Notes to Accounts of Shree Precoated Steels Ltd.

Mar 31, 2014

1. Corporate Information

Shree Precoated Steels Limited is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on one stock exchanges in India. The company engaged in the Manufacturing, Processing, Trading of Steel Products and Real Estate business.

2. Employee Benefit

Consequent to Revised Accounting Standards 15 (AS-15) "Employee Benefits" read with guidance note on implementation of AS-15 issued by Institute of Chartered Accountants of India, effective from April 1,2007, the company has reviewed and revised its accounting policy in respect of employee benefits.

3. Segment Information:

The Company primarily deals in the business of Real Estate and hence there is no Primary reportable segment in the context of Accounting Standard -17 issued by Institute of Chartered Accountants of India (ICAI).

4. Related Party Disclosures:

The related party and relationships, as identified by the Management and relied upon by the Auditors, with whom transactions have taken place during the year ended are:

a. List of related parties and their relationship:

Name of the Party Relationship

A.G. Estate Private Limited Associate

Ajmera Cement Private Limited Associate

Ajmera Realty & Infra India Ltd. Associate

Ajmera Housing Corporation Banglore Associate

Ajmera Housing Corporation Associate

Ajmera Steel Strips Limited Associate

Ajmera Water N Amusement Park Private Limited Associate

Bombay Freezco Private Limited Associate

Jolly Brothers Private Limited Associate

Vijay NagarAppartment Associate

Rushabh Investments Pvt. Ltd. Associate

Yogi Nagar Vasahat Private Limited Associate

Four Brothers Associate

Nilkanth Tech Park Private Limited Associate

b. Directors and their relatives:

Name of the Party Relationship

Shri Rajnikant S. Ajmera Relative

Shri Ra nikant S. Amera - HUF Relative

Shri Ishwarlal S. Ajmera Chairman & Managing Director

Shri Ishwarlal S. Ajmera - HUF Relative

Shri Sanjay C Ajmera Managing Director

Late Shri Bhogilal S. Ajmera Relative

Shri Natwarlal S. Ajmera Relative

Shri Shashikant S. Ajmera Relative

Late Shri Surendra I. Ajmera Relative

Shri. Manoj I. Ajmera Relative

Shri. Jayant I. Ajmera Relative

Shri. Atul C. Ajmera Relative

Smt. Bharati R Ajmera Relative

Shri. Dhaval R. Amera Director

5. Contingent Liabilities

Contingent Liabilities not provided for in respect of :

Name of Statute Nature of Dues Amount period to Forum where (Rs.in Lacs) which pending Amount relates

Service Tax GTA of Services 22.85 2005 -06 Appeal has been filed in CES TAT.

Service Tax Cenvat credit on 95.84 2006-07& Appeal has Service Tax filed in CES TAT.

Arbitration Damages for 338.71 2005-06 Mumbai High Award non Supply of Court goods

6. Disclosure under Micro, Small and Medium Enterprises Development Act, 2006:

There are no delays in payment to Micro and Small enterprises as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006.The above information and that given in Note No. 8 regarding Micro and Small enterprises has been determined to the extent such parties have been identified on the basis of information available with the company. This has been relied upon by the auditors.

7. Extra Ordinary items:

During the year company has written back old liability which is not payable amounting to Rs 4700 lacs and the company has also written off Rs 1665.53 lacs lying as sundry balances/ export receivables , as the same is not likely to materialise . The net balance amounting to Rs 3034.47 lacs has been adjusted as extraordinary items in Profit & Loss account

8. Taxation

a) During the year, the Company has not made any provision for Income Tax including Minimum Alternate (MAT) on account of accumulated losses as per Income Tax Act as well as under Companies Act.

b) The Company has, on account of substantial unabsorbed depreciation and Business Loss as per Income Tax Act 1961. However, as a prudent policy, the said Deferred Tax Asset has not been recognized, which is in accordance with the Accounting Standard 22.

9. Value of Import Calculated on CIF Basis: - NIL- 33. Earnings & Expenditure in Foreign Currency (accrual basis): - NIL- 34. Imported and indigenous raw materials, components and spare parts consumed: - NIL- 35. Regrouping of Previous Year Figures.

The company has reclassified/regrouped/rearranged previous year figures to conform to this year''s classification/regrouping/rearrangement.

10. The balances in Debtors, Creditors, bank balances and advance accounts are subject to confirmation and reconciliation if any. However, as per the management opinion no material impact on financial statements out of such reconciliation is anticipated.

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Mar 31, 2013

1. Corporate Information

Shree Precoated Steels Limited is a public company domiciled in India and incorporated underthe provisions of the Companies Act, 1956. Its shares are listed on one stock exchanges in India. The company engaged in the Manufacturing, Processing, Trading of Steel Products and Real Estate business.

2. Basis of Preparation

The financial statements of the company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified underthe Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and underthe historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous period, except for the change in accounting policy explained below.

3. Disclosure under Micro, Small and Medium Enterprises Development Act, 2006:

There are no delays in payment to Micro and Small enterprises as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006.

The above information and that given in Note No. 8 regarding Micro and Small enterprises has been determined to the extent such parties have been identified on the basis of information available with the company. This has been relied upon by the auditors.

4. Value of Import Calculated on CIF Basis: - NIL-

5. Earnings & Expenditure in Foreign Currency (accrual basis): - NIL-

6. Imported and indigenous raw materials, components and spare parts consumed: - NIL-

7. Regrouping of Previous Year Figures.

Till the period ended 31 st March 2011, the company was using pre- revised Schedule-VI of the Companies Act, 1956, for preparation and presentation of its financial statements. During the year ended 31st March 2012, the revised Schedule VI notified under the Companies Act, 1956, has become applicable to the company. The company has reclassified previous year figures to conform to this year''s classification. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However it has significant impact on presentation and discloses made in financial statements.

8. The balances in Debtors, Creditors, Bank Balances and advance accounts are subject to confirmation and reconciliation if any. However, as per the management opinion no material impact on financial statement out of such reconciliation is anticipated.

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Mar 31, 2012

1. Corporate Information

Shree Precoated Steels Limited is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on one stock exchanges in India. The company engaged in the Manufacturing, Processing, Trading of Steel Products and Real Estate business.

2. Basis of Preparation

The financial statements of the company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous period, except for the change in accounting policy explained below.

3 : SHARE CAPITAL

a. Term/rights attached to equity shares

The company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity share is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended 31st March, 2012, the amount of per share dividend recognised as distributions to equity shareholders was Rs. NIL (Previous year Rs. NIL).

4. Related Party Disclosures:

The related party and relationships, as identified by the Management and relied upon by the Auditors, with whom transactions have taken place during the year ended are:

a. List of related parties and their relationship:

Name of the Party Relationship

A. G. Estate Private Limited Associate

Ajmera Cement Private Limited Associate

Ajmera Realty & Infra India Ltd. Associate

Ajmera Housing Corporation Banglore Associate

Ajmera Housing Corporation Associate

Ajmera Steel Strips Limited Associate

Ajmera Water N Amusement Park Private Limited Associate

Bombay Freezco Private Limited Associate

Jolly Brothers Private Limited Associate

Vijay Nagar Apartment Associate

Rushabh Investments Pvt. Ltd. Associate

Yogi NagarVasahat Private Limited Associate

Four Brothers Associate

Nilkanth Tech Park Private Limited Associate

b. Directors and their relatives:

Name of the Party Relationship

Shri Chhotalal S. Ajmera* Chairman & Managing Director

Shri Chhotalal S. Ajmera - HUF Relative

Shri Rajnikant S. Ajmera** Managing Director

Shri Rajnikant S. Ajmera - HUF Relative

Shri Ishwarlal S. Ajmera*** Chairman & Managing Director

Shri Ishwarlal S. Ajmera -HUF Relative

Shri Sanjay C. Ajmera**** Managing Director

Shri Bhogilal S. Ajmera Relative

Shri Natwarlal S. Ajmera Relative

Shri Shashikant S. Ajmera Relative

Shri Surendra I. Ajmera Relative

Shri. Manoj I. Ajmera Relative

Shri Jayant I. Ajmera Relative

Smt. Veena C. Ajmera Relative

Shri. Atul C. Ajmera Relative

Smt. Bharati R. Ajmera Relative

Smt. Hasumati I. Ajmera Relative

Shri Chhaganlal S. Ajmera Relative

Shri Dhaval R. Ajmera**** Director

* Ceased to be Chairman and Managing Director w.e.f 24th March, 2012 on account of his sad demise.

**Resigned w.e.f 24th April, 2012

*** Change in designation w.e.f 24th April, 2012

****Appointed w.e.f 24th April, 2012

5. Contingent Liabilities

Contingent Liabilities not provided for in respect of:

Name of Nature of Dues Amount Period Forum where Statute (Rs. in to which pending Lacs) amount relates

Service Tax GTA of Services 22.85 2005-06 Appeal has been filed in CESTAT.

Service Tax Cenvat credit 95.84 2006-07 & Appeal has on Service Tax 2007-08 been filed in CESTAT.

Custom Act Fine 15.00 2006-07 Appeal has Penalty 5.00 been filed in CESTAT.

6. Disclosure under Micro, Small and Medium Enterprises Development Act, 2006:

There are no delays in payment to Micro and Small enterprises as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006.

The above information and that given in Note No. 8 regarding Micro and Small enterprises has been determined to the extent such parties have been identified on the basis of information available with the company. This has been relied upon by the auditors.

7. In the Previous period, the Company has transferred its Steel business as a going concern to Essar Steel Limited (ESL) under Business Transfer Agreement (BTA) w.e.f. 30th October 2009. The Company had obtained the requisite approval of its Shareholders under Section 293(1) (a) of the Companies Act 1956. After adjusting the gain on Sale of Undertaking of Rs. 4802.41 lacs, the net loss of Rs. 15694.95 lacs arising mainly out of diminishing in value of Current Assets relating to the transfer of Steel Unit have been shown as Extra Ordinary Losses in Statement of Profit & Loss and as per the direction of Honorable Bombay High Court, an equivalent amount has been transferred from General Reserve.

8. Regrouping of Previous period Figures.

Till the period ended 31st March, 2011, the company was using pre- revised Schedule-VI of the Companies Act, 1956, for preparation and presentation of its financial statements. During the year ended 31st March 2012, the revised Schedule VI notified under the Companies Act, 1956, has become applicable to the company. The company has reclassified previous period figures to conform to this year's classification. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However it has significant impact on presentation and discloses made in financial statements.

9. The accounts are drawn for the period of:

(a) Previous period from 1st October, 2009 to 31st March, 2011 (18 months).

(b) Current year from 01st April, 2011 to 31st March, 2012 (12 months). Hence the figures for the previous period is not comparable.

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Mar 31, 2011

1 The company was incorporated on 17th September 2007 as AJMERA REALITY PRIVATE LIMTIED. On 23rd July 2008 company was converted from Private Limited to Public Limited and the name was changed to AJMER APRECOATEDHPSTEELS LIMITED.

2. After the completion of demerger procedure the name of the company has been changed with effect from 17th April, 2009 (Effective date) from AJMERA

PRECOATED STEELS LIMITED to SHREE PRECOATED STEELS LIMITED (SPSL).

3. The accounts are drawn forHPthe period of:

(a) Previous Period from 1st April 2008 to 30th September 2009

(I) Current Period from 1st October 2009 to 31st March 2011

4. In the previous period, the Company has filed Composite scheme of arrangement under section 391 to 394 read with section 100 to 103 of the Companies Act, 1956 with Honorable High Court of Bombay. Pursuant to the said scheme duly approved by Honorable High Court of Bombay dated 21st March 2009, the steel business ofHPARIIL has been demerged & vested with the company with effect from 1st April 2008 (appointed date) and initial capital of the company stand cancelled. Since the company was informed only in 2007 and had no material activities, the previous year figures are not comparable.

The Salient features of demerger scheme are:

(a) Witheffectfrom theAppointed Date:

I. the whole of the Steel Division of Ajmera Realty & Infra India Limited (ARIIL), stands transferred to and vested in the Company at their book values as at the close of the business on the day immediately preceding the Appointed Date.

II. all assets (both movable and immovable), properties, debts, liabilities, duties,& obligations, contracts, agreements, permits, licenses, approvals, permissions, etc relating to the Steel Division of ARIIL stand transferred and vested to the Company.

III. all staff, workmen and employees of the Steel Division of ARIIL in service on the Effective Date have become staff, workmen and employees of the Company

(b) The steel division is transferred to the company as a going concern.

(c) As a consideration, the Company has issued and allotted 7 (Seven) fully paid up equity shares of Rs.10/- each to the shareholders of ARIIL for every 10 (Ten) equity shares of Rs 10/- each held in ARIIL.

(d) The ratio of allotment of equity shares of SPSL and reorganization of equity share capital of ARIIL, on demerger, is based on the desired capital structure of ARIIL and SPSL (post-demerger) rather than the value of the Real Estate Division and Steel Division.

(e) The shareholding of SPSL pursuant to the demerger of the Steel Division of ARIIL is the mirror image of the shareholding of ARIIL (pre-demerger) as on the record date as the new shares of SPSL are issued to the existing shareholders of ARIIL in proportion to their shareholding in ARIIL.

(f) After the allotment of new equity shares by Company, the Old Equity Shares of the Company stand cancelled.

5. Based on the scheme approved by the Honorable High Court of Bombay all assets and liabilities and capital reserve pertaining to steel division taken at the book value and 8,27,98,042 shares of Rs.10 each fully paid up issued to the share holders of ARIIL and balance amount transfer to General ReserveHPAccount.

6. The Company has transferred its Steel business as a going concern to Essar Steel Limited (ESL) under Business Transfer Agreement (BTA) w.e.f. 30th October 2009. The Company had obtained the requisite approval of its Shareholders under Section 293(1) (a) of the Companies Act 1956. After adjusting the gain on Sale of Undertaking pf Rs. 4802.41 lacs, the net loss of Rs. 15694.95 lacs arising mainly out of diminishing in value of Current Assets relating to the transfer of Steel Unit have been shown as Extra Ordinary Losses in Profit & Loss account and as per the direction of Honorable Bombay High Court, an equivalent amount has been transferred from General Reserve.

7. Contingent liabilities not provided for in respect of:

a) Estimated amount of contracts remaining to be executed on capital account & not provided for (net of advances) is Rs. NIL (Previous Period Rs 873 Lacs)

I) Bank Guarantees provided to third parties aggregate Rs. NIL (Previous Period Rs. 809 Lacs)

c) Letters of Credit aggregating to Rs. NIL (Previous Period Rs 12,615 Lacs)

d) Bills discounted with Banks amounting to Rs. NIL (Previous Period Rs 13,738 Lacs)

e) Demand from Sales Tax Recovery Officer-Kolkatta for Rs. NIL (Previous Period RslLac)

f) Suit filed against the Company not acknowledged as debts of Rs Nil (Previous Period 239 Lacs)

8 Secured loans:

In the Previous Period:

a. The Term Loans from Financial Institutions and Banks are secured by a first charge on the present and future immovable properties of the Company and on plant and machinery present and future, and a second charge on all the current assets of the Company, present and future, and are collaterally secured by personal guarantees of Shri C. S. Ajmera, Shri R. S. Ajmera and Shri I. S. Ajmera, Promoter Directors of the Company. The Company has availed fresh loan from Dena Bank and Exim bank during the period which is secured by charge on fixed assets and additional security provided by Directors, Relatives and Third Parties.

I. Dues payable to financial institutions as per scheme of rehabilitation of BIFR are further secured by pledge of Promoter Directors shareholding in the Company.

c. The Working Capital limits from consortium of banks are secured by a first charge on all the current assets of the Company, present and future, book debts and receivables and second charge on the fixed assets of the Company.

d. The Working Capital from Banks excludes Bills Discounting.

e. Hire Purchase Loans are secured by Hypothecation of specific assets.

9. In the Previous Period:

The ARIIL Company under which unit of this company was granted the new Entitlement Certificate bearing No. 27490293346 V/R-81/1478, dated 12th May 2006 for deferral mode of paying the Sales Tax with effect from 1st April 2005 from exemption availed till 31st March 2005.

The ARIIL Company was permitted in terms of Rule 81 of the Maharashtra Value Added Tax Rules 2005 (MVAT Rules) to defer the Sales Tax Liabilities for the period covered by eligibility Certificate No. FINC/l/1988/Deferral/EC-3552, dated 24th January 2006.

During the Previous period ended net Sales Tax Collected of Rs. 853 Lacs has been considered as unsecured loan, the total amount outstanding of Rs.3010 Lacs as on 30th September 2009 is repayable in five equal annual installments commencing from the June 2015. However the same is transferred along with Steel undertaking at present value.

10. Exchange Fluctuation:

Materials consumed and Sales Turnover includes exchange rate difference of Rs. 92 lacs (Adverse) (Previous Period Rs. 1554 Lacs-Adverse)^ and Rs. 402 iacs favourable (Previous Period 2284 Lacs (Adverse)respectively.

11 Managerial remuneration (excluding provision for Gratuity and provision for leave encashment on retirement) paid/payable to Directors:

No commission is payable to Whole time Directors in view of waiver of commission by them for the current period under review and also in view of loss during the current year under review. The Company has been advised that the computation of the net profit for the purpose of remuneration to Director under Section 349 & 350 of the Act need not be enumerated.

12. Deferred Taxation:

There is no Deferred Tax Liability which needs to be accounted for in the books of accounts as per Accounting Standard 22, on Accounting for Taxes on Income issued by the Institute of Chartered Accountants of India. The directors are of the opinion that the Deferred Tax Asset has not been recognized in the books during the period owing to virtual uncertainty of realization of the same in the forseeable future. Accordingly during the period the Deferred Tax Asset up to 30th September 2009 of Rs. 2339.32 lacs has been adjusted in the Profit and Loss account.

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Sep 30, 2009

1 The company was incorporated on 17th September 2007 as AJMERA REALITY PRIVATE LIMTIED. On 23rd July 2008 company was converted from Private Limited to Public Limited and the name was changed to AJMERAPRECOATED STEELS LIMITED.

2. After the completion of demerger procedure the name of the company has been changed w.e.f. 17th April, 2009 (effective date) from AJMERA PRECOATED STEELS LIMITED TO SHREE PRECOATED STEELS LIMITED (SPSL).

3. The current period accounts are drawn for the period of 18 Months from 1 st April 2008 to 30th September 2009.

4. The Company has filed Composite scheme of arrangement under section 391 To 394 read with section 100 to 103 of the companies Act 1956 with Honorable High Court of Bombay. Pursuant to the said scheme duly approved by Honorable High Court of Bombay dated 21st March 2009, the steel business of Ajmera Realty & Infra India Limited (ARIIL) has been vested with the company w.e.f. 1 st April 2008 (appointed date) and initial capital of the company stand cancelled. Since the company was formed only in 2007 and had no material activities, the previous year figures are not comparable.

The Salient features of demerger scheme are:

(a) With effect from the Appointed Date:

I. the whole of the Steel Division of Ajmera Realty & Infra India Limited (ARIIL), stands transferred to and vested in the Company at their book values as at the close of the business on the day immediately preceding the Appointed Date.

II. all assets (both movable and immovable), properties, debts, liabilities, duties, obligations, contracts, agreements, permits, licenses, approvals, permissions, etc relating to the Steel Division of ARIIL stand transferred and vested to the Company.

III. all staff, workmen and employees of the Steel Division of ARIIL in service on the Effective Date have become staff, workmen and employees of the Company

b) The steel division is transferred to the company as a going concern.

c) As a consideration, the Company has issued and allotted 7 (Seven) fully paid up equity shares of Rs.10/- each to the shareholders of ARIIL for every 10 (Ten) equity shares of Rs 10/- each held in ARI IL.

d) The ratio of allotment of equity shares of SPSL and reorganization of equity share capital of ARIIL, on demerger, is based on the desired capital structure of ARIIL and SPSL (post-demerger) rather than the value of the Real Estate Division and Steel Division.

e) The shareholding of SPSL pursuant to the demerger of the Steel Division of ARIIL is the mirror image of the shareholding of ARIIL (pre-demerger) as on the record date as the new shares of SPSL are issued to the exiting shareholders of ARIIL in proportion to their shareholding inARIIL.

f) After the allotment of new equity shares by Company, the Old Equity Shares of the Company stand cancelled.

5. Based on the scheme approved by the Honorable High Court of Bombay all assets and liabilities and capital reserve pertaining to steel division taken at the book value and 8,27,98,042 shares of Rs. 10 each fully paid up issued to the share holders of ARIIL and balance amount transfer to General Reserved Account.

6. Contingent liabilities not provided for in respect of:

a) Estimated amount of contracts remaining to be executed on capital account & not provided for (net of advances) is Rs.873 Lacs

b) Bank Guarantees provided to third parties aggregate Rs.809 Lacs

c) Letters of Credit aggregating to Rs12,615 Lacs

d) Bills discounted with Banks amounting to Rs. 13,738 Lacs

e) Demand from Sales Tax Recovery Officer- Kolkatta for Rs.1 Lac

f) Suit filed against the Company not acknowledged as debts of Rs. 239 Lacs

7. Secured loans:

a. The Term Loans from Financial Institutions and Banks are secured by a first charge on the present and future immovable properties of the Company and on plant and machinery present and future, and a second charge on all the current assets of the Company, present and future, and are collaterally secured by personal guarantees of Shri C. S. Ajmera, Shri R. S. Ajmera and Shri I. S. Ajmera, Promoter Directors of the Company. The Company has availed fresh loan from Dena Bank and Exim bank during the period which is secured by charge on fixed assets and additional security provided by Directors, Relatives and Third Parties.

b. Dues payable to financial institutions as per scheme of rehabilitation of BIFR are further secured by pledge of Promoter Directors shareholding in the Company.

c. The Working Capital limits from consortium of banks are secured by a first charge on all the current assets of the Company, present and future, book debts and receivables and second charge on the fixed assets of the Company.

d. The Working Capital from Banks excludes Bills Discounting.

e. Hire Purchase Loans are secured by Hypothecation of specific assets.

8. The ARIIL Company under which unit of this company was granted the new Entitlement Certificate bearing No. 27490293346 V/R-81/1478, dated 12th May 2006 for deferral mode of paying the Sales Tax with effect from 1st April 2005 from exemption availed till 31st March 2005.

The ARIIL Company was permitted in terms of Rule 81 of the Maharashtra Value Added Tax Rules 2005 (MVAT Rules) to defer the Sales Tax Liabilities for the period covered by eligibility Certificate No. FINC/l/1988/Deferral/EC-3552, dated 24th January 2006.

During the period ended net Sales Tax Collected of Rs. 853 Lacs has been considered as unsecured loan. The total amount outstanding of Rs. 3,410 Lacs as on 30th September 2009 is repayable in five equal annual installments commencing from the June 2015.

9. Exchange Fluctuation:

Materials consumed and Sales Turnover includes exchange rate difference of Rs. 1554 Lacs (Adverse) and Rs. 2284 Lacs (Adverse) respectively.

10.The company was claiming Export Benefits under Duty Entitlement Pass-Book (DEPB) scheme. From 1st November 2006, the company opted export benefit under Duty Free Import Authorization (DFIA) scheme, Focus Market, Target Plus and also Advance License Scheme and the amount receivable from all the schemes are grouped under the head "Sundry Debtors" and classified under the subhead in "Others considered good".

11.Managerial remuneration (excluding provision for Gratuity and provision for leave encashment on retirement) paid/payable to Directors:

No commission is payable to Wholetime Directors in view of waiver of commission by them for the current period under review and also in view of loss during the current period under review. The Company has been advised that the computation of the net profit for the purpose of remuneration to Director under Section 349 & 350 of the Act need not be enumerated.

12 The company has transferred its steel business as a going concern to Essar Steel Limited (ESL) under Business Transfer Agreement w.e.f. from 29th October 2009. The Company had obtained the requisite approval of its Shareholders under Section 293 (1) (a) of the Companies Act, 1956.

13 The Effect of post sale of Steel Business will be recorded by the company in the year of transaction concluded pending valuation of assets retained by the Company.

14 The accounts of the company have been prepared on the basis of going concern concept in view of future business plans of the company and accordingly Deferred Tax Assets/Liability have been recognized.

15 Deferred Taxation:

The Company has net Deferred Tax Asset of Rs.2,339.32 lacs as on 30th September 2009 which is in accordance with the Accounting Standard - 22 issued by the Institute of Chartered Accountants of India.

16. Employee Benefit:

Consequent to Revised Accounting Standards 15 (AS-15) "Employee Benefits" read with guidance note on implementation of AS-15 issued by Institute of Chartered Accountants of India, effective from April 1,2007, the company has reviewed and revised its accounting policy in respect of employee benefits.

17. Segment Information:

The Companys Division is only deals in Steel Products hence there is no Primary reportable segment in the context of Accounting Standard AS -17 issued by ICAI. As the Companys export turnover is significant in the context of the total turnover, geographical segment is considered as the Secondary Segment and are being reported.

18. Related Party Disclosures:

The related party and relationships, as identified by the Management and relied upon by the Auditors, with whom transactions have taken place during the period ended are:

a. List of related parties and their relationship:

Name of the Party Relationship

A.G. Estate Private Limited Associate

Ajmera Realty & Infra India Limited Associate

Ajmera Cement Private Limited Associate

Ajmera Housing Corporation Banglore Associate

Ajmera Housing Corporation Associate

Ajmera Steel Stripes Limited Associate

Ajmera Water N Amusement Park Private Limited Associate

Bombay Freeezco Private Limited Associate

Jolly Brotheres Private Limited Associate

Kunnuj Investment Private Limited Associate

Vijay NagarAppartment Associate

Rushabh Investments Pvt. Ltd. Associate

Yogi Nagar Vasahat Private Limited Associate

Nilkanth Tech Park Private Limited Associate

b. Directors and their relatives:

Name of the Party Relationship

Shri Chhotalal S. Ajmera Chairman & Managing Director

Shri Chhotalal S. Ajmera - HUF Relative Shri Rajnikant S. Ajmera Managing Director

Shri Rajnikant S. Ajmera - HUF Relative

Shri Ishwarlal S. Ajmera Director

Shri Ishwarlal S. Ajmera - HUF Relative

Shri Sanjay C Ajmera Relative

Shri Bhogilal S. Ajmera Relative

Shri Natwarlal S. Ajmera Relative

Shri Shashikant S. Ajmera Relative

Shri Surendra I. Ajmera Relative

Shri. Manoj I. Ajmera Relative

Shri. Jayant I. Ajmera Relative

Smt. Veena C. Ajmera Relative

Shri. Atul C. Ajmera Relative

Smt. Bharati R. Ajmera Relative

Shri. Dhaval R. Ajmera Relative

19. Disclosure under Micro, Small and Medium Enterprises Development Act, 2006:

There are no delays in payment to Micro and Small enterprises as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006. The above information and that given in schedule 11 -"Current Liabilities" regarding Micro and Small enterprises has been determined to the extent such parties have been identified on the basis of information available with the company. This has been relied upon by the auditors.

20. Sundry Debtors balances in the Balance Sheet includes Rs.28 lacs receivable from Rushabh Investments Private Limited, the Management of which are related to the Directors of the Company.

21. The Loans and advances includes Rs 650.08 Lacs recoverable from Government Authorities as Custom and Excise Duty refundable.

22. The payment to Auditors of Rs. 15.62 lacs includes the following : Audit Fees - Rs.6.75 lacs Tax Audit Fess - Rs. 1.12 lacs Certification & Other matters - Rs. 1.13 lacs Interim Audit-Rs. 1.12 lacs Audit under Other Acts - Rs.2.25 lacs Out of Pocket Expenses - Rs.3.25 lacs