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Notes to Accounts of National Steel and Agro Industries Ltd.

Mar 31, 2016

1.(c) Rights, preferences and restrictions attached to shares :

The Company has issued Equity shares with Voting rights only of Face value of Rs.10 each and each share carries right to one vote. The Company issued 4% Cumulative Redeemable Preference Shares of Face value of Rs.100 each. These shares are redeemable within the statutory permissible time period as per the terms of the issue. Such shares carries prior right to receive dividend over equity shareholders.

(i) Installments falling due in respect of all the above loans up to 31.03.2017 have been grouped under "Current Maturities of Long Term Debt" (Refer Note 9).

(ii) Nature of Security and terms of repayment for long term secured borrowing :-

(a) Nature of Security : Term loans from Banks/Financial Institutions are secured by way of first mortgage of all immovable properties and hypothecation of all the Company''s movables (save and except book debts and stock) including movable machinery, spares and tools both present and future ranking pari-passu inter-se subject to prior charge created/to be created in favour of the Banks/Financial Institutions on specified movable assets for securing borrowing for working capital requirements and personal guarantee of the Executive Chairman.

Trade Payable includes Rs.64,889 Lacs towards acceptances (Previous Year Rs.67,607 Lacs) and Rs.14.52 Lacs (Previous Year Rs.12.83 Lacs) due to Micro, Small and Medium Enterprises Undertakings.

Sale of Manufactured Goods includes export sales of Rs.56,831.84 Lacs (Previous Year Rs.64,145.19 Lacs) Sale of Traded Goods includes export sales of Rs.Nil Lacs (Previous Year Rs.Nil Lacs)

Note:

i) During the year under review the Company has sold fixed assets for an amount of Rs.4,273 Lacs and earned profit of Rs.2,443 Lacs.

ii) During the year under review the Company has sold 13,33,332 Equity Shares of Shreeyam Power and Steel Industries Limited at a price arrived on the basis of valuation report of an Independent Chartered Accountant. The Company has made loss of Rs.199 Lacs on the sale of the said Equity Shares.

Employee costs include Managerial remuneration of Rs.146.01 Lacs paid to Mr. Santosh Shahra, Executive Chairman in excess of the permissible limits, under the Provision of Section 197 read with Schedule V of the Companies Act, 2013. The Company proposes to apply to the Central Government for the necessary approval and also to obtain approval of the members in the ensuing Annual General Meeting.

Defined Benefit Plan :

(a) A General description of the Employees Benefit Plan:

The Company has an obligation towards gratuity, a funded defined benefit retirement plan covering eligible employees. The plan provides for lump sum payment to vested employees at retirement, death while in employment or on termination of the employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.

b) Expenses recognized during the year under the head "Employees Remuneration and Benefits"

In case of gratuity as per the actuarial certificate net cost required to recognized in the Profit and Loss Account is (Rs.35.09) Lacs (previous year Rs.103.23 Lacs).

VI. The major categories of plan assets as a percentage of the total plan assets

Insurer Managed Funds 100% 100%

Note : The details of investment made by the insurer is not readily available with the Company. The estimates of Rate of Escalation in salary considered in actuarial valuation takes into accour inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

As the investment is with the insurance company, list of investment is not available so expected return is assumed to be taken from benchmark rate available on government securities for the tenure of 15 years i.e. the average future service calculated individually.

2. During the year the Company has paid an amount of Rs.26.54 Lacs as lease rent, charged to Profit & Loss Account (Previous Year Rs.25.29 Lacs).

3. The Company is carrying the Electrical Turnkey project. During the year total Contract Revenue recognized is Rs.651.42 Lacs.

4. Balances of debtors, creditors, deposits and advances are partly confirmed.

5. The figures of previous year have been regrouped wherever necessary to conform the Current years classification.


Mar 31, 2015

1.(c) Rights, preferences and restrictions attached to shares :

The Company has issued Equity shares with Voting rights only of Face value of 10 each and each share carries right to one vote. The Company issued 4% Cumulative Redeemable Preference shares of Face value of 100 each. These shares are redeemable within the statutory permissible time period as per the terms of the issue. Such shares carries prior right to receive dividend over equity shareholders.

(i) Installments falling due in respect of all the above loans upto 31.03.2016 have been grouped under "Current Maturities of Long Term Debt" (Refer Note 9).

(ii) Nature of Security and terms of repayment for long term secured borrowing :-

(a) Nature of Security : Term loans from Banks/Financial Institutions are secured by way of first mortgage of all immovable properties and hypothecation of all the Company's movables (save and except book debts and stock) including movable machinery, spares and tools both present and future ranking pari-passu inter-se subject to prior charge created/to be created in favour of the Banks/Financial Institutions on specified movable assets for securing borrowing for working capital requirments and personal guarantee of the Executive Chairman.

Defined Benefit Plan :

(a) A general description of the Employees Benefit Plan : The Company has an obligation towards gratuity, a funded defined benefit retirement plan covering eligible employees. The plan provides for lump sum payment to vested employees at retirement, death while in employment or on termination of the employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.

Note : In case of gratuity, in previous year fair value of plan assets are more than the present value of obligation by 50.35 Lacs Such excess amount was not recognised as an assets of the Company because the Company has no right over the insurer managed gratuity fund. However in the current year present value of obligation is more than fair value of plan assets hence such excess amount recognised as liability in Balance Sheet.

VI. The major categories of plan assets as a percentage of the total plan assets

Insurer Managed Funds 100% 100%

Note : The details of investment made by the insurer is not readily available with the Company. The estimates of Rate of Escalation in salary considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

As the investment is with the insurance company list of investment is not available so expected return is assumed to be taken from benchmark rate available on Government Securities for the tenure of 15 years i.e. the average future service calculated individually.

2. Contingent Liabilities not provided for ( in Lacs)

2014-15 2013-14

a) Outstanding Bank Guarantees 583.12 338.01

b) Disputed Liabilities not acknowledged as debts 254.75 254.30

c) Estimated amount of contracts remaining to be 27.86 1,148.30 Executed on Capital Account (net of advance)

d) Corporate guarantee given on behalf of Associate 7,465.00 7,465.00

3. During the year the Company has paid an amount of 25.29 Lacs as lease rent, charged to Profit & Loss Account (Previous Year 31.54 Lacs).

4. The Company is carrying the Electrical Turnkey project. During the year total Contract Revenue recognized is 195.24 Lacs.

5. Balances of debtors, creditors, deposits and advances are partly confirmed.

6. Related party disclosures as per Accounting Standard - 18 are given below Disclosure of related parties with whom transactions entered as per AS-18. A. Relationships

a) Key Management Personnel and their relatives :

Mr. Santosh Shahra, Executive Chairman Santosh Shahra HUF

Mr. P. Srikrishna, Managing Director

Mrs. Usha Devi Shahra, wife of Executive Chairman

Mrs. Aditi Gowani, daughter of Executive Chairman

Mr. Vishesh Shahra, son of Executive Chairman

Mr. Anil Nawal, CFO

Mr. Bharat Singh, Company Secretary

b) Other related parties where control exists :

Shreeyam Power and Steel Industries Limited NSIL Infotech Limited

Shahra Brothers Private Limited

NSIL Exports Limited

Shri Mahadeo Shahra Sukrat Trust

Ruchi Infrastructure Limited

NSIL Power Limited

Ruchi Power Corporation Limited

Samidha Foods Private Limited

7. There was no MAT Credit available in the beginning of the Financial Year (previous year 3.38 Crores).

8. The figures of previous year have been regrouped wherever necessary to conform the Current years classification.


Mar 31, 2014

1.(a) Rights, preferences and restrictions attached to shares:

The Company has issued Equity shares with Voting rights only of Face value of Rs. 10 each and each share carries right to one vote. The Company issued 4% Cumulative Redeemable Preference shares of Face value of Rs. 100 each. These shares are redeemable within the statutory permissible time period as per the terms of the issue. Such shares carries prior right to receive dividend over equity share holders.

(i) Installments falling due in respect of all the above loans upto 31.03.2015 have been grouped under "Current Maturities of Long Term Debt" (Refer Note 8).

(ii) Nature of Security and terms of repayment for long term secured borrowing.

(b) Nature of Security : Term loans from Financial Institutions are secured by way of first mortgage of all immovable properties and hypothecation of all the Company''s movables (save and except book debts and stock) including movable machinery, spares and tools both present and future ranking pari-passu inter-se subject to prior charge created/to be created in favour of the banks on specified movable assets for securing borrowing for working capital requirments and personal guarantee of the Executive Chairman.

* Loans from Bank for Working Capital are secured by hypothecation of Company''s entire stocks of raw materials, stock in process, finished goods, stores & spares, stock in transit, other current assets and second charge over entire fixed assets of the Company ranking pari-passu inter-se and personal gurantee of the Executive Chairman.

Sundry Creditors includes Rs. 49,843 lacs towards acceptances (Previous Year Rs. 49,030 lacs) and Rs. 6.01 lacs (Previous Year Rs. 25.44 lacs) due to Micro, Small and Medium Enterprises Undertakings.

As per the information available with the Company relating to the registration status of the suppliers under the Micro, Small and Medium Enterprises Development Act 2006, the information required under the

* Sale of Manufactured Goods includes export sales of Rs. 36,605.46 lacs (Previous Year Rs. 60,732.45 lacs)

* Sale of Traded Goods includes export sales of Rs. 1,506.31 lacs (Previous Year Rs. 4,448.08 lacs)

Defined Benefit Plan :

(a) A general description of the Employees Benefit Plan : The Company has an obligation towards gratuity, a funded defined benefit retirement plan covering eligible employees. The plan provides for lump sum payment to vested employees at retirement, death while in employment or on termination of the employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.

Note : In case of gratuity, fair value of plan assets are more than the present value of obligation by Rs. 50.35 lacs Such excess amount was not recognized as an assets of the Company.

b) Expenses recognized during the year under the head "Employees Remuneration and Benefits"

In case of gratuity As per the actuarial certificate net cost required to recognized in the Profit and Loss Account is Rs. (21.16) lacs. However by adopting conservative approach total fund contribution has been charged to Profit & Loss Account (previous year Rs. 219.39 lacs), out of that 192.36 lacs was adjusted with the unrecognised assets of the previous year and balance amount of Rs. 27.03 lacs was charged to Profit and Loss.

VI. The major categories of plan assets as a percentage of the total plan assets

Insurer Managed Funds 100% 100%

Note : The details of investment made by the insurer is not readily available with the Company.

The estimates of Rate of Escalation in salary considered in actuarial valuation takes into account inflation, seniority, promotion and other relevent factors including supply and demand in the employment market. The above information is certified by the actuary.

As the investment is with the insurance company list of investment is not available so expected return is assumed to be taken from benchmark rate available on Government Securities for the tenure of 15 years i.e. the average future service calculated individually.

* Value of Import/Indigenous Stores & Spares Consumption, please refer Note no. 39(ii)

2. Contingent Liabilities not provided for

(Rs. in lacs)

2013-14 2012-13

a) Outstanding Bank Guarantees 338.01 1,937.59

b) Disputed Liabilities not acknowledged as debts 254.30 217.15

c) Estimated amount of contracts remaining to be 1,148.30 59.57

Executed on Capital Account (net of advance)

d) Corporate guarantee given on behalf of Associate 7,465.00 —

3. During the year the Company has paid an amount of Rs. 31.54 lacs as lease rent, charged to Profit & Loss Account (Previous Year Rs. 40.89 lacs).

4. There was a MAT Credit available for Rs. 3.38 Crores in the beginning of the Financial Year which is recognized and utilized during the year.

5. The figures of previous year have been regrouped wherever necessary to conform the Current years classification.


Mar 31, 2013

1. Contingent Liabilities not provided for

(Rs. in lacs)

2012-13 2011-12

a) Outstanding Bank Guarantees 1,937.59 1,208.26

b) Disputed Liabilities not acknowledged as debts 217.15 217.78

c) Estimated amount of contracts remaining to be 59.57 52.88

Executed on Capital Account (net of advance)

2. During the year the Company has paid an amount of Rs. 40.89 lacs as lease rent, charged to Profit & Loss Account (Previous Year Rs. 42.79 lacs).

3. The Company is carrying on the project of construction of Power Sub Stations and Installation and Commissioning of Transmission Line. During the year total Contract Revenue recognized is Rs. 128.75 lacs (previous year Rs. 180.88 lacs)

4. Balances of debtors, creditors, deposits and advances are partly confirmed.

5. Related party disclosures as per Accounting Standard - 18 are given below :- A. Relationships

a) Key Management Personnel and their relatives : Mr. Santosh Shahra, Chairman & Managing Director Mr. P. Srikrishna, Whole - Time Director

Mrs. Usha Devi Shahra, wife of Chairman & Managing Director Mrs. Aditi Gowani, daughter of Chairman & Managing Director Mr. Vishesh Shahra, son of Chairman & Managing Director

b) Other related parties where control exists : Shreeyam Power and Steel Industries Limited NSIL Infotech Limited

NSIL Power Limited

Shahra Brothers Private Limited

Ruchi Integrated Steels (India) Limited

Ruchi Power Corporation Limited

NSIL Exports Limited

Shri Mahadeo Shahra Sukrat Trust

NSIL Finance Limited

Shriyam Industries Private Limited

Nutrela Marketing Private Limited

Shahra Estate Private Limited

Divine Infracreation & Trading Private Limited

6. Total MAT Credit was available Rs. 7.66 Crores (previous year Rs. 9.62 Crores) out of which Company has recognized and utilized MAT Credit of Rs. 4.32 Crores (previous year Rs. 1.99 Crores) to the extent of entitlement.

7. The figures of previous year have been regrouped wherever necessary to conform the Current years classification.


Mar 31, 2012

1.(b) Rights, preferences and restrictions attached to shares :

The Company has issued Equity shares with Voting rights only of Face value of 10 each and each share carries right to one vote. The Company issued 4% Cumulative Redeemable Preference shares of Face value of 100 each. These shares are redeemable within the statutory permissible time period as per the terms of the issue. Such shares carries prior right to receive dividend over equity share holders.

(i) Installments falling due in respect of all the above loans upto 31.03.2013 have been grouped under

"Current Maturities of Long Term Debt" (Refer Note 8).

(ii) Nature of Security and terms of repayment for long term secured borrowing :-

(a) Nature of Security : Term loans from Financial Institutions are secured by way of first mortgage of all immovable properties and hypothecation of all the Company's movables(save and except book debts and stock) including movable machinery, spares and tools both present and future ranking pari-passu inter-se subject to prior charge created/to be created in favour of the banks on specified movable assets for securing borrowing for working capital requirments and personal guarantee of the Managing Director.

(b) Terms of Repayments :

Sundry Creditors includes 47,957 lacs towards acceptances (Previous Year 38,460 lacs) and 26.15 lacs (Previous Year 26.41 lacs) due to Micro, Small and Medium Enterprises Undertakings.

Defined Benefit Plan :

(a) A general description of the Employees Benefit Plan : The Company has an obligation towards gratuity, a funded defined benefit retirement plan covering eligible employees. The plan provides for lump sum payment to vested employees at retirement, death while in employment or on termination of the employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.

Note : In case of gratuity, fair value of plan assets are more than the present value of obligation by Rs. 192.36 lacs ( Previous year 83.07 lacs). Such excess amount was not recognized as an asset of the Company because the Company has no right over the insurer managed gratuity fund.

b) Expenses recognized during the year under the head "Employees Remuneration and Benefits"

As per the actuarial certificate net cost required to be recognized in the Profit and Loss Account is (7.28) lacs (Previous year 70.17 lacs) but total fund contribution paid to the insurer is Rs. 102.00 lacs (Previous year 144.11 lacs). Company has recognized total fund contribution as net cost by adopting the conservative approach as the excess fund contribution becomes the property of the trust maintained by the insurer and the Company has no right over that excess contribution.

Note : The details of investment made by the insurer is not readily available with the Company.

The estimates of Rate of Escalation in salary considered in actuarial valuation takes into account inflation, seniority, promotion and other relevent factors including supply and demand in the employment market. The above information is certified by the actuary.

As the investment is with the insurance company list of investment is not available so expected return is assumed to be available on risk free investment like PPF.

2. Contingent Liabilities not provided for

(Rs. in lacs)

2011-12 2010-11

a) Outstanding Bank Guarantees 1208.26 2,443.93

b) Disputed Liabilities not acknowledged as debts 217.78 173.74

c) Estimated amount of contracts remaining to be 52.88 2,598.71 Executed on Capital Account (net of advance)

3. During the year the Company has paid an amount of 42.79 lacs as lease rent, charged to Profit & Loss Account (Previous Year 42.65 lacs).

4. The Company is carrying on the project of construction of Power Sub Stations and Installation and Commissioning of Transmission Line. Having regard to the accounting policies followed by the Company and on the basis of certificate of approved surveyors, the entire expenditure on the Incompleted contracts amount to Nil lacs (Previous year 528 lacs) is shown in Work in Process (Transmission Lines) in the Balance Sheet under the head of Inventories.

5. In respect of Constructions Contracts, the Company follows the Percentage of Completion Method for recognizing profit/loss but no provision is made for contingencies in respect of contract in progress, consistent with the practice of the Company. Accounting Standard-7 on Accounting for Construction Contracts issued by the Instituted of Chartered Accountants of India requires that an appropriated allowance be made for future unforseeable factors. In the opinion of the Company, such a provision is not required and has no financial effect.

6. Balances of debtors, creditors, deposits and advances are partly confirmed.

7. Related party disclosures as per Accounting Standard - 18 are given below :-

A. Relationships

a) Key Management Personnel and their relatives :

Mr. Santosh Shahra, Managing Director

Mr. P. Srikrishna, Whole - Time Director

Mrs. Usha Devi Shahra, wife of Managing Director

Mrs. Aditi Gowani, daughter of Managing Director

Mr. Vishesh Shahra, son of Managing Director

b) Other related parties where control exists :

Shreeyam Power and Steel Industries Limited

NSIL Infotech Limited

NSIL Power Limited

Shahra Brothers Private Limited

Ruchi Integrated Steels (India) Limited

Ruchi Power Corporation Limited

NSIL Exports Limited

Shri Mahadeo Shahra Sukrat Trust

NSIL Finance Limited

Shriyam Industries Private Limited

Nutrela Marketing Private Limited

Shahra Estate Private Limited

Divine Infracreation & Trading Private Limited

8. Total MAT Credit was available 9.62 Crores out of which Company has recognized and utilized MAT Credit of 1.99 Crores to the extent of entitlement.

9. The Financial Statements for the year ended 31st March, 2011 has been prepared as per the applicable, pre-revised Schedule VI of the Companies Act, 1956. Consequent to the notification under the Companies Act, 1956, the financial statements for the year ended 31st March, 2012 are prepared under revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification.


Mar 31, 2011

(Rs. in lacs)

1. Contingent Liabilities not provided for 2010-11 2009-10

a) Outstanding Bank Guarantees 2,443.93 2,932.81

b) Disputed Liabilities not acknowledged as debts 173.74 159.83

c) Estimated amount of contracts remaining to be 2,598.71 288.59 Executed on Capital Account (net of advance)

2. Sundry Creditors includes Rs. 38,460 lacs towards acceptances (Previous Year Rs. 29,757 lacs) and Rs. 26.41 lacs (Previous Year Rs. 15.41 lacs) due to Micro, Small and Medium Enterprises Undertakings and that given in Schedule 12 - 'Current Liabilities'.

3. During the year the Company has paid an amount of Rs. 42.65 lacs as lease rent, charged to Profit & Loss Account (Previous Year Rs. 41.74 lacs).

4. The Company is carrying on the project of construction of Power Sub Stations and Installation and Commissioning of Transmission Line. Having regard to the accounting policies followed by the Company and on the basis of certificate of approved surveyors, the entire expenditure on the uncompleted contracts amounting to Rs. 528 lacs (Previous year Rs. 2,702.30 lacs) is shown in Work in Process (Transmission Lines) in the Balance Sheet under the head of Inventories.

5. In respect of Constructions Contracts, the Company follows the Percentage of Completion Method for recognizing profit/loss but no provision is made for contingencies in respect of contract in progress, consistent with the practice of the Company. Accounting Standard-7 on Accounting for Construction Contracts issued by the Instituted of Chartered Accountants of India requires that an appropriated allowance be made for future unforseeable factors. In the opinion of the Company, such a provision is not required and has no financial effect.

6. The Company has allotted 55,00,000 equity shares to Promoter Group and 63,97,058 equity shares to Non Promoter Group aggregating to 1,18,97,058 equity shares of Rs. 10/- each at a premium of Rs. 13.65 per share on conversion of warrants on 28.03.2011.

7. Balances of debtors, creditors, deposits and advances are partly confirmed.

8. As per Accounting Standard - 15 "Employee Benefits", the disclosure of Employee Benefits as defined in the Accounting Standard are given below :

Defined Benefit Plan :

(a) A general description of the Employees Benefit Plan : The Company has an obligation towards gratuity, a funded defined benefit retirement plan covering eligible employees. The plan provides for lump sum payment to vested employees at retirement, death while in employment or on termination of the employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.

(b) Details of Defined Benefit Plan : As per Actuarial valuation are as follows :

IV) b) Expenses recognized during the year under the head "Employees Remuneration and Benefits" as per Schedule "18"

As per the actuarial cetificate net cost required to be recognized in the Profit and Loss Account is Rs. 70.17 lacs (Previous year Rs. 35.49 lacs) but total fund contribution paid to the insurer is Rs. 144.11 lacs (Previous year Rs. 84.43 lacs). Company has recognized total fund contribution as net cost by adopting the conservative approach as the excess fund contribution becomes the property of the trust maintained by the insurer and the Company has no right over that excess contribution.

9. Related party disclosures as per Accounting Standard - 18 are given below :-

A. Relationships

a) Key Management Personnel and their relatives :

Mr. Santosh Shahra, Managing Director

Mr. P. Srikrishna, Whole - time Director

Mrs. Usha Devi Shahra, wife of Managing Director

Mrs. Aditi Gowani, daughter of Managing Director

Mr. Vishesh Shahra, son of Managing Director

b) Other related parties where control exists :

Ruchi Power and Steel Industries Limited

NSIL Infotech Limited

NSIL Power Limited

Shahra Brothers Private Limited

Ruchi Integrated Steels (India) Limited

Ruchi Power Corporation Limited

NSIL Exports Limited

Shri Mahadeo Shahra Sukrat Trust

NSIL Finance Limited

10. The figures of previous year have been regrouped wherever necessary to confirm the current year's classification.

11. Pre-operative Expenditure incurred during the year to the extent of Rs. 655.75 lacs on Metal Projects have been capitalized on pro-rata basis to Plant & Machinery and Buildings.


Mar 31, 2010

(Rs. in lacs) 1. Contingent Liabilities not provided for 2009-10 2008-09

a) Outstanding Bank Guarantees 2932.81 2213.57

b) Disputed Liabilities not acknowledged as debts 159.83 266.16

c) Estimated amount of contracts remaining to be 288.59 258.75

Executed on Capital Account (net of advance)

2. Sundry Creditors includes Rs. 29,757 lacs towards acceptances (Previous Year Rs. 24,896 lacs) and Rs. 15.41 lacs (Previous Year Rs. 28.38 lacs) due to Micro, Small and Medium Enterprises Undertakings and that given in Schedule 12 - ‘Current Liabilities.

3. During the year the Company has paid an amount of Rs. 41.74 lacs as lease rent, charged to Profit & Loss Account (Previous Year Rs. 25.54 lacs).

4. The Company is carrying on the project of construction of Power Sub Stations and Installation and Commissioning of Transmission Line. Having regard to the accounting policies followed by the Company and on the basis of certificate of approved surveyors, the entire expenditure on the uncompleted contracts amounting to Rs. 2,702.30 lacs (Previous year Rs. 2,677.61 lacs) is shown in Work in Process (Transmission Lines) in the Balance Sheet under the head of Inventories.

5. In respect of Constructions Contracts, the Company follows the Percentage of Completion Method for recognizing profit/loss but no provision is made for contingencies in respect of contract in progress, consistent with the practice of the Company. Accounting Standard-7 on Accounting for Construction Contracts issued by the Instituted of Chartered Accountants of India requires that an appropriated allowance be made for future unforseeable factors. In the opinion of the Company, such a provision is not required and has no financial effect.

6. During the year the Company has issued 1,18,97,058 warrants in accordance with the provisions of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 as applicable on preferential issue of warrants convertible into equity shares. These warrants have been issued to promoters, their relatives and associates and other entities. These warrants are convertible into equal number of shares of Rs. 10/- each fully paid up at a price of Rs. 23.65 including premium of Rs. 13.65 determined in accordance with the guidelines for preferential issue contained in Chapter VII of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 as amended.

7. Balances of debtors, creditors, deposits and advances are partly confirmed.

8. As per Accounting Standard - 15 "Employee Benefits", the disclosure of Employee Benefits as defined in the Accounting Standard are given below :

Defined Benefit Plan :

(a) A general description of the Employees Benefit Plan : The Company has an obligation towards gratuity, a funded defined benefit retirement plan covering eligible employees. The plan provides for lump sum payment to vested employees at retirement, death while in employment or on termination of the employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.

The estimates of Rate of Escalation in salary considered in actuarial valuation takes into account inflation, seniority, promotion and other relevent factors including supply and demand in the employment market. The above information is certified by the actuary.

The expected Rate of Return on Plan Assets is determined considering several applicable factors, mainly the composition of Plan Assets held, assessed risks, historical results of Return on Plan Assets and the Companys policy for Plan Assets Management.

9. Related party disclosures as per Accounting Standard - 18 are given below :-

A. Relationships

a) Key Management Personnel and their relatives : Mr. Santosh Shahra,Managing Director

Mr. P. Srikrishna, Whole - time Director

Mrs. Usha Devi Shahra, wife of Managing Director

Mrs. Aditi Gowani, daughter of Managing Director

Mr.Vishesh Shahra, son of Managing Director

b) Other related parties where control exists :

NSIL Infotech Limited

NSIL Power Limited

Shahra Brothers Private Limited

Ruchi Integrated Steels (India) Limited

Ruchi Power Corporation Limited

NSIL Exports Limited

Shri Mahadeo Shahra Sukrat Trust Mid India Power and Steel Limited

NSIL Finance Limited

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