Home  »  Company  »  D B Realty Ltd.  »  Quotes  »  Notes to Account
Enter the first few characters of Company and click 'Go'

Notes to Accounts of D B Realty Ltd.

Mar 31, 2016

1. Rights, preferences and restriction attached to

(a) Equity Shares

Equity shares have equal rights to dividend and voting rights pro rata their holdings. The Company has only one class of Equity Shares having a par value of Rs. 10/- per share.

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.

(b) Preference Shares

The Non Cumulative Redeemable Preference Shares shall carry coupon rate of 8% per annum. The said shares shall be redeemed at par at the end of the five years from the date of allotment, 6th February, 2016. The company has option to redeem the Preference Shares at any time after the end of one year from the date of allotment at par with dividend.

2. The said loan was received for the purpose of financing the cost of constructions of the project DB Skypark, Sahar, Andheri - East a joint venture in which the Company is a venturer and carries floating interest rate of 14.5% p.a. linked to I-Base, payable monthly. The loan is repayable in 12 quarterly installments commencing from April 1, 2016. The loan is secured by :-

1. Exclusive charge on the land situated at project of one of the subsidiary, DB Skypark, Sahar, Andheri East which is a property of co-venturer (Eversmile Construction Company Pvt Ltd) including all the structures thereon both present and future,

2. First pari-passu charge over Bacchuwadi property, Mumbai Central.

3. Corporate guarantee from YJ Realty & Aviation Pvt Ltd backed by first pari-passu charge over Dynamix Mall, Juhu.

4. Corporate guarantee from Milan Theatres Pvt Ltd.

5. Personal guarantee of one of the Managing Directors of the Company.

5.3 The said loan was received for General Corporate Purpose. The loan is secured by pledge of 13,117,020 shares of the company which are held by Neelkamal Tower Construction LLP. The loan carries fixed interest rate of 9.75% p.a on monthly rest. The loan was repayable at the end of 36 months from the date of disbursement. The interest cost is payable on monthly basis. Redemption premium is payable at the end of the tenure so as to yield a normal IRR of 14.75% p.a. on monthly rest. (The said loan has been classified as current maturity of long term debt). Out of the outstanding amount, debt redemption premium of Rs. NIL (Previous Year Rs.50,044,962/-) is payable at the end of the tenure.

3. The said loan was received in the current year for general purpose loan and carries interest rate of 15% p.a. Loan is repayable in 24 Months with bullet repayment at the end of the loan tenure. Interest to be paid annually. The said loan is secured by :-

1. An exclusive charge on the project land of Orchid Golf View Park S.No. 191A/2A/1/2, Plot No.2 at yerwada, Pune. together with all buildings and structures thereon, both present and future.

2. An exclusive charge on the scheduled receivables under the documents entered into with customer by the Borrower, all such proceeds both present and future.

3. An exclusive charge over all rights, titles, interest claim, benefits, demands under the project documents both present and future.

4. An exclusive charge over escrow account, all monies credited / deposited, therein and all investments in respect thereof (in whatever form they may be).

5. An exclusive charge on TDR - transferable development rights till the same is loaded on the project.

6. Hypothecation of Future receivables from Sale of proposed residential development project ''Orchid Golf View Park S.No. 191A/2A/1/2, Plot No.2 at yerwada, Pune''.

7. Personal Guarantee of both Managing Directors.

4. The said loan is repayable up to 36 months from the date of first disbursement i.e. 02.08.2014. The effective rate of interest for the year is 16.% p.a. Secured by Pledge /charges of shares of the Company worth minimum 2.00 times of the loan amount , as acceptable to the lender, to be pledged in a depository as suggested by lender. Further, Mr. Vinod Goenka has given personal guarantee for securing the repayment of loans and dues thereon. The said loan is also secured by 7,000,000 number of equity shares held by Ms. Sanjana Goenka in the Company.

5. The said loan was received for the purpose of financing the costs of construction and other project implementation costs in its subsidiary companies and jointly controlled companies and carries floating interest rate of 13.5% p.a. linked to LHPLR, payable monthly. The loan was repayable in six structured quarterly installments ending on August, 2013 and the outstanding balance was due in August, 2013. The said loan has been restructured on November 23, 2013 and again on April 27, 2015. The loan tenure has been extended by 12 months and hence the outstanding balance is due on January 31, 2016 and will carry floating interest rate LHPLR Plus 75 bps (Currently 16.25% p.a.). The Loan is guaranteed by personal guarantees of Managing Directors of the Company and corporate guarantee of Esteem Properties Private Limited, a wholly owned subsidiary company, which has also mortgaged its land at Sahar, Andheri in this regard. (The said loan has been classified as Current Maturities of long term debt).

6. Secured by lien on fixed deposit of Rs. 1,40,00,000/- placed by Neelkamal Realtors & Builders Private Limited with Oriental Bank of Commerce.

7. Terms of Loan

The said loan was received as Loan against Residential Property and carries floating interest rate of 20% p.a subject to BPLR being constant. The tenure of the loan was of 12 months from the date of disbursement i.e. October 31, 2015. The loan amount was repayable at the end of the tenure of the loan and interest cost was payable on a monthly basis.The said loan has been restructured on October 31, 2015. It is revolving and reviewed every year and carries floating interest rate of 20.75% p.a subject to BPLR being constant. The loan is secured by registered mortgage of immovable property of pune land situated at S.No. 191/A/2A/1/2, Plot No. 2 & 3( Block A C) at Yerwada, Pune. The said loan is secured by Personal Guarantee of both Managing Directors.

8. "The loan was repayable within 12 months from the date of first disbursement i.e. 21.11.2014. However, the said loan has been rolled

over up to 21.05.2016. The rate of interest for the year is 15.% p.a. The said loan is secured by

a) Pledge of fully paid up, de-materialized, unencumbered, freely transferable equity share of the Company, in favour of IFIN, equivalent to 2 times of outstanding principal amount.

b) Pledge of 3,838,382 Shares of Marine Drive Hospitality & Realty Pvt. Ltd., constituting 15.53% of the paid up share capital of MDHRPL held by the Company.

c) Mortgage and Hypothecation of two TDR Certificates of 85,287 square meters along with escrow of receivables emanating from sale of these TDR certificates held by Dynamix Realty on a pari passu basis for the term loan granted by IL&FS Financial Services Ltd to the Company.

d) First ranking hypothecation and escrow receivables from 614 sold units and 10 unsold units in the project. Out of the said 10 units the Company has already 7 sold units to customers.

e) Mortgage of and Hypothecation of receivables from approx 9000 square meters freehold land near Mumbai Central, owned by N.A. Estates Pvt. Ltd.

f) Personal Guarantee of both Managing Directors.

g) Pledge of 22,000,000 shares of the Company which are held by Neelkamal Tower Construction LLP."

9. Interest Free and repayable on / before the expiry of 12 months from the date of disbursement.

Notes:

10. a The Company has pledged its investment of 986,613 (PY 986,613) Class A equity shares of Neelkamal Realtors Tower Private Limited, it''s associate company, in favour of Yes Bank which provided term loan of Rs. 3,500,000,000/- to the said associate.

11. b The same has been considered as a subsidiary for the purpose of Companies Act, 2013 and for the purpose of consolidation.

12. The Company has pledged its investment of 3,838,382 equity shares of Marine Drive Hospitality & Realty Private Limited. in favour of IL & FS Financials Services Ltd which provided term loan of Rs. 950,000,000/- (PY Rs.350,000,000/-) to the Company.

13 The Company has pledged 88.79% of its investment in equity & 54.53% of its investment in ROCCPS of DB (BKC) Realtors Private Limited joint venture, in favour of banks which sanctioned term loans of Rs. 750,000,000/- (PY Rs.750,000,000/-) to the said joint venture.

14 There is no return on investments in preference shares of Marine Drive Hospitality & Realty Private Limited(''''DBH'''') during the year. Further, even though there is huge investment in these Preference Shares, there is no control or significant influence on DBH. In view of the management, investments in this entity is considered strategic and long term in nature and the market value and future prospects of these investment are significantly in excess of Company''s investment in DBH.

15 During the previous year, 2,470,000 shares Series A 0.002% ROCCPS of Marine Drive Hospitality & Realty Private Limited which are held by the Company have been handed over to Enforcement Directorate (ED) under PMLA case. (Refer Note No 43)

16 The Company has pledged its investment of 199,390 equity shares of MIG (Bandra) Realtors and Builders Private Limited, in favour of Yes Bank Ltd which provided term loan of Rs. 6,000,000,000/- (Previous Year Rs.Nil) to the said Subsidiary Company. (Refer Note 30(iii))

17 The Company has pledged its investment of 435,600 equity shares of Neelkamal Realtors Suburban Private Limited, in favour of Edelweiss Housing Finance Ltd which provided term loan of Rs. 440,000,000/- (Previous Year Rs.Nil) and in favour of ECL Finance Ltd which provided term loan ofRs. 260,000,000/- (Previous Year Rs.Nil) to the said Subsidiary Company. (Refer Note 30(iv) & (v))

Notes:

(i) The Company has granted security to Housing Development Finance Corporation Limited for securing the financial assistance of Rs. 3,000,000,000/- granted to Real Gem Buildtech Private Limited, a subsidiary company. During the year, the Company had given Corporate Guarantee in respect of additional loan availed by a subsidiary company from HDFC Limited. for Rs. 1,500,000,000. The loan is primarily secured by Mortgage of the subsidiary Company assets, scheduled receivables, pledge of 4,000,000 shares of the Company held by the Neelkamal Tower Construction LLP. The security has been granted by way of Mortgage of specified flats together with proportionate undivided share, right, title and interest in the common area and in the underlying land on which the Project is constructed and personal guarantee of Mr. Vinod Goenka. The outstanding principal amount of the loan whose principal amount is of Rs.3,000,000,000/- in the books of Real Gem Buildtech Private Limited as of March 31, 2016 is Rs.2,851,026,705/- (Previous Year Rs. 2,897,206,298/-). The outstanding principal amount of the loan whose principal amount is of Rs.1,500,000,000/- in the books of Real Gem Buildtech Private Limited as of March 31, 2016 is Rs.932,000,000/- (Previous Year Rs.NIL).

(ii) The Company has given "Guarantee" to Daimler Financial Services India Private Limited against the car finance facility of Rs.15,400,000/sanctioned to Real Gem Buildtech Private Limited, a subsidiary company. The same is secured against hypothecation of respective vehicle. The outstanding principal amount of the facility in the books of Real Gem Buildtech Private Limited as of 31st March 2016 is Rs. 8,172,134/-.

(iii) During the year, the Company had given Corporate Guarantee and pledged its holding in the subsidiary company, MIG (Bandra) Realtors & Builders Private Limited in respect of loan from Yes Bank Limited. for Rs. 6,000,000,000. The loan is primarily secured by Mortgage of the subsidiary company assets, its scheduled receivables, extension of charge on the Grand Hyatt, Goa, and personal guarantee of Mr. Vinod Goenka and Mr. Shahid Balwa.

(iv) The Company had given Corporate Guarantee on behalf of Neelkamal Realtors Suburban Private Limited. The Company had also pledged entire shares of Neelkamal Realtors Suburban Private Limited. The loan is secured by (i) Exclusive charge on the land owned by the Subsidiary Company; (ii) All movables and fixed assets of the Subsidiary Company; (iii) Exclusive charge on the receivables of the project; the Escrow Accounts, together with money lying in Escrow Accounts. (iv) Personal Guarantee of the Mr. Vinod Goenka and Mr. Shahid Balwa,

(v) The Company had extended Corporate Guarantee on behalf of Neelkamal Realtors Suburban Private Limited. The Company had also extended its pledge of entire shares of Neelkamal Realtors Suburban Private Limited for a loan sanctioned by Edelweiss Housing Finance Limited for an amount of Rs. 440,000,000/- which was reduced to Rs.380,809,936/- as on the date of Guarantee. The said loan is secured by (i) Extension of charge on the land owned by the Subsidiary Company; (ii) All movebales and fixed assets of the Subsidiary Company; (iii) Extension of charge on the receivables of the project; (iv) pledge of 66% share holding (v) Personal Guarantee of the Mr. Vinod Goenka and Mr. Shahid Balwa,

(vi) The Company has provided security of the Company’s properties admeasuring 80,934 sq meters at Malad (East), Mumbai and Resham Bhavan located at Churchgate, Mumbai. The subsidiary company has repaid the loan and the present outstanding is Rs. Nil in the books of the said company, however, the said Company is still in process of satisfaction of charge. The Company does not expect any outflow of resources.

(vii) The company had provided security as a partner of Dynamix Realty to IL&FS Financial Services Ltd. for loan of Rs. 600,000,000 availed by its subsidiary Gokuldham Real Estate Development Company Pvt. Ltd.

The facility was secured by (a) mortgage of 10 unsold units of DB woods project located at Goregaon E; (b) Hypothecation of receivables of the entire project DB Woods; (c) pledge of 38,38,382 shares of Marine Drive Hospitality & Realty Pvt. Ltd.; (d) pledge of 22,000,000 shares of the Company which are held by Neelkamal Tower Construction LLP (e) Personal Guarantee of Mr. Vinod Goenka and Mr. Shahid Balwa.

The said subsidiary company has now merged with the company. The said loan facility now forms a part of the borrowing availed by the company.

(viii) The Company had given Corporate Guarantee in respect of facilities availed by its subsidiary company Gokuldham Real Estate Development Company Pvt. Ltd. from Indiabulls Housing Finance Ltd. for corporate loan of Rs. 300,000,000. The loan was secured by pledge of 7,000,000 shares of the Company held by Sanjana Goenka.

The said subsidiary company has now merged with the company. The said loan facility now forms a part of the borrowing availed by the company.

(ix) The Company had given Corporate Guarantee on behalf of Neelkamal Realtors Tower Private Limited, a subsidiary. The Company had also pledged 986,618 shares of Neelkamal Realtors Tower Private Limited. The said facility is also secured by (i) Exclusive charge in respect of all that pieces and parcels of land of Byculla Division CS No.1906 admeasuring 19,434.10 Square Meters and structure constructed or to be constructed thereon. (ii) All moveable fixed and current assets including receivable (present and future) of the project "Orchid Heights"(iii) Escrow Account of project receivables (Orchid Heights). (iv) Personal Guarantee of Mr Shahid Balwa and Mr Vinod Goenka

(x) No amount has been borrowed by the said jointly controlled entity for which the Company had given a corporate guarantee of '' 750,000,000 (Previous year: Rs. 750,000,000) and also pledged its investment in shares of the said entity as a security. However, as no dues certificate is not yet released by Bank, it is assumed that the corporate guarantee and security provided are not yet discharged by the concerned banks.

(xi) During the year, the Company has given Corporate Guarantee in respect of loan availed by YJ Realty & Aviation Private Limited from ICICI Bank Limited. for Rs. 850,000,000. The loan is primarily secured against the monthly receivables of the YJ Mall. Other Securities include (i) Mortgage of the assets of the borrowing Company; (ii) All the moveable assets of the borrowing Company; (iii) Second charge on the 10 flats of DB Crown flats backed by Corporate Guarantee of Real Gem Buildtech Private Limited; (iv) first parri-passu charge over bacchuwadi property, Mumbai. (v) Personal Guarantee of Mr. VInod Goenka and Mr. Shahid Balwa.

(xii) In earlier years, the Company had given corporate guarantee on behalf of Majestic Infracon Private Limited in which some of the directors of the Company are interested for facility availed from Punjab National Bank, Mumbai and Bank of India, Mumbai, for an amount aggregating Rs. 8,530,000,000 (Previous Year Rs. 8,530,000,000). The Company has also provided collateral securities of the Company’s property admeasuring 80,934 sq meters at Malad (East), Mumbai (forming part of Inventory) with including all development rights, unutilized Floor Space Index (FSI) / or such other FSI that may be granted in future for Rs. 4,250,000,000 out of total loan amounting to Rs. 8,530,000,000.

The said facility is also secured by (a) pledge of Majestic Infracon Private Limited shareholding consisting of 45,934,000 equity shares in Etisalat DB Telecom Private Limited; (b) a pari passu charge on the property consisting of Hotel Hilton, Mumbai. (c) Together with collateral securities of the Company’s property admeasuring 80,934 sq meters at Malad (East), Mumbai with including all development rights, unutilized Floor Space Index (fSi) / or such other FSI that may be granted in future.

The liability of Punjab National Bank is Rs. NIL and of Bank of India has been increased due to unpaid interest to Rs. 681,146,682/-(Previous Year Rs. 652,111,989/-) as on March 31, 2016. The Company is confident that this company would fulfill the obligations under the credit facilities and does not expect any outflow of resources.

(xiii) The liability under the said loan is Rs. Nil (Previous Year Rs. Nil) as on March 31, 2016, the Company has also obtained No Dues Certificate from IL&FS Financial Services Limited.

(xiv) The Company has given corporate guarantees and has given collateral securities of the Company’s property DB Hill Park admeasuring 80,934 Sq meters at Malad (East), Mumbai and Resham Bhavan located at Churchgate, Mumbai (forming part of Inventory), on behalf of BD&P Hotels (India) Private Limited and Pune Buildtech Private Limited.

The said facilities are also secured by (i) Charge on Fixed Assets both present and future of the respective projects other than project land (ii) charge on all current assets including receipt of all the receivables related to the respective project (iii) charge on all bank accounts, insurance contracts of respective company along with the following common securities (iv) a pari passu charge on its property consisting of Hotel Hilton, Mumbai.

(xv) The Company has given corporate guarantee to ECL Finance Limited on behalf of Milan Theatres Private Limited.

The said facility is secured by (i) Pledge of 20,000,000 shares of the Company held by Neelkamal Tower Construction LLP; (ii) First Mortgage and Charge on the land admeasuring 3,442.20 Sq mtr. situated at Santacruz, Mumbai; (iii) First Mortgage and Charge on the land admeasuring 72,000 sq. yards situated at S. No. 92, Mahajan wadi, Thane; (iv) First charge on the existing and future receivables; (v) Pledge of 66.67% shares of Milan Theatres Private Limited.; (vi) Corporate Guarantee of Conwood Construction & Developers Private Limited; and (vii) Personal Guarantee of Mr. Shahid Balwa and Mr. Vinod Goenka

(xvi) The Company has given corporate guarantee in respect of facilities availed by Delux Hospitality Limited, Mauritius (‘DBH, Mauritius’) & YJ Realty & Aviation Private Limited (Formally known as Y J Realty Private Limited) from ICICI Bank UK PlC and ICICI Bank Limited respectively of USD 138 millions (Rs. 9,153,940,200) as at the year end March 31, 2016 (Previous Year Rs. 8,637,530,400) and security in respect of Bacchuwadi Property in D B Realty Limited against stand by letter of credit issued by ICICI Bank Limited as an integral part of the arrangement of USD 65 millions. The current outstanding of the loan is USD 20,354,984.61 as on March 31, 2016 in ICICI Bank UK PLC and Rs. 1,169,768,006.64 in ICICI Bank India Limited. For the purpose of the said corporate guarantee, the Company has received in its favour irrevocable and unconditional personal guarantees from the two interested directors covering the entire amount of guarantee issued by the Company.

The said facilities are secured by (a) mortgage of its property consisting of Dynamix Mall in YJ Realty & Aviation Private Limited (formally known as Y J Realty Private Limited) and (b) pledge of its entire shareholding of Marine Drive Hospitality & Realty Private Limited (formally known as DB Hospitality Private Limited (‘DBHPL’)) in DBH, Mauritius (being the wholly owned subsidiary of DBHPL) and (c) Pledge of 50,409,641 shares of the Company held by Neelkamal Tower Construction LLP (33,997,818 shares), one of the Managing Director and his relatives (16,411,823 shares) .

For all the above Contingent Liabilities the Company is confident that these companies will fulfill their obligations under the credit facilities and does not expect any outflow of resources. 31. Share of loss (net) from investments in partnership firms (“the firms”) and investments in the firms is based on financial statements of the firms as audited by other auditors. The audited financial statements/the auditors’ report on the financial statements of the partnership firms viz. Dynamix Realty (“Dynamix”), DBS Realty and Mira Real Estate Developers in which the Company is a partner have reported certain significant matters as under:

A. Dynamix Realty:

i. Notes to financial statements regarding to property tax liability:

The Firm has disputed its liability for property tax on the land on which it has constructed the Project as the said land was conveyed to the Municipal Corporation of Greater Mumbai (MCGM), though it provided for such property tax as up to March 31, 2012 and accordingly, has not paid Rs. 10,234,515/- (Previous Year Rs.10,234,515/-). Without prejudice to the same, in any view of the matter, in terms of the agreement with Slum Rehabilitation Authority as well as with MCGM, the Firm is not liable for property tax effective April 2012. Accordingly, the amounts of Rs. 3,374,099/- (Previous Year Rs. 3,374,099/-) paid under protest on or after April 2012 are carried forward as recoverable from MCGM. Adjustment entries shall be passed once the outcome is finalized.

ii. Notes to Financial statements relating to procedures regarding direct confirmations:

Balances of trade receivables and payables are subject to confirmation and reconciliation, wherever applicable, if any.

iii. Notes to financial statements and reference in Auditors’ report regarding a matter which is sub-judice:

1. The Firm had granted Loan to Kusegaon Realty Private Limited aggregating to Rs. 2,092,500,000/-, (the said loans) as up to 31.03.2010, as of 31.03.2016, which along with interest thereon stands recovered. Central Bureau of Investigation Anticorruption Branch, New Delhi (CBI) in the Supplementary (First) charge sheet RC.DAI.2009.A.0045 (2G Spectrum Case) has alleged that out of the said loans, through the Firm, Rs. 2,000,000,000/- is paid as illegal gratification to M/s Kalaignar TV Private Limited (Kalaignar) through Kusegaon Realty Private Limited and M/s Cineyug Films Pvt. Ltd., in lieu of the undue favours by accused public servants to Swan Telecom Private Limited (SWAN) in 2G Spectrum Case. The CBI have alternatively alleged in the said charge sheet that even if the said transaction of Rs. 2,000,000,000/- is accepted as genuine business transaction, the said loans obtained by Kalaignar for a consideration which being known as inadequate, constitutes commission of offence. The Firm is not an accused in the 2G Spectrum Case. In the opinion of the Partners of the Firm, these are preliminary charges based on investigation carried out by the CBI Team and the personnel named in the charge sheet are presumed to be innocent till their alleged offence is established after a fair trial. These preliminary charges have no impact on the business/operations of the Firm.

Further, consequent to above, a complaint was filed under the Prevention of Money Laundering Act, 2002 (the PML Act) (Money Laundering Case) and the Adjudicating Authority vide Order dated 10.01.2012 has confirmed the Provisional Attachment Order (the Order). The Firm being included as one of the defendant, properties in the form of bank balances and sundry debtors aggregating to Rs. 1,338,900,000/- (Previous Year Rs. 1,338,900,000/-) were provisionally attached, out of which, trade receivable of Rs. 497,100,000/- (Previous Year Rs.497,100,000/-) are realized by BD, Delhi. An appeal has been preferred against the Order before the Appellate Tribunal under the PML Act. The Directorate of Enforcement has taken physical possession of bank balance of Rs. 3,599,925/- (Previous Year Rs.3,599,925/-) and has realized the trade receivable (The Phonix Mills Limited) of Rs.345,120,750/-(Previous Year Rs.345,120,750/-). Against such recoveries the Firm has made a representation to convert the amount so recovered into fixed deposits to be held by them in trust, which is pending. These recoveries by Directorate of Enforcement are shown as receivable from Directorate of Enforcement in the firm''s financial statement.

Further, on 24.04.2014, the Directorate of Enforcement has filed a complaint before the Hon’ble Special Court in connection with the Prevention of Money Laundering Case relating to the 2G Spectrum Case against 19 accused including the Firm and its partners. The Hon’ble Special Court by an Order have framed charges against the accused persons, including the Firm. The Firm has been alleged to have paid illegal gratification of Rs. 2,000,000,000/- to Kalaignar on behalf of an accused public servant, through the process of layering and received back the same again through the process of layering from Kalaignar as Rs. 2,235,500,000/-. Thus, the Firm is alleged to be involved as also alleged to have committed an offence of money laundering under section 3 of the PML Act, which is punishable under section 4 of the PML Act.

As up to the date of signing of the financial statements, the outcome of 2G Spectrum Case/Money Laundering Case are sub-judice.

18. Trade Receivables outstanding more than 6 Months of Rs. 556,277,256/- (Previous year Rs. 583,777,256/-) which Includes dues of Rs. 493,033,364/- (Previous year Rs. 493,033,364/-) attached under the PML Act. The Firm has filed legal cases against these parties before the Hon’ble High Court of Bombay for recovery of outstanding amounts along with interest thereon, which are pending. The Firm is confident that the outcome of these cases would be in its favour and hence, the outstanding amount shall stand realized in the due course of time. Under the circumstances, provision for doubtful debts, if any, is not considered necessary to be provided for.

As regards balance receivable of Rs. 63,243,892/- (Previous year Rs. 90,743,892/-), the Partners of the Firm have taken effective steps for recovery and do not expect any short realization. Therefore, the Partners of the Firm have framed their opinion that the same are good for recovery.

B. DBS Realty:

i. Notes to financial statements relating to procedures regarding direct confirmations:

Trade Payables, Trade Receivables, Contractors’ Retention money and mobilization advance in the financial statements are subject to confirmation. As per the contention of the management, the same are good for payable / receivable.

ii. Notes to financial statement regarding property tax liabilities:

During the earlier years, the firm has received special notice from Municipal Corporation of Greater Mumbai (M.C.G.M) with regard to payment of property tax. In response to said notice the firm has filed complaint to M.C.G.M stating that the said property belongs to Government of Maharashtra and therefore the assessment for property tax made on the firm is bad in law and void.

C. Mira Real Estate Developers:

i. Notes to financial statements regarding a matter which is sub-judice:

The Salt Department, Union of India has filed a petition and the partnership firm has filed cross petitions towards their respective claim for exclusive title over the salt pan land. Though the matter is sub-judice, the firm is of opinion that it has a rightful claim over the ownership of the salt pan land and will be in a position to defend its title.

ii. Notes to Financial statements relating to procedures regarding direct confirmations:

Trade Payables, other current liabilities, other current assets and other non-current assets are subject to confirmation.

19. During an earlier year, the Company acquired 1/3rd stake in Mahal Pictures Private Limited by paying Rs. 892,225,001 by and under a Share Purchase Agreement dated December 2, 2010, the Company agreed to purchase additional 1/3rd stake from another shareholder vide a Share Purchase Agreement and paid advance of Rs. 400,000,000. However, as per the said agreement, such purchase is subject to settlement of a suit which is pending at the High Court of Judicature at Hon’ble Bombay High Court. The Company has become a party to the said suit on account of demise of that Shareholder The Company, based on legal advice is confident of a favorable resolution in getting the matter resolved favorably and accordingly the said advance paid is considered to be good of recovery.

20. One of the Company''s wholly owned subsidiary (i.e. Esteem Properties Private Limited) has plans to construct/ develop/ market project/s on its land, which are delayed due to title dispute concerning the previous landlords. The Company has filed a special leave petition before the Supreme Court of India which is pending and a status quo order has been passed by the Supreme Court of India. The Company considers its investment in the said subsidiary as long term and strategic in nature. As of March 31, 2016, the Company''s investment in and Loan to this subsidiary aggregate Rs. 312,018,720 (Previous year Rs. 312,018,720) and Rs. 1,129,615,130 (Previous year Rs. 1,127,380,130) respectively. The Company has been legally advised that the outcome of the petition before the High Court of Bombay against the reversed order & that of the Supreme Court of India against the order of the Bombay High Court in PIL can be in favor & accordingly the management is confident about the positive outcome and does not believe that there is any diminution in the value of its investments and considers the loan given as good of recovery.

21. One of the Company’s wholly owned subsidiary (DB Man Realty Private Limited) has not written off the inventory amount though LOA stands cancelled, as the said company expects positive outcome from the writ petition. As of March 31, 2016, the Company’s investment in and loan to this subsidiary aggregate Rs. 71,960,000 (Previous year 71,960,000) and Rs. 423,306 (Previous year Rs. 390,000) respectively. The management is confident about the positive outcome and does not believe that there is any diminution in the value of its investments and considers the loan given as good of recovery.

22. One of the Company’s subsidiary (Spacecon Realty Private Limited) had bid for development of the Government Colony Plot "Part - I” in Bandra (East), Mumbai which had been accepted by by Govt. of Maharashtra''s P.W.Department in year 2010. For execution of work order for the said project, the P.W.Department has asked the said subsidiary company to pay minimum upfront amount (including maintenance corpus) of Rs. 8,029,500,000/-. Against the said demand, the said subsidiary company has offered to pay an amount of Rs. 3,629,500,000/- simultaneously with the execution of concession agreement with P.W.Department for issuance of work order as per the company''s understanding of the provisions contained in the Tender. The P.W.Department cancelled the tender on Feburary 26, 2015. The Company has filed writ petition No. 2120/2015 in the Bombay High Court in respect of arbitrary cancellation of the tender for development of Government Colony "Part-I". As on March 31, 2016, the Company’s investment in and loan to this subsidiary aggregate Rs. 100,000 (Previous Year Rs. 100,000/-) and Rs. 577,138,288/- (Previous Year Rs. 577,043,288/-) respectively. The management expects positive outcome of the matter and does not believe that there is any diminution in the value of its investments and considers the loan given as good of recovery.

23. a) The Company has incurred a sum of Rs. 174,652,001/- (Previous Year Rs. 139,346,834/-) towards acquisition of development rights

pertaining to a SRA redevelopment project, which is the subject matter of litigation. There are five litigations pending regarding the same. Based on legal advice, the Company believes that it has a good chance of getting the project and is confident of commencement of redevelopment activities shortly and accordingly the said amount is considered as good of recovery.

b) In respect of project under development having a value of Rs.351,338,711/- (forming a part of inventory) The Bombay High Court has ordered payment of money under the award as and by way of part compensation of Rs.72,888,368/- towards land acquisition (included under current liabilities) the company has moved to Supreme Court against such order of the High Court seeking further compensation of Rs.216,813,968/-. The company also expects to recover amounts paid to other parties towards the project. Pending outcome of the matter, no adjustment have been made in the accounts in this regard.

24. The Scheme of Amalgamation (“the Scheme”) of Gokuldham Real Estate Development Co. Pvt. Ltd. (“transferor company”) with the Company, under Sections 391 to 394 of the Companies Act, 1956 was sanctioned by the Hon’ble High Courts of Bombay on October 16, 2015. The Scheme became effective on filing of the said order with the Registrar of Companies, Maharashtra and the Registrar of Companies taking the same on record on December 23, 2015.

Pursuant to the approval of the Scheme of Amalgamation and Arrangement between the Company, transferor company and their respective shareholders (the “Scheme”) by the Hon''ble High Court of Judicature at Bombay on October 16, 2015, the transferor company has been amalgamated with the Company with retrospective effect from April 1, 2013 (the “Appointed Date”).

The Company was holding 374,990 equity shares for Rs. 37,592,755 which constituted 75% of the equity shareholding of the transferor company before the Scheme. Transferor company carried nature of business activities similar to that of the Company. The main purpose of the Scheme was to achieve economies of scale with lesser regulatory or procedural compliances, integrate, rationalize and streamline the management structure of the merged business, saving in cost, to facilitate inter transfer of resources, costs and optimum utilization of resources, to reflect consolidated net worth of the company in one balance sheet and synchronizing of efforts to achieve uniform corporate policy. In terms of the Scheme, these 374,990 Equity Shares of the transferor company held by the Company were cancelled and no new shares were alloted in lieu of such cancellation. In case of other equity shareholders, the Company has alloted 71,755,740, 8% redeemable preference shares of Rs. 10 each in lieu of their existing equity shares in the transferor company be redeemed at par at the end of 5 years. And the company has option to redeem such shares at any time after the end of 1 year from the date of allotment. All new preference shares are issued as fully paid up. The number of equity shares of the Company pre and post Scheme therefore remained the same.

Accounting Treatment:

The amalgamation was accounted as ‘amalgamation in the nature of merger’ in accordance with the approved Scheme and consequently the pooling of interest method was used as per AS 14 Accounting for Amalgamation.

In accordance with the Scheme, the difference between Net Assets Value of the transferor company and the value of investments in the books of the Company & the purchase consideration paid by way of issue of new Preference Shares as fully paid up has been treated as capital reserve.

All assets and liabilities of transferor company have been recorded in the books of account of the Company at their book values at the close of business day immediately preceding the Appointed Date.

Accordingly, the amalgamation has resulted in transfer of assets and liabilities in accordance with the terms of the Scheme at the following summarized values as on April 1, 2013:

In terms of the Scheme, the appointed date of the amalgamation being April 1, 2013, net profit from the transferor company during the financial years 2013-14 and 2014-15 aggregating Rs. 767,355,012 has been transferred, to the extent not accounted already, to the Surplus in Statement of Profit and Loss in the books of the Company upon amalgamation.

As the Scheme has become effective from December 23, 2015 the figures for the current period includes the operations of the transferor company. Accordingly, the figures for the year ended March 31, 2016 are after giving effect to the merger, while the comparative figures are before giving effect to the merger and, hence are not comparable.

Further, the Company has initiated the name change formalities to transfer the title in respect of the other properties, contracts etc.

25. The Company has created MAT credit during the year for Rs. 29,800,000/- (Previous years reversal of Rs. 31,500,000/-) Further, MAT credit entitlement of Rs. 35,800,000/- (Previous Year Rs.6,000,000/-) is based on future performance and business projection of the company.

26. The Company has investments in certain subsidiaries, jointly controlled entities and associates aggregating Rs. 2,311,887,120 (Previous Year Rs. 2,435,072,308) and loans and advances outstanding aggregating Rs. 3,857,937,831 (Previous Year Rs. 2,566,004,652) as at March 31, 2016. While such entities have incurred losses during the year and have negative net worth as at the year end, the underlying projects in such entities are in the early stages of real estate development and are expected to achieve adequate profitability on substantial completion and/ or have current market values of certain properties which are in excess of the carrying values. The Company considers its investments in such entities as long term and strategic in nature. Accordingly, no provision is considered necessary towards diminution in the value of the Company’s investments in such entities or in respect of loans and advances advanced to such entities, which are considered good and fully recoverable.

27. D B Realty Ltd. (“Company”) is in receipt of Summons from Special Court for Prevention of Money Laundering Act (PMLA), Mumbai as one of the accused in connection with a complaint filed by Enforcement Directorate under ECIR No. ECIR/MBZO/07/2015 & ECIR/ MBZO/08/2015. The Hon’ble Court has also now summoned one of the KMP''s of the Company as one of the accused as per the said complaint. The matter in relation to the Company and the KMP involves certain advances given by the Company in the ordinary course of its business to another company, which was subsequently refunded fully upon cancellation of the understanding. The Company does not expect any financial liability.

28. Managerial remuneration:

a) In view of inadequate profit during the current and previous year, the Company has not paid any managerial remuneration to any managing director in both years.

b) Contributions to provident and other funds are not made as per declarations of non deduction received from the respective directors. Further, gratuity and leave encashment (amount unascertained) payable to the managing directors is waived by them. Such waivers have been approved by the Board of Directors.

c) Sitting fees amounting to Rs. 1,360,000 (Previous Year Rs. 980,000) have been paid to the directors.

29. Dynamix Realty (“Partnership Firm”) in which D B Realty Limited (“Company”) is a partner, had granted Loan to Kusegaon Realty Private Limited aggregating to Rs. 2,092,500,000/- (the said loan) as up to March 31, 2010. As of March 31, 2016, the outstanding balance due from Kusegaon Realty Private Limited is Rs. Nil (Previous Year Nil), being part of interest charged. Central Bureau of Investigation Anti-corruption Branch, (New Delhi) in the Supplementary (First) charge sheet RC.DAI.2009.A.0045 (2G Spectrum Case) has alleged that out of the said loans granted, Rs. 2,000,000,000 was paid as illegal gratification to M/s Kalaignar TV Private Limited through Kusegaon Realty Private Limited and M/s Cineyug Films Private Limited., in lieu of the undue favours by accused public servant to Swan Telecom Private Limited in 2G Spectrum Case. The Central Bureau of Investigation has alternatively alleged in the said charge sheet that even if the said transaction of Rs. 2,000,000,000 is accepted as genuine business transaction, the interest charged is being inadequate is a favour to a government servant, hence, it constitutes commission of offence. In the opinion of the Partners of the firm and the Management of the Company, these are preliminary charges based on investigation carried out by the Central Bureau of Investigation Team and the key management personnel named in the charge sheet are presumed to be innocent till their alleged offence is established after a fair trial. These preliminary charges have no impact on the business/operations of the firm and the Company.

Further, The Deputy Director Enforcement vide his attachment order No: 01/2011 dt. August 30, 2011 has provisionally attached Company’s bank account number 05211011001053 maintained with Oriental Bank of Commerce, Goregaon (East), having Bank Balance of Rs. 6,892,967. The Enforcement Directorate has also attached two flats belonging to the Company situated at Goregaon (East). The Combined value of these two flats as shown in Company’s financial statement is Rs. 10,765,400/- at the time of attachment (WDV as on 31st March, 2016 is Rs. 97,96,142 (Previous Year Rs. 9,970,065)). Also, a loan amounting to Rs. 503,963,329 (at the time of attachment) advanced to Goan Hotels & Clubs Private Limited (now Goan Hotels & Realty Pvt. Ltd.) has also been provisionally attached. However, the above loan was converted into the ROCCPS of Marine Drive Hospitality & Realty Private Limited (“MDHRPL”) holding Company of Goan Hotels & Clubs Private Limited, before the provisional attachment order via tripartite confirmation. This fact has been brought to the notice of Enforcement Directorate vide this Office Letter dated September 20, 2011.

This provisional attachment order has been upheld by adjudicating authority vide order number 116/2011 dt. January 10, 2012. Appeal has been filed on March 19, 2012 with Appellate Tribunal under Prevention of Money Laundering Act (PML Act). The said appeal is sub-judice.

In an earlier year, the Directorate of Enforcement had taken physical possession of bank balance of Rs. 6,892,967/- against which the Firm has written a letter to convert the amount so recovered into Fixed Deposits. Till date Directorate of Enforcement has not entertained this request. In view of the same, the said balance is shown as part of advances. (Refer Note 20.2)

Further, on April 24, 2014, the Directorate of Enforcement has filed a complaint before the Hon’ble Special Court in connection with the Prevention of Money Laundering Case relating to the 2G Spectrum Case against 19 accused including the Firm and its partners. The Hon’ble Special Court by an Order have framed charges against the accused persons, including the Firm. The Firm has been alleged to have paid illegal gratification of Rs. 2,000,000,000 to Kalaignar on behalf of an accused public servant, through the process of layering and received back the same again through the process of layering from Kalaignar as Rs. 2,235,500,000. Thus, the Firm is alleged to be involved as also alleged to have committed an offence of money laundering under section 3 of the PML Act, which is punishable under section 4 of the PML Act. During the year 2014, 2,470,600 Series A ROCCPS shares of the value of Rs. 504,002,400/in lieu of loan advanced to Goan Hotels & Club Pvt. Ltd., held by the Company have been handed over to Enforcement Directorate by letter dated October 28, 2014 (Refer Note 12.5).

As up to the date of signing of these financial statements, the outcome of 2G Spectrum Case/Money Laundering Case are sub-judice.

30. Assets taken on Operating Lease :

(i) The Company has taken commercial premises on Non Cancellable Operating Lease and lease rent of Rs.25,388,598 (Previous Year Rs. 15,232,374) has been debited to Statement of Profit and Loss and Rs. 3,659,910 (Previous Year Rs. 4,177,022) has been inventoried for the current year.

(iii) There are no exceptional/ restrictive covenants in the lease agreement.

(iv) The above mentioned amounts debited to Statement of Profit & Loss and future minimum lease payments are exclusive of service tax to the extent applicable.

(v) The above future minimum lease rental includes normal escalation rate based on the agreements. Further, normal escalation rates are 5% every year.

(vi) The Company does not have any contingent lease rental expenses/ income.

31. Assets given on Operating Lease :

The Amalgamating Company (Gokuldham Real Estate Development Company Private Limited) had executed lease deeds for certain Units forming part of the Project for a period of 25 years, the same has been classified as Non-Current Investment. In terms of the agreements, the lease rentals shall become due and payable on possession being granted.

(ii) The lease deeds are for 25 years and the lease rental is subject to increase by 5% every 5 years. Lease rent recognized during the year in the statement of Profit & Loss amount of Rs. 26,42,000/-. Accordingly, the future lease rentals are disclosed based on the Management''s estimate of the amounts that it would receive.

C) Other Long Term Employee Benefit:

The compensated absences charged for the year ended March 31, 2016, based on actuarial valuation carried out using the Projected Unit Credit Method, amounting Rs. (2,829,327/-)4 (Previous Year Rs.5,462,473/-) has been recognized in the statement of Profit and Loss. The company has also made provision for sick & casual leave as on March 31, 2016 amounting to Rs.1,281,893/-(Previous Year Rs. Nil).

32. In respect of company’s investment in Association of Person (AOP), each executing a single project, the Company’s share in the un inventoried expenses of such projects and shown as accumulated losses, is recognized only when such loss will be debited to members account in the books of such AOPs. As per the projections of the management, each of such project is expected to make a good profit on completion.

33. Segment Reporting:

The Company is mainly engaged in the business of real estate development viz. construction of residential buildings/ commercial complexes and activities connected and incidental thereto. On that basis, the Company has only one reportable business segment

- real estate development, the results of which are embodied in the financial statements. The Company operates in only one geographical segment - within India.

53. Corporate Social Responsibility:

a) Gross Amount required to be spent Rs. 1,245,179/- (Previous Year Rs.1,576,000/-)

b) Amount spent during the year on

The Company has Corporate Social Responsibility (CSR) policy and is required to incur expenditure towards CSR activity on the basis of last three years profitability statements as per section 135 of the Companies Act, 2013 and the rules made there under. During the Financial Year, the Company has spent Rs. 1,000,000 on Chief Minister Relief Fund towards CSR expenditure.

(Figures in brackets denote Previous Year''s balances)

* Warehousing LLPs includes following entities

- Daund Warehousing Developers & Builders LLP

- Saswad Warehousing Developers & Builders LLP

- Ahmednagar Warehousing Developers & Builders LLP

- Solapur Warehousing Developers & Builders LLP

- Latur Warehousing Developers & Builders LLP -Aurangabad Warehousing Developers & Builders LLP

The Company has ceased to be a partner in above six LLP''s w.e.f. July 1, 2015, since these LLPs had not carried on any business activity. The Company''s share in loss of these LLP''s amounts to Rs. 6,714 for the three months ended on June 30, 2015.

b) There are no capital commitments and other commitments related to the Company''s interest in the joint ventures and no commitments of venture itself.

# % of shareholding is considered from consolidation perspective. DB Realty Limited holds 5% and DB Contractor & Builders Private Limited (wholly owned subsidiary ) holds 45% stake in Lokhandwala DB Realty LLP.DB Contractor & Builders Private Limited has prepared its consolidated financial statement. Hence, figures here are taken at DB realty''s shareholding i.e. 5%.Further Profit & Loss are taken at 6.3% (as agreed between partners).

34. Figures of the previous year have been regrouped/ reclassified wherever necessary to conform to the presentation of the current year.


Mar 31, 2014

1 The said loan was received for General Corporate purpose & it is secured by pledge of shares of DB Realty Ltd and carries fixed interest rate of 9.75% p.a on monthly rest. The tenure of the loan is of 36 months. The loan amount is repayable at the end of the tenure of the loan and interest cost is payable on a monthly basis. Redemption premium is payable at the end of the tenure so as to yield a nominal IRR of 14.75% p.a. on monthly rests.)

2 The said loan was received for the purpose of financing the costs of construction of the Company, investment or advances to subsidiaries and other group companies and for general corporate purposes and carries floating interest rate of 18.5% p.a. linked to IBMR, payable monthly. The loan is repayable at the end of 18 Months from the date of 1st disbursement of the loan. The loan is secured by pledge of 38,38,382 equity shares of Marine Drive Hospitality & Realty Private Limited (Formerly DB Hospitality Private Limited) held by the Company and mortgage and hypothication of two TDR certificates with cummulative TDR of 85,287sq. mt. along with escrow of receivables emanating from sale of this TDR certificates to be created by a partnership firm, in which the Company is the partner. The loan is guaranteed by personal guarantees of managing directors of the Company.

3 The said loan was received for the purpose of financing the cost of constructions of the project DB Skypark. Sahar, Andheri East of a joint venture in which the Company is a venturer and carries floating interest rate of 14.5% p.a. linked to I-Base, payable monthly. The loan is repayable in 12 quarterly instalments commencing from April 1st 2016. The loan is secured by

4. Exclusive charge on the land situated at project DB Skypark, Sahar, Andheri East which is a property of co-venturer (Eversmile Construction Company Private Limited) including all the structures thereon both present and future,

5. First pari-passu charge over Bacchuwadi property, Mumbai Central,

6. Corporate guarantee from YJ Realty & Aviation Pvt Ltd backed by first pari-passu charge over Dynamix Mall, Juhu,

7. Corporate guarantee from Milan Theatres Pvt Ltd backed by first pari-passu charge over Milan Mall, Santacruz, Mumbai.

8. Personal guarantee of one of the Managing Directors of the Company.

9. The said loan was received for the purpose of financing the costs of construction and other project implementation costs within its subsidiary companies and jointly controlled companies and carries floating interest rate of 13.5% p.a. linked to LHPLR, payable monthly. The loan was repayable in six structured quarterly installments ending on August, 2013 and the outstanding balance was due in August, 2013. The said loan has been restructured on November 23, 2013. The loan tenure has been extended by 18 months and hence the outstanding balance is due on January 31, 2015 and will carry floating interest rate of 16% p.a. linked to LHPLR. The Loan is guaranteed by personal guarantees of Managing Directors of the Company. Further, Esteem Properties Private Limited, a wholly owned subsidiary Company, has mortgaged its land at Sahar, Andheri in this regard. (The said loan has been classifi ed as Current Maturities of long term debt.)

10. Terms of Loan

The said loan was received as Loan against Residential Property and carries floating interest rate of 20% p.a subject to BPLR being constant. The tenure of the loan was of 6 months from the date of disbursement. The loan amount was repayable at the end of the tenure of the loan and interest cost was payable on a monthly basis.The said loan has been restructured on March 25, 2014. It is revolving and reviewed every year and carries floating interest rate of 20.75% p.a subject to BPLR being constant. The loan is guaranteed by personal guarantees of Managing Directors of the Company. Further, registered mortgage has been created on plot 2 & 3(A C) at Yerwada Pune which is a part of Inventories of the Company.

11. The said loans carry interest rates ranging from 10% to 15.25% and are repayable on demand.

12. The said ICD is interest free and is repayable on demand.

Notes:

1. The Company has pledged its investment of 986,613 Class A equity shares (PY NIL) of Neelkamal Realtors Tower Private Limited, it''s associate Company, in favour of Yes Bank which provided term loan of Rs. 350 crores, to the said associate.

2. The Company has pledged 88.79% (PY 88.79%) of its investment in equity & 54.53% (PY 54.53%) of its investment in ROCCPS of DB (BKC) Realtors Private Limited (Formerly known as M K Malls & Developers Private Limited) joint venture, in favour of banks which sanctioned term loans of Rs. 75 crores (PY NIL), to the said joint venture.

3. The Company has pledged its investment of 3,838,382 equity shares of Marine Drive Hospitality & Realty Pvt. Ltd., in favour of IL & FS Financials Services Ltd which provided term loan of Rs. 21.50 crores (PY NIL), to the Company

4 There is no return on investments in preference shares of Marine Drive Hospitality & Realty Private Limited ("DBH") during the year. Further, even though there is a huge investment in these preference shares, there is no control or significant infIuence on DBH. In view of the management, investments in these entities are considered strategic and long term in nature and the current market values and future prospects of these investments are signifi cantly in excess of company''s investment in DBH.

13 Security deposits include Rs. 3,575,000,000 given to various related parties for acquisition of development rights. The Company is in process of obtaining necessary approvals with regard to said properties and the said properties have current market values significantly in excess of carrying values and are expected to achieve adequate profitability on substantial completion of their projects.

12.3 Refer Note 29 for advance for share purchase amounting to Rs. 40,00,00,000/-.

12.4 In respect of project advances of Rs. 78,19,45,000 forming a part of long term loans and advances provided by the Company to its two Associate Companies, the required documents are under execution.

Particulars As at As at March 31, 2014 March 31, 2013 Rs. Rs.

14. Contingent Liabilities:

A. Guarantees and Securities provided to banks and financial institutions (in India and overseas) against credit facilities extended to:

a) Subsidiaries

- Real gem Buildtech Pvt. Ltd. (Guarantee provided) 3,000,000,000 3,000,000,000

- DB View Infracon Pvt. Ltd. (Security provided) (Refer note 27 (i)) 300,000,000 -

Sub Total (a) 3,300,000,000 3,000,000,000

b) Associates

- Neelkamal Realtors Tower Private Limited 3,500,000,000 4,125,000 (Guarantee provided) (Refer note 27 (ii)

Sub Total (b) 3,500,000,000 4,125,000

c) Jointly Controlled Entities (Guarantees given)

- Dynamix Realty (Towards vehicle loan) - 4,125,000

- DB (BKC) Realtors Private Limited (earlier known as M K Malls & Developers Private Limited) 750,000,000 750,000,000 (Refer note 27(iii) below)

Sub Total (c) 750,000,000 754,125,000

d) Companies under the same management

- Majestic Infracon Private Limited (earlier known as DBI Infracon Private 8,530,000,000 8,530,000,000 Limited / Tiger Trustees Private Limited) (Refer Note 27 (iv) below)

- Heaven Star Hotels (Delhi) Private Limited (earlier known as DB Hotels 1,700,000,000 1,700,000,000

(India) Private Ltd) (Guarantees given and Security provided) (Refer Note 27 (v) below)

- Pune Buildtech Private Ltd (Refer Note 27 (vi) below) 2,250,000,000

- BD&P Hotels (India) Private Ltd (Refer Note 27 (vi) below) 650,000,000 -

- Neelkamal Realtors and Builders Private Limited - 4,125,000 (Towards vehicle loan)

Sub Total (d) 13,130,000,000 10,234,125,000

e) Others

- Delux Hospitality Limited, Mauritius (earlier known as D B Hospitality 8,293,772,400 7,505,723,400 Limited) (Term Loan of USD 138 Million) & YJ Realty Ltd (Stand by Letter of Credit of USD 65 Million) (Overall Guarantee of the Company in USD 138 million) (Refer 27 (vii) below)

Sub Total (e) 8,293,772,400 7,505,723,400 Grand Total (a b c d e) 28,973,772,400 24,148,098,400

B. Other money for which the Company is contingently liable:-

i) Contingent payments to the holders of Redeemable Optionally Convertible Amount Amount Cumulative Amount Amount Preference Shares (ROCCPS), unascertainable unascertainable Compulsory Convertible unascertainable unascertainable Preference Shares (CCPS) and equity shares subscribed by other shareholders of an entity (in which the Company has joint control) - representing the amount payable or adjustable by the Company on exercise of various exit options by _such other holders based on agreement entered with them.

ii) Provisional attachment of Amount Amount assets under Prevention of Money unascertainable unascertainable Laundering Act, Amount Amount 2002 for: unascertainable unascertainable

DB Realty Limited (Refer Note 40) Dynamix Realty (Refer Note (iii) of A of 28)

The Company is a party to various legal proceedings in the normal course of business and does not expect the outcome of these proceedings (which is not quantifi able) to have any adverse effect on its financial conditions, results of operations or cash flows.

Notes:

(i) The Company has provided security of the company''s properties admeasuring 80,934 sq meters at Malad (East), Mumbai and Resham Bhavan located at Churchgate, Mumbai. The Company is confident that the subsidiary Company would fulfill the obligations under the credit facilities and does not expect any outflow of resources.

(ii) During the year, the Company has given Corporate Guarantee on behalf of Neelkamal Realtors Tower Private Limited, an associate. The said facilities are secured by (i) Exculsive charge by in respect of all that pieces and parcels of land of Byculla Division CS no.1906 admeasuring 19434.10 Square Meters and structure constructed or to be constructed thereon. (ii) All moveable fixed and current assets including recieveables (present and future) of the project "ORCHID HEIGHT".(iii) Escrow Account of project receivables (Orchid Heights). Exculsive charge by way of 30% of total shareholding of the Company which are held by D B Realty Limited (986,613 class A equity share). (iv) Personal Guarantee of Mr Shahid Balwa and Mr Vinod Goenka

(iii) No loan has been borrowed by DB (BKC) Realtors Private Limited towards a total corporate guarantee provided of Rs. 750,000,000 (Previous year: RS. 750,000,000).

(iv) In a earlier years, the Company had given corporate guarantee on behalf of Majestic Infracon Private Limited in which some of the directors of the Company are interested for facility availed from Punjab National Bank, Mumbai and Bank of India, Mumbai, for an amount aggregating Rs. 8,530,000,000 (Previous Year Rs. 8,530,000,000) The Company has also provided collateral securities of the company''s property admeasuring 80,934 sq meters at Malad (East), Mumbai (forming part of Inventory) with all including all development rights, unutilized Floor Space Index (FSI) / or such other FSI that may be granted in future.

The said facility is also secured by (a) pledge of investment of Majestic Infracon Private Limited consisting of 45,934,000 equity shares in Etisalat DB Telecom Private Limited; (b) a pari passu charge on its property consisting of Hotel Hilton, Mumbai. (c) Together with collateral securities of the company''s property admeasuring 80,934 sq meters at Malad (East), Mumbai with all including all development rights, unutilized Floor Space Index (FSI) / or such other FSI that may be granted in future.

The Company is confident that this Company would fulfill the obligations under the credit facilities and does not expect any outfiow of resources.

(v) During the year, the Company has given Corporate Guarantee and has pledged its entire shareholding of Marine Drive Hospitality & Realty Private Limited for loan availed by Heaven Star Hotels (Delhi) Private Limited (formerly known as DB Hotels (India) Private Limited), from IL & FS Financial Services Limited.

The said facility is also secured by (i) charge on Fixed Assets both present and future of the project other than project land

(ii) charge on all current assets including receipt of all the receivables related to the project (iii) charge on all bank accounts, insurance contracts (iv) Goan Hotels & Clubs Private Limited in Heaven Star Hotels (Delhi) Private Limited. The Company is confident that this Company would fulfill the obligations under the credit facilities and does not expect any outflow of resources.

(vi) During the year, the Company has given corporate guarantees and has given collateral securities of the company''s property DB Hill Park admeasuring 80,934 sq meters at Malad (East), Mumbai and Resham Bhavan located at Churchgate, Mumbai (forming part of Inventory), on behalf of BD&P Hotels (India) Private Limited and Pune Buildtech Pvt. Ltd.

The said facilities are also secured by (i) charge on Fixed Assets both present and future of the respective projects other than project land (ii) charge on all current assets including receipt of all the receivables related to the respective project (iii) charge on all bank accounts, insurance contracts of respective Company alongwith the following common securities (iv) a pari passu charge on its property consisting of Hotel Hilton, Mumbai.

The Company is confident that this company would fulfill the obligations under the credit facilities and does not expect any outfiow of resources.

(vii) In a earlier years, the Company had given corporate guarantee in respect of facilities availed by Delux Hospitality Limited, Mauritius (''DBH, Mauritius'') & YJ Realty Ltd from ICICI Bank - United Kingdom PLC of USD 138 millions - Rs. 8,293,772,400 as at the year end March 31, 2014 (Previous Year Rs. 7,505,723,400). For the purpose of the said corporate guarantee, the Company has received in its favour irrevocable and unconditional personal guarantees from the two interested directors covering the entire amount of such guarantees issued by the Company. (Conversion rate used Rs. 60.0998/- USD as per RBI conversion rate as on 28th March 2014 (PY Rs. 54.3893/- USD)

The said facilities are secured by (a) mortgage of its property consisting of Milan Mall in Milan Theatres Private Limited, Dynamix Mall in YJ Realty Private Limited, Orchid Garden in Conwood DB JV and Orchid Park in DB Realty Limited (against stand by letter of credit issued by ICICI Bank Limited as an integral part of the arrangement); (b) pledge of its entire shareholding of DB Hospitality Private Limited (''DBHPL'') in DBH, Mauritius (being the wholly owned subsidiary of DBHPL).

The Company is confident that these companies would fulfill their obligations under the credit facilities and does not expect any outfiow of resources.

B. Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of Advances) amounting to Rs. Nil/- (Previous Year Rs. Nil) and estimated amount of contracts remaining to be executed other than capital account and not provided for amounting to Rs. NIL/- (Previous Year Rs. Nil).

15. Share of loss (net) from investments in partnership firms ("the fi rms") and investments in the firms is based on fi nancial statements of the firms as audited by other auditors except in case of a partnership firm i.e. DBS Realty (Refer Note 21.1). The audited financial statements/the auditors'' report on the financial statements of the partnership firms viz. Dynamix Realty ("Dynamix"), DBS Realty and Mira Real Estate Developers (formerly known as Mira Salt Works Company) in which the Company is a partner has reported certain signifcant matters as under:

A. Dynamix Realty:

i. Notes to financial statements and reference in Auditors'' report regarding the following matters.

1. The Firm had granted unsecured loan with interest to Kusegaon Realty Private Limited of Rs. 2,092,500,000/- and recovered principal amount in the year ended 31st March, 2011. The outstanding amount of Rs. 91,501,379/- (Previous year Rs. 91,501,379/-) represents interest receivable and is considered good for recovery, as in the opinion of the Partners they do not expect any shortfall in recovery thereof.

2. The Firm had granted unsecured loan to Nihar Construction Private Limited without interest and repayable on demand with no other terms for which the Partners had given their consent. The outstanding amount as of year-end is Rs. 87,150,000/- (Previous year Rs. 244,500,000/-) which is considered as good for recovery.

3. Trade Receivables outstanding more than 6 months of Rs. 944,656,340 which Includes dues of Rs. 838,154,114/- (Previous year Rs. 838,154,114/-) attached under the PML Act, for which the parties have given their acknowledgement. As regards balance receivable of Rs. 106,688,887/- (Previous year Rs. 44,990,913/-), the Partners of the Firm have taken effective steps for recovery and do not expect any short realisation. Therefore, the Partners of the Firm have framed their opinion that the same are good for recovery.

ii. Notes to financial statements and reference in Auditors'' report regarding a matter which is sub-judice:

The Firm had granted Loan to Kusegaon aggregating to Rs. 2,092,500,000/-, (the said loans) as upto 31.03.2010. As of 31.03.2014, the outstanding balance due from Kusegaon is Rs. 91,501,379/- (Previous year Rs. 91,501,379/-), being part of interest charged. Central Bureau of Investigation Anti-corruption Branch, New Delhi (CBI)) in the Supplementary (First) charge sheet RC.DAI.2009.A.0045 (2G Spectrum Case) has alleged that out of the said loans, through the Firm, Rs. 2,000,000,000/- is paid as illegal gratification to M/s Kalaignar TV Private Limited (Kalaignar) through Kusegaon and M/s Cineyug Films Pvt. Ltd., in lieu of the undue favours by accused public servants to Swan Telecom Private Limited (SWAN) in 2G Spectrum Case. The CBI have alternatively alleged in the said charge sheet that even if the said transaction of Rs. 2,000,000,000/- is accepted as genuine business transaction, the said loans obtained by Kalaignar for a consideration which being known as inadequate, constitutes commission of offence. The Firm is not an accused in the 2G Spectrum Case. In the opinion of the Partners of the Firm, these are preliminary charges based on investigation carried out by the CBI Team and the personnel named in the charge sheet are presumed to be innocent till their alleged offence is established after a fair trail. These preliminary charges have no impact on the business/operations of the Firm.

Further, consequent to above, a complaint was fi led under the Prevention of Money Laundering Act, 2002 (the PML Act) (Money Laundering Case) and the Adjudicating Authority vide Order dated 10.01.2012 has confi rmed the Provisional Attachment Order (the Order). The Firm being included as one of the defendant, properties in the form of bank balances and sundry debtors aggregating to Rs. 1,338,900,000/- (Previous Year Rs. 1,338,900,000/-) were provisionally attached, out of which, sundry debtors of Rs. 497,100,000/- (Previous year Rs. 497,100,000/-) stands realised after furnishing the information for which the requisite intimation has been made to the Prescribed Authority. An appeal has been preferred against the Order before the Appellate Tribunal under the PML Act. During the year, the Directorate of Enforcement has taken physical possession of bank balance of Rs. 3,599,925/-, against which the Firm has written a letter to convert the amount so recovered into Fixed Deposits which is pending. In view of the same, the said balance is continued to be shown as part of bank balance held in current account. Post Balance sheet date, the Directorate of Enforcement has filed a complaint before the Hon'' Court in connection with Money Laundering Case relating 2G Spectrum Case. In response thereto, the Firm, the Partners of the Firm and persons named in the said complaint have been issued summons for attendance. The parties hereto are yet to be provided a copy of the complaint.

As upto the date of signing of the financial statement the outcome of 2G Spectrum case/Money Laundering Case are sub judies.

iii. Notes to Financial statements relating to procedures pertaining to direct confirmations:

Balances of trade payables and trade receivables are subject to confirmation wherever applicable from respective parties & reconciliation, if any.

B. DBS Realty:

i. Notes to Financial statements relating to procedures pertaining to direct confirmations:

Trade Payables, Contractors'' Retention money and mobilization advance in the financial statements are subject to confirmation. As per the contention of the management the same are good for payable/ receivable.

C. Mira Real Estate Developers:

i. Notes to financial statements regarding a matter which is sub-judice:

The Salt Department, Union of India has filed a petition and the partnership firm has filed cross petitions towards their respective claim for exclusive title over the salt pan land. Though the matter is sub-judice, the firm is of opinion that it has a rightful claim over the ownership of the salt pan land and will be in a position to defend its title.

ii. Notes to Financial statements relating to procedures pertaining to direct confirmations:

Trade Payables, other current liabilities, other current assets and other non-current assets are subject to confirmation.

16. During an earlier year, the Company acquired 1/3rd stake in Mahal Pictures Private Limited by paying Rs. 892,225,001. By and under a Share Purchase Agreement dated December 2, 2010, the Company agreed to purchase additional 1/3rd stake from another shareholder vide a Share Purchase Agreement and paid advance of Rs. 400,000,000. However, as per the said agreement, such purchase is subject to settlement of a suit which is pending at the High Court of Judicature at H''ble Bombay High Court. The Company has became a party to the said suit on account of demise of that Shareholder The Company, based on legal advice is conf ident of a favorable resolution in getting the matter resolved favourably so as to be able to develop the underlying land parcel; and accordingly the said advance paid is considered to be good of recovery.

17. One of the company''s wholly owned subsidiary (i.e. Esteem properties private Limited) has plans to construct/ develop/ market project/s on its land, which are delayed due to title dispute concerning the previous landlords. The Company has filed a special leave petition before the Supreme Court of India which is pending and a status quo order has been passed by the Supreme Court of India. The Company considers its investment in the said subsidiary as long term and strategic in nature. As of March 31, 2014, the company''s investment in and Loan to this subsidiary aggregate Rs. 312,018,720 (previous year Rs. 312,018,720) and Rs. 1,124,970,130 (previous year Rs. 1,120,577,945) respectively. The Company has been legally advised that the outcome of the petition before the High Court of Bombay against the reversed order & that of the Supreme Court of India against the order of the Bombay High Court in PIL could be in favor & accordingly the management is confi dent about the positive outcome and does not believe that there is any diminution in the value of its investments and considers the loan given as good of recovery.

18. The Company has incurred a sum of Rs. 132,931,001 (previous year Rs. 155,772,388) towards acquisition of development rights pertaining to a SRA redevelopment project, which is the subject matter of litigation. There are five litigations pending regarding the same. Based on legal advice, the Company believes that it has a good chance of getting the project and is confident of commencement of redevelopment activities shortly and accordingly the said amount is considered as good of recovery.

32. a. The Company has not made any provision for tax for the current financial year (previous year Rs. 31,500,000) as the Company has incurred tax losses and no book profit as per Section 115JB for the purpose of MAT.

b. MAT Credit Entitlement of Rs. 37,500,000 (Previous Year Rs. 37,500,000) is based on future performance of the Company as projected by the Management and it has been relied upon by the Auditors.

c. The Company has also recognized deferred tax asset in accordance with Accounting Standard - 22 "Accounting for taxes on income" The components of the deferred tax asset recognized for the period are as follows:

19. The Company has investments in certain subsidiaries, jointly controlled entities and associates aggregating Rs. 408,054,120 (Previous year Rs. 2,046,339,120) and loans and advances outstanding aggregating Rs. 2,625,383,640 (Previous year Rs. 3,043,702,747) as at March 31, 2014. While such entities have incurred losses during the year and have negative net worth as at the year end, the underlying projects in such entities are in the early stages of real estate development and are expected to achieve adequate prof tability on substantial completion and/ or have current market values of certain properties which are in excess of the carrying values. The Company considers its investments in such entities as long term and strategic in nature. Accordingly, no provision is considered necessary towards diminution in the value of the company''s investments in such entities or in respect of loans and advances advanced to such entities, which are considered good and fully recoverable.

20. Managerial remuneration:

a) In view of inadequate profit during the year, the Company has not paid a managerial remuneration (previous year Rs. 6,000,000) to any managing directors. Further, during the previous year, Managerial Remuneration paid of Rs. 2,400,000 by the Company had exceeded the limits specified under Schedule XIII read with Sec 349, 350 & 198 of the Companies Act, 1956,. The Company has recovered such excess remuneration of Rs. 2,400,000 from the directors during the current year.

a) Contributions to provident and other funds are not made as per declarations of non deduction received from the respective directors. Further, provision for gratuity and leave encashment (amount unascertained) payable to the managing directors is waived by them. Such waivers have been approved by the Board of Directors.

b) During the year, one of the subsidiary company appointed one of the managing directors of the Company as its managing director for overall responsibilities and functions of the said subsidiary company but it has not paid any remuneration (Previous Year Rs. 13,500,000), in the absence of adequate prof it. Excess remuneration paid by the said subsidiary company in previous year of Rs. 18,692,700 has been recovered during the current year.

c) Sitting fees amounting to Rs. 800,000 (Previous Year Rs. 980,000) have been paid to the directors.

21. Dynamix Realty ("Partnership Firm") in which DB Realty Limited ("Company") is a partner, had granted Loans to Kusegaon aggregating to Rs. 2,092,425,485, (the said loans) as upto 31st March 2010. As of 31st March, 2014, the outstanding balance due from Kusegaon is Rs. 91,501,379, being part of interest charged. Central Bureau of Investigation Anti-corruption Branch, New Delhi) in the Supplementary (First) charge sheet RC.DAI.2009.A.0045 (2G Spectrum Case) has alleged that out of the said loans granted, Rs. 2,000,000,000 is paid as illegal gratification to M/s Kalaignar TV Private Limited through Kusegaon and M/s Cineyug Films Pvt. Ltd., in lieu of the undue favours by accused public servants to Swan Telecom Private Limited in 2G Spectrum Case. The Central Bureau of Investigation has alternatively alleged in the said charge sheet that even if the said transaction of Rs. 2,000,000,000 is accepted as genuine business transaction, the interest charged being inadequate is a favor to a government servant, hence constitutes commission of offence. In the opinion of the Partners of the firm and the Management of the Company, these are preliminary charges based on investigation carried out by the Central Bureau of Investigation Team and the personnel named in the charge sheet is presumed to be innocent till their alleged offence is established after a fair trial. These preliminary charges have no impact on the business/operations of the firm.

Further, The Deputy Director Enforcement vide his attachment order No: 01/2011 dt. 30th August, 2011 has provisionally attached company''s bank account number 05211011001053 maintained with Oriental Bank of Commerce, Goregaon (East), having Bank Balance of Rs. 6,892,967/-. Further the Enforcement Directorate has also attached two fiats belonging to the Company situated at Goregaon (East). The combined value of these two flats as shown in company''s financial statement of Rs. 10,765,400/- at the time of attachment (WDV as on 31st March, 2014 is Rs. 8,663,544 (PY. 9,119,520). Also, a loan amounting to Rs. 503,963,329/- (at the time of attachment) advanced to Goan Hotels & Clubs Pvt. Ltd. has also been provisionally attached. However, the above loan was converted into the ROCCPS of DB Hospitality Limited (holding Company of Goan Hotels & Clubs Private Limited) before the provisional attachment Order via tripartite confirmation. This fact has been brought to the notice of Enforcement Directorate vide this Office Letter dated 20th September, 2011.

This provisional attachment order has been upheld by adjudicating authority vide order number 116/2011 dt. 10th Jan''2012. Appeal has been filed on 19th March, 2012 with Appellate Tribunal under prevention of money laundering act (PML Act). The appeal is pending before appellate tribunal for PML.

During the year, the Directorate of Enforcement has taken physical possession of bank balance of Rs. 6,892,967/-, against which the Firm has written a letter to convert the amount so recovered into Fixed Deposits, till date ED has not entertained this request. In view of the same, the said balance is shown as part of advances recoverable in cash or in kind. Post Balance sheet date, the Directorate of Enforcement has filed a complaint before the Hon''ble Court in connection with Money Laundering Case relating 2G Spectrum Case. In response thereto, the Firm, the Partners of the Firm and certain Personnel''s / certain Directors of the Company have been issued summons for attendance. The requisite proceedings are in progress.

22. The disclosures under the Accounting Standard 15

A) Defined Contribution Plan:

* Further, the Company has inventorised contribution to Provident Fund of Rs. 23,535 (Previous Year NIL) during the year.

# Further, the Company has inventorised contribution to ESIC of Rs. 14,228 (Previous Year NIL) during the year.

C) Other Long Term Employee Benefit:

The compensated absences charged for the year ended March 31, 2014, based on actuarial valuation carried out using the Projected Unit Credit Method, amounting Rs. 1,560,534 (Previous Year Rs. 14,292,279) has been recognized in the statement of Profit and Loss. Further, the Company has inventorised compensated expenses of Rs. 66,787 (Previous Year Rs. NIL) during the year.

23. Segment Reporting:

The Company is mainly engaged in the business of real estate development viz. construction of residential buildings/ commercial complexes and activities connected and incidental thereto. The Company has also placed its bid for certain infrastructure projects for the outcome of which is awaited. On that basis, the Company has only one reportable business segment - real estate development, the results of which are embodied in the financial statements. The Company operates in only one geographical segment - within India.

24. In respect of company''s investment in Association of Person (AOP), each executing a single project, the company''s share in the expenses of such project are shown as accumulated losses, is recognized only when such loss will be debited to members account in the books of such AOPs. As per the projections of the management, each of such projects is expected to make a good profit on completion.


Mar 31, 2013

1. COMPANY BACKGROUND:

DB Realty Limited (the "Company") is public company domiciled in India. The company was initially incorporated in 2007 as a private limited company and thereafter listed with National Stock Exchange and Bombay Stock Exchange on February 24, 2010. The Company is a Real Estate Development Company that is focused on residential, commercial, retail and other projects, such as mass housing and cluster redevelopment. The company is jointly promoted by Mr. Vinod K. Goenka and Mr. Shahid Balwa.

2. In a previous year, the Company had given Corporate Guarantees on behalf of two companies in which some of the directors of the Company are interested. The said companies are however, not a part of DB consolidated group. Such guarantees are:

(i) In respect of facilities availed by Majestic Infracon Private Limited, from Punjab National Bank, Mumbai and Bank of India, Mumbai, for an amount aggregating Rs. 8,530,000,000 (Previous Year Rs. 8,530,000,000).

(ii) In respect of facilities availed by DB Hospitality Limited, Mauritius (‘DBH, Mauritius'') & YJ Realty Ltd from ICICI Bank - United Kingdom PLC of USD 138 millions – Rs. 7,505,723,400 as at the year end March 31, 2013 (Previous Year Rs. 7,059,597,000) .

The outstanding balances as at March 31, 2013 in respect of aforesaid guarantees are aggregating Rs. 16,035,723,400 (Previous Year Rs. 15,589,597,000). For the purpose of the said corporate guarantees, the Company has received in its favour irrevocable and unconditional personal guarantees from the two interested directors covering the entire amount of such guarantees issued by the Company.

The aforesaid facilities are secured as under:

(iii) Majestic Infracon Private Limited: by (a) pledge of its shareholding consisting of 45,934,000 equity shares in Etisalat DB Telecom Private Limited; (b) a pari passu charge on its property consisting of Hotel Hilton, Mumbai. (c) Together with collateral securities of the Company''s property admeasuring 80,934 sq meters at Malad (East), Mumbai with all including all development rights, unutilized Floor Space Index (FSI) / or such other FSI that may be granted in future.

(iv) DBH Mauritius: by (a) mortgage of its property consisting of Milan Mall in Milan Theatres Private Limited, Dynamix Mall in YJ Realty Private Limited, Orchid Garden in Conwood DB JV and Orchid Park in DB Realty Limited (against stand by letter of credit issued by ICICI Bank Limited as an integral part of the arrangement); (b) pledge of its entire shareholding of DB Hospitality Private Limited (‘DBHPL'') in DBH, Mauritius (being the wholly owned subsidiary of DBHPL).

The Company is confi dent that these companies would fulfi ll their obligations under the credit facilities and does not expect any outfl ow of resources.

3. During the year, the Company has given Corporate Guarantee on behalf of DB Hotels (India) Private Limited which is not a part of DB consolidated group. The said facility is secured by (i) charge on Fixed Assets both present and future of the project other than project land (ii) charge on all current assets including receipt of all the receivables related to the project (iii) charge on all bank accounts, insurance contracts (iv) pledge of its entire shareholding of DB Hospitality Private Limited (‘DBHPL'') and Goan Hotels & Clubs Private Limited in DB Hotels (India) Private Limited. The Company is confi dent that this company would fulfi ll the obligations under the credit facilities and does not expect any outfl ow of resources.

4. Share of loss (net) from investments in partnership fi rms ("the fi rms") and investments in the fi rms is based on fi nancial statements of the fi rms as audited by other auditors. The audited fi nancial statements/the auditors'' report on the fi nancial statements of the partnership fi rms viz. Dynamix Realty ("Dynamix"), DBS Realty and Mira Real Estate Developers (formerly known as Mira Salt Works Company) in which the Company is a partner has reported certain signifi cant matters as under:

A. Dynamix Realty:

i. Notes to Financial statements relating to loans and advances :

1. As at the balance sheet date, the other partner (being an entity in which a director of the Company is interested) viz. Eversmile Construction Company Private Limited (ECC) is having a debit balance of Rs. 492,920,341 (Previous Year Rs. 423,844,175). As represented by partners of the Firm, the said balance shall be recovered in due course of time and hence, the same is considered good of recovery.

2. Dynamix has granted unsecured loans with or without interest as applicable and repayable on demand with no other terms, for which the Partners have given their consent. In the opinion of the Firm, the outstanding amount as of year-end of loan and interest thereon of Rs. 374,547,577 (Previous year Rs. 387,925,377) is considered good for recovery.

ii. Notes to Financial statements relating to Trade receivables :

Trade receivable includes outstanding for more than 1 year of Rs. 860,145,027 (Previous year Rs. 860,466,407) which are inclusive of debtors amounting to Rs. 838,154,114 (Previous year Rs. 838,154,114) attached under the PML Act. In the opinion of the partners of the fi rm, they do not expect any shortfall in recovery.

iii. Notes to fi nancial statements and reference in Auditors'' report regarding a matter which is sub-judice:

Dynamix had granted Loan to Kusegaon aggregating to Rs. 2,092,500,000, (the said loans) as upto 31.03.2010. As of 31.03.2013, the outstanding balance due from Kusegaon is Rs. 91,501,379 (Previous year Rs. 91,501,379) being part of interest charged. C entral Bureau of Investigation Anti-corruption (Branch, New Delhi CBI) in the Supplementary (First) charge sheet RC.DAI.2009.A.0045 (2G Spectrum Case) has alleged that the Key Management Personnel of D B Group of Companies have out of the said loans granted, paid

Rs. 2 ,000,000,000 as illegal gratifi cation to M/s Kalaignar TV Private Limited (Kalainagar) through Kusegaon and M/s Cineyug Films Pvt. Ltd., in lieu of the undue favours by accused public servants to Swan Telecom Private Limited (Swan) in 2G Spectrum Case. The Central Bureau of Investigation have alternatively alleged in the said charge sheet that even if the said transaction of Rs. 2,000,000,000 is accepted as genuine business transaction, the said loans obtained by Kalaignar for a consideration which being known as inadequate, constitutes commission of offence. In the opinion of the Partners of the fi rm, these are preliminary charges based on investigation carried out by the Central Bureau of Investigation Team and the key management personnel named in the charge sheet are presumed to be innocent till their alleged offence is established after a fair trial. These preliminary charges have no impact on the business/operations of the fi rm.

Further, consequent to above, a complaint was fi led under the Prevention of Money Laundering Act, 2002 (the PML Act) and the Adjudicating Authority vide Order dated 10.01.2012 has confi rmed the Provisional Attachment Order (the Order). The Firm being included as one of the defendant, properties in the form of bank balances and sundry debtors aggregating to Rs. 1,338,900,000 (previous year Rs. 1,338,900,000) were provisionally attached, out of which, sundry debtors of Rs. 497,100,000 (Previous year Rs. 497,100,000) stands realized after furnishing the information for which the requisite intimation has been made to the Prescribed Authority. Upon reaching fi nality in the 2G Spectrum Case, the outcome of the Order shall become fi nal. Further, an appeal has been preferred against the Order before the Appellate Tribunal under the PML Act.

iv. Notes to Financial statements relating to procedures pertaining to direct confi rmations: Balances of unsecured loans, trade payables, trade receivables, loans granted & trade advances are subject to confi rmation wherever applicable from respective parties & reconciliation, if any.

B. DBS Realty:

i. Notes to Financial statements relating to procedures pertaining to direct confi rmations:

Trade Payables, Contractors'' Retention money and mobilization advance in the fi nancial statements are subject to confi rmation. As per the contention of the management the same are good for payable/ receivable.

C. Mira Real Estate Developers:

i. Notes to fi nancial statements and reference in Auditors'' report regarding a matter which is sub-judice:

The Salt Department, Union of India has fi led a petition and the partnership fi rm has fi led cross petitions towards their respective claim for exclusive title over the salt pan land. Though the matter is sub-judice, the fi rm is of opinion that it has a rightful claim over the ownership of the salt pan land and will be in a position to defend its title.

ii. Notes to Financial statements relating to procedures pertaining to direct confi rmations:

Trade Payables, other current liabilities, other current assets and other non-current assets are subject to confi rmation.

5. During an earlier year, the Company acquired 1/3rd stake in another company by paying Rs. 892,225,001. By and under a Share Purchase Agreement dated December 2, 2010, the Company agreed to purchase additional 1/3rd stake from another shareholder vide a Share Purchase Agreement and paid advance of Rs. 400,000,000. However, as per the said agreement, such purchase is subject to settlement of a suit which is pending at the High Court of Judicature at H''ble Bombay High Court. The Company, based on legal advice is confi dent of a favorable resolution in getting the matter resolved favourably so as to be able to develop the underlying land parcel; and accordingly the said advance paid is considered to be good of recovery.

6. One of the Company''s wholly owned subsidiary (i.e. Esteem properties private Limited) has plans to construct/ develop/ market project/s on its land, which are delayed due to title dispute concerning the previous landlords. The Company has fi led a special leave petition before the Supreme Court of India which is pending and a status quo order has been passed by the Supreme Court of India. The Company considers its investment in the said subsidiary as long term and strategic in nature. As of March 31, 2013, the Company''s investment in and Loan to this subsidiary aggregate Rs. 312,018,720 (previous year Rs. 312,018,720) and Rs. 1,120,577,945 (previous year Rs. 1,120,577,945) respectively. The company has been legally advised that the outcome of the petition before the High Court of Bombay against the reversed order & that of the Supreme Court of India against the order of the Bombay High Court in PIL could be in favor & accordingly the management is confi dent about the positive outcome and does not believe that there is any diminution in the value of its investments and considers the loan given as good of recovery.

7. The Company has incurred a sum of Rs. 155,772,388 (previous year Rs. 134,772,050) towards acquisition of development rights pertaining to a SRA redevelopment project, which is the subject matter of litigation. Based on legal advice, the Company believes that it has a good chance of getting the project and is confi dent of commencement of redevelopment activities shortly and accordingly the said amount is considered as good of recovery.

8. Provision for tax made for the current year pertains to Minimum Alternate Tax (MAT) i.e. Tax on Profi ts made under section 115JB of Income

Tax act, 1961 amounting to Rs. 31,500,000.

The Company has also recognized deferred tax asset in accordance with Accounting Standard - 22 "Accounting for taxes on income''''. The components of the deferred tax asset recognized for the period are as follows:

9. The Company has investments in certain subsidiaries, jointly controlled entities and associates aggregating Rs. 2,046,339,120 (Previous year Rs. 2,044,533,140) and loans and advances outstanding aggregating Rs. 3,043,702,747 (Previous year Rs. 3,172,489,420) as at March 31, 2013. While such entities have incurred losses during the year and have negative net worth as at the year end, the underlying projects in such entities are in the early stages of real estate development and are expected to achieve adequate profi tability on substantial completion and/ or have current market values of certain properties which are in excess of the carrying values. The Company considers its investments in such entities as long term and strategic in nature. Accordingly, no provision is considered necessary towards diminution in the value of the Company''s investments in such entities or in respect of loans and advances advanced to such entities, which are considered good and fully recoverable.

10. Dynamix Realty ("Partnership Firm") in which DB Realty Limited ("Company") is a partner, had granted Loan to Kusegaon aggregating to Rs. 2,092,425,485, (the said loans) as upto 31st March 2010. As of 31st March, 2012, the outstanding balance due from Kusegaon is Rs. 91,501,379, being part of interest charged. Central Bureau of Investigation Anti-corruption Branch, New Delhi) in the Supplementary (First) charge sheet RC.DAI.2009.A.0045 (2G Spectrum Case) has alleged that the Key Management Personnel of D B Group of Companies have out of the said loans granted, paid Rs. 2,000,000,000 as illegal gratifi cation to M/s Kalaignar TV Private Limited through Kusegaon and M/s Cineyug Films Pvt. Ltd., in lieu of the undue favours by accused public servants to Swan Telecom Private Limited in 2G Spectrum Case. The Central Bureau of Investigation has alternatively alleged in the said charge sheet that even if the said transaction of Rs. 2,000,000,000 is accepted as genuine business transaction, the interest charged being inadequate is a favor to a government servant. Hence, constitutes commission of offence. In the opinion of the Partners of the fi rm and the Management of the Company, these are preliminary charges based on investigation carried out by the Central Bureau of Investigation Team and the key management personnel named in the charge sheet are presumed to be innocent till their alleged offence is established after a fair trial. These preliminary charges have no impact on the business/ operations of the fi rm.

Further, The Deputy Director Enforcement vide his attachment order No: 01/2011 dt. 30th August, 2011 has provisionally attached Company''s bank account number 05211011001053 maintained with Oriental Bank of Commerce, Goregaon (East), having Bank Balance of Rs. 68,92,967/-. Further the Enforcement Directorate has also attached two fl ats belonging to the Company situated at Goregaon (East). The Combined value of these two fl ats as shown in Company''s fi nancial statement of Rs. 10,765,400/- at the time of attachment (WDV as on 31st March, 2013 is Rs. 9,119,520). Also, a loan amounting to Rs. 503,963,329/- (at the time of attachment) advanced to Goan Hotels & Clubs

Pvt. Ltd. Has also been provisionally attached. However, the above loan was converted into the ROCCPS of DB Hospitality Limited (holding Company of Goan Hotels & Clubs Private Limited) before the provisional attachment Order via tripartite confi rmation. This fact has been brought to the notice of Enforcement Directorate vide this Offi ce Letter dated 20th September, 2011.

This provisional attachment order has been upheld by adjudicating authority vide order number 116/2011 dt. 10th Jan''2012. Appeal has been fi led on 19th March, 2012 with Appellate Tribunal under prevention of money laundering act (PML Act). The appeal is pending before appellate tribunal for PML.

11. Segment Reporting:

The Company is mainly engaged in the business of real estate development viz. construction of residential buildings/ commercial complexes and activities connected and incidental thereto. The Company has also placed its bid for certain infrastructure projects the outcome of which is awaited. On that basis, the Company has only one reportable business segment – real estate development, the results of which are embodied in the fi nancial statements. The Company operates in only one geographical segment – within India.

12. In respect of company''s investment in Association Of Person (AOP), each executing a single project, the Company''s share in the expenses of such projects not inventorised in the books of such AOPs and shown as accumulated losses is recognised only when such loss will be debited to members account in the books of such AOPs. As per the projections of the management, each of such projects is expected to make a good profi t on completion.

13. Related Party Disclosure:

(i) Disclosures as required by the Accounting Standard 18 (AS-18) "Related Party Disclosures" are given below:

Name of the Related Party Subsidiaries:

Gokuldham Real Estate Development Company Private Limited

Neelkamal Realtors Suburban Private Limited

Neelkamal Shanti Nagar Properties Private Limited

Neelkamal Realtors Tower Private Limited (Upto 24th October 2012)

Esteem Properties Private Limited

D B Man Realty Limited

Priya Constructions Private Limited

Real Gem Buildtech Private Limited

Saifee Bucket Factory Private Limited

ECC-DB Joint Venture

Conwood-DB Joint Venture

Mira Real Estate Developers ( Formerly Mira Salts Works Company)

N.A Estate Private Limited

Royal Netra Constructions Private Limited.

Nine Paradise Erectors Private Limited

DB MIG Realtors and Builders Private Limited

Spacecon Realty Private Limited (Formerly DB Spacecon Private Limited )

Vanita Infrastructure Private Limited

DB View Infracon Private Limited

DB Contractors & Builders Private Limited

Associates:

Sangam City Township Private Limited

D.B. Hi-Sky Constructions Private Limited

Neelkamal Realtors Tower Private Limited (W.E.F 25th October 2012)

Mahal Pictures Private Limited

Jointly Controlled Entities:

Dynamix Realty

DBS Realty

Turf-Estate Joint Venture

Lokhandwala-Dynamix Balwas Joint Venture

DB (BKC) Realtors Pvt Ltd

DB Realty and Shreepati Infrastructure LLP

Daund Warehousing Developers & Builders LLP

Saswad Warehousing Developers & Builders LLP

Ahmednagar Warehousing Developers & Builders LLP

Solapur Warehousing Developers & Builders LLP

Latur Warehousing Developers & Builders LLP

Aurangabad Warehousing Developers & Builders LLP

Shree Shantinagar Ventures (Jointly controlled entity of NeelKamal Shantinagar Properties Private Limited)

Suraksha DB Realty (Jointly controlled entity of DB View Infracon Private Limited)

Evergreen Industrial Estate (Jointly controlled entity of Priya Constructions Private Limited)

Sneh Developers (Jointly Control entity of DB View Infracon Pvt Ltd)

Entity in respect of which the Company is an Associate

Neelkamal Tower Construction LLP

Key Management Personnel (KMP)

Mr. Shahid Balwa, Vice Chairman &Managing Director Mr. Vinod Goenka, ,Chairman & Managing Director

Relatives of KMP

Mr.Usman Balwa Mrs Sakina U Balwa Mrs.Shabana Balwa Mr.Arshad S.Balwa Ms.Aaliya S.Balwa Mr.Salim Balwa Mrs.Aseela V.Goenka Mr.Krishna Murari Goenka Mr.Jayvardhan V.Goenka Ms.Sanjana Goenka Mr.Pramod Goenka Mrs.Sunita Goenka Mrs.Shanita Jain

Enterprise where individuals i.e. KMP and their relatives have signifi cant infl uence

Balwas Charitable Trust Conwood Agencies Private Limited. Conwood Associates (partnership fi rm) Conwood Construction & Developers Private Limited Conwood Pre-fab Limited DB Hospitality Private Limited

Dynamix Contractors & Builders Pvt Ltd (Formerly Known as DB Modern Build tech Pvt Ltd) Pony Infrastructure and Contractors Limited Dynamix Developers Private Limited Dynamix Balwas Resorts Private Limited Dynamix Club and Resorts Private Limited Dynamix Man Pre-fab Limited Eversmile Properties Private Limited Eversmile Construction Company Private Limited. Face Inn Hotels Private Limited Goan Hotels & Clubs Private Limited Goan Real Estate and Construction Private Limited Goenka & Associates Educational Trust Goenka & Associates Medical Research Centre Goenka & Associates Social Welfare Trust K G Enterprises Milan Theatres Private Limited Modren Hi-Tech Developers Private Limited

Neelkamal Central Appartment Private Limited /Neelkamal Central Apartment LLP Neelkamal Realtors and Builders Private Limited

Nihar Construction Private Limited

Oceanmint Buildcon Pvt Ltd (w.e.f. 9th March 2013)

Neelkamal Realtors and Erectors India Private Limited

Span Construction Company Private Limited

Majestic Infracon Private Limited (formely known as Tiger Trustees Private Limited and DBI Infracon Private Limited )

Trident Estate Private Limited

Vinod Goenka-HUF

Chocklate Developers Pvt Ltd

Y. J. Realty Private Limited

Eon Aviation Pvt Ltd

BD&P Hotels (India) Pvt Ltd

Hotel Balwas Private Limited


Mar 31, 2012

1. COMPANY BACKGROUND:

DB Realty Limited (the "Company") is public company domiciled in India. The company was initially incorporated in 2007 as a private limited company and thereafter listed with National Stock Exchange and Bombay Stock Exchange on February 24, 2010. The Company is a Real Estate Development Company that is focused on residential, commercial, retail and other projects, such as mass housing and cluster redevelopment. The company is jointly promoted by Mr. Vinod K. Goenka and Mr. Shahid Balwa.



As at As at March 31, 2011 March 31.2011 Rs. Rs.

Contingent Liabilities:

A. Claim made against the Company not acknowledged as debt relating to service tax on lease rentals in respect of an office premises.(Refer Note (i)) N.A. 2,448,609

B. (a) The Company has filed a writ petition (1230 of 2010) in the High Court of Judicature at Bombay (the 'High Court'), contesting the constitutional validity of Section 65 (30) read with Section 65(105) (zzp) and Section 65(105) (zzh) read with Section 66 of the Finance Act, 1994, as amended by the Finance Act, 2010 and the matter is pending for final hearing. Further, the Company has also applied for membership of Maharashtra Chambers of Housing Industry (MCHI). MCHI, on behest of its Members, has filed a writ petition in the High Court of Bombay challenging the levy of service tax by them on Sale of Residential Flats, which has not reached its finality. Meanwhile, the High Court of Bombay has passed a Notice of Motion dated 18th February, 2011, whereby the Members are permitted to deposit the service tax with the Prothonotary & Senior Master / Registrar (O.S.) of the Court, with a direction that the same will be refunded with interest in the event Members succeed in the said writ petition. In view of the same, the Company has demanded the amount of service tax from each of the purchasers after 31st March 2011 and the amount of such service tax as upto 31st March 2011 is Rs. 656,012. The Company is of the view that the same is required to be deposited as and when collected from the purchasers. The Management of the Company has taken adequate steps for the recovery of such service tax dues and are of the opinion that the same shall be collected and deposited in due course of time and does not believe it is unreasonable to expect of ultimate collection. and N.A. Amount unascerta inable

(b) service tax matter as above in case of joint ventures (amount of service tax of Company's share as up to 31st March 2011 Rs. 2,618,769) (Refer Note (ii)) N.A. Amount unascert ainable

Notes: (i) The said claim has been provided for in the financial statements in the current year on account of levy of service tax on renting of immovable property by the Service Tax Department.

(ii) During the previous year, the outcome of the said writ petition filed by the Company and MCHI has been unfavorable. Accordingly, the Company has provided the service tax liability in its financial statements which amounts to Rs.455,163/-. The Company is of the view that the same is required to be deposited as and when collected from the purchasers. The Management of the Company has taken adequate steps for the recovery of such service tax dues and are of the opinion that the same shall be collected and deposited in due course of time and does not believe that it is unreasonable to expect the ultimate collection.

(iii) No amount has been utilized towards a total corporate guarantee provided of Rs. 750,000,000 (Previous year: Rs. 2,448,000,000).

(iv) Together with collateral securities of the Company's property admeasuring 80,934 sq meters at Malad (East), Mumbai with all including all development rights, unutilized Floor Space Index (FSI) / or such other FSI that may be granted in future.

The company is a party to various legal proceedings in the normal course of business and does not expect the outcome of these proceedings to have any adverse effect on its financial conditions, results of operations or cash flows.

2. In a previous year, the Company had given Corporate Guarantees on behalf of two companies in which some of the directors of the Company are interested. The said companies are however, not a part of DB consolidated group. Such guarantees are:

(i) In respect of facilities availed by Majestic Infracon Private Limited, from Punjab National Bank, Mumbai and Bank of India, Mumbai, for an amount aggregating Rs. 8,530,000,000 (Previous Year Rs. 8,530,000,000).

(ii) In respect of facilities availed by DB Hospitality Limited, Mauritius ('DBH, Mauritius') from ICICI Bank - United Kingdom PLC of USD 138 millions - Rs. 7,059,597,000 as at the year end March 31, 2012 (Previous Year Rs. 6,161,700,000) .

The outstanding balances as at March 31, 2012 in respect of aforesaid guarantees are aggregating Rs. 15,589,597,000 (Previous Year Rs.14,691,700,000). For the purpose of the said corporate guarantees, the Company has received in its favour irrevocable and unconditional personal guarantees from the two interested directors covering the entire amount of such guarantees issued by the Company.

The aforesaid facilities are secured as under:

(i) Majestic Infracon Private Limited: by (a) pledge of its shareholding consisting of 45,934,000 equity shares in Etisalat DB Telecom Private Limited; (b) a pari passu charge on its property consisting of Hotel Hilton, Mumbai.

(ii) DBH Mauritius: by (a) mortgage of its property consisting of Milan Mall in Milan Theatres Private Limited, Dynamix Mall in YJ Realty Private Limited, Orchid Garden in Conwood DB JV and Orchid Park in DB Realty Limited(against stand by letter of credit issued by ICICI Bank Limited as an integral part of the arrangement); (b) pledge of its entire shareholding of DB Hospitality Private Limited ('DBHPL') in DBH, Mauritius (being the wholly owned subsidiary of DBHPL). The Company is confident that these companies would fulfill their obligations under the credit facilities and does not expect any outflow of resources.

3. Share of profit (net) from investments in partnership firms ("the firms") and investments in the firms is based on financial statements of the firms as audited by other auditors. The audited financial statements/the auditors' report on the financial statements of the partnership firms viz. Dynamix Realty ("Dynamix"), DBS Realty and Mira Real Estate Developers (formerly known as Mira Salt Works Company) in which the Company is a partner has reported certain significant matters as under: A. Dynamix Realty:

i. Notes to Financial statements relating to loans and advances :

1. T he other partner (being an entity in which a director of the Company is interested) viz. Eversmile Construction Company Private Limited (ECC) has taken interest free deposit of Rs. 1,500,000,000 and the said deposit as per the deed of partnership was to be adjusted against ECC's share of profit. As at the Balance sheet date, there is a debit balance of Rs. 423,844,175 (Previous Year Rs. 3,428,974,912). As represented by partners of the Firm, the said balance shall be recovered in due course of time and hence, the same is considered good of recovery.

2. Dynamix has granted unsecured loans, repayable on demand with no other terms, for which the Partners have given their consent. In the opinion of the Firm, the outstanding amount as of year-end of loan and interest thereon of Rs.387,925,377 (Previous year Rs.1,218,431,620) (including Rs.274,000,000 (previous year 1,048,000,000) from a company in which a director of the Company is interested) is considered good for recovery.

ii. Notes to Financial statements relating to Trade receivables : During the previous financial year, Dynamix had sold 1,06,520 square meters of TDR amounting to Rs. 3,341,043,342 to a party and amount due as of period ended 31st March, 2012 from the said party is Rs. 469,100,000 which is overdue. Further, other debtors include amount of Rs. 391,366,407 which are outstanding for more than six months. Out of these outstanding, debtors amounting to Rs. 841,720,750 are attached under the PML Act. In the opinion of the Partners of the Firm, they do not expect any shortfall in recovery.

iii. Notes to Financial statements relating to treatment of income tax : In computing the provision for current tax of Dynamix for the preceding years, the profits derived from the Project were claimed as a deduction u/s 80 (IB) of the Income Tax Act, 1961 (the Act) on a year to year basis. In the current year, on completion of the Project, the balance profits stands recognised and the same is claimed as an admissible deduction u/s 80 (IB) of the Act in computing the current tax for the year.

iv. Notes to financial statements and reference in Auditors' report regarding a matter which is sub-judice:

Dynamix had granted Loan to Kusegaon aggregating to Rs. 2,092,425,485, (the said loans) as upto 31.03.2010. As of 31.03.2012, the outstanding balance due from Kusegaon is Rs. 91,501,379 being part of interest charged. Central Bureau of Investigation Anticorruption Branch, New Delhi in the Supplementary (First) charge sheet RC.DAI.2009.A.0045 (2G Spectrum Case) has alleged that the Key Management Personnel of D B Group of Companies have out of the said loans granted, paid Rs. 2,000,000,000 as illegal gratification to M/s Kalaignar TV Private Limited through Kusegaon and M/s Cineyug Films Pvt. Ltd., in lieu of the undue favours by accused public servants to Swan Telecom Private Limited in 2G Spectrum Case. The Central Bureau of Investigation have alternatively alleged in the said charge sheet that even if the said transaction of Rs. 2,000,000,000 is accepted as genuine business transaction, the said loans obtained by Kalaignar for a consideration which being known as inadequate, constitutes commission of offence. In the opinion of the Partners of the firm, these are preliminary charges based on investigation carried out by the Central Bureau of Investigation Team and the key management personnel named in the charge sheet are presumed to be innocent till their alleged offence is established after a fair trial. These preliminary charges have no impact on the business/ operations of the firm.

Further, consequent to above, a complaint was filed under the Prevention of Money Laundering Act, 2002 (the PML Act) and the Adjudicating Authority vide Order dated 10.01.2012 has confirmed the Provisional Attachment Order (the Order). The Firm being included as one of the defendant, properties in the form of bank balances and sundry debtors aggregating to Rs. 1,338,877,171 were provisionally attached, out of which, sundry debtors of Rs. 497,120,750 stands realised after furnishing the information for which the requisite intimation has been made to the Prescribed Authority. Upon reaching finality in the 2G Spectrum Case, the outcome of the Order shall become final. Further, an appeal has been preferred against the Order before the Appellate Tribunal under the PML Act.

v. Notes to Financial statements relating to procedures pertaining to direct confirmations:

The Firm's Auditor have employed direct confirmation procedure for verification of balances of certain parties from/to whom unsecured loans have been taken/granted as well as of balances held in Bank and balances of Sundry Debtors & of Sundry Creditors.

In the opinion of the partner of the firm, the balances for which confirmations have not been received in case of sundry debtors and advances granted, the same are good for recover and in case of liabilities the same are payable.

B. DBS Realty:

i. Notes to Financial statements relating to procedures pertaining to direct confirmations:

Trade Payables, Contractors' Retention money and mobilization advance in the financial statements are subject to confirmation. As per the contention of the management the same are good for realization.

i. Notes to financial statements and reference in Auditors' report regarding a matter which is sub-judice:

The Salt Department, Union of India has filed a petition and the partnership firm has filed cross petitions towards their respective claim for exclusive title over the salt pan land. Though the matter is sub-judice, the firm is of opinion that it has a rightful claim over the ownership of the salt pan land and will be in a position to defend its title.

ii. Notes to Financial statements relating to procedures pertaining to direct confirmations: Trade Payables, other current liabilities, other current assets and other non-current assets are subject to confirmation.

4. During the previous year, the Company acquired 1/3rd stake in another company by paying Rs. 892,225,001. By and under a Share Purchase Agreement dated December 2, 2010, the Company agreed to purchase additional 1/3rd stake from another shareholder vide a Share Purchase Agreement and paid advance of Rs. 400,000,000. However, as per the said agreement, such purchase is subject to settlement of a suit which is pending at the High Court of Judicature at H'ble Bombay High Court. The Company, based on legal advice is confident of a favorable resolution in getting the matter resolved favourably so as to be able to develop the underlying land parcel; and accordingly the said advance paid is considered to be good of recovery.

5. One of the Company's wholly owned subsidiary (i.e. Esteem properties private Limited) has plans to construct/ develop/ market project/s on its land, which are delayed due to title dispute concerning the previous landlords. The Company has filed a special leave petition before the Supreme Court of India. The Company considers its investment in the said subsidiary as long term and strategic in nature. As of March 31, 2012, the Company's investment in and Loan to this subsidiary aggregate Rs. 312,018,720 (previous year Rs.312,018,720) and Rs.1,106,077,945 (previous year Rs. 1,351,977,945) respectively. The management is confident about the positive outcome and does not believe that there is any diminution in the value of its investments and considers the loan given as good of recovery.

6. The Company has incurred a sum of Rs. 134,772,050 (previous year Rs.123,779,659) towards acquisition of development rights pertaining to a SRA redevelopment project, which is the subject matter of litigation. Based on legal advice, the Company believes that it has a good chance of getting the project and is confident of commencement of redevelopment activities shortly and accordingly the said amount is considered as good of recovery.

7. Provision for tax made for the current year pertains to Minimum Alternate Tax (MAT) i.e. Tax on Profits made under section 115JB of Income Tax act, 1961 amounting to Rs.6,000,000.

8. The Company has investments in certain subsidiaries, jointly controlled entities and associates aggregating Rs. 2,044,533,140 (Previous year Rs. 148,933,200) and loans and advances outstanding aggregating Rs. 3,172,489,420 (Previous year Rs. 5,843,995,961) as at March 31, 2012. While such entities have incurred losses during the year and have negative net worth as at the year end, the underlying projects in such entities are in the early stages of real estate development and are expected to achieve adequate profitability on substantial completion and/ or have current market values of certain properties which are in excess of the carrying values. Further, the Company has contribution in one of the joint venture (considered as an Associate) amounting to Rs. 24,117,000 (Previous Year Rs. 24,117,000) as at March 31, 2012. The Company has not received Financial Statements of the said Joint Venture since last two years and there is also some legal dispute with the co-venturer relating to project in Joint Venture. The Company considers its investments in such entities as long term and strategic in nature. Accordingly, no provision is considered necessary towards diminution in the value of the Company's investments in such entities or in respect of loans and advances advanced to such entities, which are considered good and fully recoverable.

Notes:

a) During the year, one of the subsidiary company appointed one of the managing directors of the Company as its managing director for overall responsibilities and functions of the said subsidiary company and it has paid aggregate of Rs. 18,000,000 as remuneration.

This additional disclosure has been made as required by revised Schedule VI of the Companies Act, 1956.

b) The above remuneration excludes:

i. Contributions to provident and other funds as per declarations of non deduction received from the respective directors.

ii. Provision for gratuity and leave encashment (amount unascertained) payable to the managing directors is waived by them. Such waivers in (i) and (ii) above have been approved by the Board of Directors.

c) Managerial Remuneration paid of Rs. 15,709,677 by the company has exceeded the limit specified under schedule xiii read with sec 349, 350 & 198 of the Companies Act, 1956 by Rs. 8,350,386. However, the Company has recovered the excess remuneration of Rs. 8,350,386 from the directors during the F.Y. 2012-13

9. Dynamix Realty ("Partnership Firm") in which DB Realty Limited ("Company") is a partner, had granted Loan to Kusegaon aggregating to Rs. 2,092,425,485, (the said loans) as upto 31st March 2010. As of 31st March, 2012, the outstanding balance due from Kusegaon is Rs. 91,501,379, being part of interest charged. Central Bureau of Investigation Anti-corruption Branch, New Delhi in the Supplementary (First) charge sheet RC.DAI.2009.A.0045 (2G Spectrum Case) has alleged that the Key Management Personnel of D B Group of Companies have out of the said loans granted, paid Rs. 2,000,000,000 as illegal gratification to M/s Kalaignar TV Private Limited through Kusegaon and M/s Cineyug Films Pvt. Ltd., in lieu of the undue favours by accused public servants to Swan Telecom Private Limited in 2G Spectrum Case. The Central Bureau Investigation has alternatively alleged in the said charge sheet that even if the said transaction of Rs. 2,000,000,000 is accepted as genuine business transaction, the interest charged being inadequate is a favor to the government servant. hence, constitutes commission of offence. In the opinion of the Partners of the firm and the Management of the Company, these are preliminary charges based on investigation carried out by the Central Bureau Investigation Team and the key management personnel named in the charge sheet are presumed to be innocent till their alleged offence is established after a fair trial. These preliminary charges have no impact on the business/operations of the firm.

Further, The Deputy Director Enforcement vide his attachment order No: 01/2011 dt. 30th August, 2011 has provisionally attached Company's bank account number 05211011001053 maintained with Oriental Bank of Commerce, Goregaon (East), having Bank Balance of Rupees 68,92,967/-. Further the Enforcement Directorate has also attached two flats belonging to the Company situated at Goregaon (East). The Combined value of these two flats as shown in Company's financial statement of Rs. 1,07,65,400/- at the time of attachment (WDV as on 31st March, 2012 is Rs. 9,599,495). Also, a loan amounting to Rs. 50,39,63,329/- (at the time of attachment) advanced to Goan Hotels & Clubs Pvt. Ltd. has also been provisionally attached. However, the above loan was converted into the ROCCPS of DB Hospitality Limited (holding Company of Goan Hotels & Clubs Private Limited) before the provisional attachment Order via tripartite confirmation. This fact has been brought to the notice of Enforcement Directorate vide this Office Letter dated 20th September, 2011.

This provisional attachment order has been upheld by adjudicating authority vide order number 116/2011 dt. 10th Jan'2012. Appeal has been preferred on 19th March, 2012 with Appellate Tribunal under prevention of money laundering act (PML Act). The appeal is pending before appellate tribunal for PML

Notes:

a) T he Management of the Company has taken approval in the Annual General Meeting held on September 29, 2010 to vary and/or revise the utilisation of the proceeds of IPO to part finance the construction and development of the existing as well as proposed projects of Subsidiaries, Joint Ventures, Associates, Firms, etc. over and above the projects already specified in the prospectus.

As regards, end use of fund utlised by the DB Realty group entities, the same is based on information compiled by those entities from their Books of Accounts and as certified by their respective auditors.

b) The Monitoring agency viz. Punjab National Bank Capital Market Service Branch, Mumbai has submitted its Report for the six month ended September 30, 2011 and the utilization of the said proceeds has been given as per the Monitoring report.

c) P ending utilisation, the funds are temporarily invested / held in:

The present value of defined benefit obligation was Rs. 3,768,438 as on March 31, 2010, Rs. 1,949,197 on March 31, 2009 and Rs.885,621 on March 31, 2008.

The fair value of plan assets was Rs. Nil as on March 31, 2008, 2009 and 2010.

The details of the Experience adjustments arising on account of plan assets and liabilities as required by paragraph 120(n)(ii) of AS 15 (Revised) on "Employee Benefits" of previous financial years are not available in the valuation report for the financial year 2007-08, 2008-09, 2009-10 and hence, are not furnished

C) Other Long Term Employee Benefit:

The compensated absences charged for the year ended March 31, 2012, based on actuarial valuation carried out using the Projected Unit Credit Method, amounting Rs.9,436,141 (for Previous Year Rs. 8,142,820) has been recognized in the statement of Profit and Loss.

10. Segment Reporting:

The Company is mainly engaged in the business of real estate development viz. construction of residential buildings/ commercial complexes and activities connected and incidental thereto. The Company has also placed its bid for certain infrastructure projects for the outcome of which is awaited. On that basis, the Company has only one reportable business segment – real estate development, the results of which are embodied in the financial statements. The Company operates in only one geographical segment – within India.

11. Related Party Disclosure:

(i) Disclosures as required by the Accounting Standard 18 (AS-18) "Related Party Disclosures" are given below:

Name of the Related Party Subsidiaries:

Gokuldham Real Estate Development Company Private Limited

Neelkamal Realtors Suburban Private Limited

Neelkamal Shanti Nagar Properties Private Limited

Neelkamal Realtors Tower Private Limited

Esteem Properties Private Limited

D. B. Properties Private Limited (upto 7th June, 2011)

D B Man Realty Limited

Priya Constructions Private Limited

Real Gem Buildtech Private Limited

Saifee Bucket Factory Private Limited

ECC-DB Joint Venture

Conwood-DB Joint Venture

Mira Real Estate Developers ( Formerly Mira Salts Works Company)

N.A Estate Private Limited

Royal Netra Constructions Private Limited.

Nine Paradise Erectors Private Limited

DB MIG Realtors and Builders Private Limited

Spacecon Realty Private Limited (Formerly DB Spacecon Private Limited )

Vanita Infrastructure Private Limited

DB View Infracon Private Limited

DB Contractors & Builders Private Limited

A G Infraconstructions Private Limited (100% subsidiary of

Royal Netra constructions Private Limited till upto 22nd March, 2012)

Associates:

Sangam City Township Private Limited

Dynamix Building Materials Private Limited (upto 30.3.2012)

Crossway Realtors Private Limited (upto 31.12.2011)

D.B. Hi-Sky Constructions Private Limited

DB Hotels (India) Private Limited (Formerly known as Heaven Star Realty Pvt. Ltd. upto 09.6.2011)

Mahal Pictures Private Limited

Jointly Controlled Entities:

Dynamix Realty

DBS Realty

Turf-Estate Joint Venture

DB (BKC) Realtors Pvt Ltd

DB Realty and Shreepati Infrastructure LLP

DB Realtors & Builders LLP

Daund Warehousing Developers & Builders LLP

Baramati Warehousing Developers & Builders LLP

Saswad Warehousing Developers & Builders LLP

Ahmednagar Warehousing Developers & Builders LLP

Ratnagiri Warehousing Developers & Builders LLP

Solapur Warehousing Developers & Builders LLP

Sawantwadi Warehousing Developers & Builders LLP

Satara Warehousing Developers & Builders LLP

Kolhapur Warehousing Developers & Builders LLP

Latur Warehousing Developers & Builders LLP

Parli Vaijnath Warehousing Developers & Builders LLP

Osmanabad Warehousing Developers & Builders LLP

Nandurbar Warehousing Developers & Builders LLP

Jalgaon Warehousing Developers & Builders LLP

Jalna Warehousing Developers & Builders LLP

Parbhani Warehousing Developers & Builders LLP

Hingoli Warehousing Developers & Builders LLP

Umri Warehousing Developers & Builders LLP

Aurangabad Warehousing Developers & Builders LLP

Malkapur Warehousing Developers & Builders LLP

Badnera Warehousing Developers & Builders LLP

Washim Warehousing Developers & Builders LLP

Bhandara Warehousing Developers & Builders LLP

Chandrapur Warehousing Developers & Builders LLP

Wadsa Warehousing Developers & Builders LLP

Shree Shantinagar Ventures (Jointly controlled entity of NeelKamal Shantinagar Properties Private Limited)

Suraksha DB Realty (Jointly controlled entity of DB View Infracon Private Limited)

Evergreen Industrial Estate (Jointly controlled entity of Priya Constructions Private Limited)

Sneh Developers (Jointly controlled entity of DB View Infracon Pvt. Ltd.)

Lokhandwala-Dynamix Balwas Joint Venture

Entity in respect of which the Company is an Associate

Neelkamal Tower Construction LLP

Key Management Personnel (KMP)

Mr. Shahid Balwa, Vice Chairman &Managing Director ( w.e.f.10.12.2011)

Mr. Vinod Goenka, Managing Director, chairman w.e.f.10.12.2011

Relatives of KMP

Mr.Usman Balwa ( w.e.f.10.12.2011)

Mrs Sakina U Balwa ( w.e.f.10.12.2011)

Mrs.Shabana Balwa ( w.e.f.10.12.2011)

Mr.Arshad S.Balwa ( w.e.f.10.12.2011)

Ms.Aaliya S.Balwa ( w.e.f.10.12.2011)

Mr.Salim Balwa ( w.e.f.10.12.2011)

Mrs.Aseela V.Goenka

Mr.Krishna Murari Goenka

Mr.Jayvardhan V.Goenka

Ms.Sanjana Goenka

Mr.Pramod Goenka

Mrs.Sunita Bali

Mrs.Shanita Jain

Enterprise where individuals i.e. KMP and their relatives have significant influence

A G Mercantile Private Limited

Aniline Construction Company Private Limited

Aniline Real Estate Developers Private Limited

Ashtlakshmi Financial and Investment Services Private Limited

Associated Hotels Private Limited

Azure Tree Township Private limited / Azure Tree Township LLP

Balwas Charitable Trust (w.e.f.10.12.2011)

Consort Hotels Private Limited

Conwood Agencies Private Limited.

Conwood Associates (partnership firm)

Conwood Chemical Industries Private Limited

Conwood Construction & Developers Private Limited

Conwood Pre-fab Limited

Crystal Granite and Marbles Private Limited

DB Hospitality Private Limited

DB Tele Wimax Private Limited

DB Modern Build Tech Private Limited

DB Structures and Builders Private Limited

Dense wood Private Limited

Pony Infrastructure and Contractors Limited

Dynamix Developers Private Limited

Dynamix Balwas Resorts Private Limited

Dynamix Balwas Telecom Private Limited

Dynamix Club and Resorts Private Limited

Dynamix Securities and Holdings Limited

Dynamix Man Pre-fab Limited

Earthen Agro & Infrastructure Private Limited

Eterna Realty Private Limited

Etisalat DB Telecom Private Limited

Eversmile Properties Private Limited

Excon Developers Private Limited

Eversmile Construction Company Private Limited.

Face Inn Hotels Private Limited

Falgun Consultants Private Limited

Goan Hotels & Clubs Private Limited

Goan Real Estate and Construction Private Limited

Goenka & Associates Educational Trust

Goenka & Associates Medical Research Centre

Goenka & Associates Social Welfare Trust

Heritage Mining Company Private Limited

Hillside Construction Company Private Limited

Hiracon Properties Private Limited

K G Enterprises

Khairun Developers Private Limited

Kalpataru Plaza Private Limited

Milan Theatres Private Limited

M. J. Estates Private Limited

Maldunge Farming and Agro Produce Private Limited

Maldunge Retreat & Farming Private Limited

Modren Hi-Tech Developers Private Limited

Neelkamal Central Appartment Private Limited /Neelkamal Central Apartment LLP

Neelkamal Realtors and Builders Private Limited

Neelkamal Realtors And Complex Pvt Ltd (w.e.f.10.12.2011)

Nihar Construction Private Limited

Pegasus Builders Private Ltd (w.e.f. 17.03.2012)

Neelkamal City Shopping Mall India Limited

Neelkamal Realtors and Erectors India Private Limited (w.e.f. 10.12.2011)

P G Developers Private Limited

Panchsheel Developers (Partnership firm)

Pushpa Properties Private Limited

Siddharth Consultancy Services Private Limited.

Swan Connect Communication Private Limited.

Sahapur Plantations & Orchard Private Limited

Schon Farms Private Limited

Siddhivinayak Realities Private Limited

Sigatu Chemicals Private Limited

Span Construction Company Private Limited

The Cresent Iron & Steel Corporation Limited

Majestic Infracon Private Limited (formely known as Tiger Trustees Private Limited and DBI Infracon Private Limited )

Trident Estate Private Limited

V.S. Erectors & Builders Private Limited

Vinod Goenka-HUF

Chocklate Developers Pvt Ltd

Y. J. Realty Private Limited

Eon Aviation Pvt Ltd

BDP & Hotels (India)Pvt Ltd

Travellers Inn Hotels (India) Limited (w.e.f February 11, 2011)

Hotel Balwas Private Limited (w.e.f.10.12.2011)

Aasma Realtors Private Limited (w.e.f.10.12.2011)

Zenstar Hotel Private Limited (w.e.f.10.12.2011)

Basera Hotels Inn Private Limited (w.e.f.10.12.2011)

Bed Inn Hotels Private Limited (w.e.f.10.12.2011)

Close Hotels Private Limited (w.e.f.10.12.2011)

Fair Brother Securities Private Limited (w.e.f.10.12.2011)

Glossy Inn Hotels Private Limited (w.e.f.10.12.2011)

Kalbadevi Hotels Private Limited (w.e.f.10.12.2011)

SB Fortune Realty Pvt Ltd (w.e.f.10.12.2011)

Ship Hotels India Private Limited (w.e.f.10.12.2011)

Success Inn Hotels Private Limited (w.e.f.10.12.2011)

Sunday Inn Hotels Private Limited (w.e.f.10.12.2011)

Taloja Hotels Private Limited (w.e.f.10.12.2011)

Thanks Inn Hotels Private Limited (w.e.f.10.12.2011)

Three star dulex Private Limited (w.e.f.10.12.2011)

Yadgar Hotels Private Limited (w.e.f.10.12.2011)

Notes:

1. The aforesaid related parties are identified by the management of the Company.

2. Lokhanwala Dynamix Balwas JV is reconsidered as JV in the current year as against associate in the previous year.

(Figures in brackets denote Previous Year's balances)

* Managerial remuneration includes remuneration to Mr. Shahid Balwa, the Managing director of Rs. 3,709,677 (Previous year Rs. 12,214,445); Mr. Vinod Goenka, Managing Director of Rs.12,000,000 (Previous year Rs. 12,214,445).

** Shares held by Mr. Vinod Goenka includes 100,000 shares held by him jointly with Mrs. Aseela Goenka having Face value Rs. 1,000,000 (Previous year Rs. 1,000,000).and as Karta of Vinod Goenka HUF Face Value Rs.94,055,020 (Previous year Rs. 88,140,0200).

12. The Financial statements of previous year have been audited by another firm of chartered accountants. As notified by Ministry of Corporate affairs, revised schedule VI under the Companies act 1956 is applicable to the financial statement for the financial year commencing on or after 1st April 2011. Accordingly, the financial statements for the year ended March 31, 2012 are prepared in accordance with the revised schedule VI. The amounts and disclosures included in the financial statements of the previous year have been reclassified to conform to the requirements of revised schedule VI.


Mar 31, 2011

1) Contingent Liabilities and commitments:

As at March 31, As at March 31,

2011 2010

(Rupees) (Rupees)

A. Estimated amount of contracts remaining to be executed on the capital account - 4,270,666 (net of advances) and not provided for

B. The Company and DB Hospitality Private Limited (together"sponsor"), acompany Not ascertainable - under the same management, have entered into a sponsorship agreement dated September 18, 2010 with DB Hotels (India) Private Limited (earlier known as Heaven Star Private Limited) (DBHPL) for providing sponsor support for project/ capital overrun (as determined in the future) and Non Disposal undertaking in respect of 70% of their paid up share capital in DBHPL to Yes Bank who have agreed to lend Rs. 10,820,000,000 to DBHPL for its project.

C. Guarantees to banks and financial institutions (in India and overseas) against credit facilities extended to:

a) Subsidiaries

Neelkamal Realtors Suburban Private Limited - 1,000,000,000

Gokuldham Real Estate Development Company Private Limited 1,300,000,000 960,000,000

Neelkamal Realtors Tower Private Limited 2,004,125,000 2,004,125,000

Sub Total (A) 3,304,125,000 3,964,125,000

b) Partnership firm

Dynamix Realty Sub Total (B) 4,125,000 1,084,125,000

c) Jointly Controlled Entity

DB (BKC) Realtors Private Limited (earlier known as M K Malls & Developers Private Limited) Sub Total (C) (Refer note i below)

d) Companies under the same management

Allianze Infratech Private Limited (erstwhile wholly owned subsidiary - 420,000,000 of Etisalat DB Telecom Private Limited)

D B Hospitality Limited, Mauritius (wholly owned subsidiary of DB 6,161,700,000 6,229,320,000 Hospitality Private Limited) (USD 138 Million) (Refer note 2 below)

Sub Total (D) 6,161,700,000 6,649,320,000

e) Others

Neelkamal Realtors and Builders Private Limited

(Refer note iii below) 4,125,000 4,125,000

Majestic Infracon Private Limited (earlier known as DBI Infracon 8,530,000,000 8,530,000,000

Private Limited / Tiger Trustees Private Limited) (Refer note ii and Note 2 below)

Sub Total (E) 8,534,125,000 8,534,125,000

Grand Total (A B C D E) 18,004,075,000 20,231,695,000

Notes:

(i) No amount has been utilized towards a total corporate guarantee provided of Rs. 2,448,000,000 (Previous year: Rs. 2,448,000,000).

(ii) Together with collateral securities of the Company's property admeasuring 80,934 sq meters at Malad (East), Mumbai with all including all development rights, unutilized Floor Space Index (FSI) / or such other FSI that may be granted in future.

(iii) Towards vehicle loan.

As at March 31, As at March 31,

2011 2010

(Rupees) (Rupees)

D. Claim made against the Company not acknowledged as debt relating to 2,448,609 858,991 service tax on lease rentals in respect of an office premises

E. Arrears of Dividend on 0.001 % compulsorily Convertible Cumulative 185 185 Preference shares (CCPS), during the previous year converted in to equity shares.

F. (a) The Company has filed a writ petition (1230 of 2010) in the High Court Amount - of Judicature at Bombay (the 'High Court'), contesting the constitutional unascertainable validity of Section 65 (30) read with Section 65(105)(zzp) and Section 65(105)(zzh) read with Section 66 of the Finance Act, 1994, as amended by the Finance Act, 2010 and the matter is pending final hearing. Further, the Company has also applied for membership of Maharashtra Chambers of Housing Industry (MCHI). MCHI, on behest of its Members, has filed a writ petition in the High Court of Bombay challenging the levy of service tax by them on Sale of Residential Flats, which has not reached its finality. Meanwhile, the High Court of Bombay has passed a Notice of Motion dated 18th February, 2011, whereby the Members are permitted to deposit the service tax with the Prothonotary & Senior Master/ Registrar (O.S.) of the Court, with a direction that the same will be refunded with interest in the event Members succeed in the said writ petition. In view of the same, the Company has demanded the amount of service tax from each of the purchasers after 31st March 2011 and the amount of such service tax as upto 31 st March 2011 is Rs. 656,012. The Company is of the view that the same is required to be deposited as and when collected from the purchasers. The Management of the Company has taken adequate steps for the recovery of such service tax dues and are of the opinion that the same shall be collected and deposited in due course of time and does not believe it is unreasonable to expect of ultimate collection.

and

(b) service tax matter as above in case of joint ventures (amount of service Amount - tax of Company's share as up to 31 st March 2011 Rs. 2,618,769) unascertainable

G. Contingent payments to the holders of Redeemable Optionally Convertible Amount Amount Cumulative Preference Shares (ROCCPS), Compulsory Convertible unascertainable unascertain -able Preference Shares (CCPS) and equity shares subscribed by other shareholders of an entity (in which the Company has joint control) - representing the amount payable or adjustable by the Company on exercise of various exit options by such other holders based on agreement entered with them.

The company is a party to various legal proceedings in the normal course of business and does not expect the outcome of these proceedings to have any adverse effect on its financial conditions, results of operations or cash flows.

2) In a previous year, the Company had given Corporate Guarantees on behalf of two companies in which some of the directors of the Company are interested. The said companies are however, not a part of DB consolidated group. Such guarantees are:

(i) In respect of facilities availed by Majestic Infracon Private Limited, from Punjab National Bank, Mumbai and Bank of India, Mumbai, for an amount aggregating Rs. 8,530,000,000 (Previous Year Rs. 8,530,000,000).

(ii) In respect of facilities availed by DB Hospitality Limited, Mauritius ('DBH, Mauritius') from ICICI Bank - United Kingdom PLC of USD 138 millions- Rs. 6,161,700,000 as at the year end March 31, 2011 (Previous Year Rs. 6,229,320,000) .

The outstanding balances as at March 31,2011 in respect of aforesaid guarantees aggregate Rs. 14,691,700,000. For the purpose of the said corporate guarantees, the Company has received in its favour irrevocable and unconditional personal guarantees from the two interested directors (one being Managing Director until February 9, 2011 and the other, Managing Director) covering the entire amount of such guarantees issued by the Company.

The aforesaid facilities are secured as under:

(i) Majestic Infracon Private Limited: by (a) pledge of its shareholding consisting of 45,934,000 equity shares in Etisalat DB Telecom Private Limited; (b) a pari passu charge on its property consisting of Hotel Hilton, Mumbai.

(ii) DBH Mauritius: by (a) mortgage of its property consisting of Milan Mall in Milan Theatres Private Limited and Dynamix Mall in YJ Realty Private Limited (against stand by letter of credit issued by ICICI Bank Limited as an integral part of the arrangement); (b) pledge of its entire shareholding of DB Hospitality Private Limited ('DBHPL) in DBH, Mauritius (being the wholly owned subsidiary of DBHPL).

The Company is confident that these companies would fulfill their obligations under the credit facilities and does not expect any outflow of resources.

3) Share of profit (net) from investments in partnership firms ("the firms") and investments in the firms is based on financial statements of the firms as audited by other auditors. The audited financial statements/the auditors' report on the financial statements of one of the partnership firms viz. Dynamix Realty ("Dynamix") in which the Company is a partner has reported certain significant matters as under:

a) Notes to financial statements relating to outstanding receivables of Rs. 5,798,640,429 (including dues aggregating Rs. 4,476,974,912 as at March 31, 2011 from companies in which directors of the Company are interested) as at March 31, 2011 as follows:

i) the other partner (being an entity in which a director of the Company is interested) viz. Eversmile Construction Company Private Limited (ECC) has a debit balance of Rs. 3,428,974,912 which includes Rs. 1,500,000,000 placed as interest free deposit. The said deposit as per the deed of partnership was to be adjusted against ECC's share of profit which remains unadjusted. The balance is confirmed by ECC and as represented by both partners of Dynamix, the said balance after considering the share of profit of ECC shall be recovered in due course of time. In view of the same, debit balance of ECC is considered good of recovery;

ii) Dynamix has granted unsecured loans, with / without interest as applicable and repayable on demand with no other terms, for which the Partners have given their consent. In the opinion of Dynamix, the outstanding amount as of the year end of loans and interest there on of Rs. 1,218,431,620 (including Rs. 1,048,000,000 from a Company in which a director of the Company is interested) is considered good of recovery;

iii) sundry debtors include Rs. 1,151,233,897 inclusive of overdue of Rs. 307,055,381 out of which Rs. 51,233,897 is outstanding for more than six months. In the opinion of the partners of Dynamix, the said outstanding is good for recovery.

b) Notes to financial statements relating to treatment of income tax:

No provision for income tax has been recognized in respect of profits of Dynamix from the project being executed as per agreement with the Slum Rehabilitation Authority, accounted as per percentage of completion method amounting Rs. 2,921,254,886 (Previous year Rs. 2,541,011,748). The profits are eligible for 100% deduction u/s 80 IB (10) of the Income Tax Act, 1961 read with the clarification issued by the CBDT that deduction can be claimed on a year to year basis. In the event Dynamix does not satisfy the enumerated conditions - more particularly of completing the project within the specified time limit of 5 years i.e. by March 31, 2012, the deduction shall stand withdrawn for all the years and Dynamix would be called upon to pay income tax and interest.

c) Notes to financial statements and reference in Auditors' report regarding a matter which is sub-judice:

Dynamix had granted loans to Kusegaon Realty Pvt Ltd. ('Kusegaon') aggregating Rs. 2,092,425,485 (the said loans) as upto March 31, 2010. As of March 31, 2011, the outstanding balance due from Kusegaon is Rs. 91,501,379 being part of interest charged. Central Bureau of Investigation Anti Corruption Branch, New Delhi (CBI) in the Supplementary (First) charge sheet RC.DAI.2009.A.0045 (2G Spectrum Case) has alleged that the Key Management Personnel of DB Group of Companies have, out of the said loans granted, paid Rs. 2,000,000,000 as illegal gratification to M/s Kalaignar TV Private Limited ('Kalaignar') through Kusegaon and M/s Cineyug Films Pvt. Ltd, in lieu of the undue favours by accused public servants to Swan Telecom Private Limited in the 2G Spectrum Case. The CBI has alternatively alleged in the said chargesheet that even if the said transaction of Rs. 2,000,000,000 is accepted as genuine business transaction, the said loans obtained by Kalaignar for a consideration which being known as inadequate, constitutes commission of offence. In the opinion of the partners of Dynamix, these are preliminary charges based on the investigation carried out by the CBI Team and the key management personnel named in the charge sheet are presumed to be innocent till their alleged offence is established after a fair trial. These preliminary charges have no impact on the business / operations of Dynamix.

4) During the year, the Company acquired 1/3rd stake in another company by paying Rs. 892,225,001 (Refer Schedule 6). By and under a Share Purchase Agreement dated December 2, 2010, the Company agreed to purchase additional 1/3rd stake from another shareholder vide a Share Purchase Agreement and paid advance of Rs. 400,000,000. However, as per the said agreement, such purchase is subject to settlement of a suit which is pending at the High Court of Judicature at H'ble Bombay High Court. The Company, based on legal advice is confident of a favourable resolution in getting the matter resolved favourably so as to be able to develop the underlying land parcel; and accordingly the said advance paid is considered to be good of recovery.

5) One of the Company's wholly owned subsidiaries has plans to construct / develop/market project/s on its land, which are delayed due to title dispute concerning the previous landlords. The Company has filed a special leave petition before the Supreme Court of India. The Company considers its investment in the said subsidiary as long term and strategic in nature. As of March 31, 2011, the Company's investment in and Loans to this subsidiary aggregate Rs. 312,018,720 and Rs. 1,351,977,945 respectively. The management, based on in-house legal advice, about the outcome of the matter does not believe that there is any diminution in the value of its investments and considers the loan given as good of recovery.

6) The Company has incurred a sum of Rs. 123,779,659 towards acquisition of tenancy rights pertaining to a redevelopment project, which is the subject matter of litigation. Based on legal advice and certain judicial precedents, the Company believes that it has better chances of getting the project awarded to itself and is confident of commencement of start redevelopment activities shortly in near future and accordingly the said amount is considered as good of recovery (Refer Schedule 9).

7) The Company has incurred losses during the year excluding share of profit / (loss) of investment in partnership firms (net) and hence no provision for current tax has been made. It has not recognized any deferred tax asset and will account for the same when there is a reasonable/virtual certainty as regards availability of taxable income in accordance with Accounting Standard-22 "Accounting for taxes on income".

8) The Company has equity investments in certain subsidiaries, jointly controlled entities and associates aggregating Rs. 148,933,200 (Previous year Rs. 385,188,120) and loans and advances outstanding aggregating Rs. 5,843,995,961 (Previous year Rs. 4,650,180,925) as at March 31, 2011. The Company considers its investments in such entities as long term and strategic in nature. While such entities have incurred losses during the year and have negative net worth as at the year end, the underlying projects in such entities are in the early stages of real estate development and are expected to achieve adequate profitability on substantial completion and/ or have current market values of certain properties which are in excess of the carrying values. Accordingly, no provision is considered necessary towards diminution in the value of the Company's investments in such entities or in respect of loans and advances advanced to such entities, which are considered good and fully recoverable.

9) Additional information pursuant to the paragraphs 3(ii) and 4C of Part II of Schedule VI to the Companies Act, 1956 are not applicable.

10) During the previous year, a loan from LIC Housing Finance Limited of Rs. 1,880,000,000 was received for the purpose of financing the cost of constructions and other project implementation cost within its subsidiary companies and jointly controlled companies. The Company has not given any security in respect of the said loan except personal guarantees of the Managing Directors of the Company. Further, Esteem Properties Private Limited, a wholly owned subsidiary company has mortgaged its land at Sahar, Andheri in this regard.

C) Other Long Term Employee Benefit:

The compensated absences charge for the year ended March 31, 2011, based on actuarial valuation carried out using the Projected Unit Credit Method, amounting Rs.8,142,820 (for Previous Year Rs. 2,694,831) has been recognized in the Profit and Loss Account.

11) Segment Reporting:

The Company is mainly engaged in the business of real estate development viz. construction of residential buildings/ commercial complexes and activities connected and incidental thereto. The Company has also placed its bid for certain infrastructure projects for which the outcome of which are awaited. On that basis, the Company has only one reportable business segment - real estate development, the results of which are embodied in the financial statements. The Company operates in only one geographical segment-within India.

12) Related Party Disclosure:

(i) Disclosures as required by the Accounting Standard 18 (AS-18) "Related Party Disclosures" are given below:

Name of the Related Party (all parties where control exists and others based on transactions with them)

Subsidiaries: (where control exisits)

Gokuldham Real Estate Development Company Private Limited

Neelkamal Realtors Suburban Private Limited

Neelkamal Shanti Nagar Properties Private Limited

Neelkamal Realtors Tower Private Limited

Esteem Properties Private Limited

D. B. Properties Private Limited

D B Man Realty Limited

Priya Constructions Private Limited

Real Gem Buildtech Private Limited

Saifee Bucket Factory Private Limited

ECC-DB Joint Venture

Conwood-DB Joint Venture

Mira Salts Works Company

DB Chandak Realtors Private Limited

N.A Estate Private Limited (w.e.f April 20, 2010)

Royal Netra Constructions Private Limited.( w.e.f May 18, 2010)

Nine Paradise Erectors Private Limited (formerly known as Nine Paradise Hotels Private Limited) (w.e.f April 8, 2010)

DB MIG Realtors and Builders Private Limited (formerly known as L &T Bombay Developers Private Limited)

(w.e.f. September 13, 2010)

DB Spacecon Private Limited (formerly known as DB Airport Infra Private Limited) (w.e.f. September 30, 2010)

Vanita Infrastructure Private Limited (w.e.f. October 1, 2010)

DB View Infracon Private Limited (subsidiary w.e.f. January 31, 2011)

DB Contractors & Builders Private Limited (w.e.f. March 7, 2011)

A G Infraconstructions Private Limited (100% subsidiary of Royal Netra constructions Private Limited w.e.f February 24, 2011)

Associates:

Sangam City Township Private Limited

Dynamix Building Materials Private Limited

Crossway Realtors Private Limited

D.B. Hi-Sky Constructions Private Limited

DB Hotels (India) Private Limited (formerly known as Heaven Star Realty Private Limited )

Mahal Pictures Private Limited (w.e.f. August 11, 2010)

DB View Infracon Private Limited(Associate till January 30, 2011)

Nine Paradise Erectors Private Limited (Formerly known as Nine Paradise Hotels Private Limited

(Associate till April 7, 2010)

Jointly Controlled Entities:

Dynamix Realty

DBS Realty

Turf-Estate Joint Venture

Lokhandwala-Dynamix Balwas Joint Venture

DB (BKC) Realtors Private Limited (formerly known as M K Malls and Developers Private Limited)

DB Realty and Shreepati Infrastructure LLP (w.e.f. September 9, 2010)

DB Realtors & Builders LLP (w.e.f December 15, 2010)

Daund Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Baramati Warehousing Developers & Builders LLP (w.e.f. October 22, 2010)

Saswad Warehousing Developers & Builders LLP (w.e.f. October 22, 2010)

Ahmednagar Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Ratnagiri Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Solapur Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Sawantwadi Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Satara Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Kolhapur Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Latur Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Parli Vaijnath Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Osmanabad Warehousing Developers & Builders LLP (w.e.f. October 22, 2010)

Nandurbar Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Jalgaon Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Jalna Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Parbhani Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Hingoli Warehousing Developers & Builders LLP (w.e.f. October 22, 2010)

Umri Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Aurangabad Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Malkapur Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Badnera Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Washim Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Bhandara Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Chandrapur Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Wadsa Warehousing Developers & Builders LLP(w.e.f. October 22, 2010)

Shree Shantinagar Ventures (Jointly controlled entity of NeelKamal Shantinagar Properties Private Limited)

Suraksha DB Realty (Jointly controlled entity of DB Properties Private Limited)

Evergreen Industrial Estate (Jointly controlled entity of Priya Constructions Private Limited)

Entity in respect of which the Company is an Associate

Neelkamal Tower Construction Private Limited now known as Neelkamal Tower Construction LLP

Key Management Personnel (KMP)

Mr. Shahid Balwa, Managing Director (upto February 9, 2011)

Mr. Vinod Goenka, Managing Director

Relatives of KMP

Mr.Usman Balwa (upto February 9, 2011)

Mrs.Shabana Balwa (upto February 9, 2011)

Mr.Salim Balwa (upto February 9, 2011)

Mrs.Aseela V.Goenka

Mr.Pramod Goenka

Mrs.Sunita Bali

Mrs.Shanita Jain

Enterprise where individuals i.e. KMP and their relatives have significant influence

Associated Hotels Private Limited

Consort Hotels Private Limited

Conwood Construction & Developers Private Limited

Conwood Pre-fab Limited

DB Hospitality Private Limited

Pony Infrastructure and Contractors Limited (formerly known as Dynamix Balwas Infrastructure Limited )

Dynamix Club and Resorts Private Limited

Eversmile Construction Company Private Limited.

Goan Hotels & Clubs Private Limited

Goan Real Estate and Construction Private Limited

K G Enterprises

Khairun Developers Private Limited

Milan Theatres Private Limited

Neelkamal Realtors and Builders Private Limited

Nihar Construction Private Limited

Neelkamal Realtors and Erectors India Private Limited (upto February 9, 2011)

Span Construction Company Private Limited

Majestic Infracon Private Limited (formely known as Tiger Trustees

Private Limited and DBI Infracon Private Limited )

Y. J. Realty Private Limited

Eon Aviation Private Limited

BD and P Hotels Private Limited

DB Spacecon Private Limited (formerly known as DB Airport Infra Private Limited)

DB Contractors & Builders Private Limited

Hotel Balwas Private Limited (Formerly known as IT Square Software Solutions Private Limited) (upto February 9, 2011)

Figures of the previous year have been regrouped / reclassified wherever necessary to conform to the presentation of current year.


Mar 31, 2010

The Company was a private Limited company and became public Limited w.e.f. September 23, 2009.

1) Contingent Liabilities and commitments:

As at march 31, 2010 As at march 31, 2009 (Rupees) (Rupees)

A. Estimated amount of contracts remaining to be executed on the 4,270,666 13,456,900 capital account (net of advances) and Not provided for

B. Guarantees to banks and financial institutions (in India and overseas) against credit facilities extended to (Refer Note 2)

a) Subsidiaries

- Neelkamal Realtors Suburban Private Limited (Refer 1,000,000,000 1,000,000,000 Note vi below)

- Gokuldham Real Estate Development Company Private 960,000,000 960,000,000 Limited

- Neelkamal Realtors Tower Private Limited 2,004,125,000 4,125,000

Sub Total (A) 3,964,125,000 1,964,125,000

b) Partnership Firm (Refer Note i below)

- Dynamix Realty Sub Total (B) 1,084,125,000 1,404,125,000

c) Jointly Controlled Entity

- M K Malls & Developers Private Limited - - (Refer Note iii below) Sub Total (C)

d) Companies under the same management

- Etisalat DB Telecom Private Limited - 6,070,000,000

- Allianze Infratech Private Limited (wholly owned 420,000,000 420,000,000 subsidiary of Etisalat Db Telecom Private Limited) (Refer Note v below)

- D B Hospitality Limited, Mauritius (wholly owned 6,229,320,000 6,441,440,000 subsidiary of DB Hospitality Private Limited) (USD 138 Million)

Sub Total (D) 6,649,320,000 12,931,440,000

e) Others

- Neelkamal Realtors and Builders Private Ltd. 4,125,000 4,125,000 (Refer Note iv below)

- Tiger Trusties Private Limited 8,530,000,000 8,530,000,000 (Refer Note ii and v below)

Sub Total (E) 8,534,125,000 8,534,125,000

Grand total (a+B+C+D+e) 20,231,695,000 24,833,815,000

NOTES:

(i) Together with collateral security of the Companys THAT piece and parcel of plot of land admeasuring 23,454 sq yards or thereabout in Foras Road Land Commissioners Map (Tardeo Division in D ward of MCGM- Bachuwadi Land).

(ii) Together with collateral securities of the Companys THAT property admeasuring 80,934 sq meters at Malad (East), Mumbai with all including all development rights, unutilized Floor Space Index/or such other FSI THAT may be granted in future.

(iii) No amount has been utilized towards a total corporate guarantee provided of Rs. 2,448,000,000 (Previous year: Rs. Nil).

(iv) Towards vehicle loan.

(v) Towards financial and performance guarantee.

(vi) The concerned bank has approved the release of the corporate guarantee amounting to Rs. 50 crores on May 12, 2010. As at march 31, 2010 As at march 31, 2009 (Rupees) (Rupees)

C. Arrears of Dividend on 0.001 % compulsorily Convertible 185 147 Cumulative Preference shares (CCPS), later on during the year converted into equity shares.

D. Contingent payments to the holders of CCPS (converted - amount into equity shares during the half year ended September unascertainable 30, 2009) as well as equity shares subscribed in 2007- 08 - Representing the amount payable or adjustable on exercise of various exit options by the holders based on agreement entered with them

E. Impact of various amendments to service tax in construction amount - industry as per Finance Act, 2010 Not determinable as the unascertainable effective date / abatement to be NotifIed.

2) With respect to above guarantees, the Company is confident that those entities would fulfill their obligations under those funded and Anon funded credit facilities.

Further, the Company has also given during the year corporate guarantees amountING Rs. 4,448,000,000 to banks on behalf of subsidiary Company (other than wholly owned) and jointly controlled entity towards the credit facilities granted to them which are secured against the first and pari-passu charge on the property of those respective borrower companies/ co-obligants.

The Company has received in its favour irrevocable and unconditional personal guarantees for an amount aggregating USD 138 million plus Rs. 16,570 million from each of its Managing Director in their personal capacity. On THAT basis, the Company does Not expect any financial liability on this account at present.

NOTES:

a) The above remuneration for the year also includes remuneration of Rs. 250,000 per month (Previous year: Rs. Nil) to Mr. Asif Balwa, Whole Time Director (Chief Financial Officer w.e.f. September 15, 2009) with effect from April 1, 2009 to September 15, 2009 as approved by the Board of Directors.

b) The above remuneration excludes;

i. Contributions to provident and other funds as per declarations of Non deduction received from the respective directors.

ii. Provision for gratuity and leave encashment (amount unascertained) payable to the managing directors is waived by them and in respect of the other whole time director (Now Chief Operating Officer w.e.f. September 15, 2009) is ascertained on an aggregated basis for the Company as a whole by way of actuarial valuation.

iii. The commission payable (Not exceeding 1% of the net profits) to Non-executive director of the Company as it has been waived by them.

Such waivers in (i) to (iii) above have been approved by the board of Directors.

Notes:

i) As required by AS 20, Bonus issue is treated as if it had occurred prior to the beginning of 2008-09, the earliest period reported. So it is considered as outstanding from April 1, 2008.

ii) In calculating diluted earnings per share for the year ended March 31, 2010 the effect of convertible preference shares till the date of actual conversion is considered whereas the effect of dilution of debentures converted into equity shares is ignored as the same are considered to be anti-dilutive.

2) The Company has made provision for current tax based on the provisions of Section 115 JB of the Income Tax Act, 1961. It has Not recognized any deferred tax asset and will account for the same when there is a reasonable/ virtual certainty as regards availability of taxable income in accordance with Accounting Standard - 22 "Accounting for taxes on income.

3) The disclosures under the Accounting Standard 15

A) Defined Contribution Plan:

B) Defined benefit Plan:

The following table sets out the status of the gratuity plan (Non-funded) and the amounts recognized in the Companys financial statements as at March 31, 2010:

C) Other Long Term Employee benefit:

The compensated absences charge for the year ended 31st March, 2010, based on actuarial valuation carried out using the Projected Unit Credit Method, amounting Rs. 2,694,831 (for Previous Year Rs. 1,456,682) has been recognized in the Profit and Loss Account.

4) Segment Reporting:

The Company is mainly engaged in the BUSINESS of real estate development viz. construction of residential buildings/ commercial complexes and has also placed its bid for certain infrastructure projects for which the outcome of bids are awaited. On THAT basis, the Company has only one reportable BUSINESS segment, the results of which are embodied in the financial statements.

5) As of March 31, 2009, the Company had 75% equity stake in Esteem Properties Private Limited ("Esteem"). During the year, the Company acquired remaining 25% equity stake by which Esteem became a wholly owned subsidiary w.e.f. May 23, 2009. Esteems plans to construct/develop/market project/s on its land are delayed due to pending litigation before the Supreme Court of India about which the company is hopeful of a positive outcome. Accordingly, the MANAGEMENT has Not considered it necessary to provide for any ‘other than temporary diminution in the value of its investments.

6) a) A Memorandum of Understanding dated July 15, 2007 between the Company and Esteem contained a stipulation to charge interest for the amount advanced to Esteem from time to time at a rate mutually agreed if for any reasons the project did Not commence before June 30, 2009. Based on the said MOU and considering the delay in the project, the Company has, during the year, charged interest @ 16% amounting to Rs. 252,414,782 for the period of funding from May 3, 2007 till March 31, 2010 of which an amount of Rs. 136,811,916 pertains to the period up to March 31, 2009.

b) The Company had from time to time advanced monies to its subsidiary viz. Neelkamal Realtor Suburban Private Limited in which the Company has equity stake of 66%. Based on a understanding reached with the subsidiary during the year, an interest @ 10.50% aggregating Rs. 152,352,986 for the period March 2007 till September 2009 has been charged on the amount advanced and at the rate 15% amounting to Rs. 10,482,981 for the period from October 2009 to March 2010. Of this, an amount of Rs 119,643,358 pertains to the period up to March 31, 2009. This subsidiary company is also in the real estate BUSINESS of constructing, developing and marketing the project and had changed the conceptualization of its project from "Mall" to "Residential cum Commercial" resulting into delays in project execution.

7) The Company received Rs. 3,275,000,000 and Rs. 1,975,000,000 in the previous year and during the year, respectively aggregating Rs. 5,250,000,000 from Walkinson Investments Limited (formerly known as Walkinson Consultants Limited) towards 8% compulsorily convertible debenture application money. The 8% Compulsorily Convertible Debentures were allotted on August 13, 2009, and Subsequently converted into equity shares as on September 22, 2009. As per the terms of the debenture subscription agreement, the transaction of allotting debentures was to be completed by the Company Not later than April 15, 2009. Based on the understanding reached with Walkinson Investments Limited interest @ 8% w.e.f April 1, 2009 on the amount remitted to the Company till the date of conversion has been paid in the books of accounts as on March 31, 2010 based on legal opinion THAT this is in compliance with Foreign Exchange MANAGEMENT Act Regulations.

8) The Company has equity investment in certain subsidiaries, jointly controlled entities and associates aggregating Rs. 385,188,120 (Previous year Rs. 411,132,515) and loans and advances outstanding aggregating Rs. 4,650,180,925 (Previous year Rs. 3,111,209,783) as at March 31, 2010. All such entities have incurred losses during the year and have negative net worth as at the year end. These entities are in the BUSINESS of real estate development and are developing various projects which are long term and which besides achieving adequate profitability on completion also have current market value based on external valuation REPORT in some projects which support the carrying value of such investments and loan outstanding. Accordingly, in the opinion of the Company, No provision is considered necessary towards diminution in the value of investments, if any, in such entities and in respect of loans and advances to such entities, which are considered good and fully recoverable.

9) a) On September 22, 2009, (a) 810,000 Compulsorily Convertible Preference Shares (CCPS) of Rs. 10/- each (issued in earlier year) at a premium of Rs. 3,990/- per CCPS were converted into 810,000 equity shares of Rs. 10/- each fully paid up and (b) 937,500 Compulsorily Convertible Debenture of Rs. 5,600/- (allotted during the year) were converted into 937,500 equity shares of Rs. 10/- each fully paid up. (c) Further, pursuant to the coNSEnt accorded in the general meeting held on September 15, 2009, bonus equity shares were allotted on September 26, 2009 in the ratio of 20 equity shares of Rs. 10/- each fully paid up for each equity share held by Shareholders as on September 25, 2009.

b) During the year, the Company came out with Initial Public Offer (IPO) of its Equity Shares aggregating Rs. 150,000 lacs and closed the subscription on February 2, 2010. The company allotted 32,051,282 equity shares of Rs. 10/- each at a premium of Rs. 458 per share on February 16, 2010. The Equity Shares of the Company were listed on Bombay Stock Exchange Limited and The National Stock Exchange of India Limited on February 24, 2010.

The share issue Expences amounting to Rs. 6,535 lacs have been debited to the Securities Premium Account.

NoTES:

(i) The monitoring agency REPORT from Punjab National Bank, Capital Market Services Branch, Mumbai for utilisation of IPO proceeds is awaited.

(ii) Utilised for certain project payments of Rs. 15,658 lacs and repayment of borrowings of Rs. 13,131 lacs as an interim measure though Not forming part of specifed utilisation of IPO proceeds as stated in the prospectus. The amount has been deployed till the actual requirement of funds for projects specifed in the prospectus instead of parking it in low yield liquid instruments. The MANAGEMENT of the Company has taken approval of the Board in this respect for such revision in its utilisation plans as specified in the prospectus.

10) Additional information pursuant to the paragraphs 3(ii) and 4C of Part II of Schedule VI to the Companies Act, 1956 are Not applicable.

11) a) A sum of prior period indirect Expences which were inadvertently inventorised in earlier years amounting to Rs. Nil (Previous Year Rs. 3,368,840/-) Now charged to Profit and loss account as adjustment to the opening balance of Inventory (Refer Schedule 7).

12) During the year, a loan from LIC Housing Finance Limited of Rs. 1,880,000,000 was received for the purpose of financing the cost of constructions and other project implementation cost within its subsidiary companies and jointly controlled companies. The Company has Not given any security in respect of the said loan except personal guarantees of the Managing Directors of the Company. Further, Esteem Properties Private Limited, a wholly owned subsidiary company has mortgaged its land at Sahar, Andheri in this regard.

13) Related Party Disclosure:

(i) Disclosures as required by the Accounting Standard 18 (AS-18) "Related Party Disclosures" are given below:

Sr. Name and Relationship of the Related Party No. Subsidiaries

1. Gokuldham Real Estate Development Company Private Limited

2. Neelkamal Realtors Suburban Private Limited

3. Neelkamal Shantinagar Properties Private Limited

4. Neelkamal Realtors Tower Private Limited

5. Esteem Properties Private Limited

6. D b Properties Private Limited

7. Air-Inn Private Limited (Up to may 22, 2009)

8. Saifee Bucket Factory Private Limited (w. e. f. September 23, 2009)

9. Real Gem Buildtech Private Limited (w.e.f. August 31, 2009)

10. D B Man Realty Private Limited (formerly known as D B Hi-Class Construction Private Limited) (w.e.f. September 22, 2009)

11. Priya Constructions Private Limited (w.e.f. September 26, 2009)

12. Mira Salts Works Company, Partnership Firm

13. ECC-DB Joint Venture

14. Conwood- DB Joint Venture

15. Royal Netra Construction Private Limited (Subsidiary of D B Man Realty Limited w.e.f. February 20, 2010)

16. D B Chandak Realtor Private Limited. (w.e.f. March 31, 2010 - formerly known as Baramati Fruits & Vegetables Private Limited)

Associates

17. Sangam City Township Private Limited

18. Dynamix Building Materials Private Limited

19. Nine Paradise Hotels Private Limited

20. Crossway Realtors Private Limited

21. D B Hi-Sky Constructions Private Limited

22. Heaven Star Realty Private Limited (w.e.f. September 26, 2009)

Entities under Joint Control of the Company

23. Dynamix Realty, Partnership Firm

24. DbS Realty, Partnership Firm

25. Turf Estate Joint Venture

26. Lokhandwala- Dynamix Balwas Joint Venture

27. M K Malls & Developers Private Limited

Entities under Joint Control of the Subsidiaries of the Company

28. Shree Shantinagar Ventures

29. Suraksha Db Realty

Key Management Personnel (KMP)

30. Mr. ViNod Goenka- Managing Director

31. Mr. Shahid Balwa-Managing Director

32. Mr. Asif Balwa-Whole Time Director (Up to September 14, 2009)

33. Mr. Rajiv Agarwal-Whole Time Director (Up to September 14, 2009)

Relatives of KMP

34. Mr. Pramod Goenka

35. Mrs. Aseela Goenka

36. Mr. Jayvardhan Goenka

37. Ms. Sanjana Goenka

38. Ms. Shanita Jain

39. Ms. Sunita bali

40. Mr. Usman balwa

41. Ms. Shabana balwa

42. Mr. Salim balwa

43. Mr. Ishaq Balwa

44. Mr. Mohammed balwa

Enterprise over which KMP and their relatives have significant infuence

45. Allianze Infratech Private Limited

46. Associates Hotels Limited

47. Conwood Agencies Private Limited

48. Conwood Construction & Developers Private Limited

49. D B Airport Infra Private Limited

50. D B Contractors & Builders Private Limited

51. D B Hospitality Private Limited

52. D B Modern build Tech Private Limited

53. D B Real Estate Development Private Limited

54. D B Tele Wimax Private Limited

55. Dynamix Balwas Infrastructure Private Limited

56. Dynamix Balwas Realty Ventures Private Limited

57. Dynamix Balwas Resorts Private Limited

58. Dynamix Balwas Telecom Private Limited

59. Dynamix Balwas Telecom Services Private Limited

60. Dynamix Club Resorts Private Limited

61. Dynamix Securities and Holdings Limited

62. Earthen Agro & Infrastructure Private Limited

63. Eterna Developers Private Limited

64. Eterna Realty Private Limited

65. Etisalat Db Telecom Private Limited (Formerly known as Swan Telecom Private Limited)

66. Eversmile Construction Company Private Limited

67. K G Enterprises

68. Khairun Developers Private Limited

69. Milan Theatres Private Limited

70. Neelkamal Realtors and Builders Private Limited

71. Neelkamal Realtors and Erectors Private Limited

72. Neelkamal Tower Construction Private Limited

73. Nihar Construction Private Limited

74. Siddharth Consultancy Services Private Limited

75. Swan Connect Communication Private Limited

76. ViNod Goenka- HUF

77. Tiger Trustees Private Limited

78. Y. J. Realty Private Limited

79. Span Construction Company Private Limited

80. Goan Real Estate and Construction Private Limited

NoTES:

1. The aforesaid related parties are identified by the Company and relied upon by the auditors.

2. Priya Construction Private Limited has been considered as Subsidiary from September 26, 2009.

Managerial remuneration includes remuneration to Mr. Shahid Balwa, the Managing director, of Rs. 13,000,000 (Previous year Rs. 11,000,000); Mr. ViNod Goenka, the then Executive Chairman (Now Managing Director w.e.f. September 15, 2009) of Rs. 13,000,000(Previous year Rs. 11,000,000), Mr. Rajiv Agarwal, the then Whole Time Director (Now Chief Operating Officer w.e.f. September 15, 2009) of Rs. 1,967,342 (Previous year Rs. 171,945) and Mr. Asif Balwa, the then Whole Time director (Now Chief Financial Officer w.e.f. September 15, 2009) of Rs. 1,366,667 (Previous year Rs. Nil).

ii) Disclosure of financial interest in Joint Ventures:

Companys share of interest in the assets, liabilities, income and expences with respect to JCEs (each without elimination of the effects of transactions between the Company and the JCEs, if any) on the basis of audited financial statements of the JCEs as at and for the period ended March 31, 2010 are as under:

14) Comparative financial information (i.e. amounts and other disclosures for the previous year presented above as corresponding figures), is included as an integral part of the current years financial statements, and is to be read in relation to the amounts and other disclosures relating to the current year. Figures of the previous year have been regrouped / reclassifed wherever necessary to correspond to figures of current year.

Find IFSC