Notes to Accounts of Atlas Cycles (Haryana) Ltd.

Mar 31, 2018

1. Company overview

The Company was incorporated under the provisions of the Companies Act applicable in India as a limited liability company by the name of Atlas Cycles (Haryana) Limited on 31^st May 1950. Companies is engaged in manufacturing and selling of Bicycles and its spare parts. Shares of the company are listed on two stock exchanges in India i.e. National Stock Exchange (NSE) and Bombay Stock Exchange (BSE).

2. Basis of preparation of financial statements

These are the company’s first financial statements for the year ended 31 March 2018 which have been prepared in accordance with Ind AS notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended by the Companies (Indian Accounting Standards) (Amendment) Rules, 2016, read with Ind AS based Schedule III, under the Companies Act, 2013.

For all periods up to and including for the year ended 31 March 2018, the company’s financial statements prepared are complying in all material respects with the accounting standards notified under Section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rule, 2014 and guidelines issued by the Securities and Exchange Board of India (SEBI).

The Company has consistently applied the accounting policies used in the preparation of its opening IND AS Balance Sheet at April 1, 2016 through out all periods presented, as if these policies had always been in effect and are covered by IND AS 101 Rs.First-time adoption of Indian Accounting StandardsRs.. The transition was carried out from accounting principles generally accepted in India (Rs.Indian GAAPRs.) which is considered as the previous GAAP, as defined in IND AS 101. The reconciliation of effects of the transition from Indian GAAP to IND AS is disclosed in note to these financial statements. The Company’s financial statements provide comparative information in respect to the previous year. In addition, the company presents Balance Sheet as at the beginning of the previous year, which is the transition date to IND AS.

The significant accounting policies used in preparing the financial statements are set out in Note no. 3 of the Notes to the Standalone Financial Statements. The preparation of the financial statements requires management to make Judgements, estimates and assumptions. Actual results could vary from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision effects only that period or in the period of the revision and future periods if the revision affects both current and future years (refer Note no. 3.2 on significant accounting estimates, assumptions and judgments.) Overall principle

The Company has prepared the balance sheet as per Ind AS as on the transition date by recognising all assets and liabilities whose recognition is required by Ind AS, not recognising items of assets or liabilities which are not permitted by Ind AS, by reclassifying items from previous GAAP to Ind AS as required under Ind AS, and applying Ind AS in measurement of recognized assets and liabilities. However, this principle is subject to certain optional exemptions availed by the Company. IND AS 101 First-time adoption of Indian Accounting Standards allows first time adopters certain exemptions and exceptions from the retrospective application of certain requirements under IND AS, effective for April 1, 2016 opening balance sheet, as explained below :

Following exemptions availed from other IND AS as per Appendix D of IND AS 101.

Deemed cost for Property, Plant and Equipment (PPE) - The Company has elected to continue with the carrying value of all of its plant and equipment and intangible assets recognized as of transition date measured as per the previous GAAP and use that carrying value as its deemed cost as of the transition date.

Estimates: The estimate at 1st April 2016 and ended 31st March 2017 are consistent with those made for the same dates in accordance with Indian GAAP (after adjustment to reflect any differences if any, in accounting policies) The estimates used by the company to present these amounts in accordance with Ind AS reflect conditions as at the transition date and as of 31st March 2016.

Derecognition of financial assets: The Company has chosen to apply derecognition criteria retrospectively. Accordingly, certain security deposits and borrowings have been re-recognized under Ind AS as at April 1, 2016.

Reconciliation between Previous GAAP and Ind AS

Note:

1 Vehicle loans are secured by way of hypothecation of vehicle concerned and carry interest from 8.5% p.a. to 13% p.a. on different loans and repayable in 36 / 48 equal installments.

2 The Company have fixed deposits from the public which carries interest @ 11% p.a. for FDRs less than Rs. 2,00,000/- for a period of one year and 11.5% p.a for more than one year irrespective of amount. Company has not repaid deposits as per requirement of companies act 2013. However, company has applied for extension for repayment of fixed deposits to NCLT and repayments are being made as per directions of NCLT.

a) Working Capital Limit from Consortium banks is secured against Hypothecation of Inventory and Book Debts and Ist Charge over Fixed Assets of the Company which is repayable on demand and carries Interest @ 14.25% p.a.

b) Bills Discounting facility from Consortium banks is fully secured by the stock against the bills discounted and IInd charge over the Fixed Assets of the Company and carries [email protected]% pa

3 FINANCIAL RISK MANAGEMENT

The Company’s principal financial liabilities, other than derivatives, comprise borrowings, trade and other payables, and financial guarantee contracts. The main purpose of these financial liabilities is to manage finances for the Company’s operations. The Company has loan and other receivables, trade and other receivables, and cash and short-term deposits that arise directly from its operations.The Company’s activities are expose it to market risk, credit risk and liquidity risk.

I. Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market prices comprise three types of risk: currency rate risk, interest rate risk and other price risks, such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings, deposits, investments.The sensitivity analyses in the following sections relate to the position as at 31st March 2018 and 31st March 2017.

The analyses exclude the impact of movements in market variables on: the carrying values of gratuity and other postretirement obligations; provisions; and the non-financial assets and liabilities of foreign operations. The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks.

(a) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. In order to optimize the Compnay’s position with regard to interest income and interest expenses and to manage the interest rate risk, treasury performs a comprehensive corporate interest rate risk management by balancing the proportion of the fixed rate andd floating rate financial instruments in its total portfolio.

(i) The exposure of Company borrowings to interest rate changes at the end of reporting period are as follows:

(b) Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company is exposed to the foreign exchange risk through its trading sales.

II. Credit risk

Credit risk arises from the possibility that the counter party will default on its contractual obligations resulting in financial loss to the company. To manage this, the Company periodically assesses the financial reliability of customers, taking into account the financial conditions, current economic trends, and analysis of historical bad debts and ageing of accounts recievable.

The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks, mutual funds and other financial instruments.

The Company extends credit to customers in normal course of business. The Company considers factors such as credit track record in the market and past dealings for extension of credit to customers. The Company monitors the payment track record of the customers. Outstanding customer receivables are regularly monitored. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries and operate in domestic markets. The Company has also taken advances and security deposits from its customers, which mitigate the credit risk to an extent.

III. Liquidity Risk

Liquidity risk is defined as the risk that company will not be able to settle or meet its obligation on time or at a reasonable price. The Company’s objective is to at all times maintain optimum levels of liquidity to meet its cash and collateral requirements. The Company’s treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risk are overseen by senior management. Management monitors the Company’s net liquidity position through rolling, forecast on the basis of expected cash flows.

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments:

4 CAPITAL MANAGEMENT

The primary objective of the Company’s Capital Management is to maximize the shareholder value and also maintain an optimal capital structure to reduce cost of capital. In order to manage the capital structure, the Company may adjust the amount of return on capial to shareholders, issue new or sell assets to reduce debts. The Company monitors capital using gearing ratio, which is net debt divided by total capital plus debt.

5 RECOGNITION OF OPENING AND CLOSING BALANCES OF DEFINED BENEFIT OBLIGATION

In accordance with the Payment of Gratuity Act, 1972, the Company provides for gratuity, as defined benefit plan. The gratuity plan provides for a lump sum payment to the employees at the time of separation from the service on completion of vested year of employment i.e. five years. The liability of gratuity plan is provided based on actuarial valuation as at the end of each financial year based on which the Company contributes the as certained liability to Life Insurance Corporation of India with whom the plan assets are maintained.

These plans typically expose the Company to actuarial risks such as: investment risk, inherent interest rate risk, longevity risk and salary risk

6 RELATED PARTY DISCLOSURES

A. Name of associated parties and nature of related party relationship

i) Associated Companies : Milton Cycles Inds Ltd, Janki Das & Sons (P) Ltd, Romer Engineering Works (P) Ltd

ii) Subsidiary Companies are: Atlas Cycles Sonepat Ltd, Atlas Cycles (Sahibabad) Ltd, Atlas Cycles (Malanpur) Ltd.,

Directors & Employees (As at 31.03.2018) : Sh. I.D.Chugh, Sh. H.L.Bhatia, Sh. Vikram Khosla, Sh. Kartik Roop Rai, Sh. Sanjiv Kavaljit Singh, Sh. Sadhna Syal, Sh. Vikram Kapur, Sh. Salil Kapur, Sh. Gautam Kapur, Sh. Girish Kapur, Sh. Sanjay Kapur, Sh. Rajiv Kapur, Sh. Angad Kapur, Sh. Rishav Kapur, Sh.Prashant Kapur, Sh. Rahul Kapur, Sh. Sidhant Kapur, Sh. Abhinav Kapur, Sh. Ashwin Kapur.

The number of shares used in computing basic EPS is the weighted average number of shares outstanding during the year. The diluted EPS is calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive equity.

7 SEGMENT INFORMATION

(i) The company is engaged in the business of “Manufacturing and Selling of Bicycles” and therefore, has only one reportable segment in accordance with IND AS 108 “ Operating segments)

8 PREVIOUS YEAR FIGURES

Figures of the Previous Year have been regrouped, rearranged and reclassified to conform to the current year classification.

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Mar 31, 2016

(b) TERMS/RIGHT ATTACHED TO EQUITY SHARES

The company has only one class of equity shares having a par value of '' 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed, if any, by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting and also has equal right in distribution of Profit/Surplus in proportions to the number of equity shares held by the shareholders.

d) Company has not issued any ESOP Plan,or Conversion of Bonds/Debentures

e) Company has not issued any shares by way of Bonus/ Right Shares and has not Buy-back any shares in the preceding five years

1 Term Loan from Central Bank Of India is secured against first pari passu charge on respective unit''s immovable property and future assets which it may acquire in future and carries interest @ 13% p.a and is repayable on 3 yearly equal installments.

2 The Company accepted fixed deposits from the public which carries interest @ 11% p.a. for FDRs less than '' 2,00,000/- for a period of one year and 11.5% p.a for more than one year irrespective of amount. However, company is repaying fixed deposit as and when becoming due for payment.

3 Vehicle loans are secured by way of hypothecation of vehicle concerned and carries interest from 8.5% p.a. to 13% p.a. on different loans and repayable in 36 / 48 equal installments.

1 Cash Credit Limit from Consortium banks is secured against Hypothecation of Inventory and Book Debts and Ist Charge over Fixed Assets of the Company which is repayable on demand and carries Interest @ 13.25% p.a.

2 Bills Discounting facility from SIDBI is fully secured by the stock against the bills discounted and IInd charge over the Fixed Assets of the Company and carries [email protected]% pa

3 Overdraft Limit from HDFC Bank is Secured against the lien on the Mutual Funds and carries interest @12.25% which is repayable on demand.

4 Bill Discounting Facility from IDBI bank is secured against second charge on current and fixed assets of Malanpur Unit.

5 Unsecured Billl Discounting Facility from India Factoring Finance Limited carries interest@ 15% p.a.

# Rs, 15.50 Crores received as advance against sale of land of Rasoi Plant and Rs, 6.37 crores received as advance against sale of land of Bawal plant.

4 In the annual report of last financial year 2014-15, a sum of Rs, 3,41,07,212/- was shown recoverable. The said amount was recoverable against the unauthorized payment of rent made from the accounts of the company for residential accomodation availed by Mr Vikram Kapur and Mr Angad Kapur. Out of said amount, a sum of Rs, 1,40,00,000 (Rupees One Crore Fouty Lacs only) was received into the accounts of the company on 30th Sep 2015 and the balance recoverable amount is Rs, 2,01,07,212/-. The company has already initiated appropriate legal proceedings against Mr Vikram Kapur and Mr Angad Kapur for misappropriation of said amount and the matter is pending adjudication in the court of Magistrate, Saket Courts, New Delhi.

5 RELATED PARTY DISCLOSURES UNDER ACCOUNTING STANDARD 18 A. Name of associated parties and nature of related party relationship

i Associated Companies : Milton Cycles Inds Ltd, Janki Das & Sons (P) Ltd,Romer Engineering Works (P) Ltd

ii) Subsidiary Companies are: Atlas Cycles Sonepat Ltd, Atlas Cycles (Sahibabad) Ltd,

Atlas Cycles (Malanpur) Ltd.,

Directors & Employees (As at 31.03.2014) : Sh. I.D.Chugh,

Sh. H.K.Ahuja, Sh. H.L.Bhatia, Sh. Vikram Khosla, Sh. Kartik Roop Rai, Sh. Sanjiv Kavaljit Singh, Sh. Veena Buber, Sh. Vikram Kapur,

Sh. Salil Kapur, Sh. Gautam Kapur, Sh. Girish Kapur, Sh. Sanjay Kapur, Sh. Rajiv Kapur, Sh. Angad Kapur, Sh. Rishav Kapur,

Sh. Prashant Kapur, Sh. Rahul Kapur,Sh.Sidhant Kapur,Sh.Abhinav Kapur,Sh.Ashwin Kapur.

C. Transactions with key managerial persons:

Remunerations: Rs, 483.64 Lacs (Previous Year '' 430.59 Lacs)

6 Figure of the Previous Year have been re-arranged, wherever necessary.

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Mar 31, 2015

1. TERMS/RIGHT ATTACHED TO EQUITY SHARES

The company has only one class of equity shares having a par value of ' 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed, if any, by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting and also has equal right in distribution of Profit/Surplus in proportions to the number of equity shares held by the shareholders.

2 Cash Credit Limit from Consortium banks is secured against Hypothecation of Inventory and Book Debts and Ist Charge over Fixed Assets of the Company which is repayable on demand and carries Interest @ 13.25% p.a.

3 Bills Discounting facility from SIDBI is fully secured by the stock against the bills discounted and IInd charge over the Fixed Assets of the Company and carries [email protected]% pa

4 Overdraft Limit from HDFC Bank is Secured against the lien on the Mutual Funds and carries interest @12.25% which is repayable on demand.

5 Bill Discounting Facility from IDBI bank is secured against second charge on current and fixed assets of Malanpur Unit.

6 Unsecured Billl Discounting Facility from India Factoring Finance Limited carries interest@ 15% p.a.

7 RELATED PARTY DISCLOSURES UNDER ACCOUNTING STANDARD 18

A. Name of associated parties and nature of related party relationship

i) Associated Companies : Milton Cycles Inds Ltd, Janki Das & Sons (P) Ltd,Romer Engineering Works (P) Ltd

ii) Subsidiary Companies are: Atlas Cycles (Sonipat) Ltd, Atlas Cycles (Sahibabad) Ltd,

Atlas Cycles (Malanpur) Ltd., Directors & Employees (As at 31.03.2014) : Sh. I.D.Chugh,

Sh. H.K.Ahuja, Sh. H.L.Bhatia, Sh. Vikram Khosla, Sh. Kartik Roop Rai, Sh. Sanjiv Kavaljit Singh, Sh. Veena Buber, Sh. Vikram Kapur, Sh. Salil Kapur, Sh. Gautam Kapur, Sh. Girish Kapur, Sh. Sanjay Kapur, Sh. Rajiv Kapur, Sh. Angad Kapur, Sh. Rishav Kapur, Sh.Prashant Kapur, Sh. Rahul Kapur,Sh.Sidhant Kapur,Sh.Abhinav Kapur,Sh.Ashwin Kapur.

8 Figure of the Previous Year have been re-arranged, wherever necessary.

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Mar 31, 2014

1 CONTIGENT LIABILITIES IN RESPECT OF 2014 2013

a) Surety bonds executed in favour of President of India through Customs & Excise authorities for payment of Central Excise/Custom duty 165.00 165.00

b) Two surety bonds in favour of government of Haryana for payment of Central & Local Sales Tax 30.40 30.40

c) Guarantees given by bank 563.05 564.75

d) In respect of Entry Tax matters 5.00 5.00

e) In respect of Excise matters 52.00 52.00

f) In respect of Sales Tax matters 568.07 568.07

2 LIST OF SMALL SCALE SUPPLIERS WHERE THE OUTSTANDING ARE OVER 30 DAYS:

Auto Fan (India), Advance Plastic Industries, Ark Enginnering Pvt. Ltd., Appu Cycles, Balbinder Mechenical Works, V.J Sales Corp., Bidar Engineering Co., Birdi International, Bharat Cycle Udyog, Chandan Industries, Chopra Engineers D.K.Industries, Ess Pee Industries, Emm Industries India, Fit Right Engineer, Govind cycles Pvt. Ltd., Great Gears Pvt.L. Hianken Industries, J.B. Industries, Jain International,Jai Shiva Trading Co., Kular Cycle Industries,Koon Cycle Industries, Kumar Enterprises, Kapson Industries,K.B. Kapoor Industries, Lion Industries, Label & Stcikers Industries, Meera Ind., Mukhtiar Engg. Works, Mandeep Products,Naveen Enterprises,Nitya Enterprises,Om Shivam Cycle India,Om Industries, Partap Cycle Ind.,Ranjeev Industries, Randhir Industrial Corp.,Ravi Industries, Rahul Enterprises, Rider Bikes Pvt. Ltd. Rana Enterprises, Seval Screw Co.,Sukhmani Steels,S.S.Product India, Shri Atamballabh Industrial Corp, Subhash & Sons, Sahil Enterprises, Vee Pee Industries,Visvakarma Industries Pvt. Ltd., Vinod Steel Craft, Watson Engg. Works, Watson Industries, Arihant Product Pvt. Ltd.,Appar Packaging Pvt. Ltd.,Bajrang Industries Carry Packers,Denzo Paints Pvt. Ltd., Laxmi Chemicals, Margo Ind. India, Margo Fastners, Punjab Plastic Ind. Parko Industries, Rishi Udyog, R.M. Industries, Amardeep Steel Industries, Anmol Industries, B.S. Lotey Brothers, Gupta Bikes Pvt. Ltd., Hindustan Tyers, Hightech Halftone, Joginder Singh Tejender Singh, Kamal Cycles Components, Mahaveer Steels, Durga Industries, H.K.Engineers, Jeet Enterprises.

3 During the year it was revealed that Mr.Salil Kapur, President of Malanpur Unit had advanced funds to the tune of Rs. 14,03,73,171/- including Rs. 11,05,36,111/- to himself and Rs. 2,98,37,060/- to private limited companies controlled by him. These advances had been granted without any approval of board of directors and without any interest and stipulated period. Board has taken serious view of this and efforts are being made to recover this amount.

4 RELATED PARTY DISCLOSURES UNDER ACCOUNTING STANDARD 18

A. Name of associated parties and nature of related party relationship

i) Associated Companies : Milton Cycles Inds Ltd, Janki Das & Sons (P) Ltd,Romer Engineering Works (P) Ltd

ii) Subsidiary Companies are: Atlas Cycles (Sonipat) Ltd, Atlas Cycles (Sahibabad) Ltd, Atlas Cycles (Malanpur) Ltd., Directors & Employees (As at 31.03.2014) : Sh. I.D.Chugh, Sh. H.K.Ahuja, Sh. H.L.Bhatia, Sh. Vikram Kapur, Sh. Salil Kapur, Sh. Gautam Kapur, Sh. Girish Kapur, Sh. Sanjay Kapur, Sh. Rajiv Kapur, Sh. Angad Kapur, Sh. Rishav Kapur, Sh.Prashant Kapur, Sh. Rahul Kapur,Sh.Sidhant Kapur,Sh.Abhinav Kapur,Sh.Ashwin Kapur.

5 Figure of the Previous Year have been re-arranged, wherever necessary.

6 (a) TERMS/RIGHT 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 shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed, if any, by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting and also has equal right in distribution of Profit/Surplus in proportions to the number of equity shares held by the shareholders.

a) Company has not issued any ESOP Plan,or Conversion of Bonds/Debentures

b) Company has not issued any shares by way of Bonus/ Right Shares and has not By-back any shares in the preceding five years

7. 1 Term Loan from Central Bank Of India is secured against first pari passu charge on respective unit''s immovable property and future assets which it may acquire in future and carries interest @ 13% p.a and is repayable on 3 yearly equal installments.

2 The Company accepts fixed deposits from the public which carries interest @ 11% p.a. for FDRs less than Rs. 2,00,000/- for a period of one year and 11.5% p.a for more than one year irrespective of amount.

3 Vehicle loans are secured by way of hypothecation of vehicle concerned and carries interest from 8.5% p.a. to 13% p.a. on different loans and repayable in 36 / 48 equal installments.

4 Term loan from Bank is secured against first pari passu charge on immovable property and future assets which it may acquire in future and carries interest @ 15% p.a and is repayable on six monthly equal installments from the date of disbursement i.e October 2013.

8. 1 Cash Credit Limit from Consortium banks is secured against Hypothecation of Inventory and Book Debts and 1st Charge over Fixed Assets of the Company which is repayable on demand and carries Interest @ 15.25% p.a.

2 Bills Discounting facility from SIDBI is fully secured by the stock against the bills discounted and IInd charge over the Fixed Assets of the Company and carries interest @ 13.50% p.a.

3 Overdraft Limit from HDFC Bank is Secured against the lien on the Mutual Funds and carries interest which is repayable on demand and carries interest @ 12.25% p.a.

4 Short Term Corporate Loans carries interest @ 18% p.a..

5 Bill Discounting Facility from IDBI bank is secured against second charge on current and fixed assets of Malanpur Unit.

6 Unsecured Billl Discounting Facility from India Factoring Finance Limited carries interest @ 15 p.a.

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Mar 31, 2013

1 SEGMENT REPORTING

Based on the guiding principles given in Accounting Standard -17 "Segment Reporting" issued by the Institute of Chartered Accountants of India, the Companies business segment includes bicycle manufacturing and Steel tube manufacturing.

SEGMENT ACCOUNTING POLICIES

The accounting policies adopted for the segment reporting are in line with the accounting policies of the company with the following additional policies for the segment reporting.

(i) Inter segment revenue have been accounted on cost to the receiving segmental unit.

(ii) Expenses have been included to the segment on the basis of their relationship to the accounting activities of the segment. Expenses which relate to the enterprise as a whole and are not allocable to the segments on a reasonable basis, have been included under "unallocated corporate expenses."

(iii) Segments assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets and provisions, which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities.

2. LIST OF SMALL SCALE SUPPLIERS WHERE THE OUTSTANDING ARE OVER 30 DAYS:

Auto Fan (India), Advance Plastic Industries, Ark Enginnering Pvt. Ltd., Appu Cycles, Balbinder Mechenical Works, V.J Sales Corp., Bidar Engineering Co., Birdi International, Bharat Cycle Udyog, Chandan Industries, Chopra Engineers, D.K.Industries, Ess Pee Industries, Emm Industries India, Fit Right Engineer, Govind cycles Pvt. Ltd., Great Gears Pvt.Ltd., Hianken Industries, J.B. Industries, Jain International,Jai Shiva Trading Co., Kular Cycle Industries,Koon Cycle Industries, Kumar Enterprises, Kapson Industries,K.B. Kapoor Industries, Lion Industries, Label & Stcikers Industries, Meera Ind., Mukhtiar Engg. Works, Mandeep Products,Naveen Enterprises,Nitya Enterprises,Om Shivam Cycle India,Om Industries, Partap Cycle Ind.,Ranjeev Industries, Randhir Industrial Corp.,Ravi Industries, Rahul Enterprises, Rider Bikes Pvt. Ltd. Rana Enterprises, Seval Screw Co.,Sukhmani Steels,S.S.Product India, Shri Atamballabh Industrial Corp, Subhash & Sons, Sahil Enterprises, Vee Pee Industries,Visvakarma Industries Pvt. Ltd., Vinod Steel Craft, Watson Engg. Works, Watson Industries, Arihant Product Pvt. Ltd.,Appar Packaging Pvt. Ltd.,Bajrang Industries Carry Packers,Denzo Paints Pvt. Ltd., Laxmi Chemicals, Margo Ind. India, Margo Fastners, Punjab Plastic Ind. Parko Industries, Rishi Udyog, R.M. Industries, Amardeep Steel Industries, Anmol Industries, B.S. Lotey Brothers, Gupta Bikes Pvt. Ltd., Hindustan Tyers, Hightech Halftone, Joginder Singh Tejender Singh, Kamal Cycles Components, Mahaveer Steels, Durga Industries, H.K.Engineers, Jeet Enterprises.

3. RELATED PARTY DISCLOSURES UNDER ACCOUNTING STANDARD 18

A. Name of associated parties and nature of related party relationship

i) Associated Companies : Milton Cycles Inds Ltd, Janki Das & Sons (P) Ltd,Romer Engineering Works (P) Ltd Exotic Flora (P) Ltd ii) Subsidiary Companies are: Atlas Cycles (Sonipat) Ltd, Atlas Cycles (Sahibabad) Ltd, Atlas Cycles (Malanpur) Ltd. Directors & Employees (As at 31.03.2013) : Sh. I.D.Chugh, Sh. H.K.Ahuja, Sh. H.L.Bhatia, Sh. P.R. Chawla, Sh. Vikram Kapur, Sh. Salil Kapur Sh. Gautam Kapur, Sh. Girish Kapur, Sh. Sanjay Kapur, Sh. Rajiv Kapur, Sh. Angad Kapur, Sh. Rishav Kapur, Sh.Prashant Kapur, Sh. Rahul Kapur, Sh.Sidhant Kapur,Sh.Abhinav Kapur,Sh.Ashwin Kapur.

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Mar 31, 2012

1 Long term loan from Tamilnand Mercentile bank limited is secured against first charge on specific assets against which loan taken and carries interest @ 12.50% p.a.

2 Term Loan from Central Bank Of India is secured against first pari passu charge on respective units immovable property and future assets which it may acquire in future and carries interest @ 13% p.a and is repayable on 3 yearly equal installments.

3 The Company accepts fixed deposits from the public which carries interest @ 11% p.a. for FDRs less than Rs 2,00,000/- for a period and 11.5% p.a for more than one year irrespective of amount.

4 Vehicle loans are secured by way of hypothecation of vehicle concerned and carries interest from 8.5% p.a. to 13% p.a. on different loans and repayable in 48 equal installments.

1 Cash Credit Limit from Consortium banks is secured against Hypothecation of Inventory and Book Debts and Ist Charge over Fixed Assets of the Company which is repayable on demand and carries Interest @ 15.25% p.a.

2 Bills Discounting facility from SIDBI is fully secured by the stock against the bills discounted and IInd charge over the Fixed Assets of the Company and carries interest @ 13.50% p.a.

3 Overdraft Limit from HDFC Bank is Secured against the lien on the Mutual Funds and carries interest which is repayable on demand and carries interest @ 11.25% p.a.

4 Credit Facilities from YES Bank is secured against Subserveint/Residual Charge on Current and Fixed Assets of the Malanpur Unit & carries interest @ 14%

5 Unsecured Short Term loan availed from HDFC Bank carries interest @ 12.75% p.a.

6 Short Term Corporate Loans carries interest @ 18% p.a..

7 Bill Discounting Facility from IDBI bank is secured against second charge on current and fixed assets of Malanpur Unit.

8 Unsecured Billl Discounting Facility from India Factoring Finance Limited carries interest@ 15% p.a.

9 Unsecured Loans from Birla Global Finance against Promoters personal guarantee carries interest @ 18%.

2012 2011 Rs. Rs.

1. CONTIGENT LIABILITIES IN RESPECT OF

a) Surety bonds executed in favour of President of India through Customs & Excise authorities for payment of Central Excise/Custom duty 165.00 165.00

b) Two surety bonds in favour of government of Haryana for payment of Central & Local Sales Tax 30.40 30.40

c) Guarantees given by bank 1324.89 1509.72

d) In respect of Entry Tax matters 6.31 5.00

e) In respect of Excise matters 52.00 52.00

f) In respect of Sales Tax matters 608.38 601.49

2 SEGMENT REPORTING

Based on the guiding principles given in Accounting Standard -17 "Segment Reporting" issued by the Institute of Chartered Accountants of India, the Companies business segment includes bicycle manufacturing and Steel tube manufacturing.

SEGMENT ACCOUNTING POLICIES

The accounting policies adopted for the segment reporting are in line with the accounting policies of the company with the following additional policies for the segment reporting.

(i) Inter segment revenue have been accounted on cost to the receiving segmental unit.

(ii) Expenses have been included to the segment on the basis of their relationship to the accounting activities of the segment. Expenses which relate to the enterprise as a whole and are not allocable to the segments on a reasonable basis, have been included under "unallocated corporate expenses."

(iii) Segments assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets and provisions, which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities.

3. LIST OF SMALL SCALE SUPPLIERS WHERE THE OUTSTANDING ARE OVER 30 DAYS:

Kanwal Engg.Works,Hansa Tubes Pvt Ltd,Nagpal Enterprises,S.K.Aggarwal & co,Hansa Mettallics Ltd, Suriendra Cycles Pvt Ltd,Aditya Industries, Advance Plastics Industries,Gobind Cycles Pvt Ltd, Gupta Bikes Pvt Ltd,Jeet Enterprises,Jsts,K.S.Munjal Industries, Lion Industries, New Modern Steels Industries,Rana Enterprsies,Rider Bikes Pvt Ltd,Rolex Cycles Pvt Ltd,S.K.Sons,Sabharwal Enterprises ,Sandow Balls (India),Sood Industries,Sukhmani Steels, Sunny Cycles Pvt Ltd,Swastik Packaging,Swastik Polythene Industries, Synergy India,Vishal Cycles Pvt ltd, Vishal Udyog Pvt Ltd,Vts Creations ,Amrit Industries,Shree Krishna Steels,Evershine Plastics Industries, Rishi Udyog,Pagan Paints & Chemical Pvt Ltd,Shree Thakur Engg. Works, Kamal Cycles Components, Auto Fans (India),Ark Engg. Pvt Ltd, Appu Cycles, Balbinder mechanical Works, V.J.Sales Corp.,Bider Engg. Co.,Birdi International, Bharat Cycles Udyog,Chandan Industries, Chopra Engineers,D.K.Industries, Ess Pee Industries,Emm Industries,Fit Right Engineer,Great Gear Pvt Ltd,Hainkain Industries,J.B.Industries,jain International, Jai Shiva Trading Co.,Kular Cycles Industries,Koon Cycles Industries,Kumar Enterprises,Kapson Industries,K.B.Kapoor Industries,Label &Sticker Industries,Meera Industries,Mukhtier Engg. Works, Mandeep Products,Naveen Enterprises, Nitya Enterprises,Om Shivam Cycles India,Om Industries,Partap Cycles Industries,Ranjeev Industries,Randhir Industrial Corp. Rahul Enterprises,S.S,Products India,Shree Attam Vallabh Industrial corp., Sahil Enterprises, Vee Pee Industries, Visvakarma Industries Pvt Ltd,Vinod Steel Craft, Arihant Product Pvt Ltd,Appar Packaging Pvt Ltd,Bajrang Industries, Carry Packers, Denzo Paints Pvt Ltd, Laxmi Chemicals, Margo Inds. India, Margo Fastners, Punjab Plastics Inds,Parko Industries, R.M.Industries,Amardeep Steels Industries.

4 RELATED PARTY DISCLOSURES UNDER ACCOUNTING STANDARD 18

A. Name of associated parties and nature of related party relationship

i) Associated Companies : Milton Cycles Inds Ltd, Janki Das & Sons (P) Ltd,Romer Engineering Works (P) Ltd ExoticFlora(P) Ltd

ii) Subsidiary Companies are: Atlas Cycles (Sonipat) Ltd, Atlas Cycles (Sahibabad) Ltd, Atlas Cycles (Malanpur) Ltd. Directors & Employees (As at 31.03.2012) : Sh. I.D.Chugh, Sh. H.K.Ahuja, Sh. H.L.Bhatia, Sh. PR. Chawla, Sh. Vikram Kapur, Sh. Salil Kapur Sh. Gautam Kapur, Sh. Girish Kapur, Sh. Sanjay Kapur, Sh. Rajiv Kapur, Sh. Angad Kapur, Sh. Rishav Kapur, Sh.Prashant Kapur, Sh. Rahul Kapur, Sh.Sidhant Kapur,Sh.Abhinav Kapur,Sh.Ashwin Kapur.

---

Mar 31, 2011

2011 2010

Rs. Rs.

1. CONTINGENT LIABILITIES IN RESPECT OF

a) Surety bonds executed in favor of President of India through Customs & Excise authorities for payment of Central Excise/Custom duty 1,64,99,412 1,64,99,412

b) Two surety bonds in favour of government of Haryana for payment of Central & Local Sales Tax 30,40,000 30,40,000

c) Guarantees given by bank 15,09,72,561 14,01,77,319

d) In respect of Entry Tax matters 5,00,000 2,79,000

e) In respect of Excise matters 52,00,000 56,20,000

f) In respect of Sales Tax matters 6,01,49,000 6,59,65,000

2. SEGMENT REPORTING

Based on the guiding principles given in Accounting Standard -17 "Segment Reporting" issued by the Institute of Chartered Accountants of India, the Companies business segment includes bicycle manufacturing and Steel tube manufacturing.

SEGMENT ACCOUNTING POLICIES

The accounting policies adopted for the segment reporting are in line with the accounting policies of the company with the following additional policies for the segment reporting.

(i) Inter segment revenue have been accounted on cost to the receiving segmental unit.

(ii) Expenses have been included to the segment on the basis of their relationship to the accounting activities of the segment. Expenses which relate to the enterprise as a whole and are not allocable to the segments on a reasonable basis, have been included under "unallocated corporate expenses."

(iii) Segments assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets and provisions, which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities.

3. LIST OF SMALL SCALE SUPPLIERS WHERE THE OUTSTANDING ARE OVER 30 DAYS:

Kanwal Engg.Works,Hansa Tubes Pvt Ltd,Nagpal Enterprises,S.K.Aggarwal & co,Hansa Mettallics Ltd,Suriendra Cycles Pvt Ltd,Aditya Industries, Advance Plastics Industries,Gobind Cycles Pvt Ltd, Gupta Bikes Pvt Ltd,Jeet Enterprises,Jsts,K.S.Munjal Industries, Lion Industries, New Modern Steels Industries,Rana Enterprsies,Rider Bikes Pvt Ltd,Rolex Cycles Pvt Ltd,S.K.Sons,Sabharwal Enterprises ,Sandow Balls (India),Sood Industries,Sukhmani Steels, Sunny Cycles Pvt Ltd,Swastik Packaging,Swastik Polythene Industries, Synergy India,Vishal Cycles Pvt ltd, Vishal Udyog Pvt Ltd,Vts Creations ,Amrit Industries,Shree Krishna Steels,Evershine Plastics Industries, Rishi Udyog,Pagan Paints & Chemical Pvt Ltd,Shree Thakur Engg. Works, Kamal Cycles Components, Auto Fans (India),Ark Engg. Pvt Ltd, Appu Cycles, Balbinder mechanical Works, V.J.Sales Corp.,Bider Engg. Co.,Birdi International, Bharat Cycles Udyog,Chandan Industries, Chopra Engineers,D.K.Industries, Ess Pee Industries,Emm Industries,Fit Right Engineer,Great Gear Pvt Ltd,Hainkain Industries,J.B.Industries,jain International, Jai Shiva Trading Co.,Kular Cycles Industries,Koon Cycles Industries,Kumar Enterprises,Kapson Industries,K.B.Kapoor Industries,Label &Sticker Industries,Meera Industries,Mukhtier Engg. Works, Mandeep Products,Naveen Enterprises, Nitya Enterprises,Om Shivam Cycles India,Om Industries,Partap Cycles Industries,Ranjeev Industries,Randhir Industrial Corp. Rahul Enterprises,S.S,Products India,Shree Attam Vallabh Industrial corp., Sahil Enterprises, Vee Pee Industries, Visvakarma Industries Pvt Ltd,Vinod Steel Craft, Arihant Product Pvt Ltd,Appar Packaging Pvt Ltd,Bajrang Industries, Carry Packers, Denzo Paints Pvt Ltd, Laxmi Chemicals , Margo Inds. India, Margo Fastners, Punjab Plastics Inds,Parko Industries, R.M.Industries,Amardeep Steels Industries,Anmol Industries, B.S.Lotey Brothers, Hindustan Tyres, Hightech Halftone, Mahaveer Steels, Durga Industries,H.K. Engineers,

4. RELATED PARTY DISCLOSURES UNDER ACCOUNTING STANDARD

5 A. Name of associated parties and nature of related party relationship

I) i) Associated companies: Milton Cycles Inds Ltd,

Janki Das & sons (P) Ltd,

Janki Das & Co.,

Roamer Engineering Works (P) Ltd.,

Exotic Flora (P) Ltd..

ii) Subsidiary Companies are: Atlas Cycles (Sonipat) Ltd, Atlas Cycles (Sahibabad) Ltd, Atlas Cycles (Malanpur) Ltd.

II) Directors & Employees (As on 31.03.2011) :

Sh. I.D. Chugh,

Sh. H.K. Ahuja,

Sh. H.L. Bhatia,

Sh. J.N. Sawhney,

Sh. P.R. Chawla,

Sh. Jai Dev Kapur,

Sh. Vikram Kapur,

Sh. Salil Kapur

Sh. Gautam Kapur,

Sh. Girish Kapur,

Sh. Sanjay Kapur,

Sh. Rajiv Kapur,

Sh. Angad Kapur,

Sh. Rishav Kapur,

Sh. Prashant Kapur,

Sh. Rahul Kapur,

Sh.Sidhant Kapur,

Sh.Abhinav Kapur,

Sh. Ashwin Kapur.

6 EXTRAORDINARY ITEMS - LEGAL & PROFESSIONAL

In order to recover the damage and loss which has been perpetrated by the ex. Malanpur Head, the legal actions initiated by the company in the recovery and its fight for its patent rights has caused the company legal expenses amounting to Rs.67.65 lacs (Previous Year Rs. 57.14 lacs).

7. Figure of the Previous Year have been re-arranged, wherever necessary.

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Mar 31, 2010

2010 2009 Rs. Rs.

1. CONTINGENT LIABILITIES IN RESPECT OF

a) Surety bonds executed in favor of President of India through Customs & Excise authorities for payment of Central Excise/Custom duty

1,64,99,412 1,64,99,412

b) Two surety bonds in favour of government of Haryana for payment of Central & Local Sales Tax 30,40,000 30,40,000 c) Guarantees given by bank 14,01,77,319 12,01,16,448

d) In respect of Entry Tax matters 2,79,000 7,61,000

e) In respect of Excise matters 56,20,000 56,02,000

f) In respect of Sales Tax matters 6,59,65,000 5,87,21,000

2. SEGMENT REPORTING

Based on the guiding principles given in Accounting Standard -17 "Segment Reporting" issued by the Institute of Chartered Accoun- tants of India, the Companies business segment includes bicycle manufacturing and Steel tube manufacturing.

SEGMENT ACCOUNTING POLICIES

The accounting policies adopted for the segment reporting are in line with the accounting policies of the company with the following additional policies for the segment reporting.

(i) Inter segment revenue have been accounted on cost to the receiving segmental unit.

(ii) Expenses have been included to the segment on the basis of their relationship to the accounting activities of the segment. Expenses which relate to the enterprise as a whole and are not allocable to the segments on a reasonable basis, have been included under "unallocated corporate expenses."

(iii) Segments assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets and provisions, which are reported as direct offsets in the balance sheet. Segment liabilities include all operat- ing liabilities and consist principally of creditors and accrued liabilities.

3. LIST OF SMALL SCALE SUPPLIERS WHERE THE OUTSTANDING ARE OVER 30 DAYS:

Alag Cycle Inds, Aarti Steel Ltd, Amber Inds, Bharat Intl, Bharat Udyog, Charu Auto Inds, Gobind Cycles (Pvt) Ltd, Goel Interprises, Govind Steel, Hindustan Tyres, , Active Cycle Industries, B.J.Sales Corp, Hargobind Mach Works, Meera Inds, New Modern Steel, Sabarwal Interprises, Brosis Intl, Vishal Udyog Pvt Ltd, Vishal Cycles Pvt Ltd, Auto Fan (India) Appu Intl, Sukhmani Steel, D.K.Inds, Kamal Cycles, Metro Tyres, Pinki Plastics, Prestige Polyfolds, Ravi Inds, Rana Enterprises, Rolex, Rahul Interprises. Atam Ballabh, Vishwakarma Inds, Alled Strips, Bajrang Inds, D.K.Enterprises, Sony Inds, Harnek Singh & Co, Om Shivam Cycles, Amar Chand & Sons, Batla Corp, H.K.Engg, Randhir Paints, Kashmir Min & Paint Ltd, Simple Paints, Ason Bikes, Field Marshal Products, Great Gearts Pvt Ltd, Gupta Bikes, Jeet Enterprises, Margo Expots, Nagpal Enterprises, Parko Sunrise Enterprises, Syndicate Tyres, Khular Cycles, Lions inds, Nitya Enterprises, Pratab Cycle Inds, Rider Bike Pvt Ltd, Sewak Screw, Enn Gee Industrial Corp, Ess Pee Inds, Fit Right Organics, Rana Enterprises, Salana Cycle Inds, Ess Ess Products of india, Atul Metal Inds, Cargo International Packing, Crown Products, Durga Industries, Industrial Sales Promoters, Punjab Poly Pack, Rishi Udyog, Raj Impex, Saurashtra Indl Products, Saif Product, Sharda Packing, Chandan Inds, S.J.Cycle Inds, Speedo Expots, Active Cycle Inds, Amardeep Steel Inds, Balbinder Mech Works, Joginder Singh Tejinder Singh, Kid Ride Inds, Vee Pee Inds, Navin Enterprises, Jain Inds, Bansal Inds, J.B.Inds, Mankoo Steels, Randhir Indl Corp, Rajeen Inds, Watson Engg, Singh Packers, Advance Plastic, Ark Engg Works, Ravi Industries,.Globe Inds.

4. RELATED PARTY DISCLOSURES UNDER ACCOUNTING STANDARD 18 A. Name of associated parties and nature of related party relationship

I) i) Associated companies: Milton Cycles Inds Ltd, Janki Das & sons (P) Ltd, Janki Das & Co., Roamer Engineering Works

(P) Ltd., Exotic Flora (P) Ltd..

ii) Subsidiary Companies are: Atlas Cycles (Sonipat) Ltd, Atlas Cycles (Sahibabad) Ltd, Atlas Cycles (Malanpur) Ltd.

II) Directors & Employees (As at 31.03.2009) : Sh. I.D.Chugh, Sh. H.K.Ahuja, Sh. H.L.Bhatia, Sh. J.N.Sawhney, Sh. P.R. Chawla, Sh. Jai Dev Kapur, Sh. Vikram Kapur, Sh. Salil Kapur, Sh. Gautam Kapur, Sh. Girish Kapur, Sh. Sanjay Kapur, Sh. Rajiv Kapur, Sh. Angad Kapur, Sh. Rishav Kapur,Sh.Prashant Kapur,Sh.Rahul Kapur,Sh.Sidhant Kapur, Sh. Abhinav Kapur.

5 EXTRAORDINARY ITEMS - LEGAL & PROFESSIONAL

In order to recover the damage and loss which has been perpetrated by the ex. Malanpur Head, the legal actions initiated by the company in the recovery and its fight for its patent rights has caused the company legal expenses amounting to Rs.57.14 lacs (Previous Year Rs. 34.48 lacs).

6. Figure of the Previous Year have been re-arranged, wherever necessary.