Notes to Accounts of Omax Autos Ltd.

Mar 31, 2021

There is no delay in the repayment of loans & interest on the date of balance sheet.

a) Term Loan from IndusInd Bank is secured by way of first pari passu charge over entire fixed assets both moveable and immovable (present & future) of the Long Member Plant and first pari passu charge on Land & Building of Manesar Unit. Term Loan is bearing 10.50% p.a. interest rate and finally repayable by March 2026 in twenty equal quarterly instalments beginning from June 2021 end.

b) Term Loan from Indian Bank is under syndication with Indusind Bank secured by way of first pari passu charge over entire fixed assets both moveable and immovable (present & future) of the Long Member Plant and first pari passu charge on Land & Building of Manesar Unit. Term Loan is bearing 10.50% p.a. interest rate and finally repayable by June 2025 in twenty equal quarterly instalments beginning from September 2020 end.

Further loan of Rs. 337 lacs under Emergency Credit Line Guarantee Scheme 2.0 is against second charge on current assets viz stocks and book debts and second pari passu charge on Manesar Land & Building and bearing interest 8.20% ~ 9.25% p.a. This loan is repayable in 36 months, monthly instalments starting from April 2022.

c) Term Loan from Yes Bank is secured by way of exclusive charge over entire fixed assets both moveable and immovable (present and future) on upcoming New Railways project and exclusive first charge on Faridabad Land . Term Loan is bearing 10.25% ~ 11% p.a. interest rate and finally repayable by February 2026 in twenty equal quarterly instalments beginning from May 2021 end.

Further, Loan of Rs. 1019 lacs under Emergency Credit Line Guarantee Scheme 2.0 taken against second charge on entire current assets (stocks and book debts) and second charge over entire fixed assets both moveable and immovable (present and future) on upcoming New Railways Plant and second charge on Faridabad Land bearing interest 8.20% ~ 9.25% p.a repayable in 48 monthly instalments starting from March 2022 till February 2026.

d) Loan from HDFC Bank Ltd. is under Emergency Credit Line Guarantee Scheme 2.0 taken against second charge on Halol Land and second pari passu charges on current assets viz stock and receivables. Term Loan is bearing 8.20% ~ 9.25% p.a. interest rate and repayable in 48 monthly instalments beginning from April 2022 till March 2026.

e) Term Loan from Bajaj Finance Limited is secured by way of exclusive first charge on Haridwar Industrial Land. Term Loan is bearing interest 9.00% ~10% p.a. and has been fully repaid by May 2021.

f) Term Loan from The Pradeshiya Industrial & Investment Corporation of U.P. Limited (PICUP) is secured by way of first charge on Land and Building of Bawal & Binola Plant and hypothecation on the Plant and Machinery of Lucknow Plant & Bawal Plant.Term Loan is interest free under Industrial Investment Promotion Scheme (IIPS) of Government of Uttar Pradesh, and repayable after 7 years from the date of respective disbursement in single instalment. Further loan of Rs. 1920.86 lacs taken in FY 2019-20 is secured by way of long term Bank Guarantee issued by a scheduled bank.

g) Term Loan from TATA Capital Financial Services Limited is secured by way of hypothecation on identified Plant & Machineries. Term Loan is bearing 10.75% p.a. interest rate and repayable in 60 monthly instalments starting from November 2020 to October 2025. Loan of Rs. 330 lacs under Emergency Credit Line Guarantee Scheme 2.0 taken against second charge over the identified Plant & Machineries funded by Tata Capital Financial Services Limited bearing interest 9% ~ 14% and repayable in 48 monthly instalments starting from March 2022 to February 2026.

q) Financial risk management :

The Company manages the financial risks relating to the operations of the Company. These risks include market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk. The Company seeks to minimise the effects of these risks by using credit limits to hedge risk exposures. The use of financial instruments is governed by the Company''s policies on foreign exchange risk and the investment. The Company does not enter into agreements for trade financial instruments, including derivative financial instruments, for speculative purposes.

Market risk is the risk of any loss in future earnings, in realizable fair values or in future cash flows that may result from a change in the price of a financial instrument. The Company''s activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates risk/ liquidity which impact returns on investments. Keeping in mind the overall small exposure, the company does not enters into derivative financial instruments to manage its exposure to foreign currency risk including export receivables and import payables. Future specific market movements cannot be normally predicted with reasonable accuracy.

Credit Risk

Credit risk is the risk that counterparty will not able to meet its obligations 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 and other receivables) and from its financing activities, including deposits with banks and other financial instruments.

Trade Receivables

The Company follows a ‘simplified approach'' (i.e. based on lifetime ECL) for recognition of impairment loss allowance on its trade receivables. For the purpose of measuring lifetime ECL allowance for trade receivables, the Company estimates irrecoverable amounts based on the ageing of the receivable balances, clubbed with, historical experience with the customer and/or the industry in which the customer operates and assessment of litigation, if applicable. Receivables are written off when they are no more deemed collectable.

Liquidity risk

The Company''s principal sources of liquidity are ‘Cash and Cash Equivalents'' and cash flows that are generated from operations. The Liquidity risk represents the inability of the Company to meet its financial obligations within stipulated time. To mitigate this risk, the Company maintains sufficient liquidity by way of readily convertible instruments and working capital limits from banks.

r) The company is into the business of manufacturing and selling sheet metal components related to automobile and Railways, having its manufacturing units in the state of Uttar Pradesh and Haryana. To maximise its revenue, the company is also developing various other products for Railways and commercial vehicle business and exploring the oppourtunities to increase its customer base.

During the year, the company for the purpose of maximising the profits had decided and closed its two units operations based at Bangalore & Bawal after assessing the viability of its products the board had approved to dispose off all assets of these manufacturing units except Land & Building of Bawal Unit. Consequently, Company had sold its Banglore unit L&B which resulting profit on sale of Land and Building amounting to Rs. 4529.41 lac which has shown as exceptional items in profit and loss account.

Further, plant and equipment of closed units were valued at cost and these were classified as ‘Assets Held for Sale''.

s) During the year, the Company has started commercial production at one of its location on January 13th, 2021 under the "Awadh Project". The other location is expected to be operational in the financial year of 2021-22 which got delayed due to adverse impact of Covid-19 pandemic and consequent lockdown.

t) The Company had entered in to fully hedged fixed rate currency transactions with Indusind Bank related to the one new location i.e. Long Member under Awadh Project. The outstanding exposure amount as on 31st March 2021 is Rs. 4059.58 lac (Previous year was Rs. 3971.19 lacs). Mark to Market (MTM) net gain is Rs. 83.71 lacs as on 31st March 2021 (Previous Year net loss was Rs. 37.13 lacs) which has been accounted in profit and loss account under the head Comprehensive Income.

u) The operational activities of the company could not take place in the month of April 2020 and partially in May 2020 due to Covid -19 restrictions and lockdown. Covid-19 pandemic posed several challenges to industrial and economic activities of the company. The plant resumed operations gradually with reduced capacity at the end of May 2020.

The Company''s operations for the financial year 2020-21 have been adversely impacted by the outbreak of COVID-19 pandemic and consequent lockdown due to that operations of passenger trains also suspended for substantial part of the year by Indian Railways effected our Rly business also. The operations of the company have now resumed to some extent due to improved scenario, but the company is still facing challenges as most of passenger trains are still not in operation because of the pandemic. So, after assessing the business situation, the Board of Directors for the purpose of infusing liquidity in the Company/ reduce losses allowed sale of Bangalore plant, accordingly land and building of said plant has been sold which has resulted in a gain of Rs. 4529.41 lacs in current quarter under review. Further, company has written back the excess provisions of Rs. 251.49 lac towards closed plants vendors which altogether has been shown under the exceptional items.

v) The amount of borrowing costs capitalized during the year ended 31 March 2021 was Rs. 1292.11 lacs (Previous years Rs. 1,016.65 lac). The interest rate charged by bank used to determine the amount of borrowing Costs eligible for capitalization.

w) The Company has re-assessed its embedded lease arrangements and is reasonably certain that the lease agreement with TATA Motors Limited will be further extended on existing terms for a period of 15 years. Accordingly impact of Ind AS 116 has been computed considering such extended period. Consequently, the impact of cumulative adjustment due to extension of lease period amounting to Rs. 2,417.19 lacs has been adjusted in retained earnings (Other equity).

x) As per Ind AS, the financial liability of interest free loan from PICUP is to be measured at fair value and the difference between disbursed interest free loan amount and fair value is to be recognised as Government grant. The Company has availed mandatory exception under Ind AS 101 and accordingly, change done in accounting treatment on the amount carried forward on the date of transition. After transition date, the difference between interest free loan and fair value has been recognised as Government grant as at Balance Sheet date. Also Government grant has been recognised in the Statement of Profit and Loss as an income on a internal rate of return basis spread over the period of grant and interest on fair value of Government grant on its inception has been recognised as finance cost.

y) As per Ind AS, the financial liability of interest free loan from PICUP is to be measured at fair value and the difference between disbursed interest free loan amount and fair value is to be recognised as Government grant. The Company has availed mandatory exception under Ind AS 101 and accordingly, change done in accounting treatment on the amount carried forward on the date of transition. After transition date, the difference between interest free loan and fair value has been recognised as Government grant as at Balance Sheet date. Also Government grant has been recognised in the Statement of Profit and Loss as an income on a internal rate of return basis spread over the period of grant and interest on fair value of Government grant on its inception has been recognised as finance cost.

z) As per Ind AS, all items of income and expense recognised in a period should be included in the Statement of Profit and Loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are recognised in profit or loss and also shown in the Statement of Profit and Loss as ‘other comprehensive income'' includes re-measurements of defined benefit plans.

zc) Previous year figures had been reclassified, regrouped, rearranged wherever necessary.

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Mar 31, 2018

1 GENERAL INFORMATION

Omax Autos Limited (the Company) is a company limited by shares, incorporated and domiciled in India. The addresses of its registered office and principal place of business are disclosed in the introduction to annual report. The shares of the Company are listed on two stock exchanges in India i.e. National Stock Exchange (NSE) and Bombay Stock Exchange (BSE). The Company is engaged in business of manufacturing and selling of sheet metal components. The Company sells its products in India as well as various other global markets but has a dominant presence in domestic market.

The financial statements for the year ended March 31, 2018 were approved by the Board of Directors and authorised for issue on May 12, 2018.

2. BASIS OF PREPARATION

Statement of Compliance with Ind AS :

These financial statements have been prepared and comply with all material aspects with Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (“the Act”), read together with the Companies (Indian Accounting Standards) Rules, 2015 and other relevant provisions of the Act.

The financial statements up to the year ended March 31, 2017 were prepared in accordance with accounting standards notified under section 133 of the Act, read together with Companies (Accounts) Rules, 2014 (as amended) and other relevant provisions of the Act, then applicable. These are Company’s first financial statements prepared in accordance with Ind AS. The date of transition to Ind AS is April 1, 2016.

Refer note 39(s) for an explanation of how the transition from previous GAAP to Ind AS has affected the Company’s financial position, financial performance and cash flows.

Exemptions and exceptions availed

Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS, which are considered to be material or significant by the Company.

Ind AS optional exemptions:

Appendix C to Ind AS 17 requires an entity to assess whether a contract or an 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 Ind AS 17 for its Lucknow unit which is set up on land granted by UP State Industrial Development Corporation (UPSICDC) under lease deed in favour of Tata Motors Ltd. for a period of 90 years which has sublet its part to Omax Autos Ltd. initially for 15 years .

Further, the Company has elected to apply Ind AS 11 for its agreement with Suzlon Energy Ltd. and Jodhpur Vidyut Vitran Nigam Ltd. for its 2.5 MW Wind Power plant at Jaisalmer, Rajasthan for supply of power for a period of 20 years from the date of commercial operation.

The Company has elected to measure its property as per previous GAAP carrying value.

The Company has kept the same classification for the past business combinations as in its previous GAAP financial statements except those specified .

IND AS MANDATORY EXCEPTIONS:

Estimates

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

Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and circumstances that exist at the date of transition to Ind AS, accordingly, Company has classified financial assets.

Fair valuation of Government grant/loan Ind AS 101 requires that a first-time adopter shall classify all Government loans received as a financial liability or an equity instrument in accordance with Ind AS 32. Except as permitted by paragraph B11, a first-time adopter shall apply the requirements in Ind AS 109 and Ind AS 20, prospectively to Government loans existing at the date of transition to Ind AS and shall not recognise the corresponding benefit of the Government loan at a below-market rate of interest as a Government grant.

Consequently, if a first-time adopter did not, under its previous GAAP, recognise and measure a Government loan at a below-market rate of interest on a basis consistent with Ind AS requirements, it shall use its previous GAAP carrying amount of the loan at the date of transition to Ind AS .

3. ACCOUNTING CONVENTION:

The financial statements have been prepared on an accrual and historical cost basis. Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.

Based on the nature of products/ activities of the Company and the normal time between acquisition of assets and their realization in cash or cash equivalents, the Company has determined its operating cycle as 12 months for the purpose of classification of its assets and liabilities as current and non-current.

(a) Terms/ rights attached to equity shares

The Company has only one class of equity shares having par value of Rs 10/- per share . Each holder of equity shares is entitled to one vote per share held and is entitled to dividend, if declared at the Annual General Meeting . In the event of liquidation, the equity shareholders are entitled to receive remaining assets of the company (after distrubtion of all preferential amounts, if any) in the proportion of equity held by the shareholders.

Note

Borrowings - There is no amount of default as on the balance sheet date in repayment of loans and interest.

a) Term Loan from ICICI Bank Limited is secured by way of first pari passu charge with HDFC Bank Limited on Land & Building and hypothecation of Plant & Machinery both present and future of Dharuhera Plant. Term Loan is bearing 10% -11% p.a. interest rate and Anally repayable by March, 2019 in sixteen instalments of average Rs. 125.00 lacs each starting from June 15, 2015.

b) Term Loan from Hongkong and Shanghai Banking Corporation Ltd. is secured by deposit of title deed of Land & Building & hypothecation of other moveable fixed assets of Sprocket Plant. Term Loan is bearing fixed 10.00% p.a. interest rate and Anally repayable by January, 2018 in sixteen quarterly instalments of average Rs. 156.25 lacs each beginning from April, 2014.

c) Rupee Term Loan from HDFC Bank Ltd. is (this loan is takeover of whole outstanding of TATA Capital Financial Services Limited) secured by way of first pari passu charge with ICICI Bank Limited on Land & Building and hypothecation of Plant & Machinery both present and future of Dharuhera main plant. Term Loan is bearing 9.4-10.75°% p.a. interest rate and Anally repayable by November, 2019 in fifteen quarterly instalments of average Rs.100 lacs each beginning from May, 2016.

d) Term Loan from Bajaj Finance Limited is secured by way of exclusive first charge on Haridwar Industrial Land. Term Loan is bearing 9.4% p.a. interest rate and Anally repayable by March, 2024 in 28 quarterly installments of average Rs. 35.72 lacs each beginning from June, 2018.

e) Term Loan from The Pradeshiya Industrial & Investment Corporation of U.P. Limited (PICUP) is secured by way of first charge on Land and Building of Bawal Plant & Land and Building of Automax, Binola plant and hypothecation on the Plant and Machinery of Lucknow Plant .Term Loan is interest free under Industrial Investment Promotion Scheme (IIPS) of Government of Uttar Pradesh, and repayable after 7 years from the date of disbursement in single instalment.

f) Sales Tax Deferment was secured by way of bank guarantees issued by bank. This loan was interest free and Anally repaid in June, 2017.

g) Vehicle Loans are secured by way of hypothecation charge on respective vehicles. ICICI Bank Limited & HDFC Bank Limited loans are bearing 9-9.50% p.a. interest rate and Anally repayable by January, 2019 in 10 monthly instalments of average Rs.1.72 lacs each.

Note:

Short Term Borrowings - There is no default as on the balance sheet date in repayment of loans. Working capital loans carring interest rate ranging 9%~12.50% p.a.

Working Capital Loans from Banks are secured by way of hypothecation of Stock & Receivables and further secured by second pari passu charges on fixed assets of Dhaurhera and Sprocket unit.

* The Company has executed two Gas Sales Agreements (GSA) with GAIL India Limited to supply PNG for two of its plants, situated at Dharuhera and Manesar. For calendar years 2014,2015,2016 and 2017, GAIL has demanded Rs. 551 lacs,Rs. 2,636 lacs, Rs 1,493 lacs and Rs. 16,969 lacs respectively, as ‘Take or Pay Obligation’ under the GSA, for shortfall in consumption of contracted quantity of PNG. The Company has disputed such demands and referred the matter for arbitration as per terms of GSA. The Company has already terminated the GSA. Currently the matter is under arbitration. Meanwhile, the company has initiated a settlement proposal which is under consideration with GAIL.

(b) Gross turnover is net of inter unit transfer of Rs. 5,868.22 lacs (Previous Year Rs. 7,337.46 lacs)

(c) Gross turnover includes direct & deemed exports of Rs 756.59 lacs (Previous Year Rs. 816.08 lacs)

(d) Enterprises covered under the Micro, Small & Medium Enterprises Development Act, 2006 have been identified by the Company on the basis of available information. There is no outstanding balance payable more than the period stipulated in the said Act. Further no interest has been paid or was payable to such parties under the said Act during the year. Disclosure requirement by MSMED Act 2006 are as under -

The remuneration paid to Executive Directors was as per minimum remuneration prescribed in Schedule V to the Companies Act, 2013 (“the Act”), for which necessary approvals from the shareholders were taken as per the provisions of the Act.

k) Related Party Disclosure as required under Ind AS-24 :

1. Relationship:

a) Key Managerial Personnel & their Relatives :

Mr. Jatender Kumar Mehta Chairman & Managing Director

Mrs.Kiran Mehta Wife

Mr.Devashish Mehta Son

Mrs. Sakshi Kaura Joint Managing Director/ Daughter

Mr. Puneet Kaura Daughter''s Husband

Mrs. Sandhya Katyal Daughter, Sister

Mr. Ritesh Katyal Daughter''s Husband

Mr. Ravinder Kumar Mehta Managing Director

Mrs.Usha Mehta Wife

Mrs.Ekta Dewan Daughter

Mrs.Sarika Dhanda Daughter

Mr.Varun Mehta Son

Mr. S.M.Mehta Brother

Mr. S.K.Mehta Brother

Mr. Tavinder Singh Whole Time Director

Mr. Sanjeeb Kumar Subudhi Company Secretary

Mr. Ghan Shyam Dass Chief Financial Officer

b) Entities over which key management personnel and their relatives are able to exercise significant influence.

i) Forerunner Capital Investments Limited

ii) Green Systems Limited

iii) Mehta Engineers Limited

iv) Omax Fusions Limited

v) Vishal Engineers

vi) J.K. Mehta (HUF)

vii) R.K. Mehta (HUF)

viii) S.K. Mehta (HUf)

ix) S.M. Mehta (HUF)

x) Gurgaon Energy & Infrastructure Limited

xi) Haridwar Estates Pvt. Limited.

xii) Automax Constructions Limited

xiii) Samtel Avionics Limited

xiv) Monk e wise

xv) Thrive Eco Logical Innovation Pvt. Limited

(o) Pursuant to Section 135 of the Companies Act, 2013 regarding Corporate Social Responsibility,

a) Gross amount to be spent by the Company for FY 14-15 is Rs. 51.11 lacs, FY 15-16 is Rs. 18.11 lacs,FY 16-17 is Rs. 12.42 lacs and for FY 17-18 is Rs. 17.32 lacs.

b) Amount spent -

p) Capital Management:

The Company manages its capital to ensure that the Company will be able to continue as a going concern while maximising the return to stakeholders through efficient allocation of capital towards business needs, optimisation of working capital requirements and deployment of surplus funds into Axed deposits . The Company does not have high long terms debts and use minimum working capital limits.

The Company is not subject to any externally imposed capital requirements. The management of the Company reviews the capital structure of the Company on regular basis. As part of this review, the Board considers the status of debts, cost of capital and movement in the working capital.

The following table summarizes the capital of the Company:

q) Financial risk management:

The Company’s Corporate Treasury function monitors and manages the financial risks relating to the operations of the Company. These risks include market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk. The Company seeks to minimise the effects of these risks by using credit limits to hedge risk exposures. The use of financial instruments is governed by the Company’s policies on foreign exchange risk and the investment. The Company does not enter into agreements for trade financial instruments, including derivative financial instruments, for speculative purposes.

Market risk is the risk of any loss in future earnings, in realizable fair values or in future cash flows that may result from a change in the price of a financial instrument. The Company’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates risk/ liquidity which impact returns on investments. Keeping in mind the overall small exposure, the company does not enters into derivative financial instruments to manage its exposure to foreign currency risk including export receivables and import payables. Future specific market movements cannot be normally predicted with reasonable accuracy.

Foreign currency risk management

The Company undertakes transactions denominated in foreign currencies; consequently, exposures to exchange rate fluctuations arise. The Company’s significant exposure to foreign currency risk at the end of the reported periods, expressed in INR, are as follows:

Foreign currency sensitivity

The following tables demonstrate the sensitivity to a reasonably possible change in foreign currency rates, with all other variables held constant. The impact on the Company’s profit before tax is due to changes in the fair value of monetary assets and liabilities. The Company’s exposure to foreign currency changes for all other currencies is not material.

A decrease of 5% in the above currency’s exchange rates would result in an equivalent reciprocal effect.

Credit risk

Credit risk is the risk that counterparty will not meet its obligations 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 and other receivables) and from its financing activities, including deposits with banks and other financial instruments.

Trade receivables

The Company follows a ‘simplified approach’ (i.e. based on lifetime ECL) for recognition of impairment loss allowance on its trade receivables. For the purpose of measuring lifetime ECL allowance for trade receivables, the Company estimates irrecoverable amounts based on the ageing of the receivable balances, clubbed with, historical experience with the customer and/ or the industry in which the customer operates and assessment of litigation, if applicable. Receivables are written off when they are no more deemed collectible.

Liquidity risk

Liquidity risk represents the inability of the Company to meet its financial obligations within stipulated time. To mitigate this risk, the Company maintains sufficient liquidity by way of readily convertible instruments and working capital limits from banks.

Maturity profile of financial liabilities (Term borrowings):

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

Notes to first time adoption :

i. Arrangements in the nature of lease:

Under the Previous GAAP, the Property Plant and Equipment (PPE) related to Lucknow plant were capitalized and depreciation was accordingly charged to statement of profit and loss. Under Ind AS, PPE related to Lucknow plant, considered as embedded lease arrangement, has been de-recognised and shown as lease receivable at amortized value.

ii. Investment Property

Under the Previous GAAP, certain Investment property was classified as Property Plant and Equipment (PPE). Under Ind AS- 40 these PPE are reclassified as Investment property.

iii. Service Concession Arrangements

Appendix A of Ind AS 11 ‘Service Concessionaire Arrangement’ is applicable to 2.5 MW wind mill projects of the Company set up at Jaisalmer, Rajasthan for supply of power for a period of 20 years from the date of commercial operation of power plant . The Operator (Suzlon Energy Ltd.) is engaged, inter alia, in the business of manufacturing and marketing of Wind Turbine Generators { hereinafter referred to as WTGs}, as well as the operating, managing and maintaining wind farm projects for the purposes of generation of wind energy and its group/ associate companies undertake other related activities for the commencement of wind generation projects. Operator has agreed to maintain wind mill in accordance with terms and conditions agreed as per agreement.

iv. Financial assets at amortised cost:

Certain financial assets held on with objective to collect contractual cash flows in the nature of interest and principal have been recognised at amortised cost on transition date as against historical cost under the previous GAAP with the difference been adjusted to the opening retained earnings.

Financial liabilities at amortized cost:

Borrowings and other financial liabilities which were recognized at historical cost under previous GAAP have been recognized at amortized cost under Ind AS with the difference been adjusted to opening retained earnings.

Under previous GAAP, the interest free loan from PICUP which is repayable after a fixed tenure of seven years was recognized a Long Term Borrowing under Non Current Liabilities . Under Ind AS, the financial liability of interest free loan from PICUP is to be measured at fair value and the difference between disbursed interest free loan amount and fair value is to be recognized as Government grant. After transition date, the difference between interest free loan and fair value has been recognised as Government grant as at Balance Sheet date. Also Government grant has been recognised in the Statement of Profit and Loss as an income on a internal rate of return basis spread over the period of grant and interest on fair value of Government grant on its inception has been recognised as finance cost.

v. Expected credit loss

The Company has provided expected credit loss based on established company policy considering provisions of Ind AS 109. Provision for doubtful debts and advances has determined based on that policy.

vi. Defined benefit liabilities:

Under IndAS, re-measurements i.e. actuarial gains and losses & the return on plan assets excluding amounts included in the net interest expense on the net defined benefit liability as per actuarial valuation are recognised in other comprehensive income post taxes separately instead of considering in employee benefit expenses in previous GAAP.

vii. Deferred tax:

Previous GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. IndAS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base.

viii. Proposed Dividend:

Under previous GAAP, proposed dividends including dividend distribution tax are recognised as a liability in the period to which they relate, irrespective of when they are declared. Under IndAS, a proposed dividend is recognised as a liability in the period in which it is declared by the company, usually when approved by the shareholders in a general meeting.

In the case of the Company, the declaration of dividend occurs after period end. Therefore, the liability for the year ended on 31st March, 2016 recorded for dividend has been derecognized against retained earnings on 1st April 2016. The proposed dividend for the year ended on 31st March, 2016 recognized under previous GAAP was reduced from other payables and with a corresponding impact in the retained earnings.

ix. Revenue from operations:

Under the previous GAAP, revenue from sale of products was presented exclusive of excise duty. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. The excise duty paid is presented on the face of the Statement of Profit and Loss as a part of expenses. There is no impact on total equity and profit.

x. Other comprehensive income:

Under Ind As, all items of income and expense recognised in a period should be included in profit or loss before taxes for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognised in profit or loss before taxes but are shown in the statement of profit and loss as ‘other comprehensive income’ which includes re-measurements of defined benefit plans. The concept of other comprehensive income did not exist under previous GAAP.

Disclosure as per Ind AS 101 First-time adoption of Indian Accounting Standards:

Effective April 01,2017, the Company has for the first time adopted Ind-AS, with a transition date of April 01,2016. Accordingly, these financial results have been prepared in accordance with the Companies (Indian Accounting Standards) Rules, 2015 prescribed under Section 133 of the Companies Act, 2013 and other recognised accounting practices and policies, to the extent applicable. The impact of transition has been accounted for in opening reserves and the comparative amounts have been restated accordingly.

The Company has prepared the opening balance sheet as per Ind AS as of 1st April, 2016 (the transition date) by recognizing all assets and liabilities whose recognition is required by Ind AS, not recognizing items of assets or liabilities which are not permitted by Ind AS, by reclassifying items from previous GAAP to Ind AS as required under Ind AS, and applying Ind AS in measurement of recognised assets and liabilities. However, this principle is subject to certain mandatory exceptions and certain optional exemptions availed by the Company as detailed below:

Mandatory exceptions and optional exemptions: Deemed cost for property, plant and equipment and intangible assets:

The Company has elected to continue with the carrying value of all of its plant and equipment, capital work-in-progress and intangible assets recognised as of 1st April, 2016 (transition date) measured as per the previous GAAP and use that carrying value as its deemed cost as of the transition date.

Determining whether an arrangement contains a lease:

The Company has applied Appendix C of Ind AS 17 Determining whether an Arrangement contains a Lease to determine whether an arrangement existing at the transition date contains a lease on the basis of facts and circumstances existing at that date.

Appendix C to Ind AS 17 “Leases” requires the Company 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.

Classification and measurement of financial assets:

The Company has classified the financial assets in accordance with Ind AS 109 on the basis of facts and circumstances that exist at the date of transition to Ind AS.

u) Under the previous GAAP, revenue from sale of products was presented exclusive of excise duty. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. The excise duty paid is presented on the face of the Statement of Profit and Loss as a part of expenses. There is no impact on the total equity and profit.

v) Under the previous GAAP, dividends proposed by the Board of Directors after the Balance Sheet date but before the approval of the financial statements in general meeting were considered as adjusting item in Statement of Profit & loss . Accordingly, provision for proposed dividend was recognised as a liability. Under Ind AS, such dividends are recognised when the same is approved by the shareholders in the general meeting. Accordingly, the liability for proposed dividend and tax thereon, included under provisions has been reversed with corresponding adjustment to retained earnings.

w) Under the previous GAAP, dividends proposed by the Board of Directors after the Balance Sheet date but before the approval of the financial statements in general meeting were considered as adjusting item in Statement of Profit & loss . Accordingly, provision for proposed dividend was recognised as a liability. Under Ind AS, such dividends are recognised when the same is approved by the shareholders in the general meeting. Accordingly, the liability for proposed dividend and tax thereon, included under provisions has been reversed with corresponding adjustment to retained earnings.

x) Under previous GAAP, the interest free loan from PICUP which is repayable after a fixed tenure of seven years was recognised a Long Term Borrowing under Non Current Liabilites . Under Ind AS, the financial liability of interest free loan from PICUP is to be measured at fair value and the difference between disbursed interest free loanamount and fair value is to be recognised as Government grant. The Company has availed mandatory exception under Ind AS 101 and accordingly, change done in accounting treatment on the amount carried forward on the date of transition.

After transition date, the difference between interest free loan and fair value has been recognised as Government grant as at Balance Sheet date. Also Government grant has been recognised in the Statement of Profit and Loss as an income on a internal rate of return basis spread over the period of grant and interest on fair value of Goverment grant on its inception has been recognised as finance cost.

y) Under Ind AS, all items of income and expense recognised in a period should be included in the Statement of Profit and Loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are recognised in profit or loss and also shown in the Statement of Profit and Loss as ‘other comprehensive income’ includes remeasurements of defined benefit plans. The concept of other comprehensive income did not exist under previous GAAP, howver,there is no impact on the total equity.

x) There were no significant reconciliation items between cash flows prepared under Indian GAAP and those prepared under Ind AS.

y) Previous Year’s figures have been regrouped, rearranged & recasted wherever necessary to make them comparable with the current year’s figures.

z) Figures have been rounded off to the nearest Rupees in lac.

aa) Standards issued but not yet effective

Ind AS 115 revenue from Contracts with Customers: Amended Ind AS 115 was notified on 28th March 2018 and establishes a five step model to account for revenue arising from contracts with customers. The new revenue standard with supersede all current revenue recognition requirements under Ind AS. This standard will come into force from accounting period commencing on or after 1st April, 2018. the Company is evaluating the requiements of the amended and the effect on the financial statements is being evaluated.

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Mar 31, 2016

(if) Defined Benefit Plan

Gratuity Liability is computed on the basis of premium paid to LIC of India as per actuarial valuation under Projected Unit Credit Method.

(ii) Defined Contribution Plans

Liability for superannuation fund on the basis of the premium paid to LIC of India in respect of employees covered under Superannuation Fund Policy. Provident fund & ESI on the basis of actual liability accrued and paid to authority.

(iii) Provision for due earned leaves are determined using Projected Unit Cost method, with actuarial valuation being carried out at Balance Sheet date. Actuarial gain / loss arising after such valuation are charged to profit & loss account in the year in which earned leaves are settled.

Note: Mr. Ramesh Bahadur Singh, Whole-time Director (Resigned from the directorship w.e.f. 16.07.2015) and Mr. Tavinder Singh, Whole-time Director (Appointed as Whole-time Director of the Company w.e.f. 29.10.2015).

The remuneration paid to Executive Directors was subject to minimum remuneration prescribed in Schedule V to the Companies Act, 2013 ("the Act"), for which necessary approvals from the shareholders were taken as per the provisions of the Act.

(k) SEGMENT REPORTING:

The company is primarily engaged in the business of Auto Components for Two Wheeler and Four wheeler industry, which are governed by the same set of risk and returns. As the company''s business activity falls within a single primary business segment, the disclosure requirements of Accounting Standard (AS-17) "Segment Reporting" issued by The Institute of Chartered Accountants of India are not applicable. Exports being less than 10% ,Geographical segment reporting is also not required.

(p) During the year Company has transferred 25,500 nos (51%) {previous year 24,500 nos (49%)} Equity Shares of Gmax Auto Limited (Subsidiary of OMAX Autos Limited till 11/31/2016) to AG Industries Pvt. Ltd. at Rs. 10 each. Ceased to be subsidiary.

(q) Previous Year''s figures have been regrouped, rearranged & recanted wherever necessary to make them comparable with the current year''s figures.

(r) Figures has been rounded off to the nearest Rupees in lac.

(s) Accompanying notes to the financial statements are an integral part of the Financial Statements.

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Mar 31, 2015

(A) Gross turnover is net of inter unit transfer of Rs. 9,546.91 lac (Previous Year Rs. 11,543.20 lac)

(B) Gross turnover includes direct & deemed exports of Rs. 1,457.96 lac (Previous Year Rs. 1,894.81 lac)

(C) Enterprises covered under the Micro, Small & Medium Enterprises Development Act 2006 have been identified by the company on the basis of information available. There is no outstanding balance payable more than the period stipulated in the said Act.

(D) Computation of Net Profit for the purpose of Section 197 of the Companies Act, 2013.

**Note : Other Directors includes Mr Ravinder Mehta, Managing Director; Mr. Ramesh Bahadur Singh, Whole-time Director (Appointed as Whole-time Director of the Company w.e.f. 23.01.2015); Mrs. Sakshi Kaura, Joint Managing Director and Mr. Jagdish Chandra Jhuraney, Whole-time Director (Resigned from the directorship w.e.f. 31.12.2014).

In case of Mr. Jatender Kumar Mehta (Managing Director), the Company had taken the approval of shareholders by passing Special Resolution through postal ballot, on 26.03.2015, for a total Remuneration not exceeding Rs. 120 lac (One Hundred Twenty Lac) per annum. Accordingly, the Company has paid Mr. Mehta Rs. 117.6 Lac (One hundred Seventeen Lac and Sixty Thousand) as his remuneration for the FY 2014-15.

(E) The Company has in- house R&D centre at IMT Manesar, Gurgaon (Haryana). Ministry of Science & Technology (Department of Scientific and Industrial Research) has accorded recognition to this centre, which is valid upto 31.03.2015 vide its letter no. TU/IV-RD/2906/2012 dtd. 01.04.2012 to this centre, further this recognition has been extended till 31.03.2018 vide its letter no TU/IV-RD/2906/2015 dated 27.04.2015-

(F) Management is of the opinion that, any of the assets other than fixed assets and non-current investments have a value on realization in the ordinary course of business at least equal to the amount at which they are stated.

(G) Related Party Disclosure as required under Accounting Standard-18 on "Related Party Disclosure" issued by the Institute of Chartered Accountants of India are given below :

(H) SEGMENT REPORTING:

The company is primarily engaged in the business of Auto Components for Two Wheeler and Four wheeler industry, which are governed by the same set of risk and returns. As the company's business activity falls within a single primary business segment, the disclosure requirements of Accounting Standard (AS-17) "Segment Reporting" issued by The Institute of Chartered Accountants of India are not applicable. Exports being less than 10% ,Geographical segment reporting is also not required.

(I) The Company has sold part of land situated at Sultanpur village of Farrukh Nagar district for Rs. 1,153.34 lacs and earned a profit of Rs. 766.05 lacs which has been shown as a exceptional item in Statement of Profit and Loss .

(J) During the year Company has transferred 24500 nos (49%) Equity Shares of Gmax Auto Limited to AG Industries Pvt. Ltd. at Rs. 10 each.

(K) Previous Year's figures have been regrouped, rearranged & recasted wherever necessary to make them comparable with the current year's figures.

(L) Figures has been rounded off to the nearest Rupees in lac.

(M) Accompanying notes to the financial statements are an integral part of the Financial Statements.

---

Mar 31, 2014

NOTE - 1 : LONG-TERM BORROWINGS*

a) Fully hedged ECB Term Loan from ICICI Bank Ltd. is secured by way of first pari passu charge/mortgage by deposit of title deeds of Land & Building and hypothecation of other movable fixed assets of Dharuhera Plant both present and future. Term Loan is bearing 9.85% P.A interest and finally repayable by June 2014 in one remaning half yearly instalment of avg. Rs.365 lac.

b) Fully hedged ECB Term Loans from Standard Chartered Bank is secured by deposit of title deed of Land & Building & hypothecation of other moveable fixed assets of Manesar plant. Term Loan is bearing 10.25% P.A interest and finally repayable by March 2016 in sixteen quarterly instalments of avg. Rs. 253 lac each beginning from June 2012.

c) Term Loan from IndusInd Bank Limited (this stands after taken over of whole outstanding of DBS Bank Ltd which earlier taken over outstanding of United Bank of India) is secured by deposit of title deed of Land & Building & hypothecation of other moveable fixed assets of Speedomax plant. Term Loan is bearing 11.25% P.A interest and finally repayable by March 2016 in eight remaning quarterly instalments of avg. Rs. 299.57 lac each.

d) Term Loan from Hongkong Shanghai and Banking Corporation Ltd is secured by deposit of title deed of Land & Building & hypothecation of other moveable fixed assets of Sprocket Plant. Term Loan is bearing fixed 10.00% P.A interest and finally repayable by March 2017 in sixteen quarterly instalments of avg. Rs. 156.25 lac each beginning from April 2014.

e) Rupee Term Loan from ICICI Bank Ltd. is secured by way of first pari passu charge with TATA Capital Financial Services Limited on Land & Building and hypothecation of Plant & Machinery both present and future of Dharuhera Plant. Term Loan is bearing 12.25% P.A interest and finally repayable by March 2018 in sixteen instalments of avg. Rs. 62.50 lac each.

f) Term Loan from TATA Capital Financial Services Limited is secured by way of exclusive charge on all the present and future fixed assets (excluding land & building ) of Lucknow project , negative lien on the building/ super structure created on the land covered under term loan and hypothecation of receivables of Lucknow plant in respect of supply to TATA Motor Ltd. Further Term loan is secured by way of first pari passu charge with ICICI Bank Ltd on Land & Building and hypothecation of Plant & Machinery both present and futureof Dharuhera Plant. Term Loan is bearing 11.40% P.A interest and finally repayable by July 2015 in six remaning quarterly instalments of avg. Rs. 194 lac each.

g) Sales Tax Deferment is fully secured by way of bank guarantees issued by bank.This is interest free and finally repayable by Jan. 2017 in remaning thirty four monthly instalments of avg. Rs. 9.16 lac each.

h) Vehicle Loans are secured by way of hypothecation charge. TATA Capital Financial Services Ltd loan is bearing 10.50% p.a interest and finally repayable by Feb. 2016 in remaning 23 monthly instalments of avg. Rs. 0.76 lac each. Axis Bank Ltd loan is bearing 9.50% p.a interest and finally repayable by Feb. 2016 in remaning 23 monthly instalments of avg. Rs. 0.53 lac each. ICICI Bank Ltd loan is bearing 9.93% p.a interest and finally repayable by Aug. 2015 in remaning 17 monthly instalments of avg. Rs. 2.08 lac each. BMW Financial Services Ltd loan is bearing 10.44% p.a interest and finally repayable by Sept. 2015 in remaning 18 monthly instalments of avg. Rs. 0.36 lac each.

Rs. in lac

I Particulars As at As at 31.03.2014 31.03.2013

(a) Contingent liabilities and commitments (to the extent not provided for)

(i) Contingent Liabilities

(A) Claims against the company not acknowledged as debt

(i) Excise & Service Tax matters 543.20 410.39

(ii) Sale Tax 174.55 185.34

(iii) Income Tax - 62.30

(B) Outstanding Guarantees issued by banks 442.30 75.72

(C) Other money for which the company is contingently liable

(i) Letter of credits 361.20 55.64

(ii) Bills discounted

(ii) Commitments

(i) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) 338.61 1465.65

(ii) Uncalled liability on shares and other investments partly paid - -

(iii) Other commitments 272.28 165.47

- Advance Licence/ EPCG

(b) Gross turnover is net of inter unit transfer of Rs. 11,543.20 lac (Previous Year Rs. 10,676.26 lac)

(c) Gross turnover includes direct & deemed exports of Rs. 1,894.81 lac (Previous Year Rs. 6,588.36 lac)

(d) Enterprises covered under the Micro, Small & Medium Enterprises Development Act 2006 have been identified by the company on the basis of information available. There is no outstanding balance payable more than the period stipulated in the said Act.

(h) The Company has in- house R&D centre at IMT Manesar ,Gurgaon (Haryana). Ministry of Science & Technology (Department of Scientific and Industrial Research) has accorded recognition to this centre, which is valid upto 31.03.2015 vide its letter no. TU/IV-RD/2906/2012 dtd. 01.04.2012 for this centre.

Total expenditure incurred towards In-house Research and Development activities during the year 2013-14 are as under -

(i) In the opinion of the Board, any of the assets other than fixed assets and non-current investments have a value on realization in the ordinary course of business at least equal to the amount at which they are stated.

(j) Related Party Disclosure as required under Accounting Standard-18 on "Related Party Disclosure" issued by the Institute of Chartered Accountants of India are given below :

1) Relationship :

a) Key management Personnel & their Relatives :

Mr. Jatender Kumar Mehta Managing Director

Mrs. Kiran Mehta Wife

Mr. Devashish Mehta Son

Mrs. Sakshi Kaura Whole Time Director

Mrs. Sandhya Katyal Daughter

Mr. Ravinder Kumar Mehta Managing Director

Mrs. Usha Mehta W ife

Mrs. Ekta Dewan Daughter

Mrs. Sarika Dhanda Daughter

Mr. Varun Mehta Son

Mr. S.M.Mehta Brother

Mr. S.K.Mehta Brother

Mr. Krishan Chand Chawla Whole Time Director

Mrs. Savita Chawla Wife

Mrs. Deepti Kumar Daughter

Ms. Ridhima Chawla Daughter

Mr. Jagdish Chandra Jhuraney Whole Time Director

b) Entities over which key management personnel and their relatives are able to exercise significant influence.

i) Forerunner Capital Investments Limited

ii) Green Systems Limited

iii) Mehta Engineers Limited

iv) Omax Bikes (P) Limited

v) Omax Fusions Limited

vi) Vishal Engineers

vii) Autotech Components (P) Ltd

viii) J.K. Mehta (HUF)

ix) R.K. Mehta (HUF)

x) S.K. Mehta (HUF)

xi) S.M. Mehta (HUF)

xii) Gurgaon Energy & Infrastructure Ltd.

(xiii) Haridwar Estates Pvt. Ltd.

xiv) B.G.J.C & Associates

xv) Gmax Auto Ltd.

xvi) Automax Constructions Ltd.

(k) SEGMENT REPORTING:

The company is primarily engaged in the business of Auto Components for Two Wheeler and Four wheeler industry, which are governed by the same set of risk and returns. As the company''s business activity falls within a single primary business segment, the disclosure requirements of Accounting Standard (AS-17) "Segment Reporting" issued by The Institute of Chartered Accountants of India are not applicable. Exports being less than 10%, Geographical segment reporting is also not required.

(m) The Company had approached the Settlement Commission of Income Tax against the demand raised by the Income Tax Dep''t for search conducted u/s 132 in the F/Y 2010-11. During the year under review, Settlement Commission settled the matter and fixed the tax liabiility at Rs. 264.95 lac which was duly paid and charged to the Profit and Loss account for the year under review as Prior period tax.

(n) Previous Year''s figures have been regrouped, rearranged & recasted wherever necessary to make them comparable with the current year''s figures.

(o) Figures has been rounded off to the nearest Rupees in lac.

(p) Accompanying notes to the financial statements are an integral part of the Balance Sheet.

---

Mar 31, 2013

(a) The Company has in- house R&D centre at IMT Manesar, Gurgaon (Haryana). Ministry of Science & Technology (Department of Scientific and Industrial Research) has accorded recognition to this centre at IMT Manesar, Gurgaon, up to 31.03.2012 vide its letter no. TU-IV/RD/2906/2009 dtd.28.08.2009 and further, the benefit was extended upto 31.03.2015 vide its letter no. TU/IV-RD/2906/2012 dtd. 01.04.2012 for this centre.

(b) In the opinion of the Board, any of the assets other than fixed assets and non-current investments have a value on realization in the ordinary course of business at least equal to the amount at which they are stated.

(c) Related Party Disclosure as required under Accounting Standard-18 on "Related Party Disclosure" issued by the Institute of Chartered Accountants of India are given below :

d) Relationship :

a) Key management Personnel & their Relatives :

Mr. Jatender Kumar Mehta Managing Director

Mrs. Kiran Mehta Wife

Mr. Devashish Mehta Son

Mrs. Sakshi Kaura Whole Time Director

Mrs. Sandhya Katyal Daughter

Mr. Ravinder Kumar Mehta Managing Director

Mrs. Usha Mehta Wife

Mrs. Ekta Dewan Daughter

Mrs. Sarika Dhanda Daughter

Mr. Varun Mehta Son

Mr. S. M. Mehta Brother

Mr. S. K. Mehta Brother

Mr. Krishan Chand Chawla Whole Time Director

Mrs. Savita Chawla Wife

Mrs. Deepti Kumar Daughter

Ms. Ridhima Chawla Daughter

b) Entities over which key management personnel and their relatives are able to exercise significant influence.

i) Forerunner Capital Investments Limited

ii) Green Systems Limited

iii) Mehta Engineers Limited

iv) Omax Bikes (P) Limited

v) Omax Fusions Limited

vi) Vishal Engineers

vii) Autotech Components (P) Ltd

viii) J. K. Mehta (HUF)

ix) R. K. Mehta (HUF)

x) S. K. Mehta (HUF)

xi) S. M. Mehta (HUF)

xii) Gurgaon Energy & Infrastructure Ltd.

(xiii) Haridwar Estates Pvt. Ltd.

xiv) B.G.J.C & Associates

xv) Gmax Auto Ltd.

(e) SEGMENT REPORTING:

The company is primarily engaged in the business of Auto Components for Two Wheeler and Four wheeler industry, which are governed by the same set of risk and returns. As the company''s business activity falls within a single primary business segment, the disclosure requirements of Accounting Standard (AS-17) "Segment Reporting" issued by The Institute of Chartered Accountants of India are not applicable. Exports being less than 10% ,Geographical segment reporting is also not required.

(f) Income tax matter u/s 245 C is pending with Hon''ble Settlement Commission for the Assessment Year 2005-06 to 2011-12 against which Rs. 271.31 Crore has been paid as tax & ineterest. The necessary entries shall be recorded in books on receipt of final verdict of settlement commission.

(g) Previous Year''s figures have been regrouped,rearranged & recasted wherever necessary to make them comparable with the current year''s figures.

(h) Figures has been rounded off to the nearest Rupees in lac.

(i) Accompanying notes to the financial statements are an integral part of the Balance Sheet.

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Mar 31, 2012

As at As at

31.03.2012 31.03.2011

(a) Contingent liabilities and commitments (to the extent not provided for)

(i) Contingent Liabilities

(A) Claims against the company not acknowledged as debt

(i) Excise & Service Tax matters 423.70 366.20

(ii) Sale Tax 30.96 4.51

(iii) Income Tax 62.30 -

(B) Outstanding Guarantees issued by bank 20.30 89.17

(C) Other money for which the company is contingently liable

(i) Letter of credits - 395.19

(ii) Bills discounted - 1,000.00

(ii) Commitments

(i) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) 307.81 424.12

(ii) Uncalled liability on shares and other 0.00 0.00 investments partly paid

(b) Other commitments 0.00 0.00

(c) The Company had entered in to a Swap transaction of amount in INR into amount in USD. The outstanding amount as on 31st March 2012 is NIL (Rs. 1140.35 lac Previous Year) and in USD NIL (USD 25.54 lac Previous Year). At the end of 31st March 2012 no outstanding remain in this regards. The actual loss/ gain has account for under "Financial Cost" as Currency loss/gain.

(d) Enterprises covered under the Micro, Small & Medium Enterprises Development Act 2006 have been identified by the company on the basis of information available. There is no outstanding balance payable more than the period stipulated in the said Act.

*Note : The total remuneration of Mr. Jatender Kumar Mehta and Mr. Ravinder Mehta had been approved in Annual General Meeting held on 30.09.2010 further the Government of India (Ministry of Company Affairs) has also accorded its approval vide letter no. B03342409/5/2011/CL/VII dated 18th April 2011. Further remuneration of Mr. Jatender Kumar Mehta and Mr. Ravinder Mehta have been revised w.e.f. 01.04.2012 with approval of shareholders through postal ballot process on 28th March, 2012, present salary (per month) of Mr. Jatender Kumar Mehta is Rs. 12,00,000- 1,25,000-17,50,000 and Mr. Ravinder Mehta salary is Rs. 1,50,000/-

(e) Deferred Tax (AS-22)

The break up of the net deferred tax liability arising on account of timing difference for the year ended 31st March,2012 is as under:

(f) Gross turnover is net of inter unit transfer of Rs. 8,259.50 lac (Previous Year Rs. 7,228.91 lac)

(g) Gross turnover includes direct & deemed exports of Rs. 9,671.63 lac (Previous Year Rs. 10,710.72 lac)

(h) Exceptional Income includes Rs. 728 lac maturity amount of Key Man Insurance Policy from LIC, In previous year, it represents Profit on Sale of Land and Behrampur warehouse.

(i) The Company incorporated a wholly owned Subsidiary Company on 20th Oct, 2011 in the name of "Gmax Auto Ltd.". This subsidiary company is yet to commence business.

(j) During the current year, Company has installed two 1.25 MW each Wind Turbine Generator in Rajasthan, India which have successfully commissioned and started to generate power.

(k) In the opinion of the Board, any of the assets other than fixed assets and non-current investments have a value on realization in the ordinary course of business at least equal to the amount at which they are stated.

(l) Related Party Disclosure as required under Accounting Standard-18 on "Related Party Disclosure" issued by the Institute of Chartered Accountants of India are given below :

(m) Segment Reporting:

The company is primarily engaged in the business of Auto Components for Two Wheeler and Four wheeler industry, which are governed by the same set of risk and returns. As the company's business activity falls within a single primary business segment, the disclosure requirements of Accounting Standard (AS-17) "Segment Reporting" issued by The Institute of Chartered Accountants of India are not applicable. Exports being less than 10%, Geographical segment reporting is also not required.

(n) Previous Year's figures have been regrouped, rearranged & recasted wherever necessary to make them comparable with the current year's figures.

(o) Figures has been rounded off to the nearest Rs. in lac.

(p) Accompanying notes to the financial statements are an integral part of the Balance Sheet.

---

Mar 31, 2010

1. NOTES TO THE ACCOUNTS

(Rupees in Lacs)

Current Year Previous Year as at 31.03.2010 as at 31.03.2009

(a) CONTINGENT LIABILITIES

(i) Outstanding Guarantees issued by bank 1,266.85 1,030.90

(ii) Excise & Service Tax matters 301.30 238.43

(iii) Income Tax Matter – 6.48

(iv) Letter of credits 589.83 586.65

(v) Bills discounted 1,998.12 -

(b) Estimated amount of contracts remaining to be executed on account of capital commitments and not provided for ( net of advances). 611.49 1,182.60

(c) The Company had entered in to a Swap transaction of amount in INR into amount in USD. The outstanding amount as on 31st March 2010 is INR 2086.90 Million and in USD 53.05 lacs. The probable loss/ gain is dependent on USD/ INR parity at the respective dates of settlement during the span of transaction period upto March 2012. In view of the fact that no precise estimate can be made in this regard, no provision on this has been made.

d) The Capital Reserve of Rs. 207.51 lacs represents forfeiture of 10% application money received towards issue of 25 lacs no. convertible share warrants due to non exercise of option of conversion.

(e) Enterprises covered under the Micro, Small & Medium Enterprises Development Act 2006 have been identified by the company on the basis of information available. There is no outstanding balance payable more than the period stipulated in said act.

(l) Gross turnover is net of inter unit transfer of Rs. 5981.15 lacs (Previous year Rs. 4905.92 lacs)

(m) Gross turnover includes direct & deemed exports of Rs 8500.33 lacs (Previous year Rs 5265.63 lacs)

(n) Interest paid during the year on borrowed funds for construction of Lucknow Plant and Other major expansion plan has been capitalised for Rs. 230.87 lacs (Previous Year 376.69 Lacs).

o) Commercial production of Lucknow plant commenced on 18 Sept. 2009. Pre operative expenditure incurred up to 17 Sept. 2009 has been allocated on pro rata basis to fixed assets other than those that were directly attributable.

p) Company has got approval of Ministry of New and Renewable Energy ( SPV Group) for installation of two 100 KWP Roof To p SPV power plants at the premises of Manesar & Dharuhera unit.One plant has been successfully installed at Manesar and has started generation of power from 27th March 2010.The second plant has been installed at Dharuhera in beginning of May 2010.

q) Ministry of Science & Technology (Department of Scientific and Industrial Research) has accorded recognisition to the In- House R&D unit at Manesar plant up to 31.12.2012 vide its letter no. TU-IV/RD/2906/2009 dtd 28.08.2009. Total expenditure incurred towards In-House Research & Development activity during the year 2009-2010 are as under :

r) The Company had taken derivative option for hedging of foreign currency exposure against exports. Due to derivative option the outstanding Mark to Market (MTM) loss as on 31.03.2010 in Dollar is USD 2.40 Lacs (previous year USD 8.51 lacs) and equivalent amount MTM in INR is Rs. 108.48 Lacs (previous year Rs. 433.48 lacs). The company has created a Provision for Fair Valuation Loss on Derivatives of Rs.108.48 Lacs (previous year Rs. 433.48 lacs) under current liabilities & provisions and has correspondingly debited the amount in Hedge Reserve account under Reserve & Surplus.

(s) Related Party Disclosure as required under Accounting Standard-18 on "Related Party Disclosure" issued by the Institute of Chartered Accountants of India are given below :

1) Relationship :

a) Key management Personnel & their Relatives :

Mr. Jatender Kumar Mehta Managing Director

Mrs. Kiran Mehta Wife

Mr. Devashish Mehta Son

Mrs. Sakshi Kaura Daughter

Mrs. Sandhya Katyal Daughter

Mr. Ravinder Mehta Managing Director

Mrs. Usha Mehta Wife

Mrs. Ekta Dewan Daughter

Mrs. Sarika Dhanda Daughter

Mr. Varun Mehta Son

Smt. Raj Dulari Mother

Mr. S.M. Mehta Brother

Mr. S.K. Mehta Brother

Mr. K.C. Chawla Whole Time Director

Mrs. Savita Chawla Wife

Mrs. Deepti Kumar Daughter

Ms. Ridhima Chawla Daughter

b) Entities over which key management personnel and their relatives are able to exercise significant influence.

i) Forerunner Capital Investments Limited

ii) Green Systems Limited

iii) Mehta Engineers Limited

iv) Omax Bikes (P) Limited

v) Omax Fusions Limited

vi) Vishal Engineers

vii) Autotech Components (P)Ltd.

viii) J.K. Mehta (HUF)

ix) R.K. Mehta (HUF)

x) S.K. Mehta (HUF)

xi) S.M. Mehta (HUF)

xii) Gurgaon Energy & Infrastructure Ltd.

xiii) Haridwar Estates Pvt. Ltd.

(t) SEGMENT REPORTING:

The company is primarily engaged in the business of Auto Components for Tw o Wheeler and Four wheeler industry, which are governed by the same set of risk and returns. As the comapnys business activity falls within a single primary business segment, the disclosure requirements of Accounting Standard (AS-17) "Segment Reporting" issued by The Institute of Chartered Accountants of India are not applicable. Exports being less than 10% Geographical segment reporting is also not required.

(v) Previous Years figures have been regrouped,rearranged & recasted wherever necessary to make them comparable with the current years figures.

(w) Figures has been rounded off to the nearest Lacs Rupees as per approval granted by Central Government to the company

(x) Schedule 1 to 15 form an integral part of Balance Sheet.