Notes to Accounts of Landmarc Leisure Corporation Ltd.

Mar 31, 2018

Notes on Accounts:

1. Contingent Liabilities:

a. Disputed income tax liabilities -Rs. 16.74 Lacs (Previous Year -Rs. 20.93 lacs) and Service Tax 93.03 Lacs.

b. Contingent Liabilities as may arise due to delayed/non-compliance of certain fiscal statutes -Amount Unascertainable (Previous year-Amount Unascertainable).

2. The Management of the Company has decided to reduce its focus of Wellness activities and concentrate on Films, Media and TV Channel business. Accordingly, it has been decided to terminate the Company''s agreements with two parties to whom security deposits have been given and utilize the resources so realized for Entertainment business Accordingly, the Company is in discussions with both the parties for the refund of the said security deposit along with interest after necessary adjustments if any as agreed mutually. On the said grounds, the Company has requested SEBI to withdraw forensic audit & also uplift the restriction on promoters as well as directors to not to transfer or sell the shares held by them, though our promoter do not intend to sell any share. The Company however has not recognised interest income amounting to Rs 3634.40 lakhs on the security deposit given as the Company on conservative approach would recognize it on receipt basis, as one of the Company to whom security deposit has gone into liquidation and provisional liquidator has been appointed and in-respect of the other Company, only principal recovery is currently being done. Further, the Company also contemplates certain adjustments from the said Companies which is currently under discussion.

3. a. Read together with Note 31 above the Company in the earlier years, the Company had given an interest-free Security Deposit of Rs 1,500 Lakhs to Shree Ram Urban Infrastructure Ltd (SRUIL) as per Memorandum of Understanding (MoU) for establishment and running of wellness centre in the upcoming project of SRUIL, as per the terms of which the Company is entitled to share revenue with SRUIL/society for a specific period. However the Company was in advanced discussion with the said party for refund of deposit but now the Company has gone into liquidation and provisional liquidator has been appointed.

b. Read together with Note 31 above the Company based on a revenue sharing agreement entered into between the Company and SKM Real Infra Limited (formerly SKM Fabrics (Andheri) Ltd.) (SKM) the Company has given an interest free deposit of Rs. 25.03 Crores (Previous year -Rs. 23.13 Crores) in relation to the Wellness Academy and other allied activities being set up in the portion of commercial premises developed by SKM. However now the Company is recovering principal portion of the said deposit.

4. In the opinion of the Board, Current & Non-current Assets and Loans and Advances have a value on realization in the ordinary course of business, at least equal to the amounts at which they are stated and adequate provision has been made for all known liabilities.

5. Certain balances appearing under certain heads of Loans & Advances and Non-current Liabilities, are as per books of accounts and as such are subject to consequential adjustments, which may arise on receipt of confirmations and/or completion of reconciliations.

6. (a). Provision for current tax has been made as per the law stated in the Income Tax Act, 1961.

(b). No Deferred Tax Assets have been recognised in the accounts by the Company in respect of brought forward losses under the Income Tax Act, 1961, keeping in view the prudence aspect.

Carrying value of all the above financial assets and financial liabilities as at March 31, 2018, March 31, 2017 and April 1, 2016 approximate the fair value because of their short-term nature. Difference between carrying amounts ad fair values of the said assets and liabilities subsequently measured at amortized cost is not significant in each of the years presented.

(b) 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 the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the company has classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.

© Valuation technique used to determine fair values

The carrying amount of current financial assets and liabilities are considered to be the same as their fair values, due to Difference between carrying amounts ad fair values of the said assets and liabilities subsequently measured at amortized cost is not significant in each of the years presented.

The fair value of security deposits and borrowings has been considered same as carrying value since there have not been any material changes in the prevailing interest rates. Impact on account of changes in interest rates, if any has been considered immaterial.

Note

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices.

Level 2: The fair value of financial instruments that are not traded in an active market (for example over-the-counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2. Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities which are included in level.

There were no transfers between any levels during the year.

7. Financial risk management

The Company''s business activities expose it to a variety of financial risks, namely liquidity risk, market risks and credit risk.

(a) Credit risk

The company is exposed to credit risk, which is the risk that counterparty will default on its contractual obligation resulting in a financial loss to the company. Credit risk arises from cash and cash equivalents and financial assets carried at amortised cost Credit risk management

Credit risk is managed at company level depending on the policy surrounding credit risk management. For banks and financial institutions, only high rated banks/institutions are accepted. Generally all policies surrounding credit risk have been managed at company level.

(b) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, company treasury maintains flexibility in funding by maintaining availability under committed credit lines.

Management monitors rolling forecasts of the company''s liquidity position and cash and cash equivalents on the basis of expected cash flows. This is generally carried out at local level in the operation of the company in accordance with practice and limits set by the company.

Maturities of financial liabilities

The amounts disclosed in the below are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.

8. Capital Management

(a) Risk Management

The company''s objectives when managing capital are to safeguard the company''s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

The Company monitors capital on basis of total equity on a periodic basis. Equity comprises all components of equity includes the fair value impact. The following table summarizes the capital of the Company:

9. Outstanding amounts payable to Micro, Small and Medium Enterprises included under Current Liabilities, as per the information available with the Company and relied upon by the Auditors - Nil (Previous year-Nil).

10. The Company had issued 2,54,000 0% Redeemable Cumulative Preference Shares of Rs. 100/each fully paid up amounting to Rs. 254.00 Lakhs which was due for redemption on 30thJanuary 2018. The said Preference Shares were not redeemed as per the provisions of the Companies Act, 2013. However the Company is in the process of further extending the redemption for five years and has taken this for approval of members in this AGM.

11. During the previous years, the Company had incurred Publicity and Promotion expenses including Satellite rights, in respect of a feature film amounting to Rs. 740.28 Lakhs, of which, the management was of the view that Rs. 400.00 Lakhs would represent the future economic benefit of the satellite rights and had accordingly capitalised the same under Intangible assets. However in the current quarter, the Company has valued the same at fair value and the difference is treated under exceptional items.

12. Travelling expenses include Directors'' travelling expenses (foreign & domestic) of Rs. 0.22 Lakhs (Previous Year - Rs. 0.24 Lakhs).

13. The Company in the current year deals in only one segment i.e Film Production and Presentation and hence there are no reportable segments during the year.

14. During the financial year 2017-18, the Company had been identified as a suspected shell company vide Ministry of Corporate Affairs Letter & Bombay Stock Exchange Notice dated August, 7, 2017. The Company had been placed under Stage VI of Graded Surveillance Measure (GSM) by SEBI and the trading in the equity shares of the Company was suspended. The Company had made an appeal before the Securities Appellate Tribunal (SAT) and subsequently SEBI had passed an interim order on 6th October, resuming the trading in equity shares of the Company with effect from 9th October, 2017, except trading in equity shares by the Promoters and Directors. The Management of the Company have confirmed that no trading was done by the Promoters and Directors during the period of trading restrictions.

15. During the financial year 2017-18, the Bombay Stock Exchange had issued a notice dated December 22, 2017 to the Company for conducting Forensic Audit on shell companies identified by SEBI. The Forensic Audit has been withheld for now by the Stock Exchange. The Company has not received any directions for the same and that the Company is in the process to file an appeal to the SAT in this regard.

16. Previous year''s figures have been regrouped /rearranged wherever considered necessary.

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Dec 31, 2014

Note 1:-

Continoent liabilities

a. Arrears of dividend on Redeemable Cumulative Preference Shares - Nil (Previous Year - Rs. Nil).

b. Contingent Liabilities as may arise on account of non/delayed compTiance of certain fiscal statutes-Amount unascertainable (Previous Year - Amount unascertainable).

Note 2:- 2,54,000 0% Redeemable Cumulative Preference Shares of Rs. 100/- each fully paid up amounting to 1254.00 Lacs due to be redeemable at 30th January 2013 (as extended previously) are further extended for redemption after 5 years i.e. up to 30th January 2018 pursuant to the provisions of section 106 of the Companies Act 1956. Further, the rate of Preference Dividend has been reduced to 0% from 1 %.

Mote 3:-

Unsecured loans from a body corporate under the same group (interest free) are repayable on demand. Certain portion of the said loan is considered as long term debt by the Company, keeping in view the purpose and (he tenure, as agreed upon with the lender body corporate.

Note 4:-

a) The Company has provided liability for gratuity and leave encashment payable to its eligible employees as per actuarial valuation, in line with the recommendations of the.Accounting Standard -15, Employee Benefits. Following are the details in respect of gratuity (Non-funded):

In the earlier years, the Company has given an interest-tree Security Deposit of Rs. 1,500 Lacs to Shree Ram Urban Infrastructure Ltd. (SRUIL) as per Memorandum of Understanding (MoU) for establishment and running of wellness centre in the upcoming project of SRUIL, as per the terms of which the Company is entitled to share revenue with SRUIL/society for a specific period.

Note 5:-

During the previous years, the Company has incurred Publicity and Promotion expenses including Satellite rights, in respect of a feature film amounting to Rs. 740.28 Lacs, of which, the management is of the view that Rs. 400.00 Lacs would represent the future economic benefit of the satellite rights and has accordingly capitalised the same under Intangible assets. Due to capitalising the same, the fixed assetsare over stated to the extent of Rs. 250.39 Lacs (Previous YearRs. 299.72 Lacs).

Note 6:-

Based on a revenue sharing agreement entered into between the Company and SKM Real Infra Limited (formerly SKM Fabrics (Andheri) Ltd.) (SKM) the Company has given an interest free deposit of Rs. 35.51 Crores (Previous year - Rs. 47.92 Crores) in relation to the Wellness Academy and other allied activities being set up in the portion of a commercial premises developed by SKM.

Note 7:-

Ceitain balances under the heads of Unsecured borrowing, Trade Receivables, Loans and Advances and Trade payables are subject to confirmation and consequential reconciliation, if any. The necessary adjustments in the respective accounts will be carried out in the year such reconciliation /confirmation takes place.

In the opinion of management, Current Assets, Loans and Advances are expected to realize at the values represented in the financial statements in the normal course of business and adequate provision has been made for all known liabilities.

Note 8:-

Travelling expenses include Directors'' Travelling expenses (foreign 4 domesticjofRs. 2.35 Lacs (Previous Year-Rs. 3.09 Lacs).

a. No provision forCurrentlaxforyearhas been considered, in view losses incurred by the Company during the year.

Tax rate considered for the above purposes is 33.22% (Previous Year 33.22 %)

c. Deferred tax Assets arising due to brought forward losses under the Income Tax Act, 1961 were not recognized in the accounts as a matter of prudence.

As per the requirements of Section 22, there are no Micro and Small Enterprise to whom the Company owes dues, which are outstanding more than 45 days as at 31st December, 2014. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company. The same has been taken on the basis of information provided by the Company and relied upon by the Auditors.

The Company has taken a premises on operating lease basis. Lease payments made during the year debited to Statement of Profit and loss 7 91.34 Lacs (Previous year Rs. 135.31 lacs), the agreement being amended during the year. The amount of future minimum lease payments/commitment under non-cancellable are as under: (Rs. in Lacs)

Note 9:-

The Company has identified three reportable Segments viz, Management Consultancy, Wellness business and Landmarc Films. Segments have been identified and reported taking into account nature of services rendered by the Company, the differing risks and returns and ffie internal business reporting systems. The accounting policies adopted for segment reporting are in line with the accounting policies of the Company, with the fallowing additional disclosures fix legmen! reporting: Segment Information Amount (Rs. In lacs)

Notes forming part of the financial statements for the year ended 3 rd December 2014

a. Revenue & Expenses have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue ! Expenses which relates to enterprise as a whole are not allocable to a segment on reasonable basis have been disclosed as "Unallocable".

b. Segment assets & liabilities represent assets A liabilities in respected segments. Tax related assets & other liabilities that cannot be allocated to a segment as a reasonable basis have been disclosed as "Unallocable''.

The Company deals only in one geographical area i.e. India hence there is no secondary segment as reportable.

Note 10 Related party Disclosure

(i) Key Management personnel

(a) ShriSDSinha-Whole Time Director

(b) Vidhi Kasliwal

(c) KapilKotia-ChieffinancialOfficer

(ii) Relatives of Key Management Personnel

(a) Vikas Kasliwal

(b) Amav Vikas Kasliwal

(c) Dhntv Vikas Kasliwal

(d) RS Kasliwal

(iii) Subsidiaries! Fellow Subsidiaries None

(iv) Associates None

(v) Enterprises over which key management personnel and their relatives exercise significant influence where the Company has ente red into transactions du ring the year:

a) Vidhi Holdings Private Limited

b) Hanumesh Investments Pvt. Ltd.

c) Akhilesh Investfin Pvt. Lid.

d) Shree Ram Urban Infrastructure Limited

e) ASParivar

f) Yashaswini Investment Company Pvt Ltd

g) S Kumar Co

The Company vide board resolution date 8th August 2014 and in accordance with provision of section 2(41) and other applicable provision of the Companies Act, 2013 has filed an application to Register of Companies for extension of the financial year for preparation of accounts covering a period of 15 months i.e. from 1st October 2013 to 31st December 2014 in view to Comply with the Companies Act 2013 where in it is required to have a uniform accounting year.

Note 11:-

The Company is in the process of complying with the requirements of section 203 of the companies Act 2013 in respect of employing a full time Company Secretary on its rolls as the company is still in the search of Company Secretary to match its requirement.

Note 12:-

As the Company has changed its accounting year from September to December the current financials have been made for 15 Months i.e 1st October, 2013 to 31st December, 2014 and hence the amounts of the current year are not comparable with the previous year. Previous year figures have been grouped / regrouped as current year financials.

Note 13:-

The Company during the year under has released a movie named * Sanngto Aika" and hence the Preoperative expenses of the same has been transferred to statement of profit and loss account details of the same are given below.

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Sep 30, 2013

Note 1: Contingent liabilities

a. Arrears of dividend on Redeemable Cumulative Preference Shares - Nil (Previous Year - Rs. 24.55 Lacs).

b. Contingent Liabilities as may arise on account of non/delayed compliance of certain fiscal statutes-Amount unascertainable (Previous Year - Amount unascertainable).

Note 2:

2,54,000 0% Redeemable Cumulative Preference Shares of Rs. 100/- each fully paid up amounting to Rs. 254.00 Lacs due to be redeemable at 30th January 2013 (as extended previously) are further extended for redemption after 5 years i.e. up to 30th January 2018 pursuant to the provisions of section 106 of the Companies Act 1956. Further, the rate of Preference Dividend has been reduced to 0% from 1 %.

Note 3:

Unsecured loans from a body corporate under the same group (interest free) are repayable on demand. Certain portion of the said loan is considered as long term debt by the Company, keeping in view the purpose and the tenure, as agreed upon with the lender body corporate.

Note 4:

a) The Company has provided liability for gratuity and leave encashment payable to its eligible employees as per actuarial valuation, in line with the recommendations of the Accounting Standard -15, Employee Benefits. Following are the details in respect of gratuity (Non-funded):

Note 5:

Certain balances under the heads of Unsecured borrowing, Trade Receivables, Loans and Advances and Trade payables are subject to confirmation and consequential reconciliation, if any. The necessary adjustments in the respective accounts will be carried out in the year such reconciliation /confirmation takes place.

Note 6:

In the opinion of management, Current Assets, Loans and Advances are expected to realize at the values represented in the financial statements in the normal course of business and adequate provision has been made for all known liabilities.

Note 7:

Travelling expenses include Directors'' Travelling expenses (foreign & domestic) of Rs. 3.09 Lacs (Previous Year - Rs. 9.99 Lacs).

Note 8:

a. No provision for Current tax for year has been considered, in view losses incurred by the Company during the year.

Tax rate considered for the above purposes is 30.90% (Previous Year: 30.90%)

c. Deferred tax Assets arising due to brought forward losses under the Income Tax Act, 1961 were not recognized in the accounts as a matter of prudence.

Note 9:

As per the requirements of Section 22, there are no Micro and Small Enterprise to whom the Company owes dues, which are outstanding more than 45 days as at 30th September, 2013. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company. The same has been taken on the basis of information provided by the Company and relied upon by the Auditors.

Note 10: Leased out Premises:

The Company has taken a premises on operating lease basis. Lease payments made during the year debited to Statement of Profit and loss Rs. 74.16 Lacs (Previous year Rs. 86.09 lacs), the agreement being amended during the year. The amount of future minimum lease payments/commitment under non-cancellable are as under:

Note 11:

The Company has identified three reportable Segments viz, Management Consultancy, Wellness business and Landmarc Films. Segments have been identified and reported taking into account nature of services rendered by the Company, the differing risks and returns and the internal business reporting systems. The accounting policies adopted for segment reporting are in line with the accounting policies of the Company, with the following additional disclosures for segment reporting:

a. Revenue & Expenses have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue & Expenses which relates to enterprise as a whole are not allocable to a segment on reasonable basis have been disclosed as "Unallocable".

b. Segment assets & liabilities represent assets & liabilities in respected segments. Tax related assets & other liabilities that cannot be allocated to a segment as a reasonable basis have been disclosed as "Unallocable".

The Company deals only in one geographical area i.e. India hence there is no secondary segment as reportable.

Note 12: Related party Disclosure

(i) Key Management personnel

(a) Shri S D Sinha - Whole Time Director

(b) Vidhi Kasliwal

(ii) Relatives of Key Management Personnel

(a) Vikas Kasliwal

(b) Arnav Vikas Kasliwal

(c) Dhruv Vikas Kasliwal

(iii) Subsidiaries & Fellow Subsidiaries None

(iv) Associates None

(v) Enterprises over which key management personnel and their relatives exercise significant influence where the Company has entered into transactions during the year:

a) Vidhi Holdings Private Limited

b) Yashaswini Leisure Private Limited

c) Akhilesh Developers Private Limited

d) Hanumesh Realtors Private Limited

e) Shree Ram Urban Infrastructure Limited

f) Yashaswini Investments Company Private Limited

g) Akhilesh Investfin Private Limited

h) Hanumesh Investments Private Limited

Notes:

(a) Related party relationships are as per the information provided by the Company and relied upon by the auditors.

(b) Previous year''s figures are given in brackets.

Note 13:

Previous year figures have been grouped / regrouped as current year financials.

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Sep 30, 2011

1. Contingent liabilities

a. Arrears of dividend on Redeemable Cumulative Preference Shares Rs 22.01 Lacs (Previous Year Rs 19.47 Lacs).

b. Contingent Liabilities as may arise on account of non/delayed compliance of certain fiscal statutes-Amount unascertainable (Previous Year - Amount unascertainable).

2. 2,54,000 1% Redeemable Cumulative Preference Shares of Rs 100/- each fully paid up amounting to Rs 254.00 Lacs are redeemable at the end of five years from the date of issue, on 30th January 2013 (as extended).

3. During the year, the Company has converted its preferential warrants into Equity shares of face value Rs 1 each, aggregating to Rs 40.00 crores at a premium of Rs 0.08 per warrant.

4. a) The Company has provided liability for gratuity payable to its eligible employees as per actuarial valuation, in line with the recommendations of the Accounting Standard -15, Employee Benefits. Following are the details in respect of gratuity (Non-funded):

5. In the earlier year the company has given an interest free security deposit of Rs 1500 Lacs to SRUIL as per MOU for establishment and running of wellness centre in the upcoming project of SRUIL, as per the terms of which the company is entitled to share revenue with SRUIL/society for a specific period.

6. During the year, the Company has incurred publicity and promotion expenses including satellite rights, in respect of a feature film amounting to Rs 740.28 Lacs, of which, the management is of the view that Rs 400.00 Lacs would represent the future economic benefit of the satellite rights and has accordingly capitalised the same under Intangible assets. Had the same been charged of to revenue during current year losses for the year would have been overstated with a similar understated of fixed assets by Rs 379.84 Lacs.

7. Based on a revenue sharing agreement entered into between the Company and SKM Real Infra Limited (formerly SKM Fabric (Andheri) Limited), the Company has given an interest free deposit of Rs 47.29 Crores (previous year Rs 14.00 Crores) in relation to the Wellness Academy and other allied activities being set up in the portion of a commercial premises developed by SKM Real Infra Limited.

8. Certain balances under the heads Loans and Advances and Current Liabilities are subject to confirmation from respective parties and consequential reconciliation, if any.

9. In the opinion of the management, the Current Assets, Loans and Advances are approximately of the values stated in the financial statements if realised in the ordinary course of business and necessary provisions for all known liabilities have been made.

10. Travelling expenses of Rs 9.86 Lacs (Previous Year Rs 6.69 Lacs) were incurred in respect of a director of the Company.

11. The Company has entered into the education sector by starting the business of SPA Wellness Academy under the brand name Svastii, to provide quality education and training to aspirants. Svastii Wellness Academy will offer a wide range of courses across various wellness and beauty related areas. The operation of the Academy will start in near future, against which the Company has incurred expenses amounting to Rs 107.71 Lacs (Previous year Rs 9.59 Lacs) till date and which has been accounted under Pre-operative expenses pending allocation.

c. Deferred tax Assets arising due to brought forward losses under the Income Tax Act, 1961 were not recognized in the accounts as a matter of prudence.

12. The Company has identified three reportable Segments viz, Wellness Business, Landmarc Films and Management Consultancy. Segments have been identified & reported taking into account nature of services rendered by the Company, the differing risks and returns & the internal business reporting systems. The accounting policies adopted for segment reporting are in line with the accounting policy of the Company with following additional policies for segment reporting.

a. Revenue & Expenses have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue & Expenses which relates to enterprise as a whole are not allocable to a segment on reasonable basis have been disclosed as "Unallowable".

b. Segment assets & liabilities represent assets & liabilities in respected segments. Tax related assets & other liabilities that cannot be allocated to a segment as a reasonable basis have been disclosed as "Unallowable".

The Company deals only in one geographical area i.e. India hence there is no secondary segment as reportable.

Notes:

(a) Related party relationships are as per the information provided by the Company and relied upon by the auditors.

(b) Previous year's figures are given in brackets.

13. The Company had in its previous year undertaken physical verification of the Fixed assets and based on the said exercise has decided to remove from the books a substantial portion of Gross block which was fully depreciated in the books amounting to Rs. 1,972.55 Lacs.

14. Information Pursuant to Schedule-VI and paragraphs 3 and 4 of part II of Schedule VI to the Companies Act,1956.

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Sep 30, 2010

1. Contingent liabilities

a. Arrears of dividend on Redeemable Cumulative Preference Shares - Rs. 19.47 Lacs (Previous Year- Rs. 16.93 Lacs).

b. Contingent Liabilities as may arise on account of non/delayed compliance of certain fiscal statutes-Amount unascertainable (Previous Year - Amount unascertainable).

2. 2,54,000 1% Redeemable Cumulative Preference Shares of Rs. 100/ - each fully paid up amounting to Rs. 254.00 Lacs are redeemable at the end of five years from the date of issue, on 30th January 2013 (as extended).

3. Pursuant to Section 81(1A) and other applicable provisions of the Companies Act, 1956 and in accordance with the provisions of the Memorandum and Articles of Association, the Company had, in the earlier years, passed a resolution to create, offer, issue and allot from time to time in one or more tranches, 4,000.00 Lacs Equity Warrants of Re. 1 each at a premium of Rs. 0.08 per warrant. Accordingly an amount equal to 25% of the price of the Equity warrants amounting to Rs. 10.80 Crores was received by the Company in earlier years, which has been shown as Warrant Application Money under the head "Shareholders Funds". The said warrants are due for conversion on or before 2nd March 2011, i.e., the expiry of 18 months from the date of issue.

4. a) The Company has provided liability for gratuity payable to its eligible employees as per actuarial valuation, in line with the recommendations of the Accounting Standard -15, Employee Benefits. Following are the details in respect of gratuity (Non- funded):

b) Leave encashment provided in the books of accounts during the year is Rs. 1,90,000 (Previous Year - Nil).

6. The Company has entered into a Memorandum of Understanding (MOU) with Shree Ram Urban Infrastructure Ltd. (SRUIL) on 13th March 2009

wherein SRUIL will handover the establishment and running of Wellness Centre in the premises of the proposed project of SRUIL. As per the MOU, the Company would be entitled to recover charges from the residents as well as outsiders for utilising the services of the wellness spa. Also the Company will share 10% of this revenue with the society/ SRUIL. The Company will enjoy the privileges on an exclusive basis for 30 years from the commencement of the wellness centre (further renewable for 20 more years).

As per the said MOU, the balance of interest free advance of Rs. 1,500.00 Lacs given in the earlier years to SRUIL its now considered as Security Deposit towards the Companys performance as per the above MOU. The Company considers the above advance/deposits to be beneficial to its interests, in view of the revenue to be generated at a future date out of the wellness spa, based on the revenue projections available and no part of the said advance is considered doubtful of recovery. Consequential impact on the revenue of the Company due to nil return on the above advance till the end of the current year is presently unascertainable.

7. The Company has given an interest free advance of Rs. 1,400.00 Lacs (Previous Year - Rs. 1,400.00 Lacs) to SKM Fabrics (Andheri) Ltd. towards its proposed occupation of a portion of commercial premises being constructed by the said company for the Wellness Academy (Refer note 11 B below). The actual utilisation of the said premises has not started till the close of the current year.

8. Certain balances under the heads Loans and Advances and Current Liabilities are subject to confirmation from respective parties and consequential reconciliation, if any.

9. In the opinion of the management, the Current Assets, Loans and Advances are approximately of the values stated in the financial statements if realised in the ordinary course of business and necessary provisions for all known liabilities have been made.

10. Travelling expenses of Rs. 6.69 Lacs (Previous Year - Rs. 1.09 Lacs) were incurred in respect of a director of the Company.

11. a. During the year, the Company has diversified into Spa and Wellness activities by opening a wellness centre. All the assets/equipments and associated cost in respect of the above activity have been appropriately capitalised.

b. During the year, the Company has entered into the education sector by starting the business of SPA Wellness Academy under the brand name Svastii, to provide quality education and training to aspirants.

Svastii wellness academy will offer a wide range of courses across various wellness and beauty related areas. The operation of the academy will start in near future, against which the Company has incurred expenses amounting to Rs. 9.10 Lacs till date and which has been accounted under Pre-operative expenses pending allocation.

12 a. No provision for Current tax for year has been considered, in view losses incurred by the Company.

Tax rate considered for the above purposes is 30.30% (Previous Year 30.30%)

c. Deferred tax Assets arising due to brought forward losses under the Income Tax Act, 1961 were not recognized in the accounts as a matter of prudence.

18. The Company has identified three reportable Segments viz. Management Consultancy, SPA Business, Share Trading. Segments have been identified & reported taking into account nature of services rendered by the Company, the differing risks and returns & the internal business reporting systems. The accounting policies adopted for segment reporting are in line with the accounting policy of the Company with following additional policies for segment reporting.

a. Revenue & Expenses have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue & Expenses which relates to enterprise as a whole are not allocable to a segment on reasonable basis have been disclosed as "Unallocable".

b. Segment assets & liabilities represent assets & liabilities in respected segments. Tax related assets & other liabilities that cannot be allocated to a segment as a reasonable basis have been disclosed as "Unallocable".

The Company deals only in one geographical area i.e. India hence there is no secondary segment as reportable.

19. Related party Disclosure

(i) Kev Management personnel

(a) Mrs. Paulomi Dhawan Managing Director

(b) Shri S D Sinha Whole Time Director

(ii) Relatives of Key Management Personnel

None

(iii) Subsidiaries & Fellow Subsidiaries

None

(iv) Associates

(a) Vidhi Holdings Pvt. Ltd

(b) Yashaswini Leisure Pvt Ltd.

Notes:

(a) Related party relationships are as per the information provided by the Company and relied upon by the auditors.

(b) Previous years figures are given in brackets.

20. The Company has during the year undertaken physical verification of the Fixed assets and based on the said exercise has decided to remove from the books a substantial portion of Gross block which was fully depreciated in the books, to the extent of Rs. 1,972.55 Lacs (Previous Year Rs. Nil)

22. Information pursuant to Schedule -VI and paragraphs 3 and 4 of Part II of Schedule VI to the Companies Act, 1956

(i) Earnings in Foreign Exchange - Rs. Nill (Previous year - Nil)

(ii) Foreign Exchange Outgo: Travelling Expenses Rs. 4.32 Lacs (Previous year-Nil)

23) Figures representing the previous year have been regrouped / rearranged wherever considered necessary.

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Sep 30, 2009

1. Contingent liabilities

a. Arrears of dividend on Redeemable Cumulative Preference Shares - Rs. 16.93 Lacs (Previous Year - Rs. 14.39 Lacs).

b. Contingent Liabilities as may arise on account of non/delayed compliance of certain fiscal statutes-Amount unascertainable (Previous Year - Amount unascertainable).

2 2,54,000 1% Redeemable Cumulative Preference Shares of Rs. 100/- each fully paid up amounting to Rs. 254.00 Lacs are redeemable at the end of five years from the date of issue, on 30th January 2013 (as extended).

3. The Company has provided liability for Gratuity payable to its eligible employees as per Actuarial Valuation in line with the recommendations of the Accounting Standard -15, Employees Benefits. No provision is considered towards leave encashment by the Company. Following are the details in respect of Gratuity (Non-funded):

4. The Company has entered into a MOU with Shree Ram Urban Infrastructure Ltd. (SRUIL) on 13th March 2009 wherein SRM will handover the Establishment and Running of Wellness Centre in the premises of the proposed project of SRUIL. As per the MOU the Company would be entitled to recover reasonable charges from the residents as well as outsiders for utilising the services of the wellness spa. Also the Company will share 10% of this revenue with the society/SRUIL. The Company will enjoy the privileges on an exclusive basis for 30 years from the commencement of the wellness centre (further renewable for 20 years).

As per the said MOU, out of an interest free advance of Rs. 2,000.00 Lacs given in the earlier years to Shree Ram Urban Infrastructure Ltd. (SRUIL) Rs. 500.00 Lacs be refunded on or before 31st March 2010 and the balance will be considered as Security Deposit towards the Companys performance as per the above MOU. The Company considers the above advance/deposits to be beneficial to its interests, in view of the revenue to be generated at a future date out of the wellness spa, based on the revenue projections available and no part of the said advance is considered doubtful of recovery. Consequential impact on the revenue of the Company due to nil return on the above advance till the end of the current year is presently unascertainable.

5. Certain balances under the heads Sundry Debtors, Loans and Advances and Current Liabilities are subject to confirmation from respective parties and consequential reconciliation, if any.

6. In the opinion of the management, the Current Assets, Loans and Advances are approximately of the values stated in the financial statements if realised in the ordinary course of business and necessary provisions for all known liabilities have been made.

7. The Company has increased it Authorised Share Capital to Rs. 110 Crores comprising of 99.40 Lacs Equity Shares of Re.1 each and 10.6 Lacs 1% Redeemable Cumulative Preference Shares of Rs. 100 each vide a resolution passed in the Extra Ordinary General Meeting held on 24th August 2009.

8. Pursuant to Section 81(1 A) and other applicable provisions of the Companies Act, 1956 and in accordance with the provisions of the Memorandum and Articles of Association, the Company has passed a resolution to create, offer, issue and allot from time to time in one or more tranches, 4,000 Lacs Equity Warrants of Re. 1 each at premium of Rs. 0.08 per warrant. Accordingly an amount of 25% of the price of the equity warrants amounting to Rs. 10.80 crores (Previous Year - Nil) was received by the Company which has been shown as Warrant Application Money under the head "Shareholders Funds". The said warrants are due for conversion on at any time before the expiry of 18 months from the date of allotment of equity warrants.

9. Travelling Expenses of Rs. 1.09 Lacs (Previous Year - Rs. 2.51 Lacs) and other expenses of Nil (Previous Year - Rs. 0.21 Lacs) were incurred in respect of a Director of the Company.

10a. No provision for Current tax for year ended 30th September 2009 has been considered in view losses incurred by the Company.

Tax rate considered for the above purposes is 30.30% (Previous Year: 33.99%)

b. Deferred tax Assets arising due to brought forward losses under the Income Tax Act, 1961 were not recognized in the accounts as a matter of prudence.

11. Segment Information

Reporting as per the recommendations of Accounting Standard-17 is not applicable to the Company during the under review, since there are no business or geographical segments. There was only one reportable segment during the year under review.

12. Related party Disclosure

(i) Key Management personnel

(a) Shri S D Sinha Whole Time Director

(b) Mrs. Paulorni Dhawan Managing Director (ii) Relatives of Key Management Personnel None

(iii) Subsidiaries & Fellow Subsidiaries None

Notes:

(a) Related party relationships are as per the information provided by the Company and relied upon by the auditors.

(b) Previous years figures are given in brackets.

13. Information pursuant to Schedule -VI and paragraphs 3 and 4 of Part II of Schedule VI to the Companies Act, 1956

(ii) Earnings in Foreign Exchange -Nil (Previous year- Nil)

(ii) Foreign Exchange Outgo: Rs. NIL Lacs (Previous year- Rs.0.86 Lacs)

14. Figures representing the previous year have been regrouped / rearranged wherever considered necessary.

20. Information pursuant to Part-IV of Schedule VI to the Companies Act, 1956;