Notes to Accounts of Eon Electric Ltd.

Mar 31, 2018

1. Corporate Information :

Eon Electric Limited is a public limited company domiciled in India and incorporated under the provisions of the Companies Act, 1956. The Registered Office of the company is situated at House No. 1048, Sector 14, Sonepat, Haryana. The shares of the company are listed on the National Stock Exchange of India Limited and Bombay Stock Exchange Limited. The company is engaged in the manufacturing and selling of Cables and Wires, Energy Efficient LED Based Lighting, Wiring accessories, Fans, Geysers, Lithium-ion Batteries, Mobile phone accessories and other electrical products. The Company''s manufacturing facilities are located at Haridwar in Uttarakhand. The financial statements were authorized by the Board of Directors for issue in accordance with resolution passed on 30th May, 2018.

2. Inventories are valued as under :-

Raw Material : At lower of cost determined on FIFO basis and net realisable value.

Work-in-Progress : At lower of cost and net realisable value.

Finished Goods : At lower of cost including excise duty and net realisable value.

Stock-in-Trade : At cost.

During the year ended March 31, 2018 the Company has converted 8,45,000 Zero Coupon Equity Warrants issued by it on preferential basis by private placement to the promoters of the Company into 8,45,000 fully paid Equity Shares of the face value of Rs. 5/- each at a price of Rs.66.50 per share. The difference between the conversion price and the face value of equity shares has been credited to Securities Premium Reserve.

3. Terms/rights attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs.5/- per share. Each holder of equity shares is entitiled to one vote per share. The Company declares and pays dividends in Indian rupees.

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.

Notes:

3.1 Vehicle Loans from Banks and others are secured by way of Hypothecation of Vehicles acquired out of such loans.

3.2 Vehicle Loans are repayable in 60 Equated Monthly Installments commencing from the date of sanction of the Loan.

3.3 Deferred payment liability was due to Haryana State Industrial & Infrastructure Development Corporation Limited against land purchased from them and is payable in 8 equal half yearly installments alongwith interest thereon.

4.1 Cash Credit Facility from State Bank of India / Patiala is secured primarily by first charge by way of hypothecation of entire current assets and collaterally by equitable mortgage (first charge) of Plot No. 10, Sector-4, IIE, SIDCUL, Haridwar and first charge on Plant and Machinery situated thereon and personally guaranteed by three directors of the company. The said facility is re-payable on demand.

4.2 Cash Credit Facility from RBL Bank Limited is secured by subservient charge by way of hypothecation on entire current assets and movable fixed assets of the company both present and future, pledge of 800,000 shares of the company held by the promoters and collaterally by way of exclusive charge on Land and Building located at Plot No. 1C, Sector 7, IIE, SIDCUL, Haridwar and personally guaranteed by three directors of the company. The said facility is re-payable on demand.

4.3 Overdraft from Standard Chartered Bank is secured by pledge of first fixed charge on Investments in Mutual Funds and Bonds liened in favour of the Bank. The said loan is vaild for one day or repayable on demand.

4.4 Overdraft from RBL Bank Limited is secured by pledge of Debt Mutual Funds and Bonds held in the name of the company and 900,000 shares of the company held by the promoters. The said loan is repayable on demand.

4.5 Overdraft from Deutsche Bank A.G. since settled in full during the year 2016-17 was secured against pledge of approved Investments in Mutual Funds and Bonds held in the name of the company.

5. Information on Operating Segments of the Company for the year ended 31st March 2018 operating Segments

In accordance with the Ind AS-108 “Operating Segment” (specified under section 133 of the Companies Act, 2013, read with Rule 7 of Companies (Accounts) Rules, 2015 the Company''s operations have been categorized into the following Operating segments :-

Cable and Wires includes Wires and Cables etc.

Lighting includes Compact Fluorescent Lamps, Fluorescent TubeLights, LEDs, Solar and Luminaires etc.

Electrical Consumer Durables includes Fans, Water Heaters etc.

Others includes Lithium Ion Batteries, Mobile Phone Accessories etc.

No operating segments have been aggregated to form above reporatable operating segments.

Segment Revenue relating to each of the above business segments includes Other Income, where applicable.

The above business segments have been identified considering :

a) the nature of products and services

b) the differing risks and returns

c) the organization structure, and

d) the internal financial reporting systems.

There are no geographical segments as the operations of the company''s existing Business Segments take place indigenously.

Notes:-

i. Segment results represent Profit/(loss) before Interest and Tax.

ii. Capital Expenditure pertains to gross additions made to fixed assets during the year including capital work in progress.

iii. Segment Assets include Fixed Assets, Current Assets & Loans and Advances directly attributable to respective business segments.

iv. Segment Liabilities include Current Liabilities and Provisions directly attributable to respective business segments.

v. The accounting policies used to derive reportable segment results are consistent with those described in the “Significant Accounting Policies” note to the financial statements.

* FVTPL - Fair Value Through Profit and Loss

# FVTOCI - Fair Value Through Other Comprehensive Income (i) Fair Value Hierarchy

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in financial statements. To provide an indication about the reliability of inputs used in determining fair values, the group has classified its financial instruments into three levels prescribed under the accounting standards.

The fair value of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

The following table provides the fair value measurement hierarchy of Company’s asset and liabilities, grouped into Level 1 to Level 3 as described below

Level 1: Quoted (unadjusted) market prices in active markets for identical assets or liabilities.

Level 2: Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable.

Level 3: Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

(ii) Valuation techniques used to determine Fair value

The Company maintains policies and procedures to value financial assets or financial liabilities using the best and most relevant data available. The fair values of the financial assets and liabilities are included at the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Specific valuation techniques used to value financial instrument includes:

- the use of quoted market prices or dealer quotes for similar financial instruments.

- the fair value of financial assets and liabilities at amortised cost is determined using discounted cash flow analysis.

The following method and assumptions are used to estimate fair values:

The Carrying amounts of trade receivables, trade payables, capital creditors, cash and cash equivalents, short term deposits etc. are considered to be their fair value, due to their short term nature.

6. Financial Risk Management - Objectives and Policies

The Company''s financial liabilities comprise mainly of borrowings, trade payables and other financial liabilities. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s financial assets comprise mainly of investments, trade receivables, cash and cash equivalents, other bank balances and other financial assets.

The Company is exposed to Market risk, Credit risk and Liquidity risk. The Board of Directors oversee the management of these financial risks. The senior professionals working to manage the financial risks and the appropriate financial risk governance framework for the Company are accountable to the Board of Directors and Audit Committee. This process provides assurance to Company''s senior management that the Company''s financial risk-taking activities are governed by appropriate policies and procedures and that financial risk are identified, measured and managed in accordance with Company policies and Company risk objective.

The Board of Directors reviews and agrees policies for managing each of these risks which are summarized as below :

1) 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 three types of risks: interest rate risk, currency risk and other price risk. Financial instruments affected by market risk include loans and borrowings, deposits, investments, trade receivables and trade payables.

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. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s Investments in Debt based Mutual Funds and Company''s borrowings from Banks at floating interest rates. Any increase or decrease in the rate of interest would directly affect the return on these investments. Similarly any increase or decrease in the rate of interest on borrowings would have an adverse or favourable impact on the profitability of the Company.

b) Foreign Currency Risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate due to changes in foreign exchange rates. The Company does not enter into any derivative instruments for trading or speculative purposes.

The carrying amounts of the Company''s Unhedged foreign currency denominated monetary items are as follows:

c) Other Price Risk

Other price risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market traded price.

The Company is exposed to price risk arising from investments in bonds recognised at FVTOCI. As at 31st March, 2018, the carrying value of such instruments recognised at FVTOCI amounts to Rs.103,264,503/- (Rs.103,871,752/as at 31st March, 2017 and Rs.101,483,566/- as at 1st April, 2016). These being debt instruments, the exposure to risk of changes in market rates is minimal. The details of such investments in bonds are given in Note No. 5.

2) Credit Risk

Credit Risk is the risk that the counter party will not meet its obligation under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including investments in mutual funds, deposits with banks and other financial instruments.

a) Trade Receivables

Customer credit risk is managed by each business unit subject to the Company''s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on an analysis of its credit worthiness and accordingly individual credit limits are defined / modified. Outstanding customer receivables are regularly monitored and any sales to new customers are generally covered by letters of credit and other forms of security.

An impairment analysis is performed at each reporting date on trade receivables by lifetime expected credit loss method based on provision matrix. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets. The Company does not hold collateral as security. The concentration of credit risk is limited due to the fact that the customer base is large and located in several jurisdictions.

The following table summarizes the movement in expected credit loss allowance measured using the Life Time Expected Credit Loss model:

b) Investments in Mutual Funds and Other Financial Assets

Credit risk arising from investment in mutual funds and other balances with banks is limited and there is no collateral held against these because the counterparties are banks and recognised financial institutions with high credit ratings assigned by the international credit rating agencies.

3) Liquidity Risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at reasonable price. The Company''s exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. The Company manages the liquidity risk by maintaining funds in cash and cash equivalents. The Company also has credit facilities agreed with banks to ensure that there is sufficient cash to meet all its normal operating commitments in a timely and cost-effective manner. Management monitors the Company''s liquidity position through rolling forecasts on the basis of expected cash flows.

Maturity profile of financial liabilities

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

7. Capital Management

For the purpose of the Company''s capital management, capital includes issued capital and all other equity reserves attributable to the equity shareholders of the Company. The primary objective of the Company when managing capital is to safeguard its ability to continue as a going concern and to maintain an optimal capital structure so as to maximize shareholder value.

As at 31st March, 2018, the Company has only one class of equity shares. Consequent to such capital structure, there are no externally imposed capital requirements. In order to maintain or achieve an optimal capital structure, the Company allocates its capital for distribution as dividend or re-investment into business based on its long term financial plans.

8. Disclosures as required by Indian Accounting Standard (Ind AS 101) First Time Adoption of Indian Accounting Standards

These are Company''s first financial statements prepared in accordance with Ind AS.

The accounting policies set out in Note 2 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 Balance Sheet as at April 1, 2016 (The Company''s date of transition).

For all periods up to and including the year ended 31st March, 2017, the Company had prepared its financial statements in accordance with the accounting standards notified under Section 133 of the Companies Act, 2013, read together with Rule 7 of the Companies (Accounts) Rules, 2014 (‘Previous GAAP'').

This note explains the principal adjustments made by the Company in restating its financial statements prepared under Previous GAAP for the following

a) Balance Sheet as at 1st April, 2016 (Transition date);

b) Balance Sheet as at 31st March, 2017;

c) Statement of Profit and Loss for the year ended 31st March, 2017; and

d) Statement of Cash flows for the year ended 31st March, 2017.

1) EXEMPTIONS AVAILED:

Ind AS 101- First-time adoption of Indian Accounting Standards, allows first-time adopters, exemptions from the retrospective application and exemption from application of certain requirements of other Ind AS. The Company has availed the following exemptions as per Ind AS 101:

a) Business Combinations

Ind AS 101 provides the option to apply Ind AS 103 prospectively from the transition date or from a specific date prior to the transition date. This provides relief from full retrospective application that would require restatement of all business combinations prior to the transition date. The Company has availed the said exemption and elected to apply Ind AS 103 prospectively to business combinations occurring after its transition date. Accordingly business combinations occurring prior to the transition date have not been restated.

b) Deemed Cost

Ind AS 101 permits a first time adopter to elect to fair value of its property, plant and equipment as recognised in financial statements as at the date of transition to Ind AS, measured as per previous GAAP and use that as its deemed cost as at the date of transition or apply principles of Ind AS retrospectively. Ind AS 101 also permits the 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. This exemption can be also used for intangible assets covered by Ind-AS 38.

The Company has elected to consider carrying value of all its Property, Plant and Equipment and Intangible Assets as its deemed cost on the date of transition to Ind AS.

c) Leases

Appendix C to Ind AS 17-” Leases” requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS 17, this assessment should be carried out at the inception of the contract or arrangement. Ind AS 101 provides an option to make this assessment on the basis of facts and circumstances existing at the date of transition to Ind-AS except where the effect is expected to be not material.

The Company has elected to apply this exemption for such contracts/arrangements.

d) Investments in Subsidiaries, Associates and Joint ventures

Ind AS 101 permits the first time adopter to measure investment in Subsidiaries, Joint ventures and Associates in accordance with Ind AS 27 at one of the following:

a) cost determined in accordance with Ind AS 27 or

b) Deemed cost:

(i) fair value at date of transition

(ii) previous GAAP carrying amount at that date.

The Company has elected to consider previous GAAP carrying amount of its investments in subsidiaries, Joint ventures and associates on the date of transition to Ind AS as its deemed cost for the purpose of determining cost in accordance with principles of Ind AS 27- “Separate Financial Statements”.

2) Ind AS Mandatory Exceptions

a) Estimates

An entity 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 at April 1, 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP.

b) Derecognition of Financial Assets and Financial Liabilities

Ind AS 101 requires a first time adopter to apply the derecognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. Accordingly, the Company has applied the derecognition requirement for financial assets and financial liabilities in Ind AS 109 prospectively for transactions occurring on or after date of transition to Ind AS.

c) Classification of Financial Assets and Liabilities

Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of facts and circumstances that exist on the date of transition to Ind AS. Accordingly, the Company has applied the above requirement prospectively.

d) Impairment of Financial Assets

Ind AS 101 requires an entity to assess and determine the impairment allowance on financial assets as per Ind AS 109 using the reasonable and supportable information that is available without undue cost or effort to determine the credit risk at the date that financial instruments which were initially recognised and compare that to the credit risk at the date of transition to Ind AS. The Company has applied this exception prospectively.

Notes to the reconciliation of Balance Sheet as at 1st April, 2016 and 31st March, 2017 and the Total Comprehensive Income for the year ended 31st March, 2017

A Non-Current Assets

1. Non-Current Investments:

In the financial statements prepared under the Previous GAAP, Non-current Investments of the Company were measured at cost less provision for diminution (other than temporary). Under Ind AS, the Company has recognised such investments as follows:

- Investment in Joint Venture - At Cost

- Investment in Bonds - At fair value through other comprehensive income (FVTOCI)

- Investment in Others- - At fair value through profit and loss (FVTPL)

Ind AS requires the above investments to be recognised at fair value (except investments in equity shares of Joint Venture and associate companies).

On the date of transition to Ind AS, the difference between the fair value of Non-Current Investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under Previous GAAP, has resulted in an increase in the carrying amount of these investments by Rs 85,84,566/- which has been recognised directly in retained earnings (Equity). Deferred tax liability amounting to Rs 17,68,421/- has been recognised on such fair valuation gain.

As at 31st March, 2017, the difference between the fair value of Non-Current Investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under the Previous GAAP, has resulted in an increase in the carrying amount of these investments by Rs. 10,972,752.The difference in the fair value of these investments as on 31st March 2017 and the transition date amounting to Rs 23,88,186/- has been recognised in OCI. Correspondingly, deferred tax expense amounting to Rs 4,91,965/- on this has been recognised in OCI .

The above transition has resulted in increase in equity by Rs 85,84,566/- as at date of transition to Ind AS and by Rs 109,72,752/- as at 31st March, 2017. Also, deferred tax on the same has resulted in decrease in equity by Rs 17,68,421/- as at date of transition to Ind AS and by Rs 22,60,386/- as at 31st March, 2017.

2. Loans :

In the financial statements prepared under the Previous GAAP, interest free security deposits (that are refundable in cash on completion of the lease term) are recorded at their transaction value. Under Ind AS, Interest free Security Deposits being a financial assets are required to be recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. The difference between the transaction value and fair value is recognised as prepaid rent as on the date of transition.

Due to this Security deposit is decreased and prepaid rent is increased by Rs 2,61,017/- and Rs 1,16,091/- as on 1st April , 2016 and 31st March, 2017 respectively. Profit for the year ended 31st March, 2017 is decreased by Rs 1, 44,926/- due to amortisation of prepaid rent which is set off with the notional interest income of Rs 1,44,926/-.

The above changes do not affect Equity as at date of transition to Ind AS and as at 31st March, 2017.

3. Amortised Cost of Financial Assets

In the financial statements prepared under the previous GAAP, interest accrued on Fixed Deposits and Margin Money Deposits was shown as interest receivable on Fixed Deposits with Banks under Other Current Assets. Under Ind AS such fixed deposits are financial assets and are qualified to be recognized at amortised cost at reporting date as per Ind AS 109. Accordingly the Company has measured them at amortised cost at reporting date. Accordingly amortised cost of fixed deposits is increased by Rs 20,24,930/-and Rs 75,96,102/- as at the date of transition and March 31, 2017 respectively with the corresponding decrease in interest receivable on fixed deposits. There is no impact on total equity and profit.

B. Current Assets:

1. Current Investments:

In the financial statements prepared under the Previous GAAP, Current Investments of the Company were measured at lower of cost or fair value. Under Ind AS, these investments have been recognised at FVTPL on the date of transition.

The fair value changes are recognised in the Statement of Profit and Loss.

On the date of transition to Ind AS, the difference between the fair value of Current Investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under the Previous GAAP, has resulted in an increase in the carrying amount of these investments by Rs 2,75,69,749/- which has been recognised directly in retained earnings (Equity). Deferred tax liability amounting to Rs 85,19,052/- has been recognised on such fair valuation gain.

As at 31st March, 2017, the difference between the fair value of Current Investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under the Previous GAAP, has resulted in an increase in the carrying amount of these investments by Rs 2,73,73,790/-.

Fair valuation loss for the year ended 31st March, 2017, amounted to Rs 1,95,959/- and the same has been recognized in Other income in Statement of Profit and Loss. Correspondingly, deferred tax benefit amounting to Rs 60,551/- has been recognised in Statement of Profit and Loss. The above transition has impacted an increase in equity by Rs 2,75,69,749/- as at transition date and by Rs 2,73,73,790/- as at 31st March, 2017. Also, deferred tax on the same has resulted in decrease in equity by Rs 85,19,052/- as at date of transition to Ind AS and decrease in equity by Rs 84,58,501/- as at 31st March, 2017.

2. Impairment Allowance for Trade Receivables :

In the financial statements prepared under the Previous GAAP, Trade Receivables of the Company were stated after making provision for doubtful debts. Under Ind AS , the company has applied the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to be recognized from initial recognition of the receivables.

Due to this the difference between the impairment allowance on Trade Receivables as per IndAS and the provision made as per the financial statements prepared under the previous GAAP has resulted in a decrease in the carrying amount of Trade Receivables by Rs 61,18,687/- as at transition date and by Rs 1,32,91,337/- as at 31st March, 2017. This has also resulted in a decrease in the amount of Equity by Rs 61,18,687/- as at transition date and a reduction of Rs 71,72,650/- in the profit of the company for the year ended 31st March, 2017.

3. Amortised Cost of Financial Assets

In the financial statements prepared under the previous GAAP, interest accrued on Fixed Deposits and Margin Money Deposits was shown as interest receivable on Fixed Deposits with Banks under Other Current Assets. Under Ind AS such fixed deposits are financial assets and are qualified to be recognized at amortised cost at reporting date as per Ind AS 109. Accordingly the Company has measured them at amortised cost at reporting date. Accordingly amortised cost of fixed deposits is increased by Rs 6,04,111/-and Rs 3,62,788/- as at the date of transition and March 31, 2017 respectively with the corresponding decrease in interest receivable on fixed deposits. There is no impact on total equity and profit.

C. Money received against Share Warrants

In the financial statements prepared under the Previous GAAP, Money received against Share Warrants was shown as a separate line item which did not form part of the Equity Share Capital or Reserves and Surplus. Under Ind AS, Money received against Share Warrants is classified under the head Other Equity. The re-classification of the Money received against Share Warrants has resulted in an increase in the Other Equity by Rs 1,40,48,125/as at 31st March, 2017.

D. Amortised Cost of Financial Liabilities

In the financial statements prepared under the previous GAAP, interest accrued on Security Deposits was shown as interest payable under Other Current Liabilities. Under Ind AS all financial liabilities are to be recognized at Fair Value i.e. amortised cost at reporting date as per Ind AS 109. Accordingly the Company has measured them at amortised cost at reporting date. Accordingly amortised cost of Security deposits is increased by Rs 5,80,279/and Rs 5,80,291/- as at the date of transition and March 31, 2017 respectively with the corresponding decrease in interest payable on security deposits. There is no impact on total equity and profit.

Further the value of Vehicle Loans is increased by Rs. 12,038/- on account of valuation of such borrowing at amortised cost with a corresponding reduction in the profit for the year ended 31st March, 2017.

E. Deferred tax:

In the financial statements prepared under the Previous GAAP, deferred tax was accounted as per the income statement approach which required creation of deferred tax asset/liability on temporary differences between taxable profit and accounting profit. Under Ind AS, deferred tax is accounted as per the Balance Sheet approach which requires creation of deferred tax asset/liability on temporary differences between the carrying amount of an asset/liability in the Balance Sheet and its corresponding tax base.

The application of Ind AS has resulted in recognition of deferred tax on new temporary differences which were not required to be recognized In the financial statements prepared under the Previous GAAP. In addition, the above mentioned transitional adjustments relating to current/non-current investments have also led to temporary differences and creation of deferred tax thereon.

The above changes have resulted in creation of deferred tax liabilities amounting to Rs 83,96,799/- as at date of transition to Ind AS and Rs 66,11,864/- as at 31st March, 2017. For the year ended 31st March, 2017, it has resulted in recognition of deferred tax benefit by Rs 22,76,901/- in the Statement of Profit and Loss and an increase in deferred tax expense by Rs 4,91,966/- in OCI.

F. Revenue from Sale of products/ Excise Duty:

In the financial statements prepared under the previous GAAP, revenue from sale of products was presented exclusive of excise duty. Under Ind AS revenue from sales of goods is presented inclusive of excise duty. Excise duty paid is presented on face of Statement of Profit and Loss as a part of expense. This change has resulted in increase in total revenue and total expense for the year ended 31st March 2017 by Rs 4,78,95,280/- There is no impact on total equity and profit.

G. Sales Discount

In the financial statements prepared under the previous GAAP, Sales discount was presented under other expenses. Under Ind AS revenue from sales of products is recognised at fair value of consideration expected to be received. Accordingly revenue for the year ended 31st March 2017 is presented net of Sales Discount. This change has resulted in decrease in total revenue and total expense for the year ended 31st March 2017 by Rs 3,48, 64,833/-. There is no impact on total equity and profit.

H. Re-measurement benefit of Defined Benefit Plans:

In the financial statements prepared under the Previous GAAP, re-measurement benefit of defined plans (Gratuity and Leave Encashment), arising primarily due to change in actuarial assumptions was recognised as employee benefits expense in the Statement of Profit and Loss. Under Ind AS, such re-measurement benefits relating to defined benefit plans is recognised in OCI as per the requirements of Ind AS 19- Employee benefits. Consequently, the related tax effect of the same has also been recognised in OCI.

For the year ended 31st March, 2017, re-measurement of gratuity liability and leave encashment liability resulted in an actuarial loss of Rs 7,60,027/-. The loss of Rs 7,60,027/- on account of change in actuarial assumptions has now been removed from employee benefits expense in the Statement of Profit and Loss and recognised separately in OCI.

This has resulted in reduction in employee benefits expense by Rs 7,60,027/- and decrease in OCI by Rs 7,60,027/- for the year ended 31st March, 2017.

The above changes do not affect Equity as at date of transition to Ind AS and as at 31st March, 2017.

However, Profit before tax and profit for the year ended 31st March, 2017 increased by Rs 7,60,027/

I. Other Comprehensive Income

Under Indian GAAP, the Company has not presented other comprehensive income (OCI) separately.

Hence, it has reconciled Indian GAAP profit to profit as per Ind AS. Further, Indian GAAP profit is reconciled to total comprehensive income as per Ind AS.

J. Statement of Cash Flows

The transition from Indian GAAP to Ind AS has not had a material impact on the statement of cash flows

9. The provision in regard to Section 135 of the Companies Act, 2013 in regard to Corporate Social Responsibility is not applicable to the Company.

10. Figures for the previous year have been reclassified / regrouped / re-stated wherever necessary to make them comparable.

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Mar 31, 2016

1. Aggregate Number of Shares bought back during the preceding 5years

The Company has bought back and extinguished 17,84,162 Equity Shares of '' 10/- each from the existing owners of Equity Shares other than the Promoters / Persons in Control from the open market through the Stock Exchange(s) in the year 2011-12.

2. Terms/rights attached to Equity Shares

The Company has only one class of equity shares having a par value of'' 5/- per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees.

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.

3. Contingent Liabilities and Commitments:-

4. Contingent Liabilities

5. Bank Guarantees Rs. 137,919,607/- (Previous yearRs.98,237,090/-).

6. Bond furnished to Custom & Central Excise Authorities for import of goods at Concessional Rate of Duty Rs. 72,500,000/- (Previous year Rs. 72,500,000/-).

7. Excise duty demands against which the company has preferred appeals Rs. 54,136,865/- (Previous year Rs. 54,136,865/-). The Company has already deposited a sum of Rs. 3,197,272/- (Previous yearRs.3,151,704/-) against the aforesaid demand.

8. Central Excise and Service Tax Appeals filed by the DepartmentRs.8,089,749/-(Previous yearRs.8,089,749/-) for excise duty and Rs. 119,921/- (Previous year Rs. 119,921/-) for service tax.

9. Sales Tax / Value Added Tax Demands against which the company has preferred appeals Rs. 5,374,917/-(Previous year Rs. 5,374,917/-). The company has already deposited a sum of Rs. 806,702/- (Previous year Rs. 806,702/-) against the aforesaid demand.

10. Income Tax demands against which the company has preferred appeals Rs. 2,137,200/- (Previous year Rs. 109,426/-).

11. Arrears for Statutory Bonus for 2014-15 not provided for Rs. 1,416,835/- as the retrospective amendment has been stayed by the Karnataka, Kerala & Uttrakhand High Courts.

12. Commitments

13. Capital commitments (net of advance) Rs. 3,173,810/- (Previous year Rs. 170,016/-).

14. Commitment to pay balance amount towards contribution to the Share Capital of Zephyr Peacock India

III Fund Rs.6,251,554/- (Previous YearRs.6,629,015/-)

15. Provision for income tax has been made without considering some taxes and amounts which will be paid before fling of Income Tax Return as provided under Section 43-B of the Income Tax Act, 1961.

16. In the opinion of Board, the current assets, loans and advances are approximately of the value stated, if realized, in the ordinary course of business. The provision for depreciation and all known liabilities is adequate and not in excess of the amount reasonably necessary.

17. The balances of Trade Receivables, Advances and Trade Payables are subject to confirmation.

18. The company has paid annual listing fees to Bombay Stock Exchange Limited and National Stock Exchange of India Limited where its equity shares are listed.

19. Information on Segment Reporting of the Company for the year ended 31st March 2016 Business Segments

In accordance with the Accounting Standard (AS) 17 “Segment Reporting”, the Company’s operations have been categorized into the following Business segments :-

Cable and Wires includes Wires and Cables etc.

Lighting includes Compact Fluorescent Lamps, Fluorescent TubeLights, LEDs and Luminaires etc.

Electrical Consumer Durables includes Fans, Water Heaters etc.

Others includes Lithium Ion Batteries, Mobile Phone Accessories etc.

Segment Revenue relating to each of the above business segments includes Other Income, where applicable. The above business segments have been identified considering :

a) the nature of products and services

b) the differing risks and returns

c) the organization structure, and

d) the internal financial reporting systems.

There are no geographical segments as the operations of the company’s existing Business Segments take place indigenously.

Notes:-

20. Segment results represent Profit/(Loss) before Interest and Tax.

21. Capital Expenditure pertains to gross additions made to fixed assets during the year including capital work in progress.

22. Segment Assets include Fixed Assets, Current Assets & Loans and Advances directly attributable to respective business segments.

23. Segment Liabilities include Current Liabilities and Provisions directly attributable to respective business segments.

24. The accounting policies used to derive reportable segment results are consistent with those described in the “Significant Accounting Policies” note to the financial statements.

25. Related Party Disclosure

Disclosures as required by Accounting Standard (AS-18) “Related Party Disclosures “are given below: A Investing Parties with whom the Company is a Joint Venture Partner

1. Indo Simon Electric Private Limited (#)

(#) Ceased to be a Joint Venture during the previous year ended 31st March, 2015.

2. Luxtra Lighting Private Limited

B. Directors, Key Managerial Personnel

1. Mr. V. P. Mahendru

2. Mr. Vinay Mahendru

3. Mr. Vivek Mahendru

C. Relatives of Directors & Key Managerial Personnel 1. Ms. Ridhi Mahendru

D. Key Managerial Personnel

1. Mr. K.B.Satija

2. Mr. Kumar Indramani (resigned w.e.f. 19th October, 2015)

E. Group Company

1. IAFL Switchgears Private Limited

F. LLP firms in which Directors and their relatives are Partners

1. VPM Industrial Services Corporation LLP

G. Company in which Directors and their relatives are Directors

1. VPM Electricals Private Limited

26. Related Party Disclosure

Disclosures as required by Accounting Standard (AS-18) “Related Party Disclosures “are given below: A Investing Parties with whom the Company is a Joint Venture Partner

1. Indo Simon Electric Private Limited (#)

(#) Ceased to be a Joint Venture during the previous year ended 31st March, 2015.

2. Luxtra Lighting Private Limited

B. Directors, Key Managerial Personnel

1. Mr. V.P.Mahendru

2. Mr. Vinay Mahendru

3. Mr. Vivek Mahendru

C. Relatives of Directors & Key Managerial Personnel 1. Ms. Ridhi Mahendru

D. Key Managerial Personnel

1. Mr. K.B.Satija

2. Mr. Kumar Indramani (resigned w.e.f. 19th October, 2015)

E. Group Company

1. IAFL Switchgears Private Limited

F. LLP firms in which Directors and their relatives are Partners 1. VPM Industrial Services Corporation LLP

G. Company in which Directors and their relatives are Directors

1. VPM Electricals Private Limited

27. Lease Payments under an operating lease are recognized as an expense in the Statement of Profit and Loss on a straight line basis over the lease term. Accordingly Rs. 13,280,942/- has been charged to Statement of Profit and Loss during the year (Previous year Rs. 14,256,549/-).

28. The Company had terminated its Joint Venture Agreement with Simon Holding S.L., Spain on 8th September, 2014 and has accordingly agreed to transfer its entire share holding comprising of 22,849,462 Shares in the Joint Venture Company Indo Simon Electric Private Limited to M/s Simon Holding S.L., Spain.

During the year ended 31st March, 2015, the Company had transferred 18,965,054 Shares of the Face Value of Rs. 10/- each aggregating to Rs. 189,650,540/- held by it in the said Joint Venture Company for a total consideration of Rs. 182,441,256/-. The loss of Rs. 7,209,284/- arising on the transfer of the above shares had been considered as an Exceptional Item. Further the Company had also made a provision of Rs. 7,000,000/- towards diminution in the value of the remaining shares held by it in the said company which too was considered as an Exceptional Item.

---

Mar 31, 2015

1. Company Overview :

Eon Electric Limited is a public limited company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on the National Stock Exchange of India Limited and Bombay Stock Exchange Limited. The company is engaged in the manufacturing and selling of Cables and Wires, Energy Efficient Lighting, Wiring accessories, Fans, Geysers, Lithium-ion Batteries, Mobile phone accessories and other electrical products. The Company''s manufacturing facilities are located at Haridwar in Uttarakhand.

2. Terms/rights attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs. 5/- per share. Each holder of equity shares is entitiled to one vote per share. The Company declares and pays dividends in Indian rupees.

3. 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.

4. Contingent Liabilities and Commitments:-

a. Contingent Liabilities

i) Bank Guarantees Rs. 98,237,090/-(Previous year Rs. 49,965,592/-).

ii) Bond furnished to Custom & Central Excise Authorities for import of goods at Concessional Rate of Duty Rs. 72,500,000/- (Previous year Rs. 70,000,000/-).

iii) Excise duty demands against which the company has preferred appeals Rs. 54,136,865/- (Previous year Rs.52,314,146/-). The Company has already deposited a sum of Rs. 3,151,704/-(Previous year Rs.3,015,000/-) against the aforesaid demand.

iv) Central Excise and Service Tax Appeals filed by the Department Rs. 8,089,749/- (Previous year Rs. 2,065,676/-) for excise duty and Rs. 119,921/-(Previous year Rs. 119,921/-) for service tax.

v) Sales Tax / Value Added Tax Demands against which the company has preferred appeals Rs. 5,374,917/-(Previous year Rs. 15,967,682/-). The company has already deposited a sum of Rs. 806,702/- (Previous year Rs. 5,664,955/-) against the aforesaid demand.

vi) Income Tax demands against which the company has preferred appeals Rs. 109,426/- (Previous year Nil).

b. Commitments

i) Capital commitments (net of advance) Rs. 170,016/- (Previous year Nil).

ii) Commitment to pay balance amount towards contribution to the Share Capital of Zephyr Peacock India III Fund Rs. 6,629,015/- (Previous Year Rs. 7,379,015/-)

5. Provision for income tax has been made without considering some taxes and amounts which will be paid before filing of Income Tax Return as provided under Section 43-B of the Income Tax Act, 1961.

6. In the opinion of Board, the current assets, loans and advances are approximately of the value stated, if realized, in the ordinary course of business. The provision for depreciation and all known liabilities is adequate and not in excess of the amount reasonably necessary.

7. The balances of Debtors, Advances and Creditors are subject to confirmation.

8. The company has paid annual listing fees to Bombay Stock Exchange Limited and National Stock Exchange of India Limited where its equity shares are listed.

9. Information on Segment Reporting of the Company for the year ended 31s'' March 2015 Business Segments

In accordance with the Accounting Standard (AS) 17 "Segment Reporting", the Company''s operations have been categorized into the following Business segments :-

Cable and Wires includes Wires and Cables etc.

Lighting includes Compact Fluorescent Lamps, Fluorescent TubeLights, LEDs and Luminaires etc.

Electrical Consumer Durables includes Fans, Water Heaters etc.

Others includes Modular Switches, Wiring Accessories, Home Automation, Lithium Ion Batteries, Mobile Phone Accessories etc.

Segment Revenue relating to each of the above business segments includes Other Income, where applicable.

The above business segments have been identified considering :

a) the nature of products and services

b) the differing risks and returns

c) the organization structure, and

d) the internal financial reporting systems.

There are no geographical segments as the operations of the company''s existing Business Segments take place indigenously.

10.

I. Segment results represent Profit/(loss) before Interest and Tax.

ii. Capital Expenditure pertains to gross additions made to fixed assets during the year including capital work in progress.

iii. Segment Assets include Fixed Assets, Current Assets & Loans and Advances directly attributable to respective business segments.

iv. Segment Liabilities include Current Liabilities and Provisions directly attributable to respective business segments.

v. The accounting policies used to derive reportable segment results are consistent with those described in the "Significant Accounting Policies" note to the financial statements.

11. Related Party Disclosure

Disclosures as required byAccounting Standard (AS-18) "Related Party Disclosures"are given below: A Investing Parties with whom the Company is a Joint Venture Partner

1. Indo Simon Electric Private Limited (#)

(#) Ceased to be a Joint Venture during the year.

2. Luxtra Lighting Private Limited

B. Directors, Key Managerial Personnel

1. Mr. V.P.Mahendru

2. Mr. Vinay Mahendru

3. Mr. Vivek Mahendru

C. Relatives of Directors & Key Managerial Personnel

1. Mr.Vimal Mahendru

2. Ms.Ridhi Mahendru

D. Key Managerial Personnel

1. Mr. K.B.Satija

2. Mr. Kumar Indramani

E. Subsidiary Company

1. IAFL Power Distribution & Infrastructure Pvt. Ltd. (*)

(*) Ceased to be a Subsidiary during the year.

F. Group Company

1. IAFL Switchgears Private Limited

G. LLP firms in which Directors and their relatives are partners

1. VPM Industrial Services Corporation LLP

H. Company in which Directors and their relatives are Directors

1. VPM Electricals Private Limited

12. Lease Payments under an operating lease are recognised as an expense in the Statement of Profit and Loss on a straight line basis over the lease term. Accordingly Rs. 14,256,549/- has been charged to Statement of Profit and Loss during the year (Previous year Rs. 16,545,463/-).

13. The Company has terminated its Joint Venture Agreement with Simon Holding S.L., Spain on 8th September, 2014 and has accordingly agreed to transfer its entire share holding comprising of 22,849,462 Shares in the Joint Venture Company Indo Simon Electric Private Limited to M/s Simon Holding S.L., Spain.

14. During the year ended 31st March, 2015, the Company has transferred 18,965,054 Shares of the face Value of Rs.10/-each aggregating to Rs. 189,650,540/- held by it in the said Joint Venture Company for a total consideration of Rs. 182,441,256/-. The loss of Rs. 7,209,284/- arising on the transfer of the above shares has been considered as an Exceptional Item. Further the Company has made a provision of Rs. 7,000,000/- towards diminution in the value of the remaining shares held by it in the said company which too has been considered as an Exceptional Item.

15. With a view to enhance management focus and provide undivided attention to the LED based Lighting business which is one of the core business activities of the company and has immense potential for growth and development, the Company has during the year ended 31st March, 2015, dis-invested its stake of 2,650,000 10% Convertible Preference Shares of the face Value of Rs.10/- each aggregating to Rs. 26,500,000/- held by it in IAFL Power Distribution & Infrastructure Private Limited, which is a subsidiary company as per Section 2(87) (ii) of the Companies Act, 2013 for a total consideration of Rs. 1,325,000/-. The loss of Rs. 25,175,000/- arising from the sale of the above shares has been considered as an Exceptional Item.

With the sale of the above shares, IAFL Power Distribution & Infrastructure Private Limited ceases to be subsidiary of the Company.

16. The provision in regard to Section 135 of The Companies Act, 2013 in regard to Corporate Social Responsibility is not applicable to the Company.

17. Figures for the previous year have been re-arranged / re-grouped where ever necessary to make them comparable with the current year.

---

Mar 31, 2014

Company Overview :

Eon Electric Limited is a public limited company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on the National Stock Exchange of India Limited and Bombay Stock Exchange Limited. The company is engaged in the manufacturing and selling of Cables and Wires, Energy Efficient Lighting, Wiring accessories, Fans, Geysers, Lithium-ion Batteries, Mobile phone accessories and other electrical products. The Company''s manufacturing facilities are located at Haridwar in Uttarakhand.

1.1.Disclosure under Accounting Standard 15 (Revised)

As per Accounting Standard (AS-15) (Revised 2005) "Employee Benefits", the disclosures of Employee benefits as defined in the Accounting Standard are given below:

2. Scheme of Arrangement

Pursuant to the Scheme of Arrangement ("Scheme") u/s 391 to 394 of the Companies Act, 1956 between Eon Electric Limited ("Eon") and Advance Metering Technology Limited ("AMTL") and their respective shareholders and creditors for demerger of the Metering Division and Power Generation Business of the company'' duly sanctioned by the Hon''ble High Court for the States of Punjab & Haryana at Chandigarh vide its order dated 27th March, 2013, the Metering Division and Power Generation Business of Eon stands demerged and transferred to and vested in AMTL with effect from 1st April, 2011 (Appointed Date) on a going concern basis.

The Scheme became effective on 8th April, 2012 (Effective Date) on filing of the Certified True Copy of the said Order of the Hon''ble High Court with the Registrar of Companies, NCT of Delhi & Haryana.

Pursuant to the above Scheme, the Authorised, Issued, Subscribed and Paid Up Share Capital of Eon as on 9th May, 2012 ("the Record Date") has been reduced to half by changing the face vale of the shares from Rs. 10/- to Rs. 5/- each. Accordingly, the Board of Directors of Eon and AMTL have at their respective meetings held on 12th May, 2012 allotted to all the eligible shareholders of Eon, one fully paid-up Equity Share of the Face Value of Rs. 5/- each of Eon and one fully paid-up Equity Share of the Face Value of Rs. 5/- each of AMTL in lieu of every one fully paid-up Equity Share of the face value of Rs. 10/- each held by them in Eon as on the Record Date.

The broad details of the assets and liabilities of the Metering Division and Power Generation Business transferred from the Company and vested with AMTL at the closing date are as under :

Necessary effects in respect of the aforesaid Scheme of Arrangement have been given in the books of accounts of the Company in the financial statements for the year ended 31st March, 2013.

3. Contingent Liabilities and Commitments:-

a. Contingent Liabilities

i) Bank Guarantees Rs. 49,965,592/- (Previous year Rs. 49,714,695/-).

ii) Bond furnished to Custom & Central Excise Authorities for import of goods at Concessional Rate of Duty Rs. 70,000,000/- (Previous year Rs. 30,000,000/-).

iii) Excise duty demands against which the company has preferred appeals Rs. 52,314,146/- (Previous year Rs. 52,314,146/-). The Company has already deposited a sum of Rs. 3,015,000/- (Previous year Rs. 3,015,000/-) against the aforesaid demand.

iv) Central Excise and Service Tax Appeals filed by the Department Rs. 2,065,676/- (Previous year Rs. 2,065,676/-) for excise duty and Rs. 119,921/- (Previous year Rs. 119,921/-) for service tax.

v) Sales Tax / Value Added Tax Demands against which the company has preferred appeals Rs. 159,676,682/- (Previous year Rs. 11,593,533/-). The company has already deposited a sum of Rs. 5,664,955/- (Previous year Rs. 4,086,662/-) against the aforesaid demand.

b. Commitments

i) Capital commitments (net of advance) Nil (Previous year Rs. 86,952,823/-).

ii) Commitment to pay balance amount towards contribution to the Share Capital of Zephyr Peacock India III Fund Rs. 7,379,015/- (Previous Year Rs. 7,754,015/-)

4. Provision for income tax has been made without considering some taxes and amounts which will be paid before filing of Income Tax Return as provided under Section 43-B of the Income Tax Act, 1961.

5. In the opinion of Board, the current assets, loans and advances are approximately of the value stated, if realized, in the ordinary course of business. The provision for depreciation and all known liabilities is adequate and not in excess of the amount reasonably necessary.

6. The balances of Debtors, Advances and Creditors are subject to confirmation.

7. The company has paid annual listing fees to Bombay Stock Exchange Limited and National Stock Exchange of India Limited where its equity shares are listed.

8. Information on Segment Reporting of the Company for the year ended 31st March 2014 Business Segments

In accordance with the Accounting Standard (AS) 17 "Segment Reporting", the Company''s operations have been categorized into the following Business segments :-

Cable and Wires includes Wires and Cables etc.

Lighting includes Compact Fluorescent Lamps, Fluorescent TubeLights, LEDs and Luminaires etc.

Others includes Modular Switches, Wiring Accessories, Home Automation, Fans, Lithium Ion Batteries, Mobile Phone Accessories etc.

Segment Revenue relating to each of the above business segments includes Other Income, where applicable. The above business segments have been identified considering :

a) the nature of products and services

b) the differing risks and returns

c) the organization structure, and

d) the internal financial reporting systems.

There are no geographical segments as the operations of the company''s existing Business Segments take place indigenously.

Notes:-

i. Segment results represent Profit/(loss) before Interest and Tax.

ii. Capital Expenditure pertains to gross additions made to fixed assets during the year including capital work in progress.

iii. Segment Assets include Fixed Assets, Current Assets & Loans and Advances directly attributable to respective business segments.

iv. Segment Liabilities include Current Liabilities and Provisions directly attributable to respective business segments.

v. The accounting policies used to derive reportable segment results are consistent with those described in the "Significant Accounting Policies" note to the financial statements.

9. Related Party Disclosure

i) Disclosures as required by Accounting Standard (AS-18) "Related Party Disclosures"are given below:

A Investing Parties with whom the Company is a Joint Venture Partner

1. Indo Simon Electric Pvt. Ltd.

2. Luxtra Lighting Private Limited

B. Directors, Key Management Personnel

1. Mr. V.P.Mahendru

2. Mr. Vinay Mahendru

3. Mr. Vivek Mahendru

C. Relatives of Directors, Key Management Personnel

1. Mr.Vimal Mahendru

D. Group Company

1. IAFL Power Distribution & Infrastructure Pvt. Ltd.

E. LLP firms in which relatives of Directors are partners 1. VPM Industrial Services Corporation LLP

F. Company in which Directors are Directors

1. VPM Electricals Private Limited

10. Lease Payments under an operating lease are recognised as an expense in the Statement of Profit and Loss on a straight line basis over the lease term. Accordingly Rs. 16,545,463/- has been charged to Statement of Profit and Loss during the year (Previous year Rs. 16,157,643/-).

The total of future minimum lease rent payable under operating lease for each of the following periods is as under

The financial data in respect of Indo Simon Electric Pvt. Ltd. for the year 31st March,2014 and Luxtra Lighting Private Limited for year ended 31st March, 2014 is based on their Provisional Accounts whereas the figures for the previous year are based on their Audited Accounts.

The aggregate amount of each of the Assets, Liabilities, Income and Expenditure related to interest of the Company in the jointly controlled entities are as under.

---

Mar 31, 2013

Company Overview :

Eon Electric Limited is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on the National Stock Exchange of India Limited and Bombay Stock Exchange Limited. The company is engaged in the manufacturing and selling of Cables and Wires, Energy Efficient Lighting, Wiring accessories, Fans, Geysers and other electrical products. The Company has also entered into business of Lithium-ion Batteries and Mobile Phone Accessories.

2. Discontinuing Operations

Pursuant to the Scheme of Arrangement ("Scheme") u/s 391 to 394 of the Companies Act, 1956 between Eon Electric Limited ("Eon") and Advance Metering Technology Limited ("AMTL") and their respective shareholders and creditors for demerger of the Metering Division and Power Generation Business of the company'' duly sanctioned by the Hon''ble High Court for the States of Punjab & Haryana at Chandigarh vide its order dated 27th March, 2012, the Metering Division and Power Generation Business of Eon stands demerged and transferred to and vested in AMTL with effect from 1st April, 2011 (Appointed Date) on a going concern basis.

''The Scheme became effective on 8th April, 2012 (Effective Date) on filing of the Certified True Copy of the said Order of the Hon''ble High Court with the Registrar of Companies, NCT of Delhi & Haryana. Upon the coming into effect of Scheme and in terms of the Scheme :

a) The business and operations of the De-merged Undertaking is deemed to be de-merged from the Company with retrospective effect from 1st April, 2011.

b) The related assets and liabilities of the De-merged Undertaking at the opening of business on 1st April, 2011 are deemed to have been transferred from the Company to AMTL with effect from that date at their respective book values.

c) The business of the De-merged Undertaking is deemed to have been carried out by the Company, in trust for and on behalf of AMTL from the Appointed date till the Effective date.

The Demerger of the Metering Division and Power Generation Business with effect from 1st April, 2011 constitutes " Discontinued Operations " within the meaning of Accounting Standard (AS) 24 on " Discontinuing Operations."

3. Contingent Liabilities and Commitments:-

a. Contingent Liabilities

i) Bank Guarantees Rs. 49,714,695/- (Previous year Rs. 52,387,744/-).

ii) Bond furnished to Custom & Central Excise Authorities for import of goods at Concessional Rate of Duty

Rs. 30,000,000/- (Previous year Rs. 30,000,000/-)

iii) Excise duty demands against which the company has preferred appeals Rs. 52,314,146/- (Previous year Rs. 52,314,146/-). The Company has already deposited a sum of Rs. 3,015,000/- (Previous year Rs. 3,015,000/-) against the aforesaid demand.

iv) Central Excise and Service Tax Appeals filed by the Department Rs. 2,065,676/- (Previous year Rs. 1,703,840/-) for excise duty and Rs. 119,921/- (Previous year Rs. 119,921/-) for service tax.

v) Sales Tax / Value Added Tax Demands against which the company has preferred appeals Rs. 11,593,533/-

(Previous year Nil) the company has already deposited a sum of Rs. 4,086,662/- (Previous year Nil) against the aforesaid demand.

b. Commitments

i) Capital commitments (net of advance) Rs. 86,952,823/- (Previous year Rs. 70,736,161/-).

ii) Commitment to pay balance amount towards contribution to the Share Capital of Zephyr Peacock India III Fund Rs. 7,754,015/- (Previous Year Nil)

4. Provision for income tax has been made without considering some taxes and amounts which will be paid before filing of Income Tax Return as provided under Section 43-B of the Income Tax Act, 1961.

5. In the opinion of Board, the current assets, loans and advances are approximately of the value stated, if realized, in the ordinary course of business. The provision for depreciation and all known liabilities is adequate and not in excess of the amount reasonably necessary.

6. The balances of Debtors, Advances and Creditors are subject to confirmation.

7. The company has paid annual listing fees to Bombay Stock Exchange Limited and National Stock Exchange of India Limited where its equity shares are listed.

8. Information on Segment Reporting of the Company for the year ended 31st March 2013 Business Segments

In accordance with the Accounting Standard (AS) 17 "Segment Reporting", the Company''s operations have been categorized into the following Business segments :- Cable and Wires includes Wires and Cables etc.

Lighting includes Compact Fluorescent Lamps, Fluorescent TubeLights, LEDs and Luminaires etc.

Others includes Modular Switches, Wiring Accessories, Home Automation, Fans, Lithium Ion Batteries, Mobile Phone Accessories etc.

Metering and Power Generation includes Energy Meters and Power Generation,

The Metering and Power Generation business has been demerged and vested with Advance Metering Technology Limited w.e.f. 1st April, 2011.

Segment Revenue relating to each of the above business segments includes Other Income, where applicable. The above business segments have been identified considering :

a) the nature of products and services

b) the differing risks and returns

c) the organization structure, and

d) the internal financial reporting systems.

There are no geographical segments as the operations of the company''s existing Business Segments take place indigenously. Notes:-

i. Segment results represent Profit/(loss) before Interest and Tax.

ii. Capital Expenditure pertains to gross additions made to fixed assets during the year including capital work in progress.

iii. Segment Assets include Fixed Assets, Current Assets & Loans and Advances directly attributable to respective business segments.

iv. Segment Liabilities include Current Liabilities and Provisions directly attributable to respective business segments.

v. The accounting policies used to derive reportable segment results are consistent with those described in the "Significant Accounting Policies" note to the financial statements.

9. Related Party Disclosure

Disclosures as required by Accounting Standard (AS-18) "Related Party Disclosures"are given below:

i) Related Party

A. Subsidiary Company

IAFL Cables Ltd.

(Ceased to be a subsidiary w.e.f. 1st April, 2011 pursuant to Scheme of Arrangement)

B. Investing Parties with whom the Company is a Joint Venture Partner

1. Indo Simon Electric Pvt. Ltd.

2. Saudi National Lamps and Electricals Company Limited

(Ceased to be a Joint Venture w.e.f.1st April, 2011 pursuant to Scheme of Arrangement)

3. Luxtra Lighting Private Limited

C. Directors, Key Management Personnel

1. Mr. V.P.Mahendru

2. Mr. P.K.Ranade( Resigned w.e.f 23 rd March, 2013)

3. Mr. Vinay Mahendru

4. Mr. Vivek Mahendru

D. Relatives of Directors, Key Management Personnel

1. Mr.Vimal Mahendru

2. Mr. Vikram Ranade(*)

3. Mr. Prashant Ranade(*)

(*) (Transferred to Resulting company pursuant to Scheme of Arrangement)

E. Group Company

1. IAFL Power Distribution & Infrastructure Pvt. Ltd.

F. LLP firms in which relatives of Directors are partners

1. VPM Industrial Services Corporation LLP

10. Lease Payments under an operating lease are recognised as an expense in the Statement of Profit and Loss on a straight line basis over the lease term. Accordingly Rs.16,157,643/- has been charged to Statement of Profit and Loss during the year (Previous year Rs. 11,565,977/-).

11. Figures for the previous year have been re-arranged, re-grouped & re-classified where ever necessary to make them comparable with the current year.

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Mar 31, 2012

Company Overview :

Eon Electric Limited (formerly known as Indo Asian Fusegear Limited) is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on the National Stock Exchange of India Limited and Bombay Stock Exchange Limited. The company is engaged in the manufacturing and selling of Cables and wires, Energy efficient lighting, Energy meters and other electrical products. The Company has recently also entered into Business of Wind power generation.

(a) Pursuant to the special resolution passed at the Extra Ordinary General Meeting of the members of the Company held on 6th May, 2010, the company had made preferential allotment of 890,000 Zero Coupon Warrants to the Promoters,each warrant convertible into one equity share of Rs. 10/- each at a price of Rs. 70/- per equity share at any time within 18 months from the date of allotment of Warrants on preferential basis by private placement to the promoters of the Company as per Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009.

During the year, the Company has converted the said Warrants into 890,000 fully paid up Equity Shares of Rs.10/- each . The difference between the Conversion Price and the face value of the equity shares has been credited to Securities Premium Reserve.

(b) The Board of Directors of the Company approved the Buy-back of its fully paid up Equity Shares of Rs. 10/- each from the existing owners of Equity Shares other than the Promoters / Persons in Control up to 6.45% of the paid-up capital and free reserves,at a price not exceeding Rs.130/- per Equity Share payable in cash, for an aggregate amount not exceeding Rs. 23.19 Crore from the open market through the Stock Exchange(s). During the year, the company has bought back and extinguished 17,84,162 Equity Shares of Rs.10/- each.

(c) During the year ended 31st March, 2011, the Company has redeemed 10% Cumulative Redeemable Preference Shares worth Rs.10,000,000/- held by Heinrich Kopp GmbH, Germany at par along with up to date Preference Dividend thereon.

1.1 Terms/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 shares is entitiled to one vote per share. The Company declares and pays dividends in Indian rupees.

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.

2. Discontinuing Operations

Pursuant to the decision in the meeting of the Board of Directors of the Company held on 22nd July, 2010 and the approval of the Shareholders of the Company through Postal Ballot, the Company has transferred the entire business of developing, manufacturing and selling Low Voltage Miniature Circuit Breakers, Residual Current Circuit Breakers, Air Circuit Breakers, Moulded Case Circuit Breakers, Distribution Boards, Fuses, Fuse Bases, Switches, Feeder Pillars, Contractors, Thermal Overload Relays("Switchgear Business"), which is a separate segment as per AS 17, Segment Reporting, to a wholly owned subsidiary of Legrand France SA by way of Slump Sale as defined under Section 2(42C) of the Income Tax Act, 1961 on a going concern basis w.e.f. 9th September, 2010 for a total value of Rs. 530,00,00,000/- on a Cash and Debt free basis.

The Slump sale of Switchgear Business constitutes "Discontinuing Operations" within the meaning of Accounting Standard (AS 24) on "Discontinuing Operations".

3. Contingent Liabilities and Commitments:- a. Contingent Liabilities

i) Bank Guarantees Rs. 52,387,744/- (Previous year Rs. 67,825,138/-).

ii) Guarantees to Banks and others on behalf of Joint Venture Company Rs. 117,324,044/- (Previous year Rs. 97,143,925/-).

iii) Excise duty demands against which the company has preferred appeals Rs. 52,314,146/- (Previous year Rs. 52,314,146/-). The Company has already deposited a sum of Rs. 3,015,000/- (Previous year Rs. 3,015,000/-) against the aforesaid demand.

iv) Central Excise and Service Tax Appeals filed by the Department Rs. 1,703,840/- (Previous year Rs. 1,703,840/-) for excise duty and Rs. 119,921/- (Previous year Rs. Nil) for Service Tax.

b. Commitments

i) Capital commitments (net of advance) Rs. 70,736,161/- (Previous year Rs. 9,432,473/-).

ii) Commitment to pay balance amount towards contribution to the Share Capital of Luxtra Lighting Private Limited, a Joint Venture Company Rs. 1,870,000/- (Previous Year Rs. Nil).

4. Provision for income tax has been made without considering some taxes and amounts which will be paid before filing of Income Tax Return as provided under Section 43-B of the Income Tax Act, 1961.

5. In the opinion of Board, the current assets, loans and advances are approximately of the value stated, if realized, in the ordinary course of business. The provision for depreciation and all known liabilities is adequate and not in excess of the amount reasonably necessary.

6. During the year, the Company has made provision for excise duty on stocks lying at the year end in various units amounting to Rs. 465,312/- (Previous year Rs. 525,118/-) and has included the said amounts in the valuation of inventories. This has no effect on the profit for the year.

7. The balances of Debtors, Advances and Creditors are subject to confirmation.

8. The company has paid annual listing fees to Bombay Stock Exchange Limited and National Stock Exchange of India Limited where its equity shares are listed.

9. Information on Segment Reporting of the Company for the year ended 31st March 2012

Business Segments

In accordance with the Accounting Standard (AS) 17 "Segment Reporting", the Company''s operations have been categorized into the following Business segments :-

Switchgear includes MCBs, HRC Fuses, Feeder Pillars, RCCBs, Distribution Boards, Switches etc. The Switchgear Segment has been discontinued w.e.f. 9th September, 2010.

Cable and Wires includes Wires and Cables etc.

Lighting includes Compact Fluorescent Lamps, Fluorescent TubeLights and Luminaires etc.

Metering and Power Generation includes Energy Meters and Power Generation,

Others includes Modular Switches, Wiring Accessories, Home Automation, Fans, Lithium Ion Batteries, Mobile Phone Accessories etc.

Segment Revenue relating to each of the above business segments includes Other Income, where applicable.

The above business segments have been identified considering :

a) the nature of products and services

b) the differing risks and returns

c) the organization structure, and

d) the internal financial reporting systems.

There are no geographical segments as the operations of the company''s existing Business Segments take place indigenously.

Notes:-

i. Segment results represent Profit/(loss) before Interest and Tax.

ii. Capital Expenditure pertains to gross additions made to fixed assets during the year including capital work in progress.

iii. Segment Assets include Fixed Assets, Current Assets & Loans and Advances directly attributable to respective business segments.

iv. Segment Liabilities include Current Liabilities and Provisions directly attributable to respective business segments.

v. The accounting policies used to derive reportable segment results are consistent with those described in the "Significant Accounting Policies" note to the financial statements.

10. Related Party Disclosures

i) Disclosures as required by Accounting Standard (AS-18) "Related Party Disclosures"are given below:

A. Subsidiary Company

IAFL Cables Ltd. (Formerly Indo Asian Cables Ltd.)

B. Investing Parties with whom the Company is a JV Partner

1. Indo Simon Electric Pvt. Ltd.(Formerly Indo Asian Simon Pvt. Ltd.)

2. Saudi National Lamps and Electricals Company Limited

3. Luxtra Lighting Private Limited

C. Directors, Key Management Personnel

1. Mr. V.P.Mahendru - Chairman cum Managing Director

2. Mr.P.K.Ranade - Joint Managing Director

3. Mr. Vinay Mahendru - Executive Director

D. Relatives of Directors, Key Management Personnel

1. Mr. Vivek Mahendru - President (Operations)

2. Mr.Vimal Mahendru - President(Corporate Affairs)

3. Mr. Vikram Ranade - Vice President(Technologies)

4. Mr. Prashant Ranade - Vice -President(Procurement)

5. Mrs. Bela Mahendru*

6. Mrs. Ratna Mahendru*

7. Mrs. Richa Mahendru*

8. Mrs. Kaushalya Gujral*

9. Mr. O.P.Mahendru*

10. Mrs. Ameeta Ranade#

11. Mrs. Asha Chaturvedi#

12. Mrs.Shama Guleri#

13. Mrs. Uma Sharma#

14. P.K.Ranade(H.U.F.)#

*Relatives of Mr. V.P.Mahendru

#Relatives of Mr. P.K.Ranade

E. Group Company

IAFL Power Distribution & Infrastructure Pvt. Ltd.

(Formerly Indo Asian Power Distribution & Infrastructure Pvt. Ltd.)

F. LLP firms in which relatives of Directors are partners

1. VPM Industrial Services Corporation LLP

2. PKR Hitech Industrial Corporation LLP

11. Subsequent events

The Hon''ble High Court for the States of Punjab & Haryana at Chandigarh vide its order dated 27th March, 2012, has approved the Scheme of Arrangement ("Scheme") u/s 391 to 394 of the Companies Act, 1956 between Eon Electric Limited ( "Eon" or "the Company") and Advance Metering Technology Limited ("AMTL") and their respective shareholders and creditors for demerger of the Metering Division and Power Generation Business ("De-merged Undertaking") of the company and transfer/vesting of the said undertaking in favour of AMTL with effect from 1st April, 2011 (Appointed Date) on a going concern basis.

The Scheme became effective on 8th April, 2012 (Effective Date) on filing of the Certified True Copy of the said Order of the Hon''ble High Court with the Registrar of Companies, NCT of Delhi & Haryana.

In terms of the Scheme, the Authorized, Issued, Subscribed and Paid up Share Capital of Eon , as on the Record Date, will be reduced to half by changing the face value of the shares from Rs. 10/- to Rs. 5/- each. All the members whose name appear in the records of Eon on the Record Date shall become the holders of the same number of Equity Shares of the face value of Rs. 5/- each credited as fully paid up of Eon and AMTL on the same terms, conditions and rights in the records of the respective companies.

Upon the coming into effect of Scheme and in terms of the Scheme :

a) The business and operations of the De-merged Undertaking shall be deemed to be de-merged from the Company with retrospective effect from 1st April, 2011.

b) The related assets and liabilities of the De-merged Undertaking at the opening of business on 1st April, 2011 shall be deemed to have been transferred from the Company to AMTL with effect from that date at their respective book values.

c) The business of the De-merged Undertaking shall be deemed to have been carried out by the Company, in trust for and on behalf of AMTL from the Appointed date till the Effective date.

Necessary effects in respect of the aforesaid Scheme of Arrangement would be given in the books of accounts of the Company during the next Financial Year.

---

Mar 31, 2011

1. Contingent Liabilities :-

i) Capital commitments (net of advance) Rs. 94.32 lacs (Previous year Rs. 644.98 lacs).

ii) Bank Guarantees Rs. 678.25 lacs (Previous year Rs.1,976.33 lacs).

iii) Guarantees to Banks and others on behalf of Joint Venture Company Rs. 948.00 lacs (Previous year Rs. 874.02 lacs)

iv) Bills Discounted with Banks outstanding as at 31st March, 2011 -Nil (Previous year Rs. 179.81 lacs).

v) Income Tax demands against which the Company has preferred appeals - Nil (Previous year Rs. 335.75 lacs).

vi) Sales Tax demands against which the company has preferred appeals - Nil (Previous year Rs. 3.10 lacs).

vii) Excise duty demands against which the company has preferred appeals Rs 523.14. lacs (Previous year Rs. 124.94 lacs). The Company has already deposited a sum of Rs.30.15 lacs (Previous year Rs. 32.34 lacs) against the aforesaid demands.

viii) Central Excise Appeal filed by the Department Rs 17.04 lacs (Previous year Nil)

2. Provision for income tax has been made without considering some taxes and amounts which will be paid before filing of Income Tax Return as provided under Section 43-B of the Income Tax Act, 1961.

3. In the opinion of Board, the current assets, loans and advances are approximately of the value stated, if realized, in the ordinary course of business. The provision for depreciation and all known liabilities is adequate and not in excess of the amount reasonably necessary.

4. During the year, the Company has made provision for excise duty on stocks lying at the year end in various units amounting to Rs.525,1181- (Previous year Rs. 3,030,585/-) and has included the said amounts in the valuation of inventories. This has no effect on the profit for the year.

5. Lease Payments under an operating lease are recognised as an expense in the statement of Profit and Loss on a straight line basis over the lease term. Accordingly Rs.16,908,094/- has been charged to Profit and Loss Account during the year (Previous year Rs. 18,808,046/-).

6. The Company has incurred Rs.2,223,933/- (Previous year Rs. 4,621,272/-) on Research & Development during the year which has been debited to Establishment and Miscellaneous Expenses.

7. Export sales include Indirect Export amounting to Rs.5,363,225/- (Previous year Rs. 18,463,116/-).

8. The balances of Debtors, Advances and Creditors are subject to confirmation.

9. The company has paid annual listing fees to Bombay Stock Exchange Limited and National Stock Exchange of India Limited where its equity shares are listed.

10. Pursuant to the special resolution passed at the Extra Ordinary General Meeting of the members of the Company held on 6th May, 2010, the company has made preferential allotment of 890,000 Zero Coupon Warrants to the Promoters.each warrant convertible into one equity share of Rs. 10/- each at a price of Rs.70/- per equity share at any time within 18 months from the date of allotment of Warrants on preferential basis by private placement to the promoters of the Company as per Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009.

11. During the year ended 31st March, 2011, the Company has converted 845,000 Zero Coupon Convertible Warrants issued by private placement on preferential basis to the promoters of the Company into 845,000 fully paid Equity Shares of Rs. 10/- each at a price of Rs.50/- per Warrant. The difference between the Conversion Price and the face value of the equity shares has been credited to Securities Premium Account.

12. Figures of the previous year have been regrouped/re-classified wherever necessary to make them comparable with the current years figures.

13. The Board of Directors had declared a special interim dividend of Rs. 10 per share (100%) amounting to Rs.169,516,280/- in its meeting held on 11th October, 2010 which has since been paid. The tax on special interim dividend amounting to Rs.28,154,535/- has also been paid.

14. During the year, the Company has paid arrears of Dividend on 10% Cumulative Redeemable Preference Shares upto 31* March, 2010 amounting to Rs.4,000,000/-. The tax on the above Preference Dividend amounting to Rs.664,350/- has also been paid.

15. During the year, the Company has redeemed 10% Cumulative Reedemable Preference Shares worth Rs. 10,000,000/- held by Heinrich Kopp GmbH, Germany at par alongwith Preference Dividend of Rs. 1,000,000/- for year ended 31st March, 2011. The tax on the above Preference Dividend amounting to Rs. 166,088/- has also been paid.

16. Related Party Disclosure

i) Disclosures as required by Accounting Standard (AS-18) "Related Party Disclosures"are given below:

A. Subsidiary Company

IAFL Cables Ltd. (Formerly Indo Asian Cables Ltd.)

B. Investing Parties with whom the Company is a JV Partner

1. Indo Simon Electric Pvt. Ltd.(Formerly Indo Asian Simon Pvt. Ltd.)

2. Saudi National Lamps and Electricals Company Limited

C. Directors, Key Management Personnel

1. Mr. V.P.Mahendru- Chairman cum Managing Director

2. Mr.P.K.Ranade- Joint Managing Director

3. Mr. Vinay Mahendru- Executive Director

D. Relatives of Directors, Key Management Personnel

1. Mr. Vivek Mahendru -President (Operations)

2. Mr.Vimal Mahendru - President(Corporate Affairs)

3. Mr. Vikram Ranade -Vice President(Technologies)

4. Mr. Prashant Ranade -Vice-President(Procurement)

5. Mrs. Bela Mahendru*

6. Mrs. Ratna Mahendru*

7. Mrs. Richa Mahendru*

8. Mrs. Kaushalya Gujral*

9. Mr. O. P. Mahendru*

10. Mrs. Ameeta Ranade#

11. Mrs.AshaChaturvedi#

12. Mrs.Shama Guleri#

13. Mrs. Uma Sharmafl

14. RK.Ranade(H.U.F.)# Relatives of Mr. V.P.Mahendru #Relatives ofMr.RK.Ranade

E. Group Company

IAFL Power Distribution & Infrastructure Pvt. Ltd.

(Formerly Indo Asian Power Distribution & Infrastructure Pvt. Ltd.)

F. LLP firms in which relatives of Directors are partners

1. VPM Industrial Services Corporation LLP

2. PKR Hitech Industrial Corporation LLP

17. Slump Sale of Switchgear Business

Pursuant to the decision in the meeting of the Board of Directors of the Company held on 22nd July, 2010 and the approval of the Shareholders of the Company through Postal Ballot, the Company has transferred the entire business of developing, manufacturing and selling Low Voltage Miniature Circuit Breakers, Residual Current Circuit Breakers, Air Circuit Breakers, Moulded Case Circuit Breakers, Distribution Boards, Fuses, Fuse Bases, Switches, Feeder Pillars, Contractors, Thermal Overload RelaysfSwitchgear Business"), which is a separate segment as per AS 17, Segment Reporting, to a wholly owned subsidiary of Legrand France SA by way of Slump Sale as defined under Section 2(42C) of the Income Tax Act, 1961 on a going concern basis w.e.f. 9th September, 2010 for a total value of Rs.530.00 Crores on a Cash and Debt free basis

18. Segment Information for the year ended 31st March 2011 Information about Business segments - Primary Business Segments

The company has considered business segment as the primary segment for disclosure. The products included in each of the reported business segments are as follows :-

Switchgear includes MCBs, HRC Fuses, Feeder Pillars, RCCBs, Distribution Boards, Switches etc.

Lighting includes Compact Fluorescent Lamps, Fluorescent Tube Lights and Luminaires etc.

Cable and Wires includes Wires and Cables etc.

Segment Revenue relating to each of the above business segments includes Other Income, where applicable.

The above business segments have been identified considering:

a) the nature of products and services

b) the differing risks and returns

c) the organization structure, and

d) the internal financial reporting systems.

19. The Company has given interest bearing inter corporate loan aggregating to Rs. 268.00 lacs (Previous Year Rs. Nil) to Indo Simon Electric Pvt. Ltd.(Formerly Indo Asian Simon Pvt. Ltd.), a Company with whom it is a Joint Venture Partner during the year. The maximum amount outstanding during the year was Rs. 278.87 lacs (Previous Year Rs. Nil). The Balance outstanding as on 31.03.11 is Rs. 278.87 lacs (Previous Year Nil). The above loan is re-payable on demand.

---

Mar 31, 2010

1. Contingent Liabilities :-

i) Capital commitments (net of advance) Rs.644.98 lacs (Previous year Rs. 732.44 lacs).

ii) Bank Guarantees Rs.1,976.33 lacs (Previous year Rs. 2,312.34 lacs).

iii) Guarantees to Banks and others on behalf of Joint Venture Company Rs. 874.02 lacs (Previous year Rs. 874.02 lacs)

iv) Bills Discounted with Banks outstanding as at 31st March, 2010 Rs. 179.81 lacs (Previous year Rs. 616.45 lacs).

v) Income Tax demands against which the Company has preferred appeals - Rs.335.75 lacs (Previous year Rs. 335.75 lacs). The Company has already deposited a sum of Rs.100.00 lacs (Previous year Rs. 100.00 lacs) against the aforesaid demand.

vi) Sales Tax demands against which the company has preferred appeals - Rs.3.10 lacs (Previous year Rs. 3.10 lacs). The Company has already deposited a sum of Rs.1.55 lacs (Previous year Rs. 1.55 lacs) against the aforesaid demand.

vii) Excise duty demand against which the company has preferred appeals Rs. 124.94 lacs (Previous year Rs. 135.60 lacs). The Company has already deposited a sum of Rs. 32.34 lacs (Previous year Rs. 12.68 lacs) against the aforesaid demand.

2. Provision for income tax has been made without considering some taxes and amounts which will be paid before filing of Income Tax Return as provided under Section 43-B of the Income Tax Act, 1961.

3. In the opinion of Board, the current assets, loans and advances are approximately of the value stated, if realized, in the ordinary course of business. The provision for depreciation and all known liabilities is adequate and not in excess of the amount reasonably necessary.

4. During the year, the Company has made provision for excise duty on stocks lying at the year end in various units amounting to Rs.30,30,585/- (Previous year Rs. 33,47,640/-) and has included the said amounts in the valuation of inventories. This has no effect on the profit for the year.

5. The Company has incurred Rs.46,21,272/- (Previous year Rs. 17,52,394/-) on Research & Development during the year which has been debited to Establishment and Miscellaneous Expenses.

6. Export sales include Indirect Export amounting to Rs.1,84,63,116/- (Previous year Rs.1,26,02,083/-).

7. The balances of Debtors, Advances and Creditors are subject to confirmation.

8. The company has paid annual listing fees to Bombay Stock Exchange Limited and National Stock Exchange of India Limited where its equity shares are listed.

9. Pursuant to the special resolution passed at the Extra Ordinary General Meeting of the members of the Company held on 25" January, 2010, the company has made preferential allotment of 16,45,000 Zero Coupon Warrants to the Promoters, each warrant convertible into one equity share of Rs. 10/- each at a price of Rs.50/- per equity share at any time within 18 months from the date of allotment of Warrants on preferential basis by private placement to the promoters of the Company as per Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009.

Out of the above the Company has converted 8,00,000 Zero Coupon Convertible Warrants into 8,00,000 fully paid Equity Shares of Rs. 10/- each at a price of Rs.50/- per Warrant. The difference between the Conversion Price and the face value of the equity shares has been credited to Securities Premium Account.

10. During the year ended 31 st March, 2009, the company issued 19,00,000 Zero Coupon Warrants each convertible into one equity share of Rs. 10/- each at a price of Rs. 130/- per equity share at any time within 18 months from the date of allotment of Warrants. As the allotees did not exercise the option for conversion of the said warrants into shares, Rs 2,47,00,000/- being 10 % of the amount received on allotment of the warrants stands forfeited and has been transferred to Capital Reserve.

11. Advances Recoverable in Cash or in Kind include Rs.10,57,76,000/- paid towards Share Application Money to Indo Asian Cables Ltd amounting to Rs. 8,06,56,000/-, Indo Asian Power Distribution and Infrastructure Private Ltd amounting to Rs.2,47,20,000/- and Indo Asian Simon Pvt. Ltd. amounting to Rs 4,00,000/- for subscribing to the equity shares.

12. Figures of the previous year have been regrouped/re-classified wherever necessary to make them comparable with the current years figures.

13. The Company has set up a new unit for the manufacture of Energy Meters Products at Noida, which has commenced commercial production during the year.

14. Related Party Disclosure

i) Disclosures as required by Accounting Standard (AS-18) "Related Party Disclosures"are given below:

A. Associate Companies

Indo Asian Power Distribution & Infrastructure Pvt. Ltd. Indo Asian Cables Ltd.

B. Directors, Key Management Personnel and their relatives

1. Mr. V.P.Mahendru - Chairman cum Managing Director

2. Mr.P.K.Ranade - Joint Managing Director

3. Mr. Vinay Mahendru - Executive Director

4. Mr. Vivek Mahendru - President (Operations)

5. Mr. Vimal Mahendru - President(Corporate Affairs)

6. Mr. Vikram Ranade - Vice President(Technologies)

7. Mr. Prashant Ranade - Vice-President(Procurement)

8. Mrs. Bela Mahendru*

9. Mrs. Ratna Mahendru*

10. Mrs. Richa Mahendru*

11. Mrs. Kaushalya Gujral*

12. Mr. O.P.Mahendru*

13. Mrs. Ameeta Ranade#

14. Mrs.AshaChaturvedi#

15. Mrs.Shama Guleri#

16. Mrs. Uma Sharma# •Relatives of Mr. V.P.Mahendru #Relatives of Mr.P.K.Ranade

C. Investing Parties with whom the Company is a JV Partner

-Indo Asian Simon Pvt. Ltd.

-Saudi National Lamps and Electricals Company Limited

15. Segment Information for the year ended 31st March 2010

Information about Business segments - Primary

Business Segments

The company has considered business segment as the primary segment for disclosure. The products included in each of the reported business segments are as follows :-

Switchgear includes MCBs, HRC Fuses, Feeder Pillars, RCCBs, Distribution Boards, Switches etc.

Lighting includes Compact Fluorescent Lamps, Fluorescent TubeLights and Luminaires etc.

Cable and Wires includes Wires and Cables etc.

The Cable & Wires segment has been identified as a reportable segment in the current year.

Segment Revenue relating to each of the above business segments includes Other Income, where applicable.

The above business segments have been identified considering :

a) the nature of products and services

b) the differing risks and returns

c) the organization structure, and

d) the internal financial reporting systems.

16. The 10% Cumulative Redeemable Preference shares are redeemable at par within a period of 20 years from the date of allotment i.e.17th February, 2001. The Cumulative amount of dividend remaining unpaid as on 31st March,2010 on the said shares is Rs.40,00,000/-.

---

Mar 31, 2009

1. Contingent Liabilities :-

i) Capital commitments (net of advance) Rs.732.44 lacs (Previous year Rs. 421.30 lacs).

ii) Bank Guarantees Rs. 2312.34 lacs (Previous year Rs. 1,687.59 lacs).

Hi) Guarantees to Banks and others on behalf of Joint Venture Company Rs. 874.02 lacs (Previous year Rs. 874.02 lacs)

iv) Bills Discounted with Banks outstanding as at 31 st March, 2009 Rs. 616.45 lacs (Previous year Rs. 246.45 lacs).

v) IncomeTax demands against which the Company has preferred appeals Rs. 335.75 lacs (Previous year Rs. 268.72 lacs). The company has already deposited a sum of Rs. 100.00 lacs (Previous year Rs. 25.00 lacs) against the aforesaid demand.

vi) Sales Tax demands against which the company has preferred appeals Rs. 3.10 lacs (Previous year Rs. 43.08 lacs). The company has already deposited a sum of Rs. 1.55 lacs (Previous year Rs. Nil) againstthe aforesaid demand.

vii) Excise duty demand against which the company has preferred appeals Rs. 135.60 lacs (Previous year Rs. 18.11 lacs). The company has already deposited a sum of Rs. 12.68 lacs (Previous year Rs. 12.68 lacs) against the aforesaid demand.

2. Provision for income tax has been made without considering some taxes and amounts which will be paid before filing of Income Tax Return as provided under Section 43-B of the Income Tax Act, 1961.

3. In the opinion of Board, the current assets, loans and advances are approximately of the value stated, if realized, in the ordinary course of business. The provision for depreciation and all known liabilities is adequate and not in excess of the amount reasonably necessary.

4. During the year, the Company has made provision for excise duty on stocks lying at the year end in various units amounting to Rs.33,47,640/- (Previous year Rs. 47,45,404/-) and has included the said amounts in the valuation of inventories. Thishasnoeffectontheprofitfortheyear.

5. The Company has incurred Rs. 17,52,394/- (Previous year Rs.11,66,859/-) on Research & Development during the year which has been debited to Establishment and Miscellaneous Expenses.

6. Export sales include Indirect Export amounting to Rs. 1,26,02,083/- (Previous year Rs.1,27,22,424/-).

7. The balances of Debtors, Advances and Creditors are subjectto confirmation.

8. The company has paid annual listing fees to Bombay Stock Exchange Limited and National Stock Exchange of India Limited where its equity shares are listed.

9. Pursuant to the special resolution passed at the Extra Ordinary General Meeting of the members of the Company held on 2nd April, 2008, the company has made preferential allotment of 15,00,000 Zero Coupon Warrants to the Promoters and 4,00,000 Zero Coupon Warrants to the Non- Promoters, each warrant convertible into one equity share of Rs. 101- each at a price of Rs. 130/- per equity share at any time within 18 months from the date of allotment of Warrants on preferential basis by private placement to the promoters and other than promoters of the Company as per Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines, 2000

10. Investment in Joint Ventures

Name of the Joint Venture Company Country of Ownership Incorporation Interest

Saudi National Lamps and Electricals Company Limited Saudi Arabia 20%

Indo Asian Simon Private Limited India 50%

The Joint Venture Companies have not yet commenced their operations.

11. Advances Recoverable in Cash or in Kind include Rs.14,68,10,805/- paid towards Share Application Money to Indo Asian Cables Ltd amounting to Rs. 7,87,00,000/-, Indo Asian Power Distribution and Infrastructure Private Ltd amounting to Rs.1,83,10,000/- and Indo Asian Simon Pvt. Ltd. amounting to Rs 4,98,00,805/- for subscribing to the equity shares.

12. The Company has not received information from vendors regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosure relating to amounts unpaid at the year end together with interest paid / payable under this Act and as required by Schedule VI to the Companies Act, 1956 have not been given.

13. Figures of the previous year have been regrouped/re-classified wherever necessary to make them comparable with the current years figures.

14. Related Party Disclosure

i) Disclosures as required by Accounting Standard (AS-18) "Related Party Disclosures"are given below:

A. Associate Companies

Indo Asian Power Distribution & Infrastructure Pvt. Ltd. Indo Asian Cables Ltd.

B. Directors, Key Management Personnel and their relatives

1. Mr.V.RMahendru

2. Mr.RK.Ranade

3. Mr. Vinay Mahendru

4. Mr. Vivek Mahendru

5. Mr.Vimal Mahendru

6. Mr. Vikram Ranade

7. Mr. Prashant Ranade

8. Mrs. Bela Mahendru*

9. Mrs. Ratna Mahendru*

10. Mrs. Richa Mahendru*

11. Mrs. KaushalyaGujral*

12. Mr.O.RMahendru*

13. Mrs.AmeetaRanade#

14. Mrs.AshaChaturvedi#

15. Mrs.ShamaGu!eri#

16. Mrs. UmaSharma# *Relatives of Mr. V. R Mahendru #Relatives of Mr. R K. Ranade

- Chairman cum Managing Director

- Joint Managing Director

- Executive Director

- President (Operations)

- President(Corporate Affairs)

- VicePresident(I.T)

- Vice -President(Procurement)

C. Investing Parties with whom the Company is a JV Partner

- Indo Asian Simon Pvt. Ltd.

- Saudi National Lamps and Electricals Company Limited

15. Segmentlnformationfortheyearended31stMarch2009

Information about Business segments Primary

Business Segments

The company has considered business segment as the primary segment for disclosure. The products included in each of the reported business segments are as follows :-

Switchgear includes MCBs, HRC Fuses, Feeder Pillars, RCCBs, Distribution Boards, Switches etc.

Lighting includes Compact Fluorescent Lamps, Fluorescent TubeLights and Luminaires etc.

Cable and Wires includes Wires and Cables etc.

The Cable & Wires segment has been identified as a reportable segment in the current year.

Segment Revenue relating to each of the above business segments includes Other Income, where applicable.

The above business segments have been identified considering:

a) the nature of products and services

b) the differing risks and returns

c) the organization structure, and

d) the internal financial reporting systems.

16. The 10% Cumulative Redeemable Preference shares are redeemable at par within a period of 20 years from the date of allotment i.e.17th February, 2001. The Cumulative amount of dividend remaining unpaid as on 31st on the said shares is Rs.30,00,000/-.

---

Mar 31, 2008

1. Contingent Liabilities :-

i) Capital commitments (net of advance) Rs.421.30 lacs (Previous year Rs. 92.18 lacs).

ii) Uncalled amount on investment Rs.Nil (Previous year Rs. 36.11 lacs)

iii) Bank Guarantees Rs.1687.59 lacs (Previous year Rs.1441.64 lacs).

iv) Guarantees to Banks and others on behalf of Joint Venture Company Rs.874.02 lacs (Previous year Rs. 580.98 lacs)

v) Bills Discounted with Banks outstanding as at 31st March, 2008 Rs. 246.45 lacs (Previous year Rs. 318.87 lacs).

vi) Income Tax demands against which the Company has preferred appeals - Rs. 268.72 lacs (Previous year Rs. 12.58 lacs).

vii) Sales Tax demands against which the company has preferred appeals - Rs.43.08 lacs (Previous year Rs.37.42 lacs).

viii) Excise duty demand against which the company has preferred appeals Rs.18.11 lacs (Previous year Rs. 31.32 lacs).

2. Provision for income tax has been made without considering some taxes and amounts which will be paid before filing of Income Tax Return as provided under Section 43-B of the Income Tax Act, 1961.

3. In the opinion of Board, the current assets, loans and advances are approximately of the value stated, if realized, in the ordinary course of business. The provision for depreciation and all known liabilities is adequate and not in excess of the amount reasonably necessary.

4. During the year, the Company has made provision for excise duty on stocks lying at the year end in various units amounting to Rs. 47,45,404/- (Previous year Rs. 38,00,806/-) and has included the said amounts in the valuation of inventories. This has no effect on the profit for the year.

5. Lease Payments under an operating lease have been recognised as an expense in the statement of Profit and Loss on a straight line basis over the lease term. Accordingly Rs. 1,23,60,027/- has been charged to Profit and Loss Account during the year (Previous year Rs.93,55,751/-).

6. The Company has incurred Rs. 11,66,859/- (Previous year Rs. 10,64,727/-) on Research & Development during the year which has been debited to Establishment and Miscellaneous Expenses .

7. Export sales include Indirect Export amounting to Rs.1,27,22,424/- (Previous year Rs.2,36,81,896/-).

8. The balances of Debtors, Advances and Creditors are subject to confirmation.

9. The company has paid annual listing fees to Bombay Stock Exchange Limited and National Stock Exchange of India Limited where its equity shares are listed.

10. During the year ended 31st March, 2007 , the company issued 7,50,000 Zero Coupon Warrants each convertible into one equity share of Rs.10/- each at a price of Rs. 161/- per equity share at any time within 18 months from the date of allotment of Warrants. As the allottees did not exercise the option for conversion of the said warrants into shares, Rs 1,20,75,000/- being 10 % of the amount received on allotment of the warrants stands forfeited and has been transferred to Capital Reserve.

11. During the year ended 31st March, 2008, the Company has converted 7,50,000 Zero Coupon Convertible Warrants issued by private placement on preferential basis to the promoters of the Company into 7,50,000 fully paid Equity Shares of Rs.10/- each at a price of Rs.160/- per Warrant. The difference between the Conversion Price and the face value of the equity shares has been credited to Securities Premium Account.

12. Advances Recoverable in Cash or in Kind include Rs.7,92,70,805/- paid towards Share Application Money to Indo Asian Cables Ltd amounting to Rs. 7,26,00,000/-, Indo Asian Power Distribution and Infrastructure Private Ltd amounting to Rs.61,50,000/- and Indo Asian Simon Pvt. Ltd. amounting to Rs 5,20,805/- for subscribing to the equity shares.

13. The Company has not received information from vendors regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosure relating to amounts unpaid at the year end together with interest paid / payable under this Act and as required by Schedule VI to the Companies Act, 1956 have not been given.

14. The Company has set up a large unit for the manufacture of Electrical Switchgear Products in the tax free zone in Uttarakhand, which has commenced commercial production during the year.

15. Figures of the previous year have been regrouped/re-classified wherever necessary to make them comparable with the current years figures.

16. Segment Information for the year ended 31st March 2008

Information about Business segments - Primary

Business Segments

The Company has considered business segment as the primary segment for disclosure. The products included in each of the reported business segments are as follows :-

Switchgear includes MCBs, HRC Fuses, Feeder Pillars, RCCBs, Distribution Boards, Switches, Wires etc.

Lighting includes Compact Fluorescent Lamps, Fluorescent Tube Lights and Luminaires etc.

Segment Revenue relating to each of the above business segments includes Other Income, where applicable.

The above business segments have been identified considering :

a) the nature of products and services

b) the differing risks and returns

c) the organization structure, and

d) the internal financial reporting systems.

17. The 10% Cumulative Redeemable Preference shares are redeemable at par within a period of 20 years from the date of allotment i.e.17th February, 2001. The Cumulative amount of dividend remaining unpaid as on 31st March,2008 on the said shares is Rs.20,00,000/-.

---

Mar 31, 2007

1. Contingent Liabilities

i) Capital commitments (net of advance) Rs.92.18 lacs (Previous year Rs.196.54 lacs).

ii) Uncalled amount on investment Rs.36.11 lacs (Previous year Rs. Nil)

iii) Bank Guarantees Rs.1441.64 lacs (Previous year Rs.314.67 lacs).

iv) Guarantees to Banks on behalf of Joint Venture Company Rs.580.98 lacs (Previous year Rs. Nil)

v) Bills Discounted with Banks outstanding as at 31st March, 2007 Rs. 318.87 lacs (Previous year Rs. Nil).

vi) Custom Duty demand on account of shortfall in fulfillment of export obligation - Nil. (Previous Year Rs 26.12 lacs)

vii) Income Tax demands against which the Company has preferred appeals - Rs.12.58 lacs (Previous year Rs. 19.95 lacs),

viii) Sales Tax demands against which the company has preferred appeals - Rs.37.42 lacs (Previous year Rs.52.66 lacs),

ix) Excise duty demand against which the company has preferred appeals Rs.31.32 lacs (Previous year Rs. 23.59 lacs).

2. Provision for income tax has been made without considering some taxes and amounts which will be paid before filing of Income Tax Return as provided under Section 43-B of the Income Tax Act, 1961.

3. In the opinion of Board, the current assets, loans and advances are approximately of the value stated, if realized, in the ordinary course of business. The provision for depreciation and all known liabilities is adequate and not in excess of the amount reasonably necessary.

4. During the year, the Company has made provision for excise duty on stocks lying at the year end in various units amounting to Rs.38,00,806/- (Previous year Rs. 39,21,977/-) and has included the said amounts in the valuation of inventories. This has no effect on the profit for the year.

5. Lease Payments under an operating lease have been recognised as an expense in the statement of Profit and Loss on a straight line basis over the lease term. Accordingly Rs.93,55,751/- has been charged to Profit and Loss Account during the year (Previous year Rs.61,08,343/-).

6. Names of suppliers being Small Scale Industrial Undertakings (as per the information available with the Company) to whom the amounts are outstanding as on 31st March, 2007 are as under :-

Ambica Techno Ceramics, Ambiyil Engineering Company, Apex Industries, Ascon Engineering Industries, Aum Techno Ceramics, Auto Lamp Caps, Channa Engineers, Choice Tape Industries, Consult Techniques, G.K.Enterprises, Hartech Plastics, J M Plastics, Jain Packwell Industries, Krishna Engg. Industries, Krishna Industries, Kunsons Metals Pvt, Ltd., Laxmi Enterprises, Metal Corporation, Novelty Enterprises, Ravi Kiran Ceramics Pvt Ltd., Sapna Industries, Satija Machine Tools, Sav Electronics and Vimlesh Industries Pvt Ltd.

7. The Company has incurred Rs. 10,64,721/- (Previous year Rs.5,72,851/-) on Research & Development during the year which has been debited to Establishment and Miscellaneous Expenses .

8. Export sales include Indirect Export amounting to Rs.2,36,81,896/- (Previous year Rs.59,68,048/-).

9. The balances of Debtors, Advances and Creditors are subject to confirmation.

10. The company has paid annual listing fees to Mumbai Stock Exchange and National Stock Exchange of India Limited where its equity shares are listed.

11. During the year the Company has converted 42,50,000 8% Convertible Preference Shares of Rs.10/- each fully paid up allotted to the equity share holders of the erstwhile Indo Kopp Limited (the transferee company) as per the Scheme of Arrangement into 2,80,528 equity shares of Rs.10/- each fully paid up at a conversion price of Rs.151/50- per share.

The difference between the Conversion Price and the face value of the equity shares has been credited to Share Premium Account.

12. Pursuant to the special resolution passed at the Extra Ordinary General Meeting of the members of the Company held on 20th March, 2006, the company has issued 7,50,000 Zero Coupon Warrants each convertible into one equity share of Rs.10/- each at a price of Rs.161/- per equity share at any time within 18 months from the date of allotment of Warrants on preferential basis by private placement to the promoters of the Company as per Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines, 2000.

13. Pursuant to the special resolution passed at the Extra Ordinary General Meeting of the members of the Company held on 1st June, 2006, the company has issued 7,50,000 Zero Coupon Warrants each convertible into one equity share of Rs.10/- each at a price of Rs.160/- per equity share at any time within 18 months from the date of allotment of Warrants on preferential basis by private placement to the promoters of the Company as per Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines, 2000.

14. Advances Recoverable in Cash or in Kind include Rs.2,13,88,915/- paid towards Share Application Money to Indo Asian Simon Private Limited, for subscribing to the equity shares in terms of the Joint Venture Agreement.

15. The Company is in the process of identifying its creditors for their classification into Micro, Small & Medium Enterprises as per the provisions of The Micro, Small and Medium Enterprises Act, 2006. Accordingly the additional information in respect of the principal amount due to such enterprises and the interest due thereon could not be ascertained.

16. The Company has set up two large units for the manufacture of energy efficient lighting products and wires and cables in the tax free zone in Uttarakhand, which have commenced commercial production during the year.

17. Figures of the previous year have been regrouped/re-classified wherever necessary to make them comparable with the current years figures.

18. Segment Information for the year ended 31" March 2007 Information about Business segments - Primary Business Segments The company has considered business segment as the primary segment for disclosure. The products included in each of the reported business segments are as follows :-

Switchgear includes MCBs, HRC Fuses, Feeder Pillars, RCCBs, Distribution Boards, Switches , Wires etc.

Lighting includes Compact Fluorescent Lamps, Fluorescent TubeLights and Luminaires etc.

Segment Revenue relating to each of the above business segments includes Other Income, where applicable.

The above business segments have been identified considering :

a) the nature of products and services

b) the differing risks and returns

c) the organization structure, and

d) the internal financial reporting systems.

19. The 10% Cumulative Redeemable Preference shares are redeemable at par within a period of 20 years from the date of allotment i.e.17th February, 2001. The Cumulative amount of dividend remaining unpaid as on 31st March, 2007 on the said shares is Rs.20,00,000/-.

---

Mar 31, 2006

1. Contingent Liabilities

i) Capital commitments (net of advance) Rs.196.54 lacs (Previous year Rs.Nil).

ii) Bank Guarantees Rs. 314.67 lacs (Previous year Rs.Nil).

iii) Custom Duty demand on account of shortfall in fulfillment of export obligation Rs.26.12 lacs (Previous Year Rs. 25.32 lacs)

iv) Income Tax demands against which the Company has preferred appeals Rs.19.95 lacs (Previous year Rs. Nil).

v) Sales Tax demands against which the company has preferred appeals Rs.52.66 lacs (Previous year Rs. Nil).

vi) Excise duty demand against which the company has preferred appeals Rs.23.59 lacs (Previous year Rs. Nil).

2. Managerial Remuneration

31.03.06 31.03.05 (Rs.) (Rs.)

Salary 23,76,000 -

House Rent Allowance/Rent Free Accommodation 11,88,000 -

Medical reimbursement & Personal

Accident Premium 1,71,100 -

Contribution to Provident Fund 1,69,920 -

Total 39,05,020 -

3. Miscellaneous expenses include Payment to Auditors as follows

Current Year Previous Year (Rs.) (Rs.)

Audit Fee 7,25,000 16,500

Other Services 3,34,500 -

Service Tax 1,06,127 1,683

4. Provision for income tax has been made without considering some taxes and amounts which will be paid before filing of Income Tax Return as provided under Section 43-B of the Income Tax Act, 1961.

5. In the opinion of Board, the current assets, loans and advances are approximately of the value stated if realised in the ordinary course of business. The provision for depreciation and all known liabilities is adequate and not in excess of the amount reasonably necessary.

6. During the year, the Company has made provision for excise duty on stocks lying at the year end in various units amounting to Rs.39,21,977/- (Previous year Rs. Nil) and has included the said amounts in the valuation of inventories. This has no effect on the profit for the year.

7. Lease Payments under an operating lease have been recognised as an expense in the statement of Profit and Loss on a straight line basis over the lease term. Accordingly Rs 61,08,343/- has been charged to Profit and Loss Account during the year.

8. The Profit and Loss Account includes previous year debit adjustments amounting to Rs.66,120/- (Previous year Rs.1,26,706/-) on account of following :-

Current Year Previous Year (Rs.) (Rs.)

Legal & Professional Charges 66,120 -

Depreciation - 1,26,706

Total 66,120 1,26,706

9. Names of suppliers being Small Scale Industrial Undertakings (as per the information available with the Company) to whom amounts are outstanding for more than thirty days, are as under :-

Ambica Techno Ceramics, Ambyil Engineering, Arora Packaging Company, Aum Techno Ceramics, Auto Lamp Caps, Consult Techniques (I) Pvt. Ltd., Channa Engineers, Ennkay Industrial Automation, G.K.Enterpises Pvt. Ltd.,Gursim Techno India, Hartech Plastics, Jain Packwell Industries, K.V.I. International, Kapoor Metal Industries, Kapoor Wire Products, Krishna Industries, Krishna Engineering Industries, Laxmi Enterprises, Novelty Enterprises, Prakash Industries, PTC Components, Ravi Kiran Ceramics Pvt. Ltd., Satija Machine Tools, Sapna Industries, Sav Electronics, Vimal Hitech Pvt. Ltd. & Vimlesh Industries Pvt. Ltd.

10. The Company has incurred Rs.5,72,857/- (Previous year Rs.Nil) on Research & Development during the year which has been debited to Establishment and Miscellaneous Expenses.

11. Export sales include Indirect Export amounting to Rs.59,68,048/- (Previous year Rs.Nil).

12. The balances of Debtors, Advances and Creditors are subject to confirmation.

13. The company has paid annual listing fees to Mumbai Stock Exchange where its equity shares are listed.

14. The Board of Directors of the Company has approved the Scheme of Arrangement of Amalgamation of the Company under Section 391 read with Section 394 of the Companies Act, 1956 with M/s Indo Asian Fusegear Limited from 1st April 2005.

The Honble High Court has vide its order dated 05th 26th May 2005 approved the Scheme of Arrangement for amalgamation of Indo Asian Fusegear Limited (transferor company) with Indo Kopp Limited (transferee company). Pursuant to the aforesaid Scheme of Arrangement, the transferor and the transferee company had revalued Land and Building by Rs.14,51,24,731/- and Rs. 5,63,72,741/- respectively duly valued by the approved valuers in their respective Balance Sheets as at 31st March, 2005.

The above amount along with other adjustments as contemplated in the aforesaid Scheme of Arrangement based upon the recommendations of Chartered Accountants jointly appointed by the Board of Directors of the transferor and transferee company has been shown as Merger Adjustment account.

15. Pursuant to the Scheme of Arrangement of erstwhile Indo Asian Fusegear Limited, a company engaged in the manufacture and marketing of LT Electrical Switchgear and Compact Fluorescent Lamps. with Indo Kopp Limited, as approved by the Honble High Court of Punjab and Haryana, Chandigarh by their order dated 5th/26th May 2005, which became effective on 27th June, 2005 on filing of the Certified True Copy of the said Order of the Honble High Court with the Registrar of Companies, NCT of Delhi, all the assets, liabilities and reserves of erstwhile Indo Asian Fusegear Limited were transferred to and vested in the Company with effect from the appointed date i.e. 1st April, 2005. The Scheme of Arrangement has been accounted for in the books of the transferee company under the Pooling of Interest Method as per Accounting Standard 14 on Accounting for Amalgamations issued by The Institute of Chartered Accountants of India whereby the assets, liabilities and reserves of the transferor company have been recorded in the books of the transferee company at their existing carrying amounts and in the same form as at the date of the amalgamation.

The value of assets, liabilities and reserves acquired effective 1st April, 2005 is set out below.

Assets/(Liabilities) acquired Rs.

Net Fixed Assets (including CWIP) 28,15,93,038

Net Current Assets 35,24,46,945

Deferred Tax Liability (98,67,477)

Capital Reserve (1,16,000)

Share Premium Account (2,51,35,500)

General Reserve (9,94,89,351)

Surplus (10,61,70,549)

Merger Adjustment Account (2,72,14,317)

Total 36,60,46,789

Less : Secured Loans 20,15,62,533

Less : Unsecured Loans 1,39,64,506

Less : Share Application Money 3,99,98,750

Net Assets as on 1st April, 2005 11,05,21,000

16. The name of the transferee company i.e. Indo Kopp Limited has been changed to Indo Asian Fusegear (India) Limited w.e.f. 15th June, 2005 and Indo Asian Fusegear Limited w.e.f. 23rd August, 2005.

17. The company has allotted 42,50,000, 8% Convertible Preference Shares of Rs. 10/- each in lieu of 25,00,000 Equity Shares of Rs. 10/- to the equity shareholders the erstwhile Indo Kopp Limited (the transferee company) as per the Scheme of Arrangement.

The difference between the amount recorded as Preference Share Capital issued and the amount of Share Capital of the transferee company amounting to Rs. 17,500,000/- has been charged to Profit and Loss Account.

18. The 8% Convertible Preference Shares held by the shareholders of the Transferor company were to be compulsorily converted into equity shares of the Transferee company as per the then existing pricing formula of SEBI on 1st April, 2006.

Subsequent to the Balance Sheet date, the company has issued 2,80,528 equity shares of Rs.10/- each fully paid up to the erstwhile shareholders of Indo Kopp Limited upon conversion of Convertible Preference Shares into Equity Shares on 1st April 2006.

19. During the year ended 31st March 2006, the company has converted 42,24,000 Zero Coupon Warrants issued by private placement on preferential basis by the erstwhile Indo Asian Fusegear Limited into 42,24,000 fully paid equity shares of Rs. 10/- each at a price of Rs.12.50 per warrant.

20. Figures of the previous year have been regrouped/re-classified wherever necessary to make them comparable with the current years figures. As this is the first year of operation of the Company after the Merger of the erstwhile Indo Asian Fusegear Limited into it, figures for the current year are not comparable with those for the earlier year.

21. As per Accounting Standard AS-29, the movement of provision made for leave encashment is given below : 31st March, 200631st March, 2005

(Rs.) (Rs.)

Opening Balance 703,413 572,831

Add : Acquired under the Scheme of Arrangement 2,806,998 -

Add : Additions 2,115,157 246,995

Less: Utilisations 1,590,903 116,413

Closing Balance 4,034,665 703,413

25. The 10% Cumulative Redeemable Preference shares are redeemable at par within a period of 20 years from the date of allotment i.e.17th February, 2001. During the year ended 31st March, 2006, the company has paid arrears of Preference Dividend amounting to Rs.10,00,000/- for the year ended 31st March, 2005. The Cumulative amount of dividend remaining unpaid as on 31st March.2006 for the said shares is Rs.10,00,000/-.

26. Elements of Deferred Tax Liability (Net) created for tax effect of timing differences as at 31st March, 2006 are as under:-

Current Year Previous Year (Rs.) (Rs.)

Difference between Book Depreciation and Depreciation under Income Tax Act, 1961 (+) 14,035,426 (+) 1,620,865

Expenditure deferred under Section 43 B of Income Tax Act, 1961 (-) 1,264,566 (-)

Provision for Gratuity (-) 3,139,286 (-) 683,828

Total 9,631,574 937,037