Delhi High Court, the amalgamation is operative with effect from the Appointed Date -01st April, 2011. Hence, it been given effect in the financial statement of the company for the year ended 31st March, 2013.

V The assets and liability of the transferor company have been accounted for in the books of account of the company in accordance with the approved scheme .

VI The income accruing and expenses incurred by the Transferor company from 1st April,2011 onwards have been clubbed and effects of same have been incorporated in the statement of profit and loss drawn for current Financial year, as the transferor company carried on the existing business in 'trust' on behalf of the Company and all the vouchers , documents etc for that period were made in the name of Transferor Company.

VII The salient features of the scheme of Amalgamtion are as follows:

a That all the property, rights and powers of the transferor companies ( as specified in the scheme) be transferred without further act or deed to the company and accordingly the same shall pursuant to Section 394(2) of the companies Act, 1956 be transferred to and vest in the company for all the interest of the transferor companies therein but subject nevertheless to all charges now affecting the same.

b That all the liabilities and duties of the transferor companies be transferred without further act or deed to the Transferee company and accordingly the same shall pursuant to section 394(2) of the Companies Act, 1956 be transferred to and become the liabilities and duties of the transferee company; and

c That all the proceedings now pending by or against the Transferor Companies be continued by or against the Transferee Company.

d Upon the scheme finally coming into effects and in consideration of the transfer and vesting of all the said assets and liabilities of the Transferor Companies to the Transferee Company in terms of the scheme , the Transferee company shall, without any further application or deed, issued and allotted Equity Shares(s) of the face value of Rs. 10/- each in the Transferee Company, credited as fully paid up, to the Members of the Transferor Companies whose names appears in the Register of Members as on a particular date (Record date / Allotment date), to be fixed by the Board of Directors of the company.

e The Authorized Share Capital of the Transferor company will get merged to form new Authorised capital of the company.

f All the reserves of the Transferor Companies under different heads shall become the corresponding reserves of the Transferee Company. Similarly, balance in the profit & loss accounts of the Transferor and Transferee Companies will also be clubbed together.

g In terms of the provisions of the Accounting Standard 14, any surplus/ deficit arising out of Amalgamation shall be adjusted In the Reserves of the company.

3. Related party disclosures

Related parties with whom transactions have taken place during the year : NIL

4. The Company had sought confirmation from its vendors on their status. Therefore based on the information available with the management there are no dues outstanding to parties covered under the Micro, Small and Medium Enterprises Development Act, 2006.

5. Balances of Parties under the head- Trade payable, Other Current Liabilities, Trade Receivables and Long Term Loans and advances given/ taken are subject to confirmation and reconciliation thereof if any.

6. Previous year's comparative figures have been regrouped/recasted wherever necessary.

7. The brvious year figures have been audited by another firm of Chartered Accountants.

For Sudhir Agarwal & Associates

Chartered Accountants FRN:509930 C

Amit Kumar

Partner

Membership no.: 518735

For and on behalf of the board of Directors of Kalpa Commercial Limited

Arvind Agarwal Managing Director DIN: 03035484

Kuldeep Singh Director DIN: 03188652

Place : New Delhi

Date : 30/05/2015