249 / 300
Notes forming part of onancial statements (Contd.)
Annual Report 2016-17
•
249
Deferred tax liabilities are recognized for all taxable temporary differences, except deferred tax liability arising
from initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and,
affects neither accounting nor taxable proot/ loss at the time of transaction. Deferred tax assets are recognized
for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses, except
deferred tax assets arising from initial recognition of goodwill or an asset or liability in a transaction that is not a
business combination and, affects neither accounting nor taxable proot/ loss at the time of transaction. Deferred
tax assets are recognized only to the extent that sufocient future taxable income will be available against which
such deferred tax assets can be realized.
In the situations where the Company is entitled to a tax holiday under the Income-tax Act, 1961 enacted in India
or tax laws prevailing in the respective tax jurisdictions where it operates, no deferred tax (asset or liability) is
recognized in respect of temporary differences which reverse during the tax holiday period, to the extent the
Company’s gross total income is subject to the deduction during the tax holiday period. Deferred tax in respect of
temporary differences which reverse after the tax holiday period is recognized in the year in which the temporary
differences originate.
The carrying amount of deferred tax asset is reviewed at each reporting date and reduced to the extent that it is
no longer probable that sufocient taxable proot will be available against which such deferred tax assets can be
realized.
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 tax assets and deferred tax liabilities relate to the same
taxable entity and the same taxation authority.
Deferred tax relating to items recognized outside the statement of proot and loss is recognized in co-relation to the
underlying transaction either in other comprehensive income or directly in equity.
Minimum alternate tax (MAT) paid in a year is charged to the statement of proot and loss as current tax. MAT credit
available is recognized as an asset only to the extent that there is convincing evidence that the Company will pay
normal income tax during the period, i.e., the period for which MAT credit is allowed to be carried forward. In the
year in which the Company recognizes MAT credit as an asset in accordance with the Guidance Note on Accounting
for Credit Available in respect of Minimum Alternative Tax under the Income-tax Act, 1961, the said asset is created
by way of credit to the statement of proot and loss and shown as “MAT Credit Entitlement.” The Company reviews
the “MAT credit entitlement” asset at each reporting date and writes down the asset to the extent the Company
does not have convincing evidence that it will pay normal tax during the specioed period.
(l) Segment reporting
In accordance with para 4 of Notioed Indian Accounting Standard 108 (Ind AS-108) “Operating Segments” the
Company has disclosed segment information only on the basis of consolidated onancial statements which are
presented together with the unconsolidated onancial statements.
(m) Earnings per share (EPS)
Basic earnings per share are calculated by dividing the net proot for the year attributable to equity shareholders
by the weighted average number of equity shares outstanding during the year. The weighted average number of
equity shares outstanding during the reporting period is adjusted for events such as bonus issue, bonus element
in a rights issue, share split, and reverse share split (consolidation of shares), if any occurred during the reporting
period, that have changed the number of equity shares outstanding, without a corresponding change in resources.
Further, the weighted average number of equity shares used in computing the basic earnings per share is reduced
by the shares held by PSP/ ESOP Management Trust at the balance sheet date, which were obtained by subscription
to the shares from onance provided by the Company.
For the purpose of calculating diluted earnings per share, the net proot for the year attributable to the equity
shareholders and the weighted average number of equity shares outstanding during the year, are adjusted for the
effects of all dilutive potential equity shares.
The number of shares and potential dilutive equity shares are adjusted retrospectively for all periods presented
for any bonus shares issues including for changes effected prior to the approval of the onancial statements by the
Board of Directors.