Notes to Accounts of Duncan Engineering Ltd.

Mar 31, 2019

I CORPORATE INFORMATION

Duncan Engineering Limited (formerly known as Schrader Duncan Limited) is a manufacturer & trader of fluid power and automation products. The Company has its manufacturing unit & registered office at F-33, MIDC, Ranjangaon, Karegaon, Taluka Shirur, Dist. Pune: 412209 (near Pune City). The Company is a Public Limited Company and is listed on the Bombay Stock Exchange (BSE).

The financial statements (hereinafter referred to as "Financial Statements") of the Company for the year ended March 31, 2019 were approved and authorised for issue by the Board of Directors at their meeting held on May 6, 2019

II BASIS OF PREPARATION

a) Statement of compliance

The Financial Statements of the Company, are prepared in accordance with the Indian Accounting Standards (Ind AS) under the historical cost convention on the accrual basis. The Ind AS are prescribed under section 133 of the Companies Act, 2013, and the relevant provisions thereof.

Accounting policies have been consistently applied except where a newly issued Accounting Standard is initially adopted or a revision to an existing Accounting Standard requires a change in the accounting policy hitherto in use. The Company has prepared these Financial Statements as per the format prescribed in Schedule III to the Companies Act, 2013.

b) Basis of measurement

The financial statements have been prepared on historical cost basis, except for following:

i. Financial assets and liabilities that is measured at Fair value/ Amortised cost;

ii. Non-current assets held for sale - measured at the lower of the carrying amounts and fair value less cost to sell;

iii. Defined benefit plans - plan assets measured at fair value.

c) Functional and presentation currency

Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the Company operates (“the functional currency”). The financial statements are presented in Indian Rupee (‘INR’), which is the Company’s functional currency.

d) Current or Non current classification

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification. An asset is classified as current when it is:

i. Expected to be realized or intended to sold or consumed in normal operating cycle;

ii. Held primarily for the purpose of trading;

iii. Expected to be realized within twelve months after the reporting period; or

iv. Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All the other assets are classified as non-current.

A liability is current when:

i. It is expected to be settled in normal operating cycle;

ii. It is held primarily for the purpose of trading;

iii. It is due to be settled within twelve months after the reporting period; or

iv. There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

The Company classifies all other liabilities as non-current. Deferred Tax Assets and Liabilities are classified as non-current assets and liabilities respectively.

e) Use of judgements and estimates

The preparation of financial statements requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management’s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.

Application of accounting policies that require critical accounting estimates and assumption judgements having the most significant effect on the amounts recognised in the financial statements are:

Measurement of defined benefit obligations;

Recognition of deferred tax assets & MAT credit entitlement;

Useful life and residual value of Property, plant and equipment and intangible assets;

Provision and employee liability for litigation

III NEW STANDARDS/ AMENDMENTS TO EXISTING STANDARDS ISSUED BUT NOTYET ADOPTED

The new Accounting Standards / amendments to existing Accounting Standards issued but not yet effective upto the date of issuance of the Company’s Financial Statements, to the extent applicable to the company, are disclosed below:

1) Ind AS 116- Leases:

On March 30, 2019, Ministry of Corporate Affairs has notified Ind AS 116 “Leases” . Ind AS 116 will replace the existing leases Standard, Ind AS 17 “Leases”. The Standard sets out the principles for the recognition, measurement, presentation and disclosure of leases for the lessor as well as the lessee. Ind AS 116 introduces a single lessee accounting model and requires a lessee to recognize assets and liabilities for all leases with a term of more than twelve months. Currently, operating lease expenses are charged to the statement of Profit & Loss. The Standard also contains enhanced disclosure requirements for lessees. The effective date for adoption of Ind AS 116 is financial year beginning on or after April 1, 2019.

"The standard permits two alternative methods of transition:

a) Full retrospective method - Retrospectively to each prior period presented applying Ind AS 8 Accounting Policies, Changes in Accounting Estimates and Errors."

"b) Modified retrospective method - Retrospectively, with the cumulative effect of initially applying the Standard recognized at the date of initial adoption. Under modified retrospective approach, the lessee records the lease liability as the present value of the remaining lease payments, discounted at the incremental borrowing rate and the right of use asset either as:- Its carrying amount as if the standard had been applied since the commencement date, but discounted at lessee’s incremental borrowing rate at the date of initial adoption or - An amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments related to that lease recognized under Ind AS 17 immediately before the date of initial adoption. "

Certain practical expedients are available under both the methods.

"The Company is currently evaluating the effect of the above amendment to Ind AS 19 on the financial statements."

2) Amendment to Ind AS 12 - Income taxes :

On March 30, 2019, Ministry of Corporate Affairs issued amendments to the guidance in Ind AS 12, ‘Income Taxes’, with regard to accounting for dividend distribution taxes. The amendment stipulates that an entity shall recognise the income tax consequences of dividends in profit or loss, other comprehensive income or equity according to where the entity originally recognised those past transactions or events. Effective date for application of this amendment is financial year beginning on or after April 1, 2019. The Company does not envisage any impact on account of this amendment.

3) Amendment to Ind AS 19 - “ Employee Benefits”

"On March 30, 2019, Ministry of Corporate Affairs issued amendments to Ind AS 19, ‘Employee Benefits’, in connection with accounting for plan amendments, curtailments and settlements. The amendments require an entity: - to use updated assumptions to determine current service cost and net interest for the remainder of the period after a plan amendment, curtailment or settlement; and - to recognise in profit or loss as part of past service cost, or a gain or loss on settlement, any reduction in a surplus, even if that surplus was not previously recognised because of the impact of the asset ceiling. Effective date for application of this amendment is financial year beginning on or after April 1, 2019. The Company is currently evaluating the effect of the above amendment to Ind AS 19 on the financial statements."

(b) Terms/ rights attached to Equity shares

Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts, in proportion to their share holding. There is no restriction on distribution of dividend. However, same except interim dividend is subject to the approval of the shareholders in the Annual General Meeting.

(e) The company has neither issued bonus shares not has bought back any shares during last 5 years

(f) No ordinary shares have been reserved for issue under options and contracts/ commitments for the sale of shares/ disinvestment as at the Balance Sheet date.

(g) No securities convertible into Equity/ Preference shares have been issued by the Company during the year.

(h) No calls are unpaid by any Director or Officer of the Company during the year.

Note No. 3.1 Capital Reserve

The Company pursuant to the scheme of amalgamation acquired Associated Polymers Ltd (100% Subsidiary) with effect from 1st April 2012

As per the accounting treatment of the scheme of amalgamation approved by the Jurisdictional High Court the differential amount between the carrying value of investments and net assets acquired from the transferor companies has been accounted as Capital reserve.

3.2 Other Comprehensive Income

Remeasurement of the defined benefit liability/ (asset) comprises actuarial gain and losses and return on plan assets.

A) Nature of goods and services

The following is a description of principal activities separated by reportable segments from which the Company generates its revenue :

The Company is primarily engaged in the manufacturing/ assembling of fluid power and automation products and generates revenue from the sale of these products and the same is only the reportable segment of the Company.

The Company has adopted Ind AS 115 " Revenue from contracts with Customers" which is mandatory for the reporting periods on or after 1st April, 2018. In terms of the requirement of Ind As -115, revenue is recognized net of discounts and incentives payable customers. Revenue for comparative periods have been adjusted to conform to current period classification.

4. Basic and Diluted Earnings per share :

The company reports basic and diluted earnings per equity share in Accordance with Indian Accounting Standard ''33'', ''Earnings per share''. Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity share outstanding during the year. There is no diluted earning per share as there are no dilutive potential equity shares.

ii) The Tube Valve product line was continuously incurring cash losses and the same was not commercially viable, hence the operations of the said product line were closed on 31st May, 2016. Consequently, the Company had retrenched 57 workmen and provided a liability of Rs.34,29,413 towards the settlement of the dues. The labour union has approached the Hon''ble High Court, Bombay against closure of the tube valve product line and the matter is pending. The Company presently does not expect any additional liability in this regard. However, further adjustments, if any, shall be made on the final outcome of the above matter which is sub judice.

5. Employee Benefits

As per Ind As 19 Employee Benefits, the Company participates in defined contribution and benefit schemes, the assets of which are held (where funded) in separately administered funds. For defined contribution schemes the amount charged to the statements of profit or loss is the total of contributions payable in the year.

a) Defined Contribution Plans

Amount recognized as an expense and included “Contribution to Provident and Other Funds" Rs 53.56 Lakhs (Previous year Rs 49.90 Lakhs).

6. Capital Management

"The Company’s objective to manage its capital is to ensure continuity of business while at the same time provide reasonable returns to its various stakeholders but keep associated costs under control. In order to achieve this, requirement of capital is reviewed periodically with reference to operating and business plans that take into account capital expenditure and strategic investments. Apart from internal accrual, sourcing of capital is done through judicious combination of equity and borrowing, both short term and long term.”

7. (A) Disclosure on Financial Instruments

This section gives an overview of the significance of financial instruments for the Company and provides additional information on balance sheet items that contain financial instruments

The details of significant accounting policies, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised in respect of each class of financial asset, financial liability and equity instrument are disclosed in Note 1 to the financial statements

To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into the three levels prescribed under the Indian Accounting Standard

Financial instruments - Fair values and risk management

Accounting classification and fair value

The following table shows the carrying amount and fair value of financial assets and financial liabilities:

8 (A) FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

Financial risk factors

The Company’s operational activities expose to various financial risks i.e. market risk, credit risk and risk of liquidity. The Company realizes that risks are inherent and integral aspect of any business. The primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. The primary market risk to the Company is foreign exchange rate risk.

1 Credit risk

The Company evaluates the customer credentials carefully from trade sources before appointment of any distributor and only financially sound parties are appointed as distributors. The Company secures adequate deposits from its distributor and hence risk of bad debt is limited. The credit outstanding is sought to be limited to the sum of advances/deposits and credit limit determined by the company. The company have stop supply mechanism in place in case outstanding goes beyond agreed limits.

a) Trade receivables:

Customer credit risk is managed by the Company subject to the Company’s established policy, procedures and control relating to customer credit risk management. Outstanding customer receivables are regularly monitored and major customers are generally secured by obtaining security deposits/bank guarantee or other forms of credit insurance.

2 Liquidity risk

The Company determines its liquidity requirement in the short term and long term. The Company manage its liquidity risk in a manner so as to meet its financial obligations without any significant delay or stress. Such risk is managed through ensuring operational cash flow while at the same time maintaining adequate cash and cash equivalent position. The management has arranged for diversified funding sources and adopted a policy of managing assets with liquidity monitoring future cash flow and liquidity on a regular basis. Besides, it generally has certain undrawn credit facilities which can be assessed as and when required; such credit facilities are reviewed at regular basis

3 Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises two types of risk: interest rate risk and foreign currency risk. Financial instruments affected by market risk include borrowings, trade receivable and trade payable.

i) Currency Risk

The Company Exposed to currency risks to the extent that there is mismatch between the currencies in which sales , purchase and borrowings are denomited in respective functional currency of the company. The company is not exposed to significant currency risks as majority of the transactions are primarily denominated in Indian Rupees, which is the nation currency of the India.

(a) Exposure to currency risk

The summary quantitative data about the Company’s exposure to currency risk as reported to management is as follows

ii) Interest rate risk is the risk that the fair value or future cash flows of the Company’s financial instruments will fluctuate because of changes in market interest rates.

The Company is exposed to risk due to interest rate fluctuation on long term borrowings. Such borrowings are based on fixed as well as floating interest rate. Interest rate risk is determined by current market interest rates, projected debt servicing capability and view on future interest rate. Such interest rate risk is actively evaluated and is managed through portfolio diversification and exercise of prepayment/refinancing options where considered necessary.

The Company is also exposed to interest rate risk on surplus funds parked in fixed deposits . To manage such risks, such investments are done mainly for short durations, in line with the expected business requirements for such funds.

9. Related party disclosure, as required by Indian Accounting Standard-24, is as below:

(A) Name of Related Party and Description of Relationship

(i) Holding Company Oriental Carbon and Chemicals Limited *

(ii) Promoter Duncan International (India) Ltd, Kolkata

(iii) Key Management Personnel: Akshat Goenka - Managing Director (Joined w.e.f. 9th February, 2017)

"* Oriental Carbon and Chemicals Limited and Cosmopolitan Investments Limited has given Corporate Guarantees to Bank (State Bank of India) against all credit facilities."

10. In the Opinion of the management and to the best of its knowledge and belief, the value on realization of current assets, loans, advances and payment of current liabilities and provisions in the ordinary course of business would not be less/ more, than the amount at which they are stated in the Balance sheet.

11. The company had sent letter for confirmation of balance to all major Customers and Vendors. However, no response has been received from the parties in many cases.

12. Previous year figures have been regrouped/rearranged wherever necessary to conform to this year classification.

---

Mar 31, 2018

1. I CORPORATE INFORMATION

Duncan Engineering Limited (formerly known as Schrader Duncan Limited) is a manufacturer & trader of tyre valves and accessories, fluid power and automation products. The Company has its manufacturing unit & registered office at F-33, MIDC, Ranjangaon, Karegaon, Taluka Shirur, Dist. Pune: 412209 (near Pune City). The Company is a Public Limited Company and is listed on the Bombay Stock Exchange (BSE).

II BASIS OF PREPARATION

a) Statement of compliance

These financial statements have been prepared in accordance with the Indian Accounting Standard (''Ind AS'') and other accounting principals generally accepted in India.

The financial statements for all periods up to and including the year ended 31^st March, 2017 were prepared in accordance with Generally Accepted Accounting Principles (GAAP) in India, which includes the accounting standards prescribed under section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules, 2014 and other provisions of the Act (collectively referred to as “Indian GAAP”). These financial statements for the year ended 31^st March, 2018 are the first Ind AS Financial Statements with comparatives, prepared under Ind AS. The Company has consistently applied the accounting policies used in the preparation of its opening Ind AS Balance Sheet as at 1^st April, 2016 throughout all periods presented, as if these policies had always been in effect and are covered by Ind AS 101”First Time Adoption of Indian Accounting Standards”.

An explanation of how the transition to Ind AS has affected the previously reported financial position, financial performance and cash flows of the Company is provided in Note No. 40. Certain of the Company''s Ind-AS accounting policies used in the opening Balance Sheet differed from its Indian GAAP policies applied as at 31^st March, 2016 and accordingly the adjustments were made to restate the opening balances as per Ind-AS. The resulting adjustment arising from events and transactions before the date of transition to Ind-AS were recognized directly through retained earnings as at 1^st April, 2016 as required by Ind- AS 101. The financial statements of the Company for the year ended 31st March, 2018 have been approved by the Board of Directors in their meeting held on 25.05.2018.

b) Basis of measurement

The financial statements have been prepared on historical cost basis, except for following:

i. Financial assets and liabilities that is measured at Fair value/ Amortised cost;

ii. Non-current assets held for sale - measured at the lower of the carrying amounts and fair value less cost to sell;

iii. Defined benefit plans - plan assets measured at fair value.

c) Functional and presentation currency

Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the Company operates (“the functional currency”). The financial statements are presented in Indian Rupee (''INR''), which is the Company''s functional currency.

d) Current or Non current classification

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification. An asset is classified as current when it is:

i. Expected to be realized or intended to sold or consumed in normal operating cycle;

ii. Held primarily for the purpose of trading;

iii. Expected to be realized within twelve months after the reporting period; or

iv. Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All the other assets are classified as non-current.

A liability is current when:

i. It is expected to be settled in normal operating cycle;

ii. It is held primarily for the purpose of trading;

iii. It is due to be settled within twelve months after the reporting period; or

iv. There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

The Company classifies all other liabilities as non-current. Deferred Tax Assets and Liabilities are classified as noncurrent assets and liabilities respectively.

e) Use of judgements and estimates

The preparation of financial statements requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the disclosure of contingent liabilities, at the end of the reporting period. Although these estimates are based on the management''s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.

Application of accounting policies that require critical accounting estimates and assumption judgements having the most significant effect on the amounts recognised in the financial statements are:

Measurement of defined benefit obligations;

Recognition of deferred tax assets & MAT credit entitlement;

Useful life and residual value of Property, plant and equipment and intangible assets;

Provision and employee liability for litigation

(b) Terms/ rights attached to Equity shares

Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts, in proportion to their share holding. There is no restriction on distribution of dividend. However, same except interim dividend is subject to the approval of the shareholders in the Annual General Meeting.

(e) The Company has neither issued bonus shares not has bought back any shares during last 5 years

(f) No ordinary shares have been reserved for issue under options and contracts/ commitments for the sale of shares/ disinvestment as at the Balance Sheet date.

(g) No securities convertible into Equity/ Preference shares have been issued by the Company during the year.

(h) No calls are unpaid by any Director or Officer of the Company during the year.

2. Capital Reserve

The Company pursuant to the scheme of amalgamation acquired Associated Polymers Ltd (100% Subsidiary) with effect from 1st April 2012

As per the accounting treatment of the scheme of amalgamation approved by the Jurisdictional High Court the differential amount between the carrying value of investments and net assets acquired from the transferor company has been accounted as Capital reserve.

2.1 Other Comprehensive Income

Remeasurement of the defined benefit liability/ (asset) comprises actuarial gain and losses and return on plan assets.

Note 3.

Employee Benefits

The Company participates in defined contribution and benefit schemes, the assets of which are held (where funded) in separately administered funds. For defined contribution schemes the amount charged to the statements of profit or loss is the total of contributions payable in the year.

(a) Defined Contribution Plans

Amount recognized as an expense and included “Contribution to Provident and Other Funds” Rs 49.90 Lakhs (Previous year Rs 47.14 Lakhs).

Capital Management

The Company''s objective to manage its capital is to ensure continuity of business while at the same time provide reasonable returns to its various stakeholders but keep associated costs under control. In order to achieve this, requirement of capital is reviewed periodically with reference to operating and business plans that take into account capital expenditure and strategic investments. Apart from internal accrual, sourcing of capital is done through judicious combination of equity and borrowing, both short term and long term.

Note 4 (A)

Disclosure on Financial Instrument

This section gives an overview of the significance of financial instruments for the Company and provides additional information on balance sheet items that contain financial instruments

The details of significant accounting policies, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised in respect of each class of financial asset, financial liability and equity instrument are disclosed in Note 1 to the financial statements

To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into the three levels prescribed under the Indian Accounting Standard

Fair value hierarchy

The section explains the judgment and estimates made in determining the fair values of the financial instruments that are recognised and measured at fair value

The table shown above analyses financial instruments carried at fair value, by valuation method. The different levels have been defined below:

Level 1 This includes financial instruments measured using quoted prices.

Level 2 The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates.

Level 3 If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. There are no transfers between level 1, level 2 and level 3 during the year.

Valuation technique used to determine fair value:

Specific valuation techniques used to value financial instruments include:

The use of quoted market prices

The fair value of forward foreign exchange contracts is determined using forward exchange rates at the balance sheet date (MTM) The fair values for security deposits (assets & liabilities) were based on their carrying values.

FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

Financial risk factors

The Company''s operational activities expose to various financial risks i.e. market risk, credit risk and risk of liquidity. The Company realizes that risks are inherent and integral aspect of any business. The primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. The primary market risk to the Company is foreign exchange rate risk.

1 Credit risk

The Company evaluates the customer credentials carefully from trade sources before appointment of any distributor and only financially sound parties are appointed as distributors. The Company secures adequate deposits from its distributor and hence risk of bad debt is limited. The credit outstanding is sought to be limited to the sum of advances/deposits and credit limit determined by the company. The company have stop supply mechanism in place in case outstanding goes beyond agreed limits.

(a) Trade receivables:

Customer credit risk is managed by the Company subject to the Company''s established policy, procedures and control relating to customer credit risk management. Outstanding customer receivables are regularly monitored and major customers are generally secured by obtaining security deposits/bank guarantee or other forms of credit insurance.

2 Liquidity risk

The Company determines its liquidity requirement in the short term and long term. The Company manage its liquidity risk in a manner so as to meet its financial obligations without any significant delay or stress. Such risk is managed through ensuring operational cash flow while at the same time maintaining adequate cash and cash equivalent position. The management has arranged for diversified funding sources and adopted a policy of managing assets with liquidity monitoring future cash flow and liquidity on a regular basis. Besides, it generally has certain undrawn credit facilities which can be assessed as and when required; such credit facilities are reviewed at regular basis

3 Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises two types of risk: interest rate risk and foreign currency risk. Financial instruments affected by market risk include borrowings, trade receivable and trade payable.

(i) Currency Risk

The Company Exposed to currency risks to the extent that there is mismatch between the currencies in which sales , purchase and borrowings are denomited in respective functional currency of the company. The company is not exposed to significant currency risks as majority of the transactions are primarily denominated in Indian Rupees, which is the nation currency of the India.

(ii) Interest rate risk is the risk that the fair value or future cash flows of the Company''s financial instruments will fluctuate because of changes in market interest rates.

The Company is exposed to risk due to interest rate fluctuation on long term borrowings. Such borrowings are based on fixed as well as floating interest rate. Interest rate risk is determined by current market interest rates, projected debt servicing capability and view on future interest rate. Such interest rate risk is actively evaluated and is managed through portfolio diversification and exercise of prepayment/refinancing options where considered necessary.

The Company is also exposed to interest rate risk on surplus funds parked in fixed deposits . To manage such risks, such investments are done mainly for short durations, in line with the expected business requirements for such funds.

Discontinued Operations

The Company, in its Board meeting held on 16th April 2016 had decided to discontinue its Tube Valve product line as it was incurring cash losses and the same was not commercially viable and the operations of the Tube Valve product line were closed on 31st May, 2016. Consequently, for the purpose of Discontinued operations, tangible assets, current assets and current liabilities, others etc. related to Tube Valve product line were identified. The company has disclosed information to the extent identifiable in compliance with the requirement of Indian Accounting Standard AS-105 on Non current Assets Held for Sale and Discontinued Operations

* As per the present system of maintenance of books of accounts the relevant records do not provide clearly identifiable cash flow from operating activities / Investing activities / Financing Activities pertaining to this product line and hence the same has not been disclosed above.

The Company has recognised Profit on sale of assets of Rs.441268 (PY- Loss Rs.38,34,447) arising out of disposal/ discontinued operations of said product line.

In view of the above discontinued operation, Company has retrenched 57 workmen and provided a liability of Rs.34,29,413 during the Previous financial year based on statutory dues payable. The labour union has approached the Hon''ble High Court, Bombay against closure of the tube valve product line and the Company does not expect any additional liability in this regard.

Note 5.

First Time Adoption of IndAS

As stated in Note 1(II)(a), these are the Company''s first financial statements prepared in accordance with Ind AS

The accounting policies set out in Note 1 have been applied in preparing the financial statements for the year ended March 31, 2018, the comparative information presented in these financial statements for the year ended March 31, 2017 and in the preparation of an opening Ind AS statement of financial position at April 1 2016 (the Company''s date of transition). In preparing its opening Ind AS statement of financial position, the Company has adjusted amounts reported previously in financial statements prepared in accordance with Indian GAAP (previous GAAP). An explanation of how the transition from previous GAAP to Ind AS has affected the Company''s financial position, financial performance and cash flows is set out in the following tables and the notes that accompany the tables.

Exemptions and exceptions applied:

Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.

(A) Ind AS optional exemptions:

(i) Property, plant and equipment & Intangible assets

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets.

Accordingly, the Company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value.

(B) Ind AS mandatory exceptions

(i) Estimates

An entity''s estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

Ind AS estimates as at April 1, 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP The Company made estimates that were consistent in conformity with previous GAAP.

(ii) Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification of financial assets on the basis of facts and circumstances existing as on the date of transition. Accordingly the Company has determined the classification of Financial Assets based on the facts and circumstances exist as on the date of transition

(C) Transition to IND AS - Reconciliations

The following reconciliations provide the explanation and qualification of the differences arising from the transition from Previous GAAP to Ind AS in accordance with Ind AS 101 “First Time Adoption of Indian Accounting Standards”.

(i) Reconciliation of material items of Balance sheet as at 1st April, 2016 (Transition Date) and as at 31st March, 2017

(ii) Reconciliation of Statement of Profit & Loss for the year ended 31st March, 2017

(iii) Reconciliation of total equity as at April 1, 2016 and March 31, 2017

(iv) Reconciliation of total comprehensive income for the year ended March 31, 2017.

(v) Reconciliation of statement of cash flows for the year ended March 31, 2017.

(D) Notes to first-time adoption:

(i) Investments (Non-Current & Current)

For investment in Equity Instrument, company has elected to fair value through Profit and Loss (FVTPL)

(ii) Excise Duty

Paragraph 8 of Ind AS 18, Revenue states that ‘Revenue includes only the gross inflows of economic benefits received and receivable by the entity on its own account. Amounts collected on behalf of third parties such as sales taxes, goods and services taxes and value added taxes are not having any economic benefits which flow to the entity and do not result in increases in equity. Therefore, they are excluded from revenue and shown separately.

(iii) Remeasurement of post-employment benefit obligations

Under Ind AS, remeasurement i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognised in other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurement were forming part of the profit or loss for the year.

Basic and Diluted Earnings per share :

The company reports basic and diluted earnings per equity share in Accordance with Indian Accounting Standard ‘33'', ‘Earnings per share''. Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity share outstanding during the year. There is no diluted earning per share as there are no dilutive potential equity shares.

In the Opinion of the management and to the best of its knowledge and belief, the value on realization of current assets, loans, advances and payment of current liabilities and provisions in the ordinary course of business would not be less/ more, than the amount at which they are stated in the Balance sheet.

Note 6.

Previous year figures have been regrouped/rearranged wherever necessary to confirm to this year classification.

---

Mar 31, 2015

1. Terms/ rights attached to Equity shares

Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts, in proportion to their share holding. There is no restriction on distribution of dividend. However, same except interim dividend is subject to the approval of the shareholders in the Annual General Meeting.

2. Schrader Duncan Limited

Notes to the Financial Statements for the year ended 31st March, 2015 Significant Accounting policies and Notes to Accounts

3. Corporate Information

Schrader Duncan Limited is a manufacturer of tyre tube valves and accessories and fluid, power and automation products. The Company has its manufacturing unit situated in Ranjangaon (near Pune). The Company is a Public Limited Company and is listed on the Bombay Stock Exchange (BSE).

As at As at 31st March, 2015 31st March, 2014

Rs. Rs.

4. Contingent Liabilities:

(a) Guarantees given by the Bank on behalf of the Company. These are financial 3,853,483 4,754,898 and performance guarantees given to the customers, expiring on various

future dates.

(b) Claims against the Company with respect to Sales Tax Matters not 6,679,879 7,418,032 acknowledged as debts.

(c) Claims against the Company with respect to Excise and Service Tax Matters not acknowledged as 3,967,557 3,967,557 debts. Appeals filed by the Company with CESTAT, West Zone Bench, and Additional Commissioner of Central Excise Mumbai, is pending disposal.

14,500,919 16,140,487

There are no litigation against the company which can lead to possible potential liabilities.

5. Other Notes on Accounts

i. Tax Provision :

Based on evaluation of its tax provisions and considering the development and order received during the year, the company has reversed excess provision for tax relating to earlier years amounting to Rs.1,83,10,094 for AY 2007-08 and has accounted potential interest income on Income Tax Refund for the A.Y. 2004-05 & AY 2012-13 of Rs. 18,50,000/- & Rs. 5,70,000/- respectively, based on opinion received from Company's Tax Advisor.

ii. Sales Tax liability

During the year based on evaluation of the sales tax proceedings the company has written off Rs. 52,02,339/- for FY 2009-10 & Rs. 12,87,342/- for FY 2010-11 and the same has been charged under the head "Rates & Taxes", and accordingly figures for the current year are not comparable to the previous year to this extent.

iii. Provision for Doubtful debts

During the year, company has made provision for Doubtful debts of Rs. 79,34,503/- (which includes of single debtors amounting to Rs. 72,57,721/-) and accordingly figures for the current year are not comparable to the previous year to this extent.

iv. Depreciation

Effective April 1, 2014, pursuant to and in line with the requirements of Part C of Schedule II of the Companies Act, 2013 during the year ended March 31, 2015; the Company has reviewed its policy of providing for depreciation on its Tangible & Intangible fixed assets and also reassessed their useful lives. As a result the following changes with respect to provision for depreciation have been effected;

a) In respect of assets where remaining useful life as on April 1, 2014 is 'Nil', their carrying amounts after retaining the residual value, if any, aggregating to Rs 5,95,022/-, has been adjusted in the current year depreciation & amortisation and is charged to the Statement of Profit & Loss.

b) In respect of other assets, depreciation is provided under the Straight Line Method (SLM). Based on the revised useful life as per Schedule II of the Companies Act, 2013 / estimated useful life determined by the Management. Their carrying amount as at April 1, 2014 is depreciated over their useful lives. Pursuant to this, the depreciation for the year ended March 31, 2015 is higher by Rs 72,78,811/-.

v. Related Party Disclosures (As identified by the Management)

A) Relationships :

(a) Holding Company

Oriental Carbon and Chemicals Limited *

(b) Key Management Personnel:

Mr. Shantanu Parvati - Managing Director

* Oriental Carbon and Chemicals Limited and Cosmopolitan Investments Limited has given corporate Guarantees to B (State Bank of India) against all credit facilities.

vi. In the Opinion of the management and to the best of its knowledge and belief, the value on realization of current assets, loans, advances and payment of current liabilities and provisions in the ordinary course of business would not be less/ more, than the amount at which they are stated in the Balance sheet.

vii. Previous year figures have been regrouped/rearranged wherever necessary to conform to this year classification.

---

Mar 31, 2014

Corporate Information

Schrader Duncan Limited is a manufacturer of tyre tube valves and accessories and fluid, power and automation products. The Company has its manufacturing unit situated in Ranjangaon (near Pune). The Company is a Public Limited Company and is listed on the Bombay Stock Exchange (BSE).

(a) Terms/ rights attached to Equity shares

Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the company, the holders of 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. There is no restriction on distribution of dividend. However, same except interim dividend is subject to the approval of the shareholders in the Annual General Meeting.

(b) There are no amounts due and outstanding to be credited to Investor Education and Protection Fund under section 205C of the Companies Act, 1956 as at the year end.

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

Note 1

Contingent Liabilities:

(a) Claims against the Company - 1,278,698 with respect to Income Tax Matters not acknowledged as debts. Appeals filed by the Company with the relevant authorities of Income Tax Department are pending disposal.

(b)Guarantees given by the Bank on 4,754,898 3,227,027 behalf of the Company. These are financial and performance guarantees given to the customers, expiring on various future dates.

(c)Claims against the Company 7,418,032 1,603,537 with respect to Sales Tax Matters not acknowledged as debts.

(d) Claims against the Company 3,967,557 2,147,830 with respect to Excise and Service Tax Matters not acknowledged as debts. Appeals filed by the Company with CESTAT, West Zone Bench, and Additional Commissioner of Central Excise Mumbai, is pending disposal.

16,140,487 8,257,092

Note 2

Surrender of Office premises

During the year, the company has entered into Deed of Surrender dated 24th March, 2014 for transfer of its office premises at WTC, Mumbai. The company has recognized profit on transfer of office premises amounting to Rs.26,990,582 as an exceptional item.

Note 3

Tax Provision :

Based on evaluation of its tax provisions, the company has reversed excess provision for tax relating to earlier years amounting to Rs. 877,704

Note 4

Sales Tax liability

a) During the year company has written back an amount of Rs. 31,95,499 for pending C form liabilities for the year 2006-07 as the same has been time barred.

b) During the year company has conducted an evaluation of its sales tax liabilities and has written back an amount of Rs. 41,75,509 for excess provision created in earlier years.

* The value of consumption of raw materials has been arrived at on the basis of Opening Stock plus Purchases less Closing Stock. The consumption, therefore, includes adjustments for raw materials written-off, shortage / excess etc.

Note 5

In the Opinion of the management and to the best of its knowledge and belief, the value on realization of current assets, loans, advances and payment of current liabilities and provisions in the ordinary course of business would not be less/ more, than the amount at which they are stated in the Balance sheet.

Note 6

Previous year figures have been regrouped/rearranged wherever necessary to conform to this year classification.

---

Mar 31, 2013

Note 1

Corporate Information

Schrader Duncan Limited is a manufacturer of tyre tube valves and accessories and pneumatic products. The Company has its manufacturing unit situated in Ranjangaon (near Pune). The Company is a Public Limited Company and is listed on the Bombay Stock Exchange (BSE).

Note 2

Scheme of Amalgamation

(a) A Scheme of Amalgamation of Associated Polymers Limited (APL) herein after (referred to as "Transferor company") and Schrader Duncan Limited (the Company or SDL) and their respective shareholders, under section 391 to 394 of the companies Act, 1956 ("the scheme") has been sanctioned by the Hon''ble Court of Judicature at Bombay (vide its order dated 18th April, 2013).

(b) The Scheme became effective on 17th May 2013 ("effective date") on filing of the certified copies of the Orders with the Registrar of companies. The Appointed date from which the Scheme is operative is 1st April 2012 (the "Appointed Date").

(c) APL was engaged in the business of processors of all kind of rubber whether natural and/or synthetic and/or reclaimed and/or PVC and/or Polyethylene and/or resins and/or celluloid and/or other substitutes thereof.

(d) Consequent to the Scheme becoming effective from the Appointed date, the entire business and undertaking of the transferor company including all assets, debts, liabilities, duties and obligations have, without further act, instrument or deed, but subject to the charges affecting the same as on the effective date, been transferred and vested in the company. On the scheme becoming effective, all Staff, workmen and employees of the transferor company in service on the effective date, are deemed to have become staff, workmen and employees of the company.

(e) During the period from the Appointed date to the effective date, the transferor company have been deemed to have carried out their respective business and activities for and on account of and in trust for the company. Accordingly, the revenue from operations and profit before tax of the transferor company for the year ended 31 March ''2013 are included in the financial statements.

(f) In terms of the Scheme, the company has accounted for the amalgamation based on the ''Pooling of Interest'' method as under:

(i) All the assets and liabilities recorded in the books of the transferor company have been recorded by the company at their respective book values; the amount of inter-company balances have been cancelled. (ii) APL being a wholly owned subsidiary of the company, no fresh shares are required to be issued and the Investments of

SDL in APL stands cancelled. (iii) The surplus arising between the aggregate values of assets of the transferor company acquired, net of the ggregate of the liabilities of the transferor companies, has been recorded as capital reserve of the Company based on the Court Order as under:

Note 3

Voluntary Retirement of Service

(i) During the year, the company has completed the process of shifting the manufacturing operations of Mahape to Ranjangoan for rationalisation and consolidation of its operations dated 9th January 2013 based on the Memorandum of settlement with the union of workmen employed at Mahape total liability of Rs. 10,496,600 (including the incremental settlement liability of Rs. 9,296,600) has been accounted during the year as exceptional item.

(ii) During the year, the company has also completed the process of shifting the manufacturing operations of its rubber mixing operations from MIDC Tarapur to Ranjangoan for rationalisation and consolidation of its processes dated 19th October, 2012 based on the settlement with the workers employed at MIDC, Tarapur total liability of Rs. 3,701,362 (including the incremental settlement liability of Rs. 3,291,954) has been accounted during the year as exceptional item.

Note 4 Sale of Land

During the year, the company has entered into an MOU dated 27th September, 2012 for transfer of its land at MIDC, Tarapur. The permission from MIDC for transfer of Land was received during the year. The company considers risks and rewards relating to the transaction to have been transferred and has accordingly recognized profit on transfer of land amounting to Rs. 44,775,921.

Note 5

Tax Provision :

Based on evaluation of its tax provisions, the company has reversed excess provision for tax relating to earlier years amounting to Rs. 18,617,713 and recognized MAT credit entitlement of Rs. 8,531,787 during the year.

Note 6

Sales Tax liability

During the year company has received Sales Tax Assessment order for the year 2005-06 and 2008-09. The company is still receiving some C forms and went into the Appeal. On Prudence basis of accounting, company has during the year provided Rs 7,661,648/- as potential sales tax liability for the four years consisting of 2005-06,2006-07,2007-08 and 2008-09. This amount has been debited to Rates and Taxes and shown as other current Liabilities.

Note 7

Disclosures under Accounting Standards 15

(A) Defined Contribution Plans

a. Provident fund

b. Superannuation fund

c. State defined contribution plans

- Employers'' Contribution to Employees'' State Insurance

- Employers'' Contribution to Employees'' Pension Scheme 1995

The provident fund and the state defined contribution plan are operated by the Regional Provident Fund Commissioner and the superannuation fund is administered by the trustees of Schrader Duncan Limited. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognised by the Income tax authorities.

Note 8

Related Party Disclosures (As identified by the Management)

A) Relationships:

(i) Holding Company

Oriental Carbon and Chemicals Limited *

(ii) Associate Company Cosmopolitan Investments Limited *

(iii) Erstwhile Subsidiary of the Company: ( merged with effect from 1st April, 2012) Associated Polymers Limited

(iv) Key Management Personnel:

Mr. Shantanu Parvati - Managing Director

* Oriental Carbon and chemicals Limited and Cosmopolitan Investments Limited has given corporate Guarantees to Bank (State Bank of India) against all credit facilities.

Note 9

Basic and Diluted Earnings per share :

The company reports basic and diluted earnngs per equity share in Accordance with AS-20, ''Earnings per share''. Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity share outstanding during the year. There is no diluted earning per share as there are no dilutive potential equity shares.

Note 10

In the Opinion of the management and to the best of its knowledge and belief, the value on realization of current assets, loans, advances and payment of current liabilities and provisions in the ordinary course of business would not be less/ more, than the amount at which they are stated in the Balancesheet.

---

Mar 31, 2012

1. General Information

Schrader Duncan Limited is a manufacturer of tyre tube valves and accessories and pneumatic products. The Company has two manufacturing units situated in Ranjangaon (near Pune) and Mahape (Navi Mumbai). The Company is a Public Limited Company and is listed on the Bombay Stock Exchange (BSE).

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

The Company has issued one class of equity shares having a face value of Rs. 10 per share. Each shareholder has right to vote in respect of such share, on every resolution placed before the Company and his voting right on a poll shall be in proportion to his share of the paid-up equity capital of the Company. In the event of liquidation, the equity shareholders are entitled to receive the remaining assets of the Company after payments to secured and unsecured creditors, in proportion to their shareholding.

(b) Chage in Shareholding :

However, subsequent to the year end on April 01, 2012, Schrader Bridgeport International Inc, USA opted to exit the joint venture and sold their entire stake comprising 50% of the share capital to the Indian Promoter (Oriental Carbon and Chemicals Limited).

(a) Details of security for the Secured Short-term borrowings :

Cash Credit and Foreign Currency Demand Loan is secured by First hypothication charge on the company's entire current assets, present and future, First charge on Company's movable fixed assets at Mahape Plant, Extension of First charge on tangible Fixed assets at Ranjagaon, Pune. Further by Corporate Guarantees of (i) Tomkins Pic, London and (ii) Cosmopolitan Investments Ltd.

(a) There are no amounts due and outstanding to be credited to Investor Education and Protection Fund under section 205C of the Companies Act, 1956 as at the year end.

The above information regarding Micro and Small enterprises has been determined on the basis of information available with the Company.

Disclosures under Accounting Standards 15

(A) Defined Contribution Plans

a. Provident fund

b. Superannuation fund

c. State defined contribution plans

- Employers' Contribution to Employees' State Insurance

- Employers' Contribution to Employees' Pension Scheme 1995

The provident fund and the state defined contribution plan are operated by the Regional Provident Fund Commissioner and the superannuation fund is administered by the trustees of Schrader Duncan Limited. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognised by the Income tax authorities.

(D) The Liability for leave encashment and compensated balances as at year end is Rs. 2,096,742 (Previous Year Rs. 1,293,885).

* The value of consumption of raw materials has been arrived at on the basis of Opening Stock plus Purchases less Closing Stock. The consumption, therefore, includes adjustments for raw materials written-off, shortage /excess etc.

111. Notes:

a) The company is organised into two main business segments -

- Automotive products- comprising of tyre tube valves and accessories.

- Pneumatic products - comprising of pneumatic equipment and hydraulic products.

Segments have been identified and reported taking into account, the nature of products and services, the differing risks and returns, the organisation structure and the internal financial reporting systems.

b) The segment revenue in the geographical segments considered for disclosure are as follows:

- Revenue within India includes sales to customers located within India and earnings in India.

- Revenue outside India includes sales to customers located outside India and earnings outside India.

c) Segment Revenue, Results, Assets and Liabilities include the respective amounts identifiable to each of the segments and amounts allocated on a reasonable basis.

Note 2

Related Party Disclosures (As identified by the Management]

A) Relationships:

(i) Investing Companies

a. Schrader Bridgeport International, Inc.

b. Cosmopolitan Investments Limited @

(ii) Associate Companies /Affiliates

a. Tomkins Pic, London @

b. Gates India Pvt. Ltd.

c. Gates Corporation, USA

d. Gates Corporation, Germany

e. Schrader International - Brazil

f. Schrader S.A.S France

g. Schrader Engineering Product - China

h. Gates Unitta Asia Trading Company Pte Ltd. - Singapore

(iii) Subsidiary of the Company: Associated Polymers Limited

(iv) Key Management Personnel:

Mr. Shantanu Parvati - Managing Director

@ Tomkins Pic, London and Cosmopolitan Investments Limited has given corporate Guarantees to Bank (State Bank of India) against all credit facilities.

Note: Figures in italics represents previous year figures.

Note 3

Contingent Liabilities:

(a) Claims against the Company with respect to Income Tax Matters not acknowledged as debts is Rs. 6,874,536 (Previous Year: Rs. 13,312,357). Appeals filed by the Company with the relevant authorities of Income Tax Department are pending disposal.

(b) Guarantees given by the Bank on behalf of the Company are Rs. 3,843,211 (Previous Year: Rs. 3,786,119). These are financial and performance guarantees given to the customers, expiring on various future dates over the next 26 months.

(c) Claims against the Company with respect to Sales Tax Matters not acknowledged as debts is Rs. 3,323,124 (Previous Year: Rs. 3,323,124).

(d) Claims against the Company with respect to Excise and Service Tax Matters not acknowledged as debts is Rs. 2,590,790 (Previous Year: Rs. 2,590,790). Appeals filed by the Company with Customs, Excise and Service Tax Appellate Tribunal, West Zone Bench, and Commissioner of Central Excise (Appeals) Mumbai, is pending disposal.

Note 4

Capital and other commitments:

Outstanding commitments for capital expenditure (net of advance) Rs. 404,279 (Previous Year: Rs. 3,038,012).

Net Deferred Tax Liability (a-b) _

* on consideration of prudence the Company has accounted deferred tax asset only to the extent of liability.

Note 5

The Company had, on March 26, 2011, entered into an agreement for sale-cum-development of its land at Mulund Plant. During the current year, the Company has met all its obligations as a seller except for completing the administrative process for mutation for a small portion of land in its name. The Company is of the view that all significant risks and rewards in respect of the said land have been transferred to the buyer which has been adequately supported by a legal opinion and accordingly Profit on Sale of land amounting to Rs. 4,190.32 lacs has been recorded during the year ended March 31, 2012 and disclosed as exceptional item. Out of the total sales consideration, the Company is yet to receive an amount of Rs. 2,193.52 lacs and same has been disclosed in the financial statements as at March 31, 2012 under the head "Other Current Assets".

Note 6

The financial statements for the year ended March 31, 2011 had been prepared as per the then applicable, pre-revised Schedule VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended March 31, 2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification.The adoption of Revised Schedule VI for previous year figures does not impact recognition and measurement principles followed for preparation of financial statements.

---

Mar 31, 2011

1. Duty Entitlement Pass Book (DEPB) Credit:

Dunng the year the Company has recognised DEPB credit aggregating Rs. 89,353 on post export basis (Previous Year: Rs. 322,511).

2. Outstanding commitments for capital expenditure (net of advance) Rs. 3,038,012 (Previous Year: Rs. 3,856,675).

3. The amount of foreign exchange difference in respect of exchange contracts to be recognised in the subsequent years Rs. 178,986 (Previous Year: Rs. 74,671).

4. Contingent Liabilities:

a) Claims against the Company with respect to Income Tax Matters not acknowledged as debts is Rs. 13,312,357 (Previous Year: Rs. 13,749,472). Appeals Hied by the Company with the relevant authorities of Income Tax Department are pending disposal.

b) Guarantees given by the Bank on behalf of the Company are Rs. 3,786,119 (Previous Year: Rs. 2,456,608). These are financial and performance guarantees given to the customers, expiring on various future dates over the next 26 months.

c) Claims against the Company with respect to Sales Tax Matters not acknowledged as debts is Rs. 3,323,124 (Previous Year : Rs. 3,323,124).

d) Claims against the Company with respect to Excise and Service Tax Matters not acknowledged as debts is Rs. 2,590,790 (Previous Year: Rs. 3,080,113). Appeals filed by the Company with Customs, Excise and Service Tax Appellate Tribunal, West Zone Bench, and Commissioner of Central Excise (Appeals) Mumbai, is pending disposal.

5. Taxation

(a) In view of loss for the year no provisions for taxation has been made in these financial statements.

(b) Deferred Tax:

6 Licenced capacity, Installed capacity, Production during the year and opening and closing stocks of goods produced is given in Annexure A.

7. Related Party Disclosure (As identified by the Management)

Related party disclosure as required by AS-18, "Related Party Disclosure", are given below:

A) Relationships:

(i) Investing Companies

a. Schrader Bridgeport International, Inc.

b. Cosmopolitan Investments Limited @

(ii) Associate Companies/Affiliates

a. Tomkins Pic, London @

b. Gates India Pvt. Ltd.

c. Gates Corporation, USA

d. Gates Corporation, Germany

e. Schrader International - Brazil

f. Schrader S.A.S France

g. Schrader Engineering Product - China

h. Gates Unitta Asia Trading Company Pte Ltd. - Singapore

(iii) Subsidiary of the Company:

Associated Polymers Limited

(iv) Key Management Personnel:

Mr Ravi Swaminathan - Managing Director

@ Tomkins Plc, London and Cosmopolitan Investments Limited has given corporate Guarantees to Bank (State Bank of India) against all credit facilities.

C) Remuneration paid to Key Management Personnel is disclosed in Note 7 (a) above.

8. The amount of excise duty disclosed as deduction from turnover is the total excise duty for the year except for the excise duty related to the difference between the closing stock and opening stock and excise duty paid but not recovered, which has been disclosed as excise duty expenses in "Other Expenses" under Schedule 12 forming part of the Profit and Loss Account.

9. The Company has classified various employee benefits as under: (A) Defined Contribution Plans

a. Provident fund

b. Superannuation fund

c. State defined contribution plans

- Employers Contribution to Employees State Insurance

- Employers Contribution to Employees Pension Scheme 1995

The provident fund and the state defined contribution plan are operated by the Regional Provident Fund Commissioner and the superannuation fund is administered by the trustees of Schrader Duncan Limited. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognised by the Income tax authorities.

(C) Disclosure as required under para 120(n);

Since the Company has adopted AS - 15 for the first time during the financial year ended March 31, 2008, hence the disclosure for gratuity figures as required by para 120(n) of AS -15 have not been presented for the financial year prior to 2007-2008.

(D) The Liability for leave encashment and compensated balances as at year end is Rs.1,293,885 (Previous Year Rs. 2,902,659).

10. Segment information for the year ended March 31, 2011

III. Notes:

a) The company is organised into two main business segments -

- Automotive products- comprising of tyre tube valves and accessories.

- Pneumatic products - comprising of pneumatic equipment and hydraulic products.

Segments have been identified and reported taking into account, the nature of products and services, the differing risks and returns, the organisation structure and the internal financial reporting systems.

b) The segment revenue in the geographical segments considered for disclosure are as follows:

- Revenue within India includes sales to customers located within India and earnings in India.

- Revenue outside India includes sales to customers located outside India and earnings outside India.

c) Segment Revenue, Results, Assets and Liabilities include the respective amounts identifiable to each of the segments and amounts allocated on a reasonable basis.

11. The Company has entered into an irrevocable agreement for sale dated March 26, 2011 with Kalpataru Ltd. for sale of its front portion of land at Mulund plant at a consideration of Rs. 438,889,350. As per the agreement, the Company has received an advance of Rs. 160,000,000 which is disclosed under schedule 8 "Current Liabilities and Provisions". The Company is in the process of executing the deed of conveyance, transfer, sale and possession of the aforesaid land will be completed at a future date subject to relevant approval, permissions from the Government and other statutory bodies, as deemed necessary and on receipt of sale consideration.

12. Exceptional Items

(i) The Company has entered into agreement dated July 15, 2010, with the unionised category of workmen and staff employed in the plant at Mulund for Voluntary Retirement Compensation. Accordingly, the Company has incurred an expenses of Rs. 145,720,474 for VRS and other related expenses. The operations for Mulund plant have been ceased completely w.e.f July 31, 2010.

(ii) Exceptional expenses represents legal and professional fees incurred by the Company of Rs. 9,029,300 for sale of land of its land at Mulund plant.

(iii) Exceptional Income of Rs. 20,000,000 represents compensation received by the Company for sale of rear portion of land at Mulund which were on hold in accordance with the agreement for Development dated December 22, 2006.

13. Previous Years figures have been re-grouped/re-arranged, wherever necessary.

---

Mar 31, 2010

1 Duty Entitlement Pass Book (DEPB) Credit:

During the year the Company has recognised DEPB credit aggregating Rs.322,511 on post export basis (Previous Year: Rs.651,839).

2. Outstanding commitments for capita! expenditure (net of advance) Rs.3,856,675 (Previous Year: Rs. 123,068,744)

3. The amount of foreign exchange difference In respect of exchange contracts to be recognised In the subsequent years Rs. 74,671 (Previous Year: Rs.148,710).

4. Contingent Liabilities

a) Claims against the Company with respect to Income Tax Matters not acknowledged as debts Is Rs. 13,749,472(Previous Year: Rs. 1,584,649) .Appeals filed by the Company with the relevant authorities of Income Tax Department are pending disposal.

b) Guarantees given by the Bank on behalf of the Company are Rs. 2,456,608 (Previous Year: Rs. 1,723,399). These are financial and performance guarantees given to the customers, expiring on various future dates over the next 30 months.

c) Claims against the Company with respect to Sales Tax Matters not acknowledged as debts is Rs. 3,323,124 (Previous Year: Rs. 205,219).

d) Claims against the Company with respect to Excise and Service TAX Matters not acknowledged as debts is Rs.3,080,113 (Previous Year : Rs. 3,307,078). Appeals filed by the Company with Customs, Excise and Service Tax Appellate Tribunal, West Zone Bench, and Commissioner of Central Excise (Appeals) Mumbal, is pending disposal.