Notes to Accounts of PAE Ltd.

Mar 31, 2015

(A) Terms attached to Equity and Preference Shares

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

(ii) During the year ended March 31, 2015, the Company issued 30,00,000 (thirty lacs)(previous year 50,00,000) 11% Non- convertible, cumulative, redeemable preference shares(NCRPS) of Rs.10/- each fully paid up. The NCRPS holder shall have a right to vote on resolution placed before the Company which directly affect the rights attached to his preference share only, and any resolution for the winding up of the Company or repayment or reduction of its equity or preference share capital, provided that where the dividend is not paid for two or more years such class of NCRPS holders shall have right to vote on all resolutions placed before the Company. The NCRPS shall be redeemed by the Company at par on expiry of 13 years from the date of allotment, or on the request of NCRPS holders, which ever is earlier. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

(iii) During the year ended March 31,2015, the Company issued 9,00,000 11% Optionally Convertible, Cumulative, Redeemable Preference Shares of the face value of Rs.10/- each for cash at par. On November 10, 2015, 4,30,000 (four lacs thirty thousand) 11% Optionally Convertible Cumulative Redeemable preference shares were converted into equity shares. The equity shares so alloted on conversion are subject to lock-in for a period of 3 years from the date of trading approval or as required under ICDR Regulations. The outstanding balance in this class of shares as on March 31,2015 is 4,70,000 (four lacs seventy thousand) shares. The said shares are convertible into equity shares (ranking pari passu to the existing equity shares of the Company) at the option of the allotees in one or more tranches at any time after allotment within a period of eighteen months. If the allotees do not opt for conversion within the said period of 18 months, then the said shares shall be redeemable at par at the end of 20 years from the date of allotment or earlier on the terms and conditions as may be deemed fit by the Board of Directors of the Company, subject to the approval of the regulatory authorities wherever applicable.

During the year ended March 31, 2015, the Company has received share application money of Rs.40 lacs which will be utilised to issue 4,00,000 (four lacs) 11% Non-convertible, cumulative, redeemable preference shares(NCPRS) of Rs.10/- each at par.

(a) The vehicle loan - non current maturity Rs. Nil (previous year Rs. 40 lacs) is taken from Kotak Mahindra Prime Ltd against refinance of existing motor vehicles owned by the company. This loan carries an interest of 18.08% p.a. and is payable in 24 installments along with interest from the date of the loan. The period of maturity w.r.t. balance sheet date is with EMI of Rs.1.08 lacs each for seven month.

(b) Fixed deposits from related parties carry interest @ 11% to 11.75% p.a.(Previous Year 11% to 11.75% p.a.) and are repayable after 3 years from the respective dates of deposit.

( c) Fixed deposits from shareholders and others carry interest ranging from 11% to 11.75% p.a.(Previous Year 11% to 11.75% p.a.) and are repayable after 2 years and 3 years from the respective dates of deposit.

(a) Working capital loan from banks is secured by hypothecation of current assets and all movables, both present and future and with a collateral charge on immovable and movable properties. The loan carries interest at 7% p.a. in State Bank of India and 5.10% p.a. in Corporation Bank above Bank Rate(BR), present effective rate being 17% p.a. and 15.35% p.a. respectively.

(b) The tenor of inter-corporate deposits is 90 days and carry interest @16.50% p.a. and 17% p.a.

(c) Unsecured loan from "related party" is an interest free loan w.e.f. January 1,2014.

* There is no amount due and outstanding as at Balance Sheet date to be credited to Investor Education and Protection Fund.

Investment in subsidiary, Shurjo Energy Pvt. Ltd

a) The company's subsidiary Shurjo Energy Pvt. Ltd. (SEPL) has been manufacturing solar panels, an industry currently in a challenging situation worldwide. As at March 31, 2014, the accumulated losses in SEPL have exceeded its net worth by Rs.426.57 lacs. The company is actively pursuing the revival of it's subsidiary Shurjo Energy Pvt. Ltd.(SEPL) by diversifying its activities. Towards this end, the company has applied to Falta Special Economic Zone for removing the 100 % E.O.U. status to facilitate the diversification. Company is also exploring the induction of a strategic investor for trading in power back up systems and lead smelting activity. It is of the opinion that losses suffered during the initial years by SEPL are temporary in nature and no provision for diminution in the value of investment of Rs. 785.66 lacs is considered necessary at this juncture. Also the loans and advances of Rs.655.45 lacs due from SEPL as at the balance sheet date are considered as fully recoverable.

Investment in subsidiary, PAE Renewables Pvt. Ltd.

b) The company holds long term investment of Rs.1176.00 lacs in PAE Renewables Private Limited ('PAER') which in turn has invested in its step down wholly owned subsidiary Sovox Renewables Private Limited ('SRPL'). During the year PAE Renewables Pte Limited, wholly owned subsidiary of PAER has entered into MOU for sale of its investment in SRPL. The management is of the opinion that, loss arising out of the sale transaction and the impact of it on PAER investment is not ascertainable. The same will be considered and the necessary affect will be given on completion of the sale transaction of shares.

(a) Loans and advances to subsidiaries is for the purpose of meeting the working capital requirement of the subsidiares. During the year, the company has not charged any interest on these loans and advances.

(b) Loans and advances in the nature of Loans and advances/ICD given to subsidiaries and associates and firms/companies in which directors are interested.

During the current year, PAE Renewables Pte. Ltd.(PAER Pte), a step down subsidiary of PAE Limited has entered into an MOU for the sale of its investment in Sovox Renewables Pvt Ltd.(SRPL), which is step down subsidiary of PAER Pte. Amount received by SRPL towards the sale consideration has been utilised to repay the loans and advances given by PAE Limited to the extent of Rs.653.31 lacs. The balance amount of Rs.186.89 lacs represents the unrecoverable portion of the loans and advances written off in the statement of profit & loss and included under exceptional items.

2 Leases

Disclosure as required by Accounting Standard 19, "Leases", issued by the Institute of Chartered Accountants of India, are given below:

a Where the company is a lessee:

The company has taken various office and godown premises under leave and licence agreements. These are not non cancellable and range between 11 months and 5 years under leave and licence and are renewable by mutual concent on mutually agreeable terms. The company has given refundable interest free security deposits under certain agreements. Amounts paid during the year under such agreements are Rs.61.05 lacs (previous year Rs.87.42 lacs) and are recognised in the statement of profit and loss account under "Rent" Note no.27.

b Where company is a lessor:

The company has given its own office and residential premises under leave and licence agreements. These are not non cancellable and range between 11 months and 5 years under leave and licence and are renewable by mutual concent on mutually agreeable terms. The company has taken refundable interest free security deposits under certain agreements. Amounts received during the year under such agreements are Rs.6.42 lacs(previous year Rs.29.79 lacs) and are recognised in the statement of profit and loss account under 'Rent Income' in Note no. 22.

3 Segment information

The company has only one reportable segment, namely "Power Products", hence segment disclosure under Accounting Standard -17 (AS-17) is not required.

4 Related Party Disclosure as per AS-18

A Particulars of subsidiary companies Shurjo Energy Pvt. Limited PAE Renewables Pvt. Ltd. (Formerly known as Sky Naturenergy Pvt. Ltd.) PAE Infrastructure Pvt. Ltd. Sovox Renewables Pvt. Ltd. PAE Renewables Pte Ltd., Singapore Sovox Renewables Pte. Ltd., Singapore

B Particulars of Enterprises controlled by any person described as Key Management Personnel:

Name of the related party Nature of relationship

Rajubai Investment Pvt. Ltd.

Assure Insurance Advisors Pvt. Ltd. Controlled through key management personnel

Arvind R. Doshi HUF Pritam A.Doshi HUF

C Key Management Personnel:

Name of related party Nature of relationship

Mr. Arvind R. Doshi Chairman

Mr. Pritam A. Doshi Managing Director & Head Finance

D Relatives of Key Management Personnel:

Name of relatives Nature of relationship

Mrs. Pratibha A. Doshi Wife of Mr. Arvind R. Doshi

Ms. Priyadarshani A. Doshi Daughter of Mr. Arvind R. Doshi

Mrs. Sohini P. Doshi Wife of Mr. Pritam A. Doshi

Master Viraj P. Doshi Son of Mr. Pritam A. Doshi

Baby Nitya P. Doshi Daughter of Mr. Pritam A. Doshi

5 Contingent liabilities

a Accrued dividend on 11% Non Convertible Redeemable Preference Shares is Rs.60.63 lacs (previous year Rs.14.16 lacs) and on 11% Optionally Convertible, Cumulative, Redeemable Preference Shares is Rs.3.23 lacs (previous year nil). b Disputed sales tax demand of Rs.131.50 lacs (previous year Rs.114.27 lacs). The management has been adviced that there will be no liability arising on this account.

c Counter indemnities given by the company in respect of guarantees issued by the bank Rs.3.78 lacs (prevoius year Rs.36.93 lacs).

d The company has given a corporate guarantee to a bank for Rs. Nil and Rs.125 lacs for secured loans availed by its subsidiary namely, Shurjo Energy Pvt Ltd and PAE Renewables Pvt. Ltd (previous year Rs.350 lacs & Rs.125 lacs for secured loan availed by its subsidiary Shurjo Energy Pvt. Ltd. and PAE Renewables Pvt Ltd respectively.) e Provision for Warranties

As per AS-29, Provisions, Contingent Liabilities and Contingent Assets, issued by the Institute of Chartered Accountants of India, given below are the movements in the warranty provision account:

(Rsin lacs) March 31, 2015 March 31, 2014

At the beginning of the year 90.99 94.18

Provision for warranty made during the year 77.57 55.65

Utilised during the year (54.89) (58.84)

Closing provision for warranty as at the end of the year 113.67 90.99

This information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of information available with the company. This has been relied upon by the auditors.

6 The management and Board of Directors of the company have initiated various steps like cost reduction, identifying non core assets for monetisation, which will improve the cash flows. Further, steps are also being taken to evaluate various alternatives for raising funds and resolution of debts. The Board of Directors expects improvement in the business results in the forthcoming years. Accordingly, the financial statements have been prepared on going concern basis.

7 Others

Figures of the previous year have been regrouped and recast wherever necessary.

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Mar 31, 2014

1 Leases:

Disclosure as required by Accounting Standard 19, "Leases", issued by the Institute of Chartered Accountants of India, are given below:

a Where the company is a lessee:

The company has taken various office and godown premises under leave and licence agreements. These are not non cancellable and range between 11 months and 5 years under leave and licence and are renewable by mutual concent on mutually agreeable terms. The company has given refundable interest free security deposits under certain agreements. Amounts paid during the year under such agreements are Rs. 87.42 lacs (previous year Rs.102.60 lacs) and are recognised in the statement of profit and loss account under "Rent" Note no.26. b Where company is a lessor:

The company has given its own office and residential premises under leave and licence agreements. These are not non cancellable and range between 11 months and 5 years under leave and licence and are renewable by mutual concent on mutually agreeable terms. The company has taken refundable interest free security deposits under certain agreements. Amounts received during the year under such agreements are Rs. 29.79 lacs(previous year Rs.15.95 lacs) and are recognised in the statement of profit and loss account under ''Rent Income'' in Note no. 21.

2 Segment Information:

The company has defined its business segments as Power Products, Other Auto Products and Solar Products, taking into account the nature of products, and differential risks and returns.

As per the Accounting Standard 17 on ''Segment Reporting'' issued by the Institute of Chartered Accountants of India, the segment disclosures are as follows:

The assets and liabilities of the company not being specifically identifiable with a particular segment, cost related thereto and other common expenses have been shown as unallocated items. Operating income not identifiable with a particular segment has been disclosed as unallocated.

3 Related Party Disclosure as per AS-18:

A Particulars of subsidiary companies

Shurjo Energy Pvt. Limited PAE Renewables Pvt. Ltd.

(Formerly known as Sky Naturenergy Pvt. Ltd. )

PAE Infrastructure Pvt. Ltd.

Sovox Renewables Pvt. Ltd.

PAE Renewables Pte Ltd., Singapore

Sovox Renewables Pte. Ltd.,Singapore

B Particulars of Enterprises controlled by any person described as Key Management Personnel:

Name of the related party Nature of relationship

Rajubai Investment Pvt. Ltd.

Assure Insurance Advisors Pvt. Ltd. Controlled through key management personnel

Arvind R. Doshi HUF

Pritam A. Doshi HUF

C Key Management Personnel:

Name of related party Nature of relationship

Mr. Arvind R. Doshi Executive Chairman

Mr. Pritam A. Doshi Managing Director

D Relavtives of Key Management Personnel:

Name of relatives Nature of relationship

Mrs. Pratibha A. Doshi Wife of Mr. Arvind R. Doshi

Ms. Priyadarshani A. Doshi Daughter of Mr. Arvind R. Doshi

Mrs. Sohini P. Doshi Wife of Mr. Pritam A. Doshi

Master Viraj P. Doshi Son of Mr. Pritam A. Doshi

Baby Nitya P. Doshi Daughter of Mr. Pritam A. Doshi

4 Contingent liabilities:

a Disputed sales tax demand of Rs. 114.27 lacs (previous year Rs. 112.71 lacs). The management has been adviced that there will be no liability arising on this account.

b Counter indemnities given by the company in respect of guarantees issued by the bank Rs. 36.93 lacs (prevoius year Rs. 48.14 lacs).

c The company has given a corporate guarantee to a bank for Rs. 350 lacs and Rs. 125 lacs for sercured loans availed by its subsidiary namely, Shurjo Energy Pvt Ltd and PAE Renewables Pvt. Ltd (previous year Rs. 350 lacs & Rs. 100 lacs for secured loan availed by its subsidiary Shurjo Energy Pvt. Ltd. and PAE Renewables Pvt Ltd respectively.)

5 Investment in subsidiary, Shurjo Energy Pvt. Ltd

The company''s subsidiary Shurjo Energy Pvt. Ltd. (SEPL) has been manufacturing solar panels, an industry currently in a challenging situation worldwide. As at March 31, 2014, the accumulated losses in SEPL have exceeded its net worth by Rs. 309.58 lacs. The company is actively pursuing the revival of it''s subsidiary Shurjo Energy Pvt. Ltd.(SEPL) by diversifying its activities. Towards this end, the company has applied to Falta Special Economic Zone for removing the 100% E.O.U. status to facilitate the diversification. Company is also exploring the induction of a strategic investor for trading in power back up systems and lead smelting activity. It is of the opinion that losses suffered during the initial years by SEPL are temporary in nature and no provision for diminution in the value of investment of Rs. 785.66 lacs is considered necessary at this juncture. Also the loans and advances of Rs. 717.30 lacs due from SEPL as at the balance sheet date are considered as fully recoverable.

This information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of information available with the company. This has been relied upon by the auditors.

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Mar 31, 2013

1 Leases:

Disclosure as required by Accounting Standard 19, "Leases", issued by the Institute of Chartered Accountants of India, are given below:

a Where the Company is a lessee:

The company has taken various office and godown premises under leave and licence agreements. These are not non cancellable and range between 11 months and 5 years under leave and licence and are renewable by mutual consent on mutually agreeable terms. The company has given refundable interest free security deposits under certain agreements. Amounts paid during the year under such agreements are Rs. 102.60 lacs (previous year Rs. 111.19 lacs) and are recognised in the statement of profit and loss under "Rent" Note no.26.

b Where company is a lessor:

The company has given its own office and residential premises under leave and licence agreements. These are not non cancellable and range between 11 months and 5 years under leave and licence and are renewable by mutual consent on mutually agreeable terms. The company has taken refundable interest free security deposits under certain agreements. Amounts received during the year under such agreements are Rs. 15.95 lacs (previous year Rs. 47.08 lacs) and are recognised in the statement of profit and loss under ''Rent Income'' in Note no. 21.

2 Segment information:

The company has defined its business segments as Power products, other auto products and solar products, taking into account the nature of products, and differential risks and returns.

As per the Accounting Standard 17 on ''Segment Reporting'' issued by the Institute of Chartered Accountants of India, the segment disclosures are as follows:

3 Related party disclosure as per AS-18 A Particulars of Subsidiary Companies

Shurjo Energy Pvt. Limited

PAE Renewables Pvt. Ltd.

(Formerly known as Sky Naturenergy Pvt. Ltd. )

PAE Infrastructure Pvt. Ltd.

Sovox Renewables Pvt. Ltd.

PAE Renewables Pte Ltd., Singapore

Sovox Renewables Pte. Ltd., Singapore

B Particulars of Enterprises controlled by any person described as Key Management Personnel:

Name of the related party

Rajubai Investment Pvt. Ltd. Assure Insurance Advisors Pvt. Lt Arvind R. Doshi HUF Pritam A. Doshi HUF

C Key Management Personnel: Name of related party

Shri Arvind R. Doshi Shri Pritam A. Doshi

4 Contingent liabilities:

a Disputed sales tax demand of Rs. 112.71 lacs (previous year Rs. 58.18 lacs). The management has been adviced that there will be no liability arising on this account. b Estimated tax liability Rs. Nil (previous year Rs. Nil). c Counter indemnities given by the company in respect of guarantees issued by the bank Rs. 48.14 lacs (prevoius year Rs. 91.96 lacs). d The company has given a corporate guarantee to a bank of Rs. 350 lacs and Rs. 100 lacs for sercured loan availed by its subsidiary, Shurjo Energy Pvt. Ltd. and PAE Renewables Pvt. Ltd respectively (previous year Rs. 350 lacs and Rs. 100 lacs for secured loan availed by its subsidiary Shurjo Energy Pvt. Ltd. and PAE Renewables Pvt Ltd respectively.)

5 Investment in subsidiaries:

a During the year, the company subscribed to Nil equity shares (previous year 2,27,85,178) for a total consideration of Rs. Nil (previous year Rs. 227.85 lacs) in Shurjo Energy Pvt. Ltd. thereby increasing its stake to Nil% (previous year 85% in the company w.e.f. 1st October, 2011). The company is engaged in manufacturing of solar photovoltaic panels using CIGS technology.

b During the year, the company subscribed to 46,00,000 equity shares (previous year 46,75,000) of Rs. 10/- each for a total consideration of Rs. 460 lacs (previous year Rs. 467.75 lacs) in PAE Renewables Pvt. Ltd. PAE Renewables Pvt. Ltd. is a 100% subsidiary of PAE Limited and is engaged in the business to design, install, sell and service renewable energy solutions of small and medium sizes in India.

c During the year, the company subscribed to Nil equity shares (previous year 3,52,000) of Rs. 10/- each for a total consideration of Rs. Nil (previous year 35.20) in PAE Infrastructure Pvt. Ltd. PAE Infrastructure Pvt. Ltd. is a 100% subsidiary of PAE Limited.

d The company''s subsidiary Shurjo Energy Pvt. Ltd. (SEPL) has been manufacturing solar panels, an industry currently in a challenging situation worldwide. As at March 31, 2013, the accumulated losses in SEPL have exceeded its net worth by Rs. 216.74 lacs. The management has plans to diversify the activities of SEPL by introduction of trading in power back up systems to Original Equipment customers and is of the opinion that lossess sufferred during the initial years by SEPL are temporary in nature. In view of this, and also taking into consideration the company''s long term, strategic investment in SEPL, no provision for diminution in the value of investment of Rs. 785.66 lacs is considered necessary. Also the loans and advances of Rs. 1296.62 lacs due from SEPL as at the balance sheet date are considered as fully recoverable.

6 In accordance with Accounting Standard 11, the exchange loss debited to profit and loss account is Rs. 25.84 lacs (previous year Rs. 19.92 lacs).

7 Others

a In the year 2008-09 the company had filed a petition in the High Court of Mumbai for interest charged under section 234B of the Income Tax Act, 1961 against order passed by the settlement commision for A.Y. 1993-94, 1994-95 and 1996-97. Pending High Court Order, no adjustments have been made in respect of tax provision against these years.

b Figures of the previous year have been regrouped and recast wherever necessary.

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Mar 31, 2012

(a) Terms/rights attached to equity shares

The company has only one class of equity shares having a face value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees.

(b) During the year, Rs. 92 lacs was taken as loans against refinance of existing motor vehicles owned by the company from Kotak Mahindra Prime Ltd. This loan carries an interest of 19.467% p.a., and is payable in 36 installments, alongwith interest from the date of the loan. The period of maturity w.r.t. balance sheet date is 2 years and 4 months with EMI of Rs.4.49 lacs for 4 months, Rs. 3.31 lacs for 12 months and Rs. 1.82 lacs for 12 months respectively.

(c) Fixed deposits from related parties carry interest @11% to 11.75% p.a.(previous year 10.50% to 11.25% p.a.) and are repayble after 3 years from the respective dates of deposit.

(d) Fixed deposits from shareholders and others carry interest ranging from 11% to 11.75% p.a.(previous year 10.50% to 11.25% p.a.) and are repayble after 2 years and 3 years from the respective dates of deposit.

(e) During the year, unsecured loan of Rs.60 lacs was taken from Kotak Mahindra Bank, which carries interest @ 9.50% p.a. and is repayable in 24 installments. The period of maturity w.r.t. balance sheet date is 1 year and 5 months with EMI of Rs.4.35 lacs for 1 month, Rs. 2.94 lacs for 8 months and Rs.1.50 lacs for 8 months.

(a) Working capital loan from banks is secured by hypothecation of current assets and all movables, both present and future and with a collateral charge on immovable and movable properties. The working capital from banks carries interest of @15.75% and 16.15% p.a.

(b) Inter-corporate deposits are having a tenure of 90 days to 120 days and carry interest @13.50% to 17.75% p.a.

(c) Fixed deposits from others and shareholders carry interest ranging from 10% to 10.75% p.a.(previous year 10% to 10.25% p.a.).

(a) Margin money deposits with maturity of less than I upto three months is against letter of credit and bank guarantees.

(b) Margin money deposits with maturity more than three months and upto 12 months is against bank guarantees.

(c) Deposits with maturity of more than three months and upto 12 months of Rs. 54 lacs (Previous Year Rs. 54 lacs) is kept as collateral against cash credit limits with banks.

1 Leases:

Disclosure as required by Accounting Standard 19, "Leases", issued by the Institute of Chartered Accountants of India, are given below:

a Where the company is a lessee:

The company has taken various office and godown premises under leave and licence agreements. These are not non cancellable and range between 11 months and 5 years under leave and licence and are renewable by mutual concent on mutually agreeable terms. The company has given refundable interest free security deposits under certain agreements. Amounts paid during the year under such agreements are Rs. 111.19 lacs (previous year Rs. 88.87 lacs) and are recognized in the statement of profit and loss under "Rent" Note no.28.

b Where company is a lessor:

The company has given its own office and residential premises under leave and licence agreements. These are not non cancellable and range between 11 months and 5 years under leave and licence and are renewable by mutual concent on mutually agreeable terms. The company has taken refundable interest free security deposits under certain agreements. Amounts received during the year under such agreements are Rs. 47.08 lacs(previous year Rs. 45.29 lacs) and are recognized in the statement of profit and loss under 'Rent Income' in Note no. 22.

2 Contingent liabilities

a Disputed sales tax demand of Rs. 58.18 lacs (previous year Rs. 34.15 lacs). The management has been adviced that there will be no liability arising on this account.

b Estimated tax liability Nil (previous year Nil).

c Counter indemnities given by the company in respect of guarantees issued by the bank Rs.91.96 lacs (previous year Rs.157.29lacs).

d The company has given a corporate guarantee to a bank of Rs.350 lacs and Rs.100 lacs for sercured loan availed by its subsidiary, Shurjo Energy Private Limited and PAE Renewables Private Limited respectively (previous year Rs. 350 lacs for secured loan availed by its subsidiary Shurjo Energy Private Limited).

3 Investment in subsidiaries

a During the year, the company subscribed to 2,27,85,178 equity shares (previous year 29,71,474) for a total consideration of Rs. 227.85 lacs (previous year Rs. 51.00 lacs) in Shurjo Energy Private Limited thereby increasing its stake to 85% in the company w.e.f. October 1, 2011. The company is engaged in manufacturing of solar photovoltaic panels using CIGS technology.

b During the year, the company subscribed to 23,00,000 equity shares of Rs.10/- each at par on June 6, 2011 and 23,75,000 equity shares of Rs.10/- each at premium of Rs.10/- each on September 13,2011 (previous year 1,00,000) ofRs. 10/- each for a total consideration of Rs.467.75 lacs (previous yearRs. 10 lacs) in PAE Renewables Private Limited, PAE Renewables Private Limited is a 100% subsidiary of PAE Limited and is engaged in the business to design, install, sell and service renewable energy solutions of small and medium sizes in India.

c During the year, the company subscribed to 3,52,000 equity shares (previous year nil) of Rs.10/- each for a total consideration of Rs.35.20 lacs (previous year nil) in PAE Infrastructure Pvt. Ltd. PAE Infrastructure Pvt. Ltd. is a 100% subsidiary of PAE Limited.

d The company has reviewed the value of long term investment made in its subsidiary, Shurjo Energy Pvt. Ltd. Inspite of the accumulated losses in the said subsidiary, the management is of the opinion that there is no permanent diminution in the value of investment, after taking into consideration the change in the business policy to be pursued in the ensuing years.

4 Dues to micro and small enterprises

There are no amounts overdue and remaining unpaid for 30 days on account of principal and/or over due interest at the close of the year to micro, small and medium enterprises, as defined under'Micro Small and Medium Enterprises Development Act, 2006. This information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of information available with the company. This has been relied upon by the auditors.

5 Derivative instruments and unhedged foreign currency exposure

a In accordance with Accounting Standard 11, the exchange loss debited to statement of profit and loss is Rs.19.92(previous year Rs.15.60 lacs). Premium in respect of forward contracts to be debited to subsequent years's statement of profit and loss is Nil (previous year Rs. 18.49 lacs).

b Disclosure in relation to derivative instruments for hedging foreign currency risk for secured loans:

6 Others:

a In the year 2008-09 the company had filed a petition in the High Court of Mumbai for interest charged under section 234B of the Income Tax Act, 1961 against order passed by the settlement commission for A.Y. 1993-94, 1994-95 and 1996-97. Pending High Court order, no adjustments have been made in respect of tax provision against these years.

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

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Mar 31, 2011

1. Contingent liabilities not provided for in respect of:

a. Disputed Sales Tax demand of Rs.34.15 lacs (Previous year Rs.56.87 lacs). The management has been advised that there will be no liability arising on this account.

b. Estimated tax liability Nil (Previous year Nil).

c. Counter indemnities given by the Company in respect of guarantees issued by the bank Rs. 157.29 lacs(Previous year Rs.6.14 lacs).

d. The Company has given a corporate guarantee to a bank of Rs.350 lacs for secured loan availed by its subsidiary, Shurjo Energy Pvt. Ltd.

2. a) During the year, the Company subscribed to 29,71,474 equity shares (previous year 95,75,437) for a total consideration of Rs.51.00 lacs (previous year Rs.331.21 lacs) in Shurjo Energy Pvt. Ltd. thereby increasing its stake to 70% in the company w.e.f. October 25, 2010. The company is engaged in manufacturing of solar photovoltaic panels using CIGS technology.

b) During the year, the Company subscribed to 1,00,000 equity shares (previous year 10,000) of Rs.10/- each for a total consideration of Rs. 10 lacs (previous year Rs. 1 lac) in PAE Renewables Pvt. Ltd. PAE Renewables Pvt. Ltd. is a 100% subsidiary of PAE Limited and is engaged in the business to design, install, sell and service renewable energy solutions of small and medium sizes in India.

4. There are no amounts overdue and remaining unpaid for 30 days on account of principal and /or over due interest at the close of the year to micro, small and medium enterprises, as defined under "Micro, Small and Medium Enterprises Development Act, 2006". This information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of information available with the Company. This has been relied upon by the auditors.

5 (b) Computation of net profit for commission payable to the Directors in accordance with Section 198 of the Companies Act, 1956

i) Remuneration paid to Executive Chairman is in accordance with the approval granted by the Ministry of Corporate Affairs, The Government of lndia vide its letter dated December 27, 2010.

ii) Due to inadequecy of profit remuneration paid to the Managing Director is the minimum remuneration based on the effective capital of the company as prescribed under Schedule XIII of the said Act.

9. (i) In accordance with Accounting Standard 11, the exchange loss debited to Profits Loss Account is Rs. 15.60 lacs (previous year Rs. 1.02 lacs). Premium in respect of Forward Exchange Contracts to be debited to subsequent years Profit and Loss account is Rs.18.49 lacs (Previous year Rs.0.37 lacs).

12. The company has defined its business segments as Lead Acid Storage Batteries, Power Backup Systems, Other Auto Products and Solar Products taking into account the nature of the products, and differential risks and returns.

The assets and liabilities of the company not being specifically identifiable with a particular segment, costs related thereto and other common expenses have been shown as unallocated items Operating income not identifiable with a particular segment has been disclosed as unallocated.

13. Disclosure as required by Accounting Standard 19, "Leases", issued by the lnstitute of Chartered Accountants of India, are given below:

(a) Where the Company is a lessee:

The Company has taken various office and god own premises under leave and licence agreements. These are not non cancellable and range between 11 months and 5 years under leave and licence and are renewable by mutual consent on mutually agreeable terms. The Company has given refundable interest free security deposits under certain agreements. Amounts paid during the year under such agreements are Rs.88.87 lacs (previous year Rs.78.18 lacs) and are recognised in the Profit and Loss Account under Rent in Schedule M.

(b) Where the Company is a lessor:

The Company has given its own office and residential premises under leave and licence agreements. These are not non cancellable and range between 11 months and 5 years under leave and licence and are renewable by mutual consent on mutually agreeable terms. The Company has taken refundable interest free security deposits under certain agreements. Amounts received during the year under such agreements are Rs.45.29 lacs (previous year Rs.39 82 lacs) and are recognised in the Profit and Loss Account under Rent Income in Scheduled.

14. In accordance with AS-22, Accounting for Taxes on Income, Deferred Tax Liability as at March 31,2011 is Rs.5.25 lacs.

15. Related Party Disclosure as per AS-18:

A. Particulars of Subsidiary Companies

Shurjo Energy Pvt. Limited

PAE Renewables Pvt. Ltd. (Formerly known as Sky Naturenergy Pvt. Ltd.)

B. Particulars of Enterprises controlled by any person described as Key Management Personnel:

Name of the Related Party Nature of Relationship

Raiubai Investment Pvt. Ltd. }

Assure Insurance Advisors Pvt. Ltd. } Controlled through key management personnel Arvind R Doshi HUF }

Pritam A Doshi HUF }

C. Key Management Personnel:

Name of Related Party Nature of Relationship

Shri Arvind R. Doshi Executive Chairman

Shri Pritam A. Doshi Managing Director

D. Relatives of Key Management Personnel:

Name of Relatives Nature of Relationship

Smt. Pratibha A. Doshi Wife of Shri Arvind R. Doshi

Ms. Priyadarshani A. Doshi Daughter of Shri Arvind R. Doshi

Smt. Sohini P. Doshi Wife of Shri Pritam A. Doshi

Master Viraj P. Doshi Son of Shri Pritam A. Doshi

Baby Nitya P. Doshi Daughter of Shri Pritam A. Doshi

17. In the year 2008-09 the Company had filed a petition in the High Court of Mumbai for interest charged under section 234B of the Income Tax Act, 1961 against order passed by the settlement commission for A.Y. 1993-94, 1994-95 and 1996-97. Pending High Court Order, no adjustments have been made in respect of tax provision against these years.

18. Previous year figures have been re-grouped/reclassified wherever necessary.