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Notes to Accounts of Prajay Engineers Syndicate Ltd.

Mar 31, 2015

NOTE : 1

SHARE CAPITAL

2,972,787 shares have been alloted pursuant to a contract without payments being received in cash. Rights, preferences and restrictions attached to shares

The Company has one class of equity shares having a par value of Rs. 10 each. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing annual general meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

NOTE : 2

As stated in Note 1(g)(ii) for recognizing profit on projects, stage of completion is determined as a proportion that project costs incurred for the work performed bear to the estimated total costs. Further, as stated in that note expected loss on projects is recognised when it is probable that the total project costs will exceed the total project revenue. For this purpose total project costs are ascertained on the basis of project costs incurred and costs to completion of projects on progress, which is arrived at by the Management, based on current technical data, forecasts and estimate of net expenditure to be incurred in future including for contingencies etc., which being technical matters have been relied on by auditors. Further, in respect of certain properties where sale agreement has been entered with parties even though money has not been received as per stipulation in the contract, the Company has recognised revenue and debtors as management is confident that it shall be able to realize the sale proceeds.

NOTE : 3

As stated in Note. 1 (g)(iii) the method used to recognize the contract revenue is percentage of completion method measured by survey of work performed. Further, as stated in the note, expected loss on contracts is recognised when it is probable that the total contract cost will exceed the total contract revenue. For this purpose total contract cost is ascertained on the basis of contract cost incurred and cost to completion of contract on progress ,which is arrived at by the management, based on current technical data, forecasts and estimate of net expenditure to be incurred in future including for contingencies etc, which being technical matters have been relied on by auditors.

An amount of Rs. 4,193.58 lacs (31.03.2014 Rs. 6,085.47lacs) is recognized as contract revenue by the company during the current financial year. The cost incurred in respect of the above is Rs. 3,762.27 lacs (31.03.2014 Rs. 5,282.16 lacs).

NOTE : 4

Trade Payables - Dues to Micro and small enterprises

Trade payables (Note 8) include Rs. Nil (31.03.2014 Rs. Nil) due to micro enterprises and small enterprises as defined under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006). The company has not received any memorandum (as required to be filed by the suppliers with the notified authority under the MSMED Act, 2006) claiming their status as micro or small or medium enterprises.

NOTE : 5

Contingent Liabilities (not provided for) Guarantees given to banks (on behalf of Prajay Properties Pvt Ltd) 12,130.00 12,130.00

The following disputed liabilities are under appeal by the Company:

Service tax* 1,820.62 1,820.62

Income Tax 791.71 40.79

VAT 5.77 5.77

* The company has disputed the liability and replied to the show cause notice, that the short payment of service tax, if any, demanded by the Service Tax Authorities is not maintainable under law.

Further, as per Circular No.108/02/2009-ST, dated 29.01.2009 issued by CBEC, no service tax is payable on the Construction of Complex Service for the impugned period 2006-07 to 2010-11. During the impugned period, the company had deposited with the Service Tax Authorities, whatever service tax collected from the customers. The Company has filed appeal on 08.04.2013 with CESTAT, Bangalore against order dated 04.01.13 of Commissioner of Service Tax.

NOTE : 6

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advance) Rs. 466.79 lacs (31.03.2014: Rs. 520.39 lacs); Other commitments Nil (31-03-2014: Nil).

NOTE : 7

Related Party Disclosures:

A. List of Related Parties Party Relationship

(a) Prajay Holdings Private Limited Subsidiary

Prajay Developers Private Limited Step down - Subsidiary

Prajay Retail Properties Private Ltd Subsidiary

Prajay Binjusaria Estates Associate

Prajay Properties Pvt Ltd Associate

Genesis Capital Pvt.Ltd.(Mauritius) Associate

(b) Key Management Personnel Designation Relatives (Relation)*

Mr. Vijay Sen Reddy Managing Director Mrs. Sharmila Reddy (Wife) Mr.Rohit Reddy (Son)

Mr. K. Ravi Kumar Whole time Director -

Mr. Sumit Sen Whole time Director Mrs. Rina Sen (Wife)

* Relatives of key management personnel with whom there were transactions during the year

(c) Other entities under the control of key management personnel and their relatives

Prajay Financial Services Limited

Prajay Lifestyle UPVC Windows Private Limited

Prajay Princeton Hotel Private Limited

Prajay Princeton Developers Private Limited

Prajay Land Capital Private Limited

VijMohan Constructions Private Limited

Prajay Velocity Developers Private Limited

Prajay Chit Funds Pvt.Ltd.

Secunderabad Golf and Leisure Resorts Private Limited

NOTE : 8

Hire Purchase:

(i) The Company has taken plant and machinery, motor vehicles under hire purchase arrangements for which the ownership will be transferred to the Company at the end of the hire purchase term.

(ii) Reconciliation between the total of minimum hire purchase payments at the balance sheet date and the present value:

NOTE : 9

(a) Trade Receivables (Note 15), unsecured considered good, includes Rs. 23,519.03 lacs (31-03-2014: Rs. 24,419.62 lacs), outstanding for more than six months. As a result of economic slowdown and recession in realty sector, the realizations from customers are slow. The company has provided Rs. 896.96 lacs during the year towards doubtful debts against Trade receivables, unsecured, considered doubtful.

(b) Long Term Loans and Advances (Note 13) include advances given to Landlords/ developers towards certain projects amounting to Rs. 5999.05 lacs (31-03-2014: Rs. 6,191.04 lacs) and Short Term Loans and Advances (Note 17) to suppliers, etc amounting to Rs. 727.58 lacs (31-03-2014: Rs. 188.94 lacs) outstanding from earlier years. Due to long term involvement in such projects, no provision has been considered necessary.

NOTE : 10

Details as required under Schedule III - Part I of the Companies Act, 2013 relating to investment in partnership firm.

(a) Name of the Partnership Firm - Prajay Binjusaria Estates

(b) Total Capital of the said Firm is Rs. 2055.50 lacs (31-03-2014 : Rs. 2055.50 lacs)

NOTE : 11

The Secured Loan of Rs. 3,200.00 Lacs from Prajay Properties Private Limited is continuing as Interest free by virtue of the agreement Dated 6th October '2009.

Since some of the statutory approvals for Prajay Megapolis project are yet to be obtained, crystallization of loan repayment time schedule has not taken place as on 31.03.15.

NOTE : 12

Previous years figures have been recast / restated, to conform to current year classification.


Mar 31, 2014

1.Rights, preferences and restrictions attached to shares

The Company has one class of equity shares having a par value of Rs. 10 each. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing annual general meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

Note : Plant & Machinery Costing Rs. 970.26 Lacs (31.03.13 Rs. 704.41 Lacs) and Vehicles Costing Rs. 204.43 Lacs (31.03.13 Rs. 208.57 Lacs) have been acquired on Hire Purchase, the legal Owner Ship of which will be transferred to the Company after the final payment.

(a) includes deposit to Director Rs. 500 Lacs (31.03.13 Rs. 500 Lacs)

(b) 1. includes advance to Partnership firms in which the company is partner Rs. 99.39 Lacs (31.03.13 Rs. 98.45Lacs)

2. includes advance to private companies in which any director is a director Rs. 1,862.60Lacs (31.03.13 Rs. 1,734.65)

a) includes Rs. 213.52 Lacs (31-03-2013: Rs. 199.90 lacs) to Private Companies having Common Director.

1. As stated in Note 1 (g)(ii) for recognizing profit on projects, stage of completion is determined as a proportion that project costs incurred for the work performed bear to the estimated total costs. Further, as stated in that note expected loss on projects is recognised when it is probable that the total project costs will exceed the total project revenue. For this purpose total project costs are ascertained on the basis of project costs incurred and costs to completion of projects on progress, which is arrived at by the Management, based on current technical data, forecasts and estimate of net expenditure to be incurred in future including for contingencies etc., which being technical matters have been relied on by auditors. Further, in respect of certain properties where sale agreement has been entered with parties even though money has not been received as per stipulation in the contract, the Company has recognised revenue and debtors as management is confident that it shall be able to realize the sale proceeds.

2. As stated in Note. 1 (g)(iii) the method used to recognize the contract revenue is percentage of completion method measured by survey of work performed. Further, as stated in the note, expected loss on contracts is recognised when it is probable that the total contract cost will exceed the total contract revenue. For this purpose total contract cost is ascertained on the basis of contract cost incurred and cost to completion of contract on progress ,which is arrived at by the management, based on current technical data, forecasts and estimate of net expenditure to be incurred in future including for contingencies etc, which being technical matters have been relied on by auditors.

An amount of Rs. 6,085.47 lacs (31.03.2013 Rs. 9,073.49 lacs) is recognized as contract revenue by the company during the current financial year. The cost incurred in respect of the above is Rs. 5,282.16 lacs (31.03.2013 Rs. 7,821.60 lacs).

3. Trade Payables - Dues to Micro and small enterprises

Trade payables (Note 8) include Rs. Nil (31.03.2013 Rs. Nil) due to micro enterprises and small enterprises as defined under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006).

The company has not received any memorandum (as required to be filed by the suppliers with the notified authority under the MSMED Act, 2006) claiming their status as micro or small or medium enterprises.

(Rs. in lacs)

Particulars 2013-14 2012-13

3. Contingent Liabilities (not provided for)

Guarantees given to banks

(on behalf of Prajay Properties Pvt Ltd) 12,130.00 12,130.00

Service Tax demand* 1,820.62 1,820.62

* The company has disputed the liability and replied to the show cause notice, that the short payment of service tax, if any, demanded by the Service Tax Authorities is not maintainable under law.

Further, as per Circular No.108/02/2009-ST, dated 29.01.2009 issued by CBEC, no service tax is payable on the Construction of Complex Service for the impugned period 2006-07 to 2010-11. During the impugned period, the company had deposited with the Service Tax Authorities, whatever service tax collected from the customers. The Company has filed appeal on 08.04.2013 with CESTAT, Bangalore against order dated 04.01.13 of Commissioner of Service Tax.

4. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advance) Rs. 520.39 lacs, (31.03.2013: Rs. 384.57 lacs); Other commitments Nil (31-03-2013: Nil).

(b) Hire Purchase:

(i) The Company has taken plant and machinery, motor vehicles under hire purchase arrangements for which the ownership will be transferred to the Company at the end of the hire purchase term.

5. Employee Benefits :

Disclosure in respect of gratuity as required under Accounting Standard 15 (Revised) notified by the Companies (Accounting Standards) Rules, 2006.

6. (a) Trade Receivables (Note 15), unsecured considered good, includes Rs. 24,419.62 lacs (31-03-2013: Rs. 27,195.98 lacs), outstanding for more than six months. As a result of economic slowdown and recession in realty sector, the realizations from customers are slow.

(b) Long Term Loans and Advances (Note 13) include advances given to Landlords/ developers towards certain projects amounting to Rs. 6,191.04 lacs (31-03-2013: Rs. 7,833.42 lacs) and Short Term Loans and Advances (Note 17) to suppliers, etc amounting to Rs. 188.94 lacs (31-03-2013: Rs. 275.58 lacs) outstanding from earlier years. Due to long term involvement in such projects, no provision has been considered necessary.

7. Details as required under Schedule VI - Part I of the Companies Act, 1956 relating to investment in partnership firm.

(a) Name of the Partnership Firm - Prajay Binjusaria Estates

(b) Total Capital of the said Firm is Rs. 2055.50 lacs (31-03-2013 Rs. 2685.50 lacs)

(c) Share of each partner in the Profit or Loss

8. The Secured Loan of Rs. 3,200.00 Lacs from Prajay Properties Private Limited is continuing as Interest free by virtue of the agreement Dated 6th October ''2009.

Since some of the statutory approvals for prajay megapolis project are yet to be obtained, crystallization of loan repayment time schedule has not taken place as on 31-03-2014.

9. Previous year''s figures have been recast/restated, to conform to current year classification.


Mar 31, 2013

1. As stated in Note 1(g)(ii) for recognizing profi t on projects, stage of completion is determined as a proportion that project costs incurred for the work performed bear to the estimated total costs. Further, as stated in that note expected loss on projects is recognized when it is probable that the total project costs will exceed the total project revenue. For this purpose total project costs are ascertained on the basis of project costs incurred and costs to completion of projects on progress, which is arrived at by the Management, based on current technical data, forecasts and estimate of net expenditure to be incurred in future including for contingencies etc., which being technical matters have been relied on by auditors. Further, in respect of certain properties where sale agreement has been entered with parties even though money has not been received as per stipulation in the contract, the Company has recognized revenue and debtors as management is confi dent that it shall be able to realize the sale proceeds.

2. As stated in Note.1(g)(iii) the method used to recognize the contract revenue is percentage of completion method measured by survey of work performed. Further, as stated in the note, expected loss on contracts is recognized when it is probable that the total contract cost will exceed the total contract revenue. For this purpose total contract cost is ascertained on the basis of contract cost incurred and cost to completion of contract on progress, which is arrived at by the management, based on current technical data, forecasts and estimate of net expenditure to be incurred in future including for contingencies etc,which being technical matters have been relied on by auditors.

An amount of Rs.9,073.49 lacs (31.03.2012 Rs.999.13 lacs) is recognized as contract revenue by the company during the current fi nancial year. The cost incurred in respect of the above is Rs. 7,821.60 lacs (31.03.2012 Rs.672.91 lacs).

3. Trade Payables – Dues to Micro and small enterprises

Trade payables (Note 8) include Rs. Nil (31.03.2012 Rs. Nil) due to micro enterprises and small enterprises as defi ned under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006).

The company has not received any memorandum (as required to be fi led by the suppliers with the notifi ed authority under the MSMED Act, 2006) claiming their status as micro or small or medium enterprises.

4. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advance) Rs. 384.57 lacs, (31.03.2012: Rs.387.35 lacs); Other commitments Nil (31.03.2012 : Nil).

5. Details as required under Schedule VI - Part I of the Companies Act, 1956 relating to investment in partnership fi rm.

(a) Name of the Partnership Firm - Prajay Binjusaria Estates

(b) Total Capital of the said Firm is Rs.2,685.50 lacs

(c) As at March 31, 2013 the partnership fi rm has not commenced any activities

(d) Share of each partner in the Profi t or Loss

6. The Secured Loan of Rs.3,200.00 Lacs from Prajay Properties Private Limited is continuing as Interest free by virtue of the agreement Dated 6th October ''2009.

7. Previous years fi gures have been recast / restated, to conform to current year classifi cation.


Mar 31, 2012

1. As stated in Note 1(g) (ii) for recognizing profit on projects, stage of completion is determined as a proportion that project costs incurred for the work performed bear to the estimated total costs. Further, as stated in that note expected loss on projects is recognised when it its probable that the total project costs will exceed the total project revenue. For this purpose total project costs are ascertained on the basis of project costs incurred and costs to completion of projects on progress, which is arrived at by the Management, based on current technical data, forecasts and estimate of net expenditure to be incurred in future including for contingencies etc., which being technical matters have been relied on by auditors. Further, in respect of certain properties where sale agreement has been entered with parties even though money has not been received as per stipulation in the contract, the Company has recognised revenue and debtors as management is confident that it shall be able to realize the sale proceeds.

2 As stated in Note 1(g) (iii) the method used to recognize the contract revenue is percentage of completion method measured by survey of work performed. Further, as stated in the note expected loss on contracts is recognised when it is problem that the total contract cost will exceed the total contract revenue. For this purpose total contract cost is ascertained on the basis of contract cost incurred and cost to completion of contract on progress ,which is arrived at by the management, based on current technical data, forecasts and estimate of net expenditure to be incurred in future including for contingencies etc,which being technical matters have been relied on by auditors.

An amount of Rs. 999.13 lacs (31.03.2011 Rs.2327.53 lacs) is recognized as contract revenue by the company during the current financial year. The cost incurred in respect of the above is Rs. 672.91 lacs (31.03.2011 Rs.1439.97 lacs) .

3. Trade Payables - Dues to Micro and small enterprises

Trade payables (Note 8) include Rs. Nil (31.03.2011 Rs. Nil) due to micro enterprises and small enterprises as defined under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006).

The company has not received any memorandum (as required to be filed by the suppliers with the notified authority under the MSMED Act, 2006) claiming their status as micro or small or medium enterprises.

* The company has disputed the liability and replied to the show cause notice, that the short payment of service tax, if any, demanded by the Service Tax Authorities is not maintainable in law.

Further, as per Circular No.108/02/2009-ST, dated 29.01.2009 issued by CBEC, no service tax is payable on the Construction of Complex Service for the impugned period 2006-07 to 2010-11. During the impugned period, the company had deposited with the Service Tax Authorities, whatever service tax collected from the customers.

4 Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advance) Rs. 387.35 lacs, (31.03.2011: Rs.2632.27 lacs), other commitments Nil. (31-03-2011: Nil).

5. Disclosure as required by Accounting Standard 19 - "Leases" notified by the Companies (Accounting Standards) Rules, 2006.

(a) Operating Lease:

i. Where the Company is a Iessee:

The Company's significant leasing arrangements are in respect of operating leases for premises (residences, office, etc.). The leasing arrangements, which are not non-cancellable, range generally between 11 months to 5 years and are usually renewable by mutual consent on agreed terms.

The aggregate lease rents payable are recognized in the Profit and Loss Account for the year and included as Rent (Note 24)

The Company has taken a building under a non-cancellable lease

(b) Hire Purchase:

(i) The Company has taken plant and machinery, motor vehicles under hire purchase arrangements for which the ownership will be transferred to the Company at the end of the hire purchase term.

(ii) Reconciliation between the total of minimum hire purchase payments at the balance sheet date and the present value:

6. (a) Trade Receivables - (Note.no.16) unsecured, considered good, includes Rs. 27,213.09 lacs (31.03.2011 year Rs.26,421.37), outstanding for more than six months. As a result of economic slowdown and recession in realty sector, the realizations from customers are slow.

(b) Revenue from operations (Note 19) Sales Include sale of constructed properties Rs.235.68 lacs wherein sales revenue (in respect of alterations or additional works requested by customers) has been recognized, pending completion of relevant documentation. The company is in the process of completing the documentation in this regard.

(c) Long Term Loans and Advances (Note 13) include advances given to Landlords/ developers towards certain projects amounting to Rs.7,858.42 lacs (31-03-2011: Rs.8,514.32 lacs) and Short Term Loans and Advances (Note 18) to suppliers, etc amounting to Rs.1,205.17 lacs (31-03-2011: Rs.1,671.20 lacs) outstanding from earlier years. Due to long term involvement in such projects, no provision has been considered necessary.

7. Details as required under Schedule VI - Part I of the Companies Act, I956 relating to investment in partnership firm.

(a) Name of the Partnership Firm - Prajay Binjusaria Estates

(b) Total Capital of the said Firm is Rs.2685.50 lacs

(c) As at March 31, 2012 the partnership firm has not commenced any activities

(d) Share of each partner in the Profit or Loss

8. The Secured Loan of Rs.3200.00 Lacs from Prajay Properties Private Limited is continuing as Interest free by virtue of the agreement Dated 6 th October '2009.

9. These financial statements have been prepared in the format prescribed by the Revised Schedule VI to the Companies Act, 1956. Previous years figures have been recast/restated.


Mar 31, 2011

1. As stated in note A (7) (ii) for recognizing profit on projects, stage of completion is determined as a proportion that project costs incurred for the work performed bear to the estimated total costs. Further, as stated in that note expected loss on projects is recognised when it its probable that the total project costs will exceed the total project revenue. For this purpose total project costs are ascertained on the basis of project costs incurred and costs to completion of projects on progress, which is arrived at by the Management, based on current technical data, forecasts and estimate of net expenditure to be incurred in future including for contingencies etc., which being technical matters have been relied on by auditors. Further, in respect of certain properties where sale agreement has been entered with parties even though money has not been received as per stipulation in the contract, the Company has recognised revenue and debtors as management is confident that it shall be able to realize the sale proceeds.

2. As stated in note A(7)(iii) the method used to recognize the contract revenue is percentage of completion method measured by survey of work performed. Further, as stated in the note expected loss on contracts is recognised when it is problem that the total contract cost will exceed the total contract revenue. For this purpose total contract cost is ascertained on the basis of contract cost incurred and cost to completion of contract on progress ,which is arrived at by the management, based on current technical data, forecasts and estimate of net expenditure to be incurred in future including for contingencies etc,which being technical matters have been relied on by auditors.

An amount of Rs. 2327.53 lacs (31.03.2010 Rs.1689.94 lacs) is recognized as contract revenue by the company during the current financial year. The cost incurred in respect of the above is Rs.1439.97 lacs (31.03.2010 Rs.953.26 lacs) .The amount of advances received against these contracts is Rs . Nil.(31.03.2010 Rs. Nil).

3. Sundry Creditors - Dues to Micro and small enterprises

Sundry Creditors (Schedule 11, Current Liabilities and Provisions) include Rs. Nil (31.03.2010 Rs. Nil) due to micro enterprises and small enterprises as defined under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006).

The company has not received any memorandum (as required to be filed by the suppliers with the notified authority under the MSMED Act, 2006) claiming their status as micro or small or medium enterprises.

4. (a) As the Company is not a manufacturing/trading Company, additional information as required under Part II of Schedule VI to Companies Act, 1956 relating to capacities, production, sales, consumption of materials etc., is not applicable to it.

(b) The Company has applied for exemption from giving the quantity wise details of turnover in respect of supply of Accommodation, Food & Beverage and Liquor & Wines, for which approval is awaited.

5. Contingent Liabilities (not provided for)

(Rs. in lacs)

2010-11 2009-10

(a) Guarantees given to Banks on behalf of Prajay Properties Pvt ltd 12130.00 –

6. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advance) Rs. 2632.27 lacs (31.03.2010: Rs.2436.14 lacs).

7. Related Party Disclosures:

Information relating to Related Party Transactions as per Accounting Standard 18 notified by the Companies (Accounting Standards) Rules, 2006.

A. List of Related Parties

Party Relationship

(a) Prajay Holdings Private Limited Subsidiary

Prajay Developers Private Limited Step down - Subsidiary

Prajay Realty Private Limited Subsidiary

Prajay Retail Properties Private Ltd Subsidiary

Prajay Binjusaria Estates Associate

Prajay Properties Pvt Ltd Associate

(b) Key Management Personnel Designation Relatives (Relation)*

Mr. Chandra Mohan Reddy Managing Director Mrs. Hymavathi Reddy (Wife)

Mr. Vijay Sen Reddy Executive Director Mrs. Sharmila Reddy (Wife)

Mr. Ravinder Reddy Director Operations Mr. Hanumanth Reddy (Father)

Mr. K. Ravi Kumar Whole time Director –

Mr. Sumit Sen Whole time Director Mrs. Rina Sen (Wife)

*Relatives of key management personnel with whom there were transactions during the year

(c) Other entities under the control of key management personnel and their relatives

Prajay Financial Services Limited

Prajay Estates Private Limited

Prajay Hotels Limited

Prajay Arnav Shelter Private Limited

Prajay Velocity Developers Private Limited

VijMohan Constructions Private Limited

Prajay Resorts and Amusement Park Limited

Money Tree Entertainment Limited

Prajay Resorts and Hotels Limited

Prajay Township Private Limited

Prajay Techpark Private Limited

Prajay Chit Funds Private Limited

Prajay ARRF Estates Private Limited

Money Tree Investments & Holdings Pvt. Ltd.

Money Tree Life Style Destinations pvt. Ltd

Prajay Constructions Limited

Secunderabad Golf and Leisure Resorts Private Ltd.

Prajay Land Capital Private Limited

Money Tree Media Ventures Private Limited

8. Disclosure as required by Accounting Standard 19 - "Leases" notified by the Companies (Accounting Standards) Rules, 2006.

(a) Operating Lease:

i. Where the Company is a lessee:

The Company's significant leasing arrangements are in respect of operating leases for premises (residences, office, etc.). The leasing arrangements, which are not non-cancellable, range generally between 11 months to 5 years and are usually renewable by mutual consent on agreed terms.

The aggregate lease rents payable are recognized in the Profit and Loss Account for the year and included as Rent (disclosed under Establishment and Other Expenses in Schedule - 16)

(b) Hire Purchase:

(i) The Company has taken plant and machinery, motor vehicles under hire purchase arrangements for which the ownership will be transferred to the Company at the end of the hire purchase term.

9. (a) Sundry Debtors - Schedule 8, unsecured, considered good, includes Rs. 26421.37 lacs, outstanding for more than six months. As a result of economic slowdown and recession in realty sector the realisations from customers are slow.

(b) Loans and Advances - Schedule 10 include advances given to Landlords/developers towards certain projects amounting to Rs. 8514.32 lacs and to suppliers, etc. amounting to Rs. 1671.20 lacs outstanding from earlier years. Due to long term involvement in such projects, no provision has been considered necessary.

10. Details as required under Schedule VI - Part I of the Companies Act, 1956 relating to investment in partnership firm.

(a) Name of the Partnership Firm - Prajay Binjusaria Estates

(b) Total Capital of the said Firm is Rs.2685.50 lacs

(c) As at March 31, 2011 the partnership firm has not commenced any activities

(d) Share of each partner in the Profit or Loss

11. The company has entered into Rupee Facility Agreement with Prajay Properties Private Limited (PPPL) on 22nd August 2008 and taken a Loan of Rs.3200 Lacs in terms of a Facility Agreement dated 17.06.2008 between the PPPL and Lehman Brothers Capital Private Limited. In terms of the revised Rupee Facility Agreement dated 6th October 2009 with PPPL on account of settlement reached by PPPL with the lender Lehman brothers capital Private limited, no Interest is payable on the loan taken from PPPL. However during the year additional security cover has been provided for the loan taken thereby changing the category of the loan to a secured loan and hence depicted accordingly.

12. During the year 97,59,985 Share Warrants were forfeited as the warrant holders did not opt to convert them into equity shares . Consequently the amount of Rs.475.80 Lacs received against these Share warrants have been transferred to Capital Reserve.

13. Previous year figures have been regrouped/reclassified wherever necessary to conform to current year classification.


Mar 31, 2010

1. As stated in note A (7) (ii) for recognizing profit: on projects stage of completion is determined as a proportion that project costs incurred for the work performed bear to the^estimatedtotahDosts. Further, as stated in that noteexpectec[ loss on projects is recognised when it is probable that the total project costs will exceed the total project revenue. For this purpose total project costs are ascertained[on the basis of project costs incurred and costs to corcipletiqn of projects on progress, which is arrived at by the Management, based on current technical data, forecasts and estimate of net expenditure to be incurred in future including for contingencies etc., which being technical matters have been relied on by auditors. Further, in respect of certain properties where sale agreement has been entered with parties even though money has not been received as per stipulation in the contract, the Company has recognised revenue and debtors as management is confident that it shall be able to realize the sale proceeds.

2. As stated in note A (7) (Hi) the method used to recognize the contract revenue is percentage of completion method measured by survey of work performed. Further, as stated in the note expected loss on contracts is recognised when it is probable that the total contract cost will exceed the total contract revenue. For this purpose total contract cost is ascertained on the basis of contract cost incurred and cost to completion of contract on progress, which is arrived at by the Management, based on current technical data, forecasts and estimate of net expenditure to be incurred in future including for contingencies etc., which being technical matters have been relied on by auditors.

An amount of Rs. 1689.94 lacs is recognized as contract revenue by the company during the current financial year. The aggregate amount of costs incurred in respect of contracts in progress as on 31.03.2010 is Rs.953.26 lacs. The amount of advances received against these contracts is Rs.nil.

3. Sundry Creditors - Dues to Micro and small enterprises

Sundry Creditors (Schedule 11, Current Liabilities and Provisions) include Rs. Nil due to micro enterprises and small enterprises as defined underthe Micro, Small and Medium Enterprises Development Act, 2006 (MSJMED Act, 20J36.

The panyhas not received any memorandurn (asjequired to be filed by thie suppliers with thejiotifjed authority under the MSMED Act, 2006) claiming their status as micro or small or medium enterprises.

4. (a) As the Company is not a manufacturing/trading Company, additional information as required under Part II of Schedule VI to Companies Act, 1956 relating to capacities, production, sales, consumption of materials etc., is not applicable to it.

Rs. in Lacs 2009-10 2008-09

5. Contingent Liabilities (Not provided for) Nil Nil

6. Estimated amount of contracts remaining to be executed on capital account and not Provided for (net of advance) ps;2436.74 lara]3lT03.2u0RsTnac

7. Related Party Disclosures:

Information relating to Related Party Transactions as per Accounting Standard 18 notified by the Companies (Accounting Standards) Rules, 2006.

A. List of Related Parties

Party

(a) Prajay Holdings

Private Limited Prajay

Properties Private Limited

Prajay Realty Private Limited

Dillu Cine Enterprises Private Ltd

Prajay Developers Private Limited

Prajay Land Capital Private Limited

Prajay Binjusaria Estates

Relationship

Subsidiary

Subsidiary

Subsidiary

Subsidiary

StepDown Subsidiary

StepDown Subsidiary

Associate

(b) Key Management Personnel

Mr. Chandra Mohan Reddy

Mr. Vijay Sen Reddy

Mr. Ravinder Reddy

Mr. K. Ravi Kumar

Mr.SumitSen



Designation

Managing Director

Executive Director

Director Operations

Whole time Director

Whole time Director

Relatives (Relation)*

Mrs. Hymavathi Reddy (Wife)

Mrs. Sharmila Reddy (Wife)

Mr. Hanumanth Reddy (Father)

Mrs. Rina Sen (Wife)

* Heiatives ot key management personnel witn wnom mere were transactions during trie year (c) Other entities under the control of key management personnel and their relatives

Prajay Constructions Limited

Vijmohan Constructions Private Limited

Prajay Estates Private Limited

Prajay Hotels Limited

Prajay Arnav Shelter Private Limited

Prajay Velocity Developers Private Limited

Prajay Resorts and Amusement Park Limited

Money Tree Entertainment Limited

Money Tree Investment & Holdings Private Limited

Prajay Resorts and Hotels Limited

Prajay Township Private Limited

Prajay Urban Private Limited

Prajay Techpark Private Limited

Prajay Financial Services Limited

Prajay Chit Funds Private Limited

Prajay ARRF Estates Private Limited

Secunderabad Golf and Leisure Resorts Private Limited

Money Tree Media Ventures Private Limited

Money Tree Lifestyle Destinations Private Limited Prajay Binjusaria Estates

8. Disclosure as required by Accounting Standard 19 - "Leases" notified by the Companies (Accounting Standards) rules, 2006.

(a) Operating Lease:

i. Where the Company is a lessee:

The Companys significant leasing arrangements are in respect of operating leases for premises (residences, office, etc.). The leasing arrangements, which are not non-cancellable, range generally between 11 months to 5 years and are usually renewable by mutual consent on agreed terms. The aggregatejease rents^payable are recognized in the Profit and Loss Account for the year and included as Rent (disclosed under Establishment and Other Expenses in Schedule -16)

9. (a) Sundry Debtors - Schedule 8, unsecured, considered good, includes

six months. As a result of economic slowdown and recession in realty sector the realisations from...customers are slow.

(b) Loans and Advances - ScheduleMO include ...advancesi given to Landlords/developers toward amounting to Rs. 8310.62 lacs, outstanding from earlier years. Due to long term involvement in such projects, no provision has been considered necessary

10. Details as required under Schedule VI - Part I of the Companies Act, 1956 relating^investment in partnership firm.

(a) Name of the Partnership Firm - Prajay Binjusaria Estates

(b) Total Capital of the said Firm is Rs.2281.50 lacs

(c) As at March 31,2010 the partnership firm has not commenced any activities

11. The company has entered into Rupee Facility agreement with its subsidiary company Prajay Properties Private Limited on 22nd August ,2008 and taken a loan of Rs.3200 lacs in terms of a facility agreement dated 17.06.2008 between the subsidiary company and Lehman Brothers Capital Private Limited. In terms of Revised Rupee Facility agreement dated 6th October,2009 with the subsidiary company on account of settlement reached by the subsidiary company with the lender Lehman Brothers Capital Private Limited, the company has not provided interest during the current financial year on the loan taken from subsidiary company.

12. Share Warrants represent the amount received against 400 lacs warrants on preferential basis after conversion of 86,35,084 warrants into shares during the year. The warrants are issued at a price of Rs. 19.50 per warrant with a right to apply and be allotted equity shares of the company of Rs. 10 each at a premium of Rs.9.50 per share.

Terms of Issue of Share Warrants on preferential basis:

a. Share warrants can be converted at any time within a period of 18 months from the date of allotment.

b. An amount equal to 25% be payable on allotment and balance amount is payable at the time of conversion.

c. The amount paid as upfront money i.e.25% be forfeited if the conversion is not exercised within 18 months

d. Other terms like lock-in period are as per SEBI guidelines/regulat -ions, as amended from time to time.

13. Previous year figures have been regrouped/ reclassified wherever necessary to conform to current year classification.