Notes to Accounts of Chase Bright Steel Ltd.

Mar 31, 2014

Note - 1 : CORPORATE INFORMATION

Chase Bright Steel Ltd. is a Public Company incorporated in India in the year 1959 under the Companies Act, 1956 and having its registered office in Mumbai, Maharashtra. The shares of the Company are listed on the Bombay Stock Exchange. The Company is engaged in manufacture of bright bars made of mild steel, alloy steel and stainless steel etc.

a) Terms / Rights attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs. 10/- per share.

Each holder of the Equity Shares is entitled to one vote per share held. Dividend, if any, proposed by the Board of Directors will be subject to the approval of the Shareholders in the ensuing Annual General Meeting except in case of Interim Dividend

In the event of liquidation of the Company, the holders of the Equity Shares will be entitled to receive remaining assets of the Company after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Terms / Rights attached to 15% Redeemable Preference Shares

The Company has only one class of preference shares having a par value of Rs. 10/- per share. The said shares are cumulative in nature.

Dividend, if any, proposed by the Board of Directors will be subject to the approval of the Shareholders in the ensuing Annual General Meeting except in case of Interim Dividend.

In the event of liquidation of the Company, the holders of the preference Shares will be entitled to receive amounts to the extent of their holding in the company before any distribution of remaining assets of the Company to the Equity Shareholders of the Company.

Arrears of Redeemable Cumulative Preference Shares Dividend - Rs. 3,08,750/- (Previous year - Rs. 3,08,750/-)

The Balance 20,000 - 15% Preference Shares of Rs. 10/- each are yet to be redeemed. The time for redemption was extended up to 10.05.1999 vide resolution passed at the Board Meeting of the Company held on 16.07.1991. Further extension is being sought for.

b) Shares held by holding / ultimate holding company and / or their subsidiaries / Associates

There are no shares held by holding / ultimate holding company and / or their subsidiaries / Associates.

Terms and Conditions of the Secured Loans Term Loan from HDFC Bank - Loan 1

The Loan is secured by hypothecation of Motor Car and with Company being the main borrower and one of the directors being co-borrower.

The loan is repayable in 36 equated Monthly Installments (EMI) of Rs. 24,630/- each commencing from January 2012 and ending on December 2014. The rate of interest being 11.90% p. a.

Term Loan from HDFC Bank - Loan 2

The Loan is secured by hypothecation of Motor Bike and with Company being the main borrower and one of the directors being co-borrower.

The loan is repayable in 24 equated Monthly Installments (EMI) of Rs. 2,657/- each commencing from November 2012 and ending on October 2014. The rate of interest being 19.35% p. a.

Term Loan from HDFC Bank - Loan 3

The Loan is secured by hypothecation of Motor Bike and with Company being the main borrower and one of the directors being co-borrower.

The loan is repayable in 24 equated Monthly Installments (EMI) of Rs. 2,008/- each commencing from November 2012 and ending on October 2014. The rate of interest being 19.35% p. a.

Term Loan from HDFC Bank - Loan 4

The Loan is secured by hypothecation of Motor Bike and with Company being the main borrower and one of the directors being co-borrower.

The loan is repayable in 24 equated Monthly Installments (EMI) of Rs. 2,008/- each commencing from November 2012 and ending on October 2014. The rate of interest being 19.35% p. a.

Term Loan from Kotak Mahindra Prime Ltd. - Loan 1

The Loan is secured by hypothecation of Motor Car and with Company being the main borrower and one of the directors being co-borrower.

The loan is repayable in 36 equated Monthly Installments (EMI) of Rs. 8,343/- each commencing from April 2012 and ending on March 2015. The rate of interest being 19.84% p. a.

Term Loan from Kotak Mahindra Prime Ltd. - Loan 2

The Loan is secured by hypothecation of Motor Car and with Company being the main borrower and one of the directors being co-borrower.

The loan is repayable in 36 equated Monthly Installments (EMI) of Rs. 12,978/- each commencing from April 2012 and ending on March 2015. The rate of interest being 19.84% p. a.

Term Loan from Kotak Mahindra Prime Ltd. - Loan 3

The Loan is secured by hypothecation of Motor Car and with Company being the main borrower and one of the directors being co-borrower.

The loan is repayable in 36 equated Monthly Installments (EMI) of Rs. 12,570/- each commencing from April 2012 and ending on March 2015. The rate of interest being 19.84% p. a.

Term Loan from Kotak Mahindra Prime Ltd. - Loan 4

The Loan is secured by hypothecation of Motor Car and with Company being the main borrower and one of the directors being co-borrower.

The loan is repayable in 36 equated Monthly Installments (EMI) of Rs. 33,706/- each commencing from April 2012 and ending on March 2015. The rate of interest being 19.84% p. a.

Term Loan from Kotak Mahindra Prime Ltd. - Loan 5

The Loan is secured by hypothecation of Motor Car and with Company being the main borrower and one of the directors being co-borrower.

The loan is repayable in 36 equated Monthly Installments (EMI) of Rs. 25,511/- each commencing from April 2012 and ending on March 2015. The rate of interest being 19.84% p. a.

Term Loan from Kotak Mahindra Prime Ltd. - Loan 6

The Loan is secured by hypothecation of Motor Car and with Company being the main borrower and one of the directors being co-borrower.

The loan is repayable in 36 equated Monthly Installments (EMI) of Rs. 14,350/- each commencing from April 2012 and ending on March 2015. The rate of interest being 19.84% p. a.

Term Loan from Religare Finvest Ltd. - Loan 3

The Loan is secured by Mortgage of Company''s property - Land and Building at R-237, TTC, MIDC Rabale, Navi Mumbai and with Company being the main borrower and two of the directors being co-borrowers.

The loan is repayable in 120 equated Monthly Installments (EMI) of Rs. 4,03,337/- each commencing from April 2014 and ending on March 2023. The rate of interest being 15.00% p. a.

Term Loan from ICICI Bank - Loan 1

The Loan is secured by hypothecation of Motor Car and with Company being the main borrower and one of the directors being co-borrower.

The loan is repayable in 35 equated Monthly Installments (EMI) of Rs. 34,581/- each commencing from May 2013 and ending on March 2016. The rate of interest being 9.84% p. a.

Terms and Conditions of the Unsecured Loans Term Loan from Rellgare Finvest Ltd. - Loan 2

The Loan is unsecured with Company being the main borrower and two of the directors being co-borrowers.

The loan is repayable in Monthly Installments (MI) of Rs. 2,66,330/- (8 installments), of Rs. 1,84,800/- (8 installments) and of Rs. 92,400/- (8 installments) each commencing from March 2013 and ending on February 2015. The rate of interest being 20.35% p. a.

Term Loan from Shriram City Union Finance Ltd. - Loan 1

The Loan is unsecured with Company being the main borrower and two of the directors being co-borrowers.

The loan is repayable in Monthly Installments (MI) of Rs. 1,46,250/- (8 installments), of Rs. 1,22,850/- (8 installments) and of Rs. 23,400/- (8 installments) each commencing from October 2013 and ending on September 2015. The rate of interest being 15.55% p. a.

Term Loan from Other Corporates

Loan from Sujata Trading Pvt. Ltd. (Rs. 52,50,000/- - previous year Rs. 50,00,000/-) is repayable in 6 quarterly installments of Rs. 8,75,000/- each commencing from September 2014 and ending on December 2015. The said loan is interest free.

Term Loan from Others

Loan from Mrs. Rajnidevi Jajodia (Rs. 9,18,750/- - previous year Rs. 45,93,750/-) is repayable in 6 quarterly installments of Rs. 9,18,750/- each commencing from March 2013 and ending on June 2014. The said loan is interest free.

NOTE 2 :

Additional Information to the Financial Statements

(A) Contingent Liabilities -

Year ended Year ended March 31, 2014 March 31, 2013

Contingent Liabilities and Commitments

i) On Import of 108 MT of Raw materials 17,52,000 17,52,000 wherein the Hon''ble High Court, Delhi has asked Customs Authorities to adjudicate the matter

ii) Estimated amount of contracts remaining to 7,35,000 Nil be executed on capital account

(B) Arrears of Redeemable Cumulative Preference Shares Dividend - Rs. 3,08,750/- (Previous year - Rs. 3,08,750/-).

(C) Purchase of Raw Material viz 108 tonnes of steel was cleared by the company at a lower rate of duty i.e. at 75% (i.e. at pre- budget rate) against 175% (as increased by the budget proposal 1981) as per the orders passed by a division bench of the High Court at Delhi in the matter of a writ petition filed by the Company, challenging the validity of the budget proposal. As per the said orders, the Company has furnished a bond, till further order of the court. The said writ petition has been disposed off for adjudication by customs. There is a contingent liability of Rs. 17.52 lakhs (Previous Year Rs. 17.52 lakhs).

(D) The amounts of certain Sundry Debtors, Sundry Creditors, Advances and Lenders are subject to confirmations / reconciliation and adjustments, if any. The management does not expect any material difference affecting the current year''s financial statements.

(E) In the opinion of the Board of Directors, unless otherwise stated in the Balance Sheet, the current assets, loans and advances have value of realisation, in the ordinary course business, at least equal to the amount stated in the Balance Sheet.

(F) Unsecured Loans include that of the Directors and their Associates

(G) The sales-tax assessment of the Company has been finalised upto and including the accounting year 2009 - 2010.

(H) The Income-tax Assessments of the Company are completed upto March 31, 2012 (Assessment Year 2012 - 2013).

(I) Sundry Creditors include Rs. NIL (Previous Year Rs. NIL) due to Small Scale Industrial Undertakings (SSI''s) to the extent such parties have been identified from the available information / documents with the company.

(J) As per the information available with the Company in response to the enquiries from all existing suppliers with whom the Company deals, none of the suppliers are registered under the Micro, Small and Medium Enterprises Development Act, 2006.

(K) One of the creditors of the Company has filed legal case against the Company for recovery of dues. However, the same is being contested by the Company.

(L) The Company has filed a legal case or is in the process of filing legal cases against various parties to recover amounts due from them.

(M) The Company does not expect any shortfall on realisation of assets on aggregate basis, despite accumulated losses as on March 31,2014.

(N) Disclosures pursuant to Accounting Standard - 15: Employees'' Benefit

(ii) The Deferred Tax Asset (Net) for the year of Rs. 16,51,249/- (Previous Year Deferred Tax Liability Rs. 54,947/-) is reduced from the Current Year''s loss (Previous year reduced from the Profit) and added to the balance in Deferred Tax Assets (Previous Year - reduced from the Deferred Tax Assets)..

(T) Segment Reporting as per AS 17:- Primary Segment :

The Company operates only one primary segment viz. manufacture and sale of Bright Bars and has entire turnover from sale of Bright Bars and / or processing of Bright Bars.

(U) Related Party Information

Disclosures in respect of related parties (as defined in Accounting Standard 18), with whom transactions have taken place during the year given below:

1) Relationship

a) Enterprise where control of Key Management Personnel and / or their relatives exists.

1. Rose Investment Pvt. Ltd.

2. Himatsingka Chemicals Pvt. Ltd.

3. Swan Silver Wares Pvt. Ltd.

4. Economic Forge Pvt. Ltd.

b) Key Management Personnel

1. Shri Avinash Jajodia - Chairman and Managing Director

2. Smt. Manjudevi Jajodia - Executive Director

Note : Related Party relationship is as identified by the company and relied upon by the auditors.

3. Figures of the previous year have been regrouped / reclassified / rearranged, wherever necessary, to conform with the current year''s classification and presentation. Amounts and other disclosures for the preceding year are included as an integral part of the current year''s financial statements and are to be read in relation to the amounts and other disclosures relating to the current year.

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Mar 31, 2013

Note – 1 : CORPORATE INFORMATION

Chase Bright Steel Ltd. is a Public Company incorporated in India in the year 1959 under the Companies Act, 1956 and having its registered office in Mumbai, Maharashtra. The shares of the Company are listed on the Bombay Stock Exchange. The Company is engaged in manufacture of bright bars made of mild steel, alloy steel and stainless steel etc.

(A) Contingent Liabilities –

Year ended Year ended March 31, 2013 March 31, 2012 Rs. Rs.

Contingent Liabilities and Commitments

i) On Import of 108 MT of Raw materials 17,52,000 17,52,000 wherein the Hon’ble High Court, Delhi has asked Customs Authorities to adjudicate the matter

ii) Estimated amount of contracts remaining to Nil Nil be executed on capital account

(B) Arrears of Redeemable Cumulative Preference Shares Dividend – Rs. 3,08,750/- (Previous year – Rs. 3,08,750/-).

(C) Purchase of Raw Material viz 108 tonnes of steel was cleared by the company at a lower rate of duty i.e. at 75% (i.e. at pre- budget rate) against 175% (as increased by the budget proposal 1981) as per the orders passed by a division bench of the High Court at Delhi in the matter of a writ petition filed by the Company, challenging the validity of the budget proposal. As per the said orders, the Company has furnished a bond, till further order of the court. The said writ petition has been disposed off for adjudication by customs. There is a contingent liability of Rs. 17.52 lakhs ( Previous Year Rs. 17.52 lakhs).

(D) The amounts of certain Sundry Debtors, Sundry Creditors, Advances and Lenders are subject to confirmations / reconciliation and adjustments, if any. The management does not expect any material difference affecting the current year’s financial statements.

(E) In the opinion of the Board of Directors, unless otherwise stated in the Balance Sheet, the current assets, loans and advances have value of realisation, in the ordinary course business, at least equal to the amount stated in the Balance Sheet.

(F) Unsecured Loans include that of the Directors and their Associates.

(G) The Company has not made provision for doubtful debts of Rs. 10,09,374/- (Previous year Rs. 10,09,374/-) as the Company is taking required steps for recovery of the amounts from the party.

(H) The sales-tax assessment of the Company has been finalised upto and including the accounting year 2007-2008.

(I) The Income-tax Assessments of the Company are completed upto March 31, 2010 (Assessment Year 2010-2011).

(J) Sundry Creditors include Rs. NIL (Previous Year Rs. NIL) due to Small Scale Industrial Undertakings (SSI’s) to the extent such parties have been identified from the available information / documents with the company.

(K) As per the information available with the Company in response to the enquiries from all existing suppliers with whom the Company deals, none of the suppliers are registered under the Micro, Small and Medium Enterprises Development Act, 2006.

(L) One of the creditors of the Company has filed legal case against the Company for recovery of dues. However, the same is being contested by the Company.

(M) The Company has filed a legal case or is in the process of filing legal cases against various parties to recover amounts due from them.

(N) The Company does not expect any shortfall on realisation of assets on aggregate basis, despite accumulated losses as on March 31, 2013.

(O) Segment Reporting as per AS 17:- Primary Segment :

The Company operates only one primary segment viz. manufacture and sale of Bright Bars and has entire turnover from sale of Bright Bars and / or processing of Bright Bars.

(P) Related Party Information

Disclosures in respect of related parties (as defined in Accounting Standard 18), with whom transactions have taken place during the year given below:

1) Relationship

a) Enterprise where control of Key Management Personnel and / or their relatives exists.

1. Rose Investments Pvt. Ltd.

2. Avanti Traders Pvt. Ltd.

3. Abhishek Chemicals Pvt. Ltd.

4. Himatsingka Chemicals Pvt. Ltd.

5. Swan Silver Wares Pvt. Ltd.

b) Key Management Personnel

1. Shri Alok Kumar Jajodia – Executive Chairman (till 15-06-2012)

2. Shri Avinash Jajodia – Chairman and Managing Director (from 14-08-2012)

3. Smt. Manjudevi Jajodia – Whole-time Director (from 01-09-2012)

c) Relative of Key Management Personnel Smt. Rajnidevi Jajodia

Note : Related Party relationship is as identified by the company and relied upon by the auditors.

2. Figures of the previous year have been regrouped / reclassified / rearranged, wherever necessary, to conform with the current year’s classification and presentation. Amounts and other disclosures for the preceding year are included as an integral part of the current year’s financial statements and are to be read in relation to the amounts and other disclosures relating to the current year.

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Mar 31, 2012

A) Terms / Rights attached to Equity Shares

The Company has only one class of equity shares having a par value of 10/- per share.

Each holder of the Equity Shares is entitled to one vote per share held.

Dividend, if any, proposed by the Board of Directors will be subject to the approval of the Shareholders in the ensuing Annual General Meeting except in case of Interim Dividend

In the even off liquidation of the Company, the holders of the Equity Shares will be entitled to receive remaining assets of the Company after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Terms / Rights attached to 15% Redeemable Preference Shares

The Company has only one class of preference shares having a par value of 10/- per share. The said shares are non cumulative in nature.

Dividend, if any, proposed by the Board of Directors will be subject to the approval of the Shareholders in the ensuing Annual General Meeting except in case of Interim Dividend

In the even off liquidation of the Company, the holders of the preference Shares will be entitled to receive amounts to the extent of their holding in the company before any distribution of remaining assets of the Company to the Equity Shareholders of the Company.

Arrears of Redeemable Cumulative Preference Shares Dividend 3,08,750/- (Previous year - 3,08,750/-)

The Balance 20,000 - 15% Preference Shares of 10 each are yet to be redeemed. The time for redemption was extended upto 10.05.1999 vide resolution passed at the Board Meeting of the Company held on 16.07.1991. Further extension is being sought for.

b) Shares held by holding / ultimate holding company and / or their subsidiaries / Associates

There are no shares held by holding / ultimate holding company and / or their subsidiaries / Associates

1. Contingent Liabilities not provided for :

a) Arrears of Redeemable Cumulative Preference Shares Dividend – Rs. 3,08,750/- (Previous year - 3,08,750/-).

b) Purchase of Raw Material viz 108 tonnes of steel was cleared by the company at a lower rate of duty i.e. at 75% (i.e. at pre-budget rate) against 175% (as increased by the budget proposal 1981) as per the orders passed by a division bench of the High Court at Delhi in the matter of a writ petition filed by the Company, challenging the validity of the budget proposal. As per the said orders, the Company has furnished a bond, till further order of the court. The said writ petition has been disposed off for adjudication by customs. There is a contingent liability of 17.52 lakhs ( Previous Year 17.52 lakhs )

2. Estimated amounts of contracts remaining to be executed on capital accounts and not provided for - NIL (Previous year- NIL).

3. The amounts of certain Sundry Debtors, Sundry Creditors, Advances and Lenders are subject to confirmations / reconciliation and adjustments, if any. The management does not expect any material difference affecting the current year's financial statements.

4. In the opinion of the Board of Directors, unless otherwise stated in the Balance Sheet, the current assets, loans and advances have value of realisation, in the ordinary course business, at least equal to the amount stated in the Balance Sheet.

5. Unsecured Loans include that of the Directors and their Associates

6. The Company has not made provision for doubtful debts of 10,09,374/- (Previous year Rs. 10,09,374/-) as the Company is taking required steps for recovery of the amounts from the party.

7. The sales-tax assessment of the Company has been finalised upto and including the accounting year 2007-2008.

8. The Income-tax Assessments of the Company are completed upto March 31, 2009 (Assessment Year 2009-2010).

9. The Company has modified the method of valuation of closing stock of goods from April 2011 onwards. Due to the said modification in the method of valuation of the closing stock, the closing stock as on March 31, 2012 has been valued lower by 21.36 lakhs and profit after tax for the year is lower by 14.43 lakhs.

10. Sundry Creditors include NIL (Previous Year NIL) due to Small Scale Industrial Undertakings (SSI's) to the extent such parties have been identified from the available information / documents with the company.

11. As per the information available with the Company in response to the enquiries from all existing suppliers with whom the Company deals, none of the suppliers are registered under the Micro, Small and Medium Enterprises Development Act, 2006.

12. One of the creditors of the Company has filed legal case against the Company for recovery of dues. However, the same is being contested by the Company.

13. Some of the unsecured loan creditors have initiated legal action against the company for recovery of their loan amount along with interest. The Company is examining the issue and suitable steps will be taken to protect the interest of the company.

14. The Company has filed a legal case or is in the process of filing legal cases against various parties to recover amounts due from them.

15. The Company does not expect any shortfall on realisation of assets on aggregate basis, despite accumulated losses as on March 31, 2012.

16. The Company's operations relate to manufacture of Bright Bars. The Company does not have any separate business segments.

17. Disclosures in respect of Derivative Instruments :

a. There are no derivative instrument like Forward Exchange Contracts etc. outstanding at the end of the year as on March 31, 2012 and at the end of the year as on March 31, 2011

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Mar 31, 2011

1 Contingent Liabilities not provided for:

a) Arrears of Redeemable Cumulative Preference Shares Dividend - Rs. 3,08.750/- (Previous year - Rs. 3.08,750/-)

b) Purchase of Raw Material viz 108 tonnes of steel was cleared by the company at a lower rate of duty i.e. at 75% (i.e. at pre-budget rate) against 175% (as increased by the budget proposal 1981) as per the orders passed by a division bench of the High Court at Delhi in the matter of a writ petition filed by the Company, challenging the validity of the budget proposal. As per the said orders, the Company has furnished a bond, till further order of the court. The said writ petition has been disposed off for adjudication by customs. There is a contingent liability of Rs. 17.52 lakhs (Previous Year Rs. 17.52 lakhs)

c) Estimated amounts of contracts remaining to be executed on capital accounts and not provided for - Rs. NIL (Previous year- Rs. NIL).

2 The amounts of certain Sundry Debtors. Sundry Creditors, Advances and Lenders are subject to confirmations / reconciliation and adjustments, if any. The management does not expect any material difference affecting the current year's financial statements.

3 In the opinion of the Board of Directors, unless otherwise stated in the Balance Sheet, the current assets, loans and advances have value of realisation, in the ordinary course business. at least equal to the amount stated in the Balance Sheet.

4 Unsecured Loans include that of the Directors and their Associates

5 The Company has not made provision for doubtful debts of Rs. 10,09,374/- (Previous year Rs. 10,09,374/-) as the Company is in the taking required steps for recovery of the amounts from the parties.

6 The Scheme of Amalgamation:

a) In accordance with the Scheme of Amalgamation Scheme ("the Scheme") as approved by the Hon'ble Bombay High court vide Order dated 10.02.2006, all the assets and liabilities of erstwhile Chase Atherton Steel Pvt. Ltd. (CASPL) whose principal business was of manufacturing of bright steel bars, has been transferred to and vested with the Company with effect from appointed date 01.04.2004. The Scheme has been given effect to in the accounts for the period ended March 31, 2006.

b) The amalgamation has been accounted for under "Purchase Method" of accounting as prescribed by Accounting Standard (AS) 14 "Accounting for Amalgamations" issued by the Institute of Chartered Accountants of India.

d) The aforesaid difference, as per AS-14 "Accounting for Amalgamation" has been debited to Goodwill on Amalgamation Account and shown separately in the Balance Sheet. Further, as per the said Accounting Standard, the said Goodwill on Amalgamation is to be written off over a period of 5 years and hence a sum of ? 9,33,040/- (Previous Year Rs. 18,66,094/-) is written off in the Profit and Loss Account.

f) In terms of the Scheme, 11,25,000 equity shares of Rs. 10/- each of the Company were to be issued and allotted to the shareholders of the erstwhile CASPL in the ratio of 450 shares of the Company for every 100 shares of CASPL. The Company has issued the said shares to the shareholders of the erstwhile Chase Atherton Steel Pvt. Ltd during the year 2006-2007.

g) Certain leasehold rights, buildings, licenses, agreements, loan documents etc. are in the process of being transferred in the name of the Company.

h) In terms of the Scheme, all employees in service of the erstwhile CASPL have become employees of the Company without any break or interruption in service. All rights, duties, power and obligations of erstwhile CASPL in relation to Provident Fund etc. are in the process of being transferred in the name of the Company.

7 The sales-tax assessment of the Company has been finalised upto and including the accounting year 2007-2008.

8 The Income-tax Assessments of the Company are completed upto March 31, 2009 (Assessment Year 2009-2010).

9. a) The Company has been advised that the computation of net profits for the purpose of Directors' Remuneration under section 349 of the Companies Act, 1956 need not be enumerated since no commission has been paid to Directors. Fixed monthly remuneration has been made to the Executive Chairman / Managing Director.

10. The Board of Directors have re-appointed the Executive Chairman for a period of three years with effect from January 15, 2011 af a remuneration of ? 18,00,000/- per annum along with applicable perquisites as set out in the appointment letter/ contract with the Executive Chairman. The said re-appointment and payment of the remuneration with effect from January 15, 2011 is subject to approval by the shareholders in the General Meeting.

11. The Balance 20,000 -15% Preference Shares of Rs. 10/- each are yet to be redeemed. The time for redemption was extended upto 10.05.1999 vide resolution passed at the Board Meeting of the Company held on 16.07.1991.

12. Sundry Creditors include ? NIL (Previous Year Rs. NIL) due to Small Scale Industrial Undertakings (SSI's) to the extent such parties have been identified from the available information / documents with the company.

13. As per the information available with the Company in response to the enquiries from all existing suppliers with whom the Company deals, none of the suppliers are registered under the Micro, Small and Medium Enterprises Development Act, 2006.

14. One of the creditors of the Company has filed legal case against the Company for recovery of dues. However, the same is being contested by the Company.

15. The Company has filed a legal case or is in the process of filing legal cases against various parties to recover amounts due from them.

16. The Company does not expect any shortfall on realisation of assets on aggregate basis, i despite accumulated losses as on March 31, 2011.

17. Provisions for Current tax / Fringe Benefit Tax have been made based on the current tax rates and other provisions of the income-tax Act, 1961.

18. The Company's operations relate to manufacture of Bright Steel Bars. The Company does not have any separate business segments.

19. Prior Period Adjustment represents Debit relating to earlier years Rs. 3,91,3121- (Previous Year Rs. 5,99,839/-) and credits relating to earlier years Rs.7,141/-(Previous Year Rs. 3,05,341/-)

b. The Deferred Tax Assets (Net) for the year of Rs. 4,76,524/- (Previous Year- Deferred Tax Liabiltities of Rs. 4,52,626/-) is added to the Current Year's Profit and shown as Deferred Tax Assets and added to the Deferred Tax Assets.

20. Related Party Information

Disclosures in respect of related parties (as defined in Accounting Standard 18), with whom transactions have taken place during the year given below:

1) Relationship

a) Enterprise where control of Key Management Personnel and / or their relatives exists.

1. Rose Investment Pvt. Ltd.

2. Avanti Traders Pvt. Ltd.

b) Key Management Personnel

1. Shri Alok Kumar Jajodia - Executive Chairman

2. Shri Avinash Jajodia - Managing Director

3. Smt. Manjudevi Jajodia - Director

c) Relatives of Key Management Personnel

1. Smt. Shamoli Malhotra

2. Smt. Rajnidevi Jajodia

Note : Related Party relationship is as identified by the company and relied upon by the auditors.

21. Disclosures in respect of Derivative Instruments :

a. There are no derivative instrument like Forward Exchange Contracts etc. outstanding at the end of the year as on March 31,2011 and at the end of the year as on March 31,2010

22. Figures of the previous year have been regrouped / reclassified / rearranged, wherever necessary, to conform with the current year's presentation. Amounts and other disclosures for the preceding year are included as an integral part of the current year's financial statements and are to be read in relation to the amounts and other disclosures relating to the current year.

23. Information required as per part IV of Schedule VI of the Companies Act, 1956.

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Mar 31, 2010

1 Contingent Liabilities not provided for:

a) Arrears of Redeemable Cumulative,Preference Shares Dividend - Rs 3,08,750/- (Previous year- Rs 3,08,750/-)

b) Purchase of Raw Material viz 108 tonnes of steel was cleared by the company at a lower rate of duty i.e. at 75% (i.e. at pre- budget rate) against 175% (as increased by the budget proposal 1981) as per the orders passed by a division bench of the High Court at Delhi in the matter of a writ petition filed by the Company, challenging the validity of the budget proposal. As per the said orders, the Company has furnished a bond, till further order of the court. The said writ petition has been disposed off for adjudication by customs. There is a contingent liability of Rs 17.52 lakhs (Previous Year Rs 17.52 lakhs)

c) Estimated amounts of contracts remaining to be executed on capital accounts and not provided for- Rs NIL (Previous year- Rs 2,20,000).

2 The amounts of certain Sundry Debtors, Sundry Creditors, Advances and Lenders are subject to confirmations / reconciliation and adjustments, if any. The management does not expect any material difference affecting the current years financial statements.

3 In the opinion of the Board of Directors, unless otherwise stated in the Balance Sheet, the current assets, loans and advances have value of realisation, in the ordinary course business, at least equal to the amount stated in the Balance Sheet.

4 Unsecured Loans include that of the Directors and their Associates

5 The Company has not made provision for doubtful debts of Rs 10,09,374/- (Previous year Rs 34,17,724/-) as the Company is taking required steps for recovery of the amounts from the parties.

6 The Scheme of Amalgamation:

a) In accordance with the Scheme of Amalgamation Scheme ("the Scheme") as approved by the Honble Bombay High court vide Order dated 10.02.2006, all the assets and liabilities of erstwhile

Chase Atherton Steel Pvt. Ltd. (CASPL) whose principal business was of manufacturing of bright steel bars, has been transferred to and vested with the Company with effect from appointed date 01.04.2004. The Scheme has been given effect to in the accounts for the period ended March 31, 2006

b) The amalgamation has been accounted for under "Purchase Method" of accounting as prescribed by Accounting Standard (AS) 14 "Accounting for Amalgamations" issued by the Institute of Chartered Accountants of India.

d) The aforesaid difference, as per AS - 14 "Accounting for Amalgamation" has been debited to Goodwill on Amalgamation Account and shown separately in the Balance Sheet. Further, as per the said Accounting Standard, the said Goodwill on Amalgamation is to be written off over a period of 5 years and hence a sum of Rs18,66,094/- (Previous Year Rs 18,66,094/-) is written off in the Profit and Loss Account.

e) From April 01,2004, the erstwhile CASPL had carried on its business in "Trust" on behalf of the Company. Profit for the 18 months period April 01,2004 to September 30,2005 of erstwhile CASPL after making the following adjustments has been added to the Profit and Loss Account as disclosed in the Profit and Loss Account:

f) In terms of the Scheme, 11,25,000 equity shares of Rs 10/- each of the Company were to be issued and allotted to the shareholders of the erstwhile CASPL in the ratio of 450 shares of the Company for every 100 shares of CASPL. The Company has issued the said shares to the shareholders of the erstwhile Chase Atherton Steel Pvt. Ltd during the year 2006 - 2007.

g) Certain leasehold rights, buildings, licenses, agreements, loan documents etc. are in the process of being transferred in the name of the Company.

h) In terms of the Scheme, all employees in service of the erstwhile CASPL have become employees of the Company without any break or interruption in service. All rights, duties, power and obligations of erstwhile CASPL in relation to Provident Fund etc. are in the process of being transferred in the name of the Company.

7 The sales-tax assessment of the Company has been finalised upto and including the accounting year 2007 - 2008.

8 The Income-tax Assessments of the Company are completed upto March 31, 2007 (Assessment Year 2007 - 2008).

9. a) The Company has been advised that the computation of net profits for the purpose of Directors Remuneration under section 349 of the Companies Act, 1956 need not be enumerated since no commission has been paid to Directors. Fixed monthly remuneration has been made to the Executive Chairman / Managing Director.

10. The Balance 20,000 -15% Preference Shares of Rs 10 each are yet to be redeemed. The time for redemption was extended upto 10.05.1999 vide resolution passed at the Board Meeting of the Company held on 16.07.1991. Further extension is being sought for.

11. Sundry Creditors include Rs NIL (Previous Year Rs NIL) due to Small Scale Industrial Undertakings (SSIs) to the extent such parties have been identified from the available information / documents with the company.

12. As per the information available with the Company in response to the enquiries from all existing suppliers with whom the Company deals, none of the suppliers are registered under the Micro, Small and Medium Enterprises Development Act, 2006.

13. Some of the creditors of the Company have filed legal cases against the Company for recovery of dues, However, the same are being contested by the Company.

14. The Company has filed legal cases or is in the process of filing legal cases against various parties to recover amounts due from them.

15. The Company does not expect any shortfall on realisation of assets on aggregate basis, despite accumulated losses as on March 31, 2010.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand factors in the employment markets.

16. Provisions for Current tax / Fringe Benefit Tax have been made based on the current tax rates and other provisions of the Income-tax Act, 1961.

17. The Companys operations relate to manufacture of Bright Steel Bars. The Company does not have any separate business segments.

18. Prior Period Adjustment represents Debit relating to earlier years Rs 5,99,839/- (Previous Year Rs 2,16,126/-) and credits relating to earlier years Rs 3,05,34V-(Previous Year Rs 65,283/-)

b. The Deferred Tax Liability (Net) for the year of Rs 4,52,626/- (Previous Year - Deferred Tax Assets of Rs 19,50,622/-) is added to the Current Years Profit and shown as Deferred Tax Assets after adjusting opening Deferred Tax Liability.

19. Related Party Information

Disclosures in respect of related parties (as defined in Accounting Standard 18), with whom transactions have taken place during the year given below:

1) Relationship

a) Enterprise where control of Key Management Personnel and / or their relatives exists.

1 Rose Investments Pvt. Ltd.

2 Avanti Traders Pvt. Ltd.

b) Key Management Personnel

1 Shri Alok Kumar Jajodia- Executive Chairman

2 Shri Avinash Jajodia - Managing Director

3 Smt. Manjudevi Jajodia - Director

c) Relatives of Key Management Personnel

1 Smt. Shamoli Malhotra

2 Smt. Rajnidevi Jajodia

Note : Related Party relationship is as identified by the company and relied upon by the auditors.

20. Disclosures in respect of Derivative Instruments:

a. There are no derivative instrument like Forward Exchange Contracts etc. outstanding at the end of the year as on March 31,2010 and at the end of the year as on March 31,2009

21. Figures of the previous year have been regrouped / reclassified / rearranged, wherever necessary, to conform with the current years presentation. Amounts and other disclosures for the preceding year are included as an integral part of the current years financial statements and are to be read in relation to the amounts and other disclosures relating to the current year.