Notes to Accounts of Shree Ajit Pulp & Paper Ltd.

Mar 31, 2018

Note : 1

A) Corporate information:

Shree Ajit Pulp And Paper Ltd (‘the Company’) is a public company incorporated in India. Its shares are listed on Bombay Stock Exchange and Vadodara Stock Exchange. The Company is engaged in the manufacturing of Kraft Paper (Testliner / Multilayer Testliner) which is mainly used for manufacturing of corrugated boxes.

The Company owns and operates manufacturing unit located in the state of Gujarat, India at Morai, Vapi.

The Company has adopted Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs with effect from April 1, 2017, with a transition date of April 1, 2016. The adoption of Ind AS has been carried out in accordance with Ind AS 101, First-time Adoption of Indian Accounting Standards. Ind AS 101 requires that all Ind AS standards and interpretations that are issued and effective for the ‘First Ind AS financial statements’ for the year ended March 31, 2018, be applied retrospectively and consistently for all financial years presented. However, in preparing these Ind AS financial statements, the Company has availed of certain exemptions and exceptions in accordance with Ind AS 101, as explained in note 2. The resulting difference between the carrying values of the assets and liabilities in the financial statements as at the transition date under Ind AS and Previous GAAP have been recognised directly in retained earnings.

B) Basis of preparation and presentation

i) Statement of compliance

The financial statements as at and for the year ended March 31, 2018 have been prepared in accordance with Indian Accounting Standards (“Ind AS”) notified under the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.

In accordance with Ind AS 101 First-time Adoption of Indian Accounting Standard, the Company has presented a reconciliation from the presentation of financial statements under Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (“Previous GAAP”) to Ind AS for Shareholders’ equity as at March 31, 2017 and April 1, 2016 and of the total comprehensive income for the year ended March 31, 2017.

For all the periods up to and including the year ended March 31, 2017, the Company prepared its financial statements in accordance with Accounting Standards notified under the section 133 of the Companies Act, 2013 (Indian GAAP). These financial statements for the year ended March 31, 2018 are the Company’s first Ind financial statements.

ii) Basis of measurement

The financial statements have been prepared on a historical cost convention and on an accrual basis, except for certain items that are measured at fair value as required by relevant Ind AS:

1. Financial assets and financial liabilities measured at fair value (refer accounting policy on financial instruments);

2. Defined benefit and other long-term employee benefits.

C. Critical accounting judgements and key sources of estimation uncertainty

In the application of the Company’s accounting policies, the management of the Company is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. In the following areas the management of the Company has made critical judgements and estimates.

Useful lives of property, plant and equipment

The Company reviews the useful lives and carrying amount of property, plant and equipment at the end of each reporting period. This reassessment may result in change in depreciation expense in future periods.

Estimation of defined benefit obligation

The Company has defined benefit plans for its employees which are actuarially valued. Such valuation is based on many estimates and other factors, which may have a scope of causing a material adjustment to the carrying amounts of assets and liabilities.

Recognition of deferred tax assets

Deferred tax asset is recognised for all the deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilised. The management assumes that taxable profits will be available while recognising deferred tax assets.

Recognition and measurement of other provisions

The recognition and measurement of other provisions are based on the assessment of the probability of an outflow of resources and on past experience and circumstances known at the balance sheet date. The actual outflow of resources at a future date may therefore vary from the figure so provided and included as liability.

2. First time adoption of Ind AS

These are the Company’s first financial statements prepared in accordance with Ind AS. The accounting policies set out in above paragraphs have been applied in preparing the financial statements for the year ended March 31, 2018, the comparative information presented in these financial statements for the year ended March 31, 2017 and in the preparation of the opening Ind AS balance sheet as at April 1, 2016 (the Company’s date of transition). In preparing its opening Ind AS balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (previous GAAP or Indian GAAP). An explanation of how the transition from previous GAAP to Ind AS has affected the Company’s financial position, financial performance and cash flows is set out in the following tables and notes:

Explanation 1 - Exemptions and exceptions availed

Explanation 2 - Reconciliation of total equity as at March 31, 2017 and as at April 1, 2016.

Explanation 3 - Reconciliation of total comprehensive income for the year ended March 31, 2017.

Explanation 4 - Impact on cash flows for the year ended March 31, 2017.

Explanation 1 - 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

a. Ind AS Optional exemptions

Deemed Cost

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 -Intangible Assets. Accordingly, the Company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value.

Equity investments at FVTOCI

The Company has designated investment in equity shares (Other than investment in subsidiary and joint venture) at FVTOCI on the basis of facts and circumstances that existed at the transition date.

Investments in subsidiary and joint venture

Ind AS 101 permits a first-time adopter to measure investments in subsidiary and joint venture at cost. The cost of such investment may be determined in accordance with Ind AS 27 or deemed cost (fair value or previous GAAP carrying value) in its opening Ind AS balance sheet. Accordingly, the Company has elected to measure investments in subsidiary and joint venture at their previous GAAP carrying value.

b. Ind AS mandatory exceptions

i) Estimates

An entity’s estimates in accordance with Ind ASs at the date of transition shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error. Ind AS estimates as at April 1, 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP.

ii. 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. The Company accordingly has made such assessment to assess such classification and measurement on the basis of the facts and circumstances that exist at the date of transition to Ind AS. Similarly, the Company has determined the classification of investments at FVTOCI based on the facts and circumstances that are existing as of transition date.

iii. De-recognition of financial assets and liabilities

Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the de-recognition requirements in Ind AS 109 retrospectively from a date of the entity’s choosing, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities de recognised as a result of past transactions was obtained at the time of initially accounting for those transactions. The Company has elected to apply the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.

iv. Impairment of financial assets

The Company has applied the impairment requirements of Ind AS 109 retrospectively; however, as permitted by Ind AS 101, it has used reasonable and supportable information that is available without undue cost or effort to determine the credit risk at the date that financial instruments were initially recognised in order to compare it with the credit risk at the transition date. Further, the Company has not undertaken an exhaustive search for information when determining, at the date of transition to Ind Ass, whether there have been significant increases in credit risk since initial recognition, as permitted by Ind AS 101.

Notes to the reconciliations:

a. Under IGAAP, leasehold land was capitalised under fixed assets and depreciated over the lease term. Under Ind AS, such leasehold lands have to be assessed as to whether they are an operating lease or a financing lease, basis the terms and conditions in the lease agreement. Consequently, leasehold lands that classify as operating leases have been removed from property, plant and equipment and treated as a separate prepaid asset. The same is expensed off to the consolidated statement of profit and loss over the lease term as lease rent. Therefore an amount of ‘21.91 lakh and ‘20.40 lakh has been reclassified as at April 1, 2016 and March 31, 2017 respectively from property, plant and equipment to prepaid current and prepaid non-current asset. This transaction does not have any impact on equity.

b. The investments in equity instruments under IGAAP were carried at lower of cost and fair value. Under Ind AS, the investments in equity investments are to be fair valued with the corresponding gains/losses to be recognised in the consolidated statement of profit and loss except for investment in joint venture for which optional exemption is available to value these at cost pursuant to Ind AS 101. Consequently, there is an increase in equity by Rs.1.58 lakh and ‘2.90 lakh as on April 1, 2016 and March 31, 2017 respectively.

c. Under IGAAP, dividends proposed by the board of directors after the balance sheet date but before the approval of the financial statements were considered as an adjusting event. Accordingly, provision for proposed dividend and tax on dividend were 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 for the year ended 31 March 2016, and tax there on for financial year 2015-16 of Rs.48.36 lakh has been reversed with corresponding adjustment in retained earnings. Consequently, the total equity increased by an equivalent amount.

d. Deferred taxes on the above adjustments have also been provided. Deferred tax liability has been recognised to the tune of ‘0.55 lakh and Rs.1.01 lakh as on April 1, 2016 and March 31, 2017 respectively.

e. Under the previous GAAP, revenue from sale of goods 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 consolidated statement of profit and loss as part of expenses. This change has resulted in an increase in total revenue and total expenses for the year ended March 31, 2017 by Rs.1,311.52 lakh. There is no impact on equity and profit.

f. Under Ind AS, the investments in equity instruments are carried at fair value through other comprehensive income. Consequently, the profit for the year ended March 31, 2017 has increased by Rs. 1.32 lakh (refer note b above).

g. Under Ind AS, remeasurements i.e actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognised in the other comprehensive income instead of the consolidated statement of profit and loss. Under the previous GAAP, these remeasurements were forming part of statement of profit and loss for the year.

As a result of this change, the profit for the year ended March 31, 2017 increased by ‘0.72 lakh. These remeasurement losses have been reclassified to other comprehensive income at ‘0.47 lakh (net of taxes Rs. 0.25 lakh). This reclassification has led no impact on equity or profit for the year.

h. Under IGAAP, the depreciation on lease hold lands was classified as a depreciation expense. Since under Ind AS, these leasehold lands are classified as operating leases, the prepaid rent has been expensed off as lease rent. Hence, the depreciation expense has reduced by Rs.1.50 lakh and other expenses has increased by the same amount. There is no impact on profit for the year (refer note a above).

i. The deferred tax liability has been created on the above adjustments to the tune of ‘0.46 lakh for the year ended March 31, 2017. Consequently, the profit for the year has reduced by an equivalent amount (refer note d above).

Explanation 4 - Impact on cash flows for the year ended March 31, 2017.

There is no impact on cash flows due to transition to Ind AS.

Note 3.1 : Inventories have been offered as security against the term loans and working capital loans provided by the banks (refer note 16.1 and 19.1).

Note 3.2 : Inventory of raw materials includes Goods - in - transit as at 31 March, 2018 NIL , as at 31 March, 2017 NIL and as at 1 April, 2016 Rs. 98.62 lakh.

Note 3.3 : Inventory of consumables includes Goods-in-transit as at 31 March, 2018 NIL , as at 31 March, 2017 Rs. 117.38 lakh and as at 1 April, 2016 Rs. 23.07 lakh.

Note : 4.1 Information about major customers : One customer contributed to more than 10% of the total revenue individually during the year ended March 31, 2018, March 31, 2017 and As at 1st April, 2016. Total revenue from this customer is Rs. 4,528.40 lakh, Rs. 4,701.08 lakh and Rs. 4,955.27 lakh during the year ended March 31, 2018, March 31, 2017 and as at 1st April, 2016 respectively.

Note 5.1 : Fire occurred at one of the raw material godowns of the Company on 31st August, 2016 resulting into loss of raw material inventory amounting to Rs. 422.99 lakh. The Company has lodged an insurance claim for loss of raw material inventory based on its assessment and taking into consideration terms and conditions of insurance policy. During the year the Company has received Rs. 364.44 lakh against the claim lodged. Accordingly balance amount of Rs. 58.55 lakh is charged to statement of profit and loss as an exceptional item for the year ended 31st March, 2018.

Note : 5.2 Terms and Rights attached to Equity Shares :

The company has only one class of equity shares having a par value of Rs. 10 per share. Each Shareholder of equity share 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. Further, the Board of Director may also announce an interim dividend.

In the event of liquidation of the company, the holder of equity shares will be entitled to receive remaining assets of the company after distribution of all preferential amounts in proportion to their shareholdings.

Note : 6.1 Cash Credit is secured by way of hypothecation of stocks, book debts, furniture, fixture and fitting, office equipment and plant and machinery and equitable mortgage of immovable properties on pari passu basis and personal guarantee of Chairman and Managing Director of the Company. The Cash Credit is repayable on demand and bears interest at the rate of base rate plus 1.5% to 2.75%.

Note : 7.1 Consequent to introduction of Goods and Services Tax (GST) with effect from 1st July, 2017, Central Excise, Value Added Tax (VAT) etc. have been subsumed to GST. In accordance with Ind AS -18 on Revenue and Schedule III of the Companies Act, 2013, unlike Excise Duties, levies like GST, VAT are not part of Revenue. The following additional information is being provided to facilitate such understanding :

Disclosures under Indian Accounting Standards:

Note: 8.1 Employee Benefit Obligations

a. Short-term Employee Benefits

These benefits include wages and salaries, including other monetary and non-monetary benefits, compensated absences which are either non-accumulating or accumulated and expected to be availed within twelve months after the end of the reporting period.

b. Long-term Employee Benefits

i) Defined Contribution Plans

The Company makes Provident Fund contributions, which are defined contribution plans, for qualifying employees. Company has no further payment obligations once the contributions have been paid. Under the Provident Fund Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The contributions payable to these plans by the Company are in compliance with the rates specified in the rules of the schemes. The Company recognised Rs. 34.61 lakh (previous year ‘30.42 Lakh) as an expense and included in Note 29 - Employee Benefit Expenses ‘Contribution to provident fund and other funds’ in the Statement of Profit and Loss for the year ended March 31, 2018.

ii) Defined Benefit Plans

The Company has a defined benefit plan for gratuity plan in India (funded). The company’s defined benefit plan for gratuity is a final salary plan for employees, which requires contributions to be made to a separately administered fund.

These plans typically expose the Group to actuarial risks such as :

Investment risk - The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds. If the return on plan asset is below this rate, it will create a plan deficit. Currently, for the plan in India, it has a relatively balanced mix of investments in government securities, and other debt instruments.

Interest rate risk - A fall in the discount rate which is linked to the Government Securites Rate will increase the present value of the liability requiring higher provision. A fall in the discount rate generally increases the mark to market value of the assets depending on the duration of asset.

Asset Liability Matching Risk (ALM) - The plan faces the ALM risk as to the matching cash flow. Since the plan is invested in lines of Rule 101 of Income Tax Rules, 1962, this generally reduces ALM risk.

Salary risk - The present value of the defined benefit plan liability is calculated by reference to the future salaries of members. As such, an increase in the salary of the members more than the assumed level will increase the plan’s liability. Mortality risk - Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

Concentration Risk - Plan is having a concentration risk as all the assets are invested with the insurance company and a default will wipe out all the assets. Although probability of this is very less as insurance companies have to follow regulatory guidelines.

In order to protect the capital and optimise returns within acceptable risk parameters, the plan assets are well diversified. The estimate of future salary increases considered, takes into account the inflation, seniority, promotion, increments and other relevant factors.

Sensitivity

Sensitivity of the projected benefit obligation on assumptions :

The sensitivity analysis have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.

The sensitivity analysis presented above may not be representative of the actual change in the projected benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the projected benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same method as applied in calculating the projected benefit obligation as recognised in the balance sheet.

There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.

iii) Other Long-term Employee Benefits

Compensated absences which are accumulated and not expected to be availed within twelve months after the end of the reporting period in which the employee renders the related service are recognised as a liability at the present value of the defined benefit obligation as at the balance sheet date.

An amount of Rs.49.61 Lakh (previous year Rs. 54.41 Lakh) has been charged to the Statement of Profit and Loss for the year ended March 31, 2018 towards Compensated absences.

Note: 8.2 Segment Information

a. Description of segments and principal activities

An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Company’s other components, and for which discrete financial information is available. All operating segments’ operating results are reviewed regularly by the Company’s Board of Directors (BoD) i.e. CODM to make decisions about resources to be allocated to the segments and assess their performance.

The company has a single operating segment i.e. manufacturing of kraft paper (Testliner and Multilayer Testliner). Accordingly the segment revenue, segment result, segment assets and segment liabilities are reflected in the financial statements as at and for the financial year ended March 31, 2018, March 31, 2017 and as at 1st April, 2016 respectively.

b. Geographical Information

Revenue from customers earned and non-current assets are located, in India.

c. Information about products and services

The company is in single line of business of manufacturing of Kraft paper (Testliner / Multilayer Testliner ).

Note: 8.3 Related Party Disclosure Details of Related Parties:

Note: 8.4 Financial Instruments (Fair Value Measurements) :

The Company has various financial assets and liabilities. The disclosures regarding the classification, fair value hierarchy, capital management, markets risk, credit risks and liquidity risks are as follows :

b. Fair Value Hierarchy of Financial Assets and Liabilities

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

Level 1: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.

Level 2: Level 2 inputs are inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3 : Level 3 inputs are unobservable inputs for the asset or liability.

Company’s policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.

(i) Measured at Amortised Cost for which Fair Value is disclosed

The fair values of all current financial assets and liabilities including trade receivables, cash and cash equivalents, bank balances, trade payables, and other current financial assets and liabilities are considered to be the same as their carrying values, due to their short term nature. The fair values of all non - current financial assets and liabilities are considered to be the same as their carrying values, as the impact of fair valuation is not material.

(ii) Measured at Fair Value Through Other Comprehensive Income (FVTOCI)

The company has investments in quoted equity shares of Gujarat State Financial Corporation and Punjab National Bank. These equity investments have been classified as Fair Value through Other Comprehensive Income (FVTOCI). Fair value movements are recognized directly in other comprehensive income on such investments. Accordingly, such quoted investments fall under fair value hierarchy level 1. The fair value of these investments as at March 31,2018, March 31, 2017 and April 1, 2016 is Rs. 2.49 lakh, Rs. 3.57 lakh, Rs. 2.26 lakh respectively.

c. Capital Management and Gearing ratio

Total equity as shown in the balance sheet includes equity share capital, general reserves and retained earnings.

The Company aims to manage its capital efficiently so as to safeguard its ability to continue as a going concern and to optimise returns to its shareholders.

The Company’s policy is to maintain a stable and strong capital structure with a focus on total equity so as to maintain investor, creditors and market confidence and to sustain future development and growth of its business. The Company will take appropriate steps in order to maintain, or if necessary adjust, its capital structure. The management monitors the return on capital as well as the level of dividends to shareholders.

d. Financial risk management

Company’s activities expose it to credit risk, liquidity risk and market risk. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and its impact on the financial statements

(i) Credit Risk

Credit risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss. Trade receivables are typically unsecured and are derived from revenue earned from customers located in India. Credit risk has always been managed by the company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. On account of adoption of Ind AS 109, the company uses expected credit loss model to assess the impairment loss or gain.

(ii) Liquidity Risk

Liquidity risk is the risk that the Company will find it difficult in meeting its obligations associated with its financial liabilities in time.

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions.

Management monitors rolling forecasts of the Company’s liquidity position and cash and cash equivalents on the basis of expected cash flows.

The tables below analyses the Company’s financial liabilities into relevant maturity groupings based on their contractual maturities.

(iii) Market Risk

The Company is exposed to the movement in price of key raw materials in domestic and international markets. The Company has in place policies to manage exposure to fluctuations in the prices of the key raw materials used in operations. The Company manages fluctuations in raw material price through hedging in the form of advance procurement when the prices are perceived to be low and also enters into advance buying contracts as strategic sourcing initiative in order to keep raw material and prices under control to the extent possible.

1

A) Foreign Exchange Risk

The Company is exposed to foreign exchange risk arising from direct transactions in foreign currency and also indirectly through transactions denominated in foreign currency though settled in functional currency(INR), primarily with respect to the US Dollar (USD). Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the company’s functional currency (INR).

The risk is measured through a forecast of highly probable foreign currency cash flows. As per the risk management policy, the foreign currency exposure is unhedged.

B) Interest Rate Risk and Sensitivity :

The Company’s exposure to the risk of changes in market interest rates relates primarily to long term debt. Borrowings at variable rates expose the Company to cash flow interest rate risk. With all other variables held constant, the following table demonstrates composition of fixed and floating rate borrowing of the company and impact of floating rate borrowings on company’s profitability.

This amount is spent for promoting health and education.

Amount spent on construction / acquisition of any assets is NIL.

Note: 8.5 Events after the reporting period

The Board of Directors, at its meeting held on 17th May , 2018, has proposed a final dividend of Rs. 0.75/- per equity share of face value Rs.10/- each for the financial year ended March 31, 2018. The proposal is subject to the approval of shareholders at the Annual General Meeting to be held and if approved would result in a cash outflow of approximately Rs. 40.18 Lakh for dividend.

Note: 8.6 Approval of financial statements

The financial statements were approved by the board of directors on May 17, 2018.

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Mar 31, 2016

1. Terms and Rights attached to Equity Shares :

The company has only one class of equity shares having a par value ofRs.10 per share. Each Shareholder of equity share 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. Further, the Board of Director may also announce an interim dividend.

In the event of liquidation of the company, the holder of equity shares will be entitled to receive remaining assets of the company after distribution of all preferential amounts in proportion to their shareholdings.

2. Term loan is secured by way of pari passu charges on proposed plant and machinery & office building and other construction at Vapi of the company and equitable mortgage on immovable property situated at Vapi of the company, further secured by hypothecation of stocks, book debts, furniture, fixture and fitting, office equipment situated at Vapi of the company.

3. Term loan is Secured by way of exclusive charge on plant and machinery and building of windmill situated at village Murvel Dist Jamnagar and equitable mortgage on immovable property situated at Vapi of the company, further secured by hypothecation of stocks, book debts, furniture, fixture and fitting, office equipment situated at Vapi of the company on pari passu basis.

4. Term loan is secured by way of exclusive charge on plant and machinery and building of co generation power plant situated at Vapi of the company and equitable mortgage on immovable property situated at Vapi of the company, further secured by hypothecation of stocks, book debts, furniture, fixture and fitting, office equipment situated at Vapi of the company on pari passu basis.

Note d. Vehicle loanRs.19,35,257 included in current maturities of long term borrowings is secured by way of hypothecation of Vehicle.

5. All term loans from banks and from others are further secured by way of shares pledged and personal guarantee of Mr. Gautam D Shah Managing Director of the company and bears rate of interest at base rate plus 2.90 % to 3.50 %.

6. Cash Credit is secured by way of hypothecation of stocks, book debts, furniture, fixture and fitting, office equipment and plant and machinery and equitable mortgage of immovable properties on pari passu basis and personal guarantee of Chairman and Managing Director of the Company. The Cash Credit is repayable on demand and bears interest at the rate of base rate plus 1.5% to 3.25%.

7. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

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Mar 31, 2015

1. Corporate information:

Shree Ajit Pulp And Paper Ltd ('the company) is a public company incorporated in India. Its shares are listed on Bombay Stock Exchange, Vadodara Stock Exchange and Ahmedabad Stock Exchange. The company is engaged in the manufacturing of Kraft Paper (Testliner/Multilayer Testliner) which is mainly used for manufacturing corrugated boxes.

The company owns and operate manufacturing unit located in the state of Gujarat, India at Morai, Vapi. The unit is having an all modern manufacturing facility.

2. Terms and Rights attached to Equity Shares :

The company has only one class of equity shares having a par value of Rs. 10 per share. Each Shareholder of equity share 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. Further, the Board of Director may also announce an interim dividend.

In the event of liquidation of the company, the holder of equity shares will be entitled to receive remaining assets of the company after distribution of all preferential amounts in proportion to their shareholdings.

Note a. Term loans are secured by plant and machinery and equitable mortgage on immovable property and hypothecation of stocks, book debts, furniture, fixture and fitting, office equipment situated at Vapi of the company on pari passu basis.

Note b. Term loan of Rs. 1,08,18,004 included in current maturities of long term debts is secured by way of exclusive charge on plant and machinery and building of windmill situated at village Bagasara dist Rajkot and equitable mortgage on immovable property situated at Vapi of the company, further secured by hypothecation of stocks, book debts, furniture, fixture and fitting, office equipment situated at Vapi of the company on pari passu basis.

Note c. Term loan is Secured by way of exclusive charge on plant and machinery and building of windmill situated at village Murvel dist Jamnagar and equitable mortgage on immovable property situated at Vapi of the company, further secured by hypothecation of stocks, book debts, furniture, fixture and fitting, office equipment situated at Vapi ofthe company on pari passu basis.

Note d. Term loan is secured by way of exclusive charge on plant and machinery and building of co generation power plant situated at Vapi ofthe company and equitable mortgage on immovable property situated at Vapi ofthe company, further secured by hypothecation of stocks, book debts , furniture, fixture and fitting, office equipment situated at Vapi of the company on pari passu basis.

Note e. Vehicle loan is secured byway of hypothecation of Vehicle.

Note f. All term loans from banks and from others are further secured by way of personal guarantee of Mr. Gautam D Shah Managing Director ofthe company and bears rate of interest base rate plus 2.90 % to 3.50 %.

3. Deferred tax - Prior year Rs. 1,30,13,580 represents reversal of deferred tax liability created in earlier years in respect of timing differences which reversed during the tax holiday period.

4. Cash Credit is secured by way of hypothecation of stocks, book debts, furniture, fixture and fitting, office equipment and plant and machinery and equitable mortgage of immovable properties on pari passu basis and personal guarantee of Managing Director of the Company. The Cash Credit is repayable on demand and bears interest at the rate of base rate plus 1.5% to 3.25%.

5. The Board of Directors of Shree Samarpan Pulp and Paper Private Limited (a Joint Venture Company ), vide a Board resolution dated 26th July, 2014, have decided to dissolve its Joint Venture Entity, consequentially, the Company has written off its Investment of Rs. 1,00,000 in the said company.

6. Balance with banks in earmarked accounts include Rs. 50,32,861 ( Previous year Rs. 49,54,373) which have restriction.

Note : 7 Related Party disclosure

8. Details of related parties:

Description of relationship Names of related parties

(i) Subsidiary Shree Samrudhi Industrial Papers Private Limited

(ii) Jointly Controlled Entities (JCE) Shree Samrat Pulp and Paper Private Limited

Shree Samarpan Pulp and Paper Pvt Ltd (Refer note 12.2) (company under liquidation)

(iii) Key Management Personnel Mr. Gautam D Shah, Mr. Piyush R Shah, Mrs. Bela G Shah

Note : 9 Contingent Liabilities and Commitments (to the extent not provided for)

Particulars For the year ended For the year ended 31 March, 2015 31 March, 2014

Contingent liabilities

Claims against the company not acknowledged as debt 28,36,620 28,36,620 Demand for Custom duty (Deposit paid Rs. 2,36,963) 62,07,453 -

Future cash outflows in respect of above matters are determinable only on receipt of judgements /decisions pending at various forums /authorities.

Commitments

Estimate amount of contracts remaining to be executed on capital account and 32,84,081 12,46,688 not provided for

Note: 10 Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification /disclosure.

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Mar 31, 2014

1. CORPORATE INFORMATION:

Shree Ajit Pulp And Paper Utl is a Kraft Paper manufacturing company established In 109b Is Haled on BSE, VSE andABE have a modern manufacturing facility at Moral, Vapi, GUJARAT State, approximately 170 KM from Mumbai.

2. We are engaged in the manufacturing of TESTLINER /MULTILAYERTESTLINER which Is mainly used for manufaolui lug corrugated boxes. With,in a short span of time tire product has found its own place in the markets all over the country.

3. We are now recognized as one of the leading Krai l Manufacturing Unit in India for our duality and reliable products, W o I vivo a Strong Nationwide Dealers Network Covering the entire country for Solos & Service,

4. Terms and Rights attached to Equity Shares :

The company has only one class of equity shares having a par value ofRs10 per share. Each Shareholder of equity share 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. Further, the Board of Director may also announce an interim dividend.

5. In the event of liquidation of the company, the holder of equity shares will be entitled to receive remaining assets of the company after dislribution of all preferential amounts in proportion to their shareholdings.

6. Term loans are secured by plant and machinery and equitable; mortgage on Immovable properly and hypothescsllo i ol stocks, book debts , furniture, fixture and fitting, office equipment situated at Vapl of (ho company on purl passu bnisln.

7 Term loan is secured by way of exclusive charge on plant and machinery and building of windmill situated at village Bagasara district Rajkot and equitable mortgage on immovable property situated at Vapi of the company, furllmr secured by hypothecation of slocks, book debts, furniture, fixture and filling, office equipment situated at Vap i of 11 in company on pari passu basis,

8 Term loan is secured by way of exclusive charge on plant and machinery and building ol windmill situated a I vlllngo Murvel district Jamnagar and equitable morlgage on immovable property situated at Vapi of the company, furlhor secured by hypothecation of stocks, book debts, furniture, fixture and fitting, office equipment situated at Vapi of the company on pari passu basis.

9 Term loan is secured by way of exclusive charge on plant and machinery and building of co generation power plmil situated at Vapi of the company and equitable mortgage on immovable property situated at Vapi of the company, further secured by hypothecation of slocks, book debts, furniture, fixture and filling, office equipment situated ai Vapi of the company on pari passu basis.

10 Vehicle loan is secured by way of hypothecation of vehicle. The loan is repyable in 31 installments, with 14 EMI of rS 105,000, 12 EMI of 78,000 and 5 EMI of 14,000.

11 Vehicle loan is secured by way of hypothecation of vehicle.

12 Vehicle loan is from NBFC and secured by way of hypothecation of vehicle.

All term loan above from banks and from others are further secured by way of personal guarantee of Mr. Gau turn D Shah Managing Director of the company.

13 Term loan balance as on 31.03.2014 of 205,545,715 includes current maturities of long term borrowings of 70,81 9,592 as disclosed in note 9.

14 Deferred tax-Prior year for the year ended 31st March, 2014 amounting 13,013,580 represents reversal of deferred tax liability created in earlier years in respect of timing differences which reversed during the tax holiday period.

15 Cash Credit is secured by way of hypothecation of slocks, book debts, furniture, fixture and fitting, office equipment and plant and machinery and equitable mortgage of immovable properties on pari passu basis and personal guarantee of Managing Director of the Company. The Cash Credit is repayable on demand and carries interest base rate plus 0.fi% to 2,5%.

16. Depreciation on Fixed Assets is provided oi l the Straight Lino Method at the rales nnd In manner prescribed In Schedule XIV to the Companies Act, 1956 except on cellular handsets having gross block value Rs 962,05' depreciation calculated @ 25 % included in office equipments and Waste Paper God own having Gross block value Rs 1,080,551 doprcsolnlloii calculated @ 20 % on SLM basis included in buildings. Depreciation on additions to assets during the year Is provided on pro-rata basis.

17 Addition during the year includes Rs 8,865,994 (Previous year Rs44,83(1) on account of Interest capitalised on Pliant and equipment and Rs 7,852 (Previous year Rs Nil) on Building and RS 1,794,445 (Previous year Rs. Nil.) on account ol foreign exchange fluctuation capitalised on PI an I and Equipments.

18 Previous year figures are shown in italics.

19 Related Party disclosure

30.1 Details of related parties:

Description of relationship Names of related parties

(i) Subsidiary

Shree Samrudhi Industriaf Papers Private Limited

(ii) Jointly Controlled Entities (JCE)

Shree Samrat Pulp and Paper Private Limited Shree Samarpan Pulp and Paper Private Limited

(iii) Key Management Personnel Mr. Gautam D Shah, Mr. Piyush R Shah

20. Interest In Joint Venture :

The company holds ISO % interest in Shree Sairtral Pulp and Paper Private Untiled and in SI tree Snmarpnn Pu Ip and Paper Private Limited, jointly controlled entitles which are involved in manufacturing activity, However, Shree Snnwpnii Pulp and Paper Private Limited has not started any activity till ond of the year under consideration.

21 The company's share of assets, liabilities, income and expenses in the jointly controlled entities for the year ended 31 stMarch as per (heir audited financial statements are as follows;

22 Segment Information

The Company identifies primary segments based on the dominant source, nature of risks and returns and the interna! organisation and management structure. Accordingly, the Company has identified two primary business segments viz Paper and Windmills, Primary Segment Information :

23 Contingent Liabilities and Commitments (to the extent not provided for)

Particulars For the year ended For the year ended 31 March 2014 31 March 2013

Contingent liabilities

Claims against the company not acknowledged as debt 2,836,620 2,836,620

Commitments

Estimate amount of contracts remaining to be executed on capital account and not provided for 1,246,688 88,738,707

24. Derivative Instruments

The year end foreign currency exposures that have not been hedged by a derivative instrument or otherwise are as below:

For the year ended For the year ended Particulars 31 March 2014 31 March 2013

Rs Forex (USD) Rs Forex (USD)

1 Import of Goods and Services 327,704 5,308 - -

25. Sales and other expenses are net off VAT paid/payable.

26. Previous year's figures have been regrouped Z reclassified wherever necessary to correspond with the current year's classification / disclosure.

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Mar 31, 2013

Note : 1 Related Party Disclosure

1.1 List of related parties where control exists and related parties with whom transactions have taken place and relationships:

a) Enterprises Owned by Directors or Major Shareholders

Ajit Steel Centre, Twinkle Investment, Paras Industries, Piyush Export, Ratilal Ujamlal, Kashinda, Shree Samrat Pulp & Paper Pvt Ltd, Shree Samarpan Pulp & Paper Pvt. Ltd

b) Key managerial Personnel

Shri Gautam D Shah, Shri Piyush R Shah

c) Relatives of Key Management Personnel Narmada Sales Corporation

d) Subsidiary Company

Shree Samrudhi Industrial Papers Pvt Ltd

Note : 2 Interest in Joint Venture :

The company hold 50 % interest in Shree Samrat Pulp & Paper Pvt Ltd and Shree Samarpan Pulp & Paper Pvt. Ltd, a jointly controlled entity which is involved in manufacturing activity. First Joint Venture has taken over a running unit for manufacturing of kraft paper during the year. The second one has not started any activity till the end of the year under consideration.

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Mar 31, 2012

1.1 Secured Term Loan from Banks

1 Term Loan outstanding of Rs. 30,000,000 (60,000,000)from Nationalised Bank and carrying rate of Interest base rate plus 3% per annum and repayable in 60 Installments starting from April 2009 of Rs. 2,500,000 each along with interest.

2 Term Loan outstanding of Rs. 34,146,947 (63,342,947)from Nationalised Bank and carrying rate of Interest base rate plus 3% per annum and repayable in 60 Installments starting from Nov. 2009 of Rs. 2,433,000 each along with interest.

3 Term Loan outstanding of Rs. 7,533,086 (8,545,216)from Nationalised Bank and carrying rate of Interest base rate plus 3% per annum and repayable in 60 Installments starting from July 2011 of Rs. 625,000 each along with interest.

4 Term Loan outstanding of Rs. 1,357,500 (NIL) from Nationalised Bank and carrying rate of Interest base rate plus 3% per annum and repayable in 60 Installments starting from Oct 2013 of Rs. 1,375,000 each along with interest.

5 Term Loan outstanding of Rs. NIL (2,025,924) from Nationalised Bank and carrying rate of Interest base rate plus 4% per annum and repayable in 20 quarterly Installments starting from March 2008 of Rs. 1,300,000 each along with interest every month.

All above loans are Secured by Plant & Machinery and Equitable Mortgage on Immovable property and Hypothecation of stocks, book debts, furniture, fixture & fitting, office equipment situated at Vapi of the company.

6 Term Loan outstanding of Rs. 36,819,772 (49,819,660) from Nationalised Bank is Secured by way of first charge on Plant & Machinery and Equitable Mortgage on Immovable property situated at Vapi of the company, Secured by Hypothecation of Plant & Machinery for the Windmill situated on lease land at Village Bagasara, Dist Rajkot. Term loan is Carrying rate of Interest base rate plus 3% per annum and repayable in 60 Installments starting from Feb 2011 of Rs. 1,083,334 each along with interest.

7 Term Loan outstanding of Rs. 48,702,045 (NIL) from Nationalised Bank is Secured by way of first charge on Plant & Machinery and Equitable Mortgage on Immovable property situated at Vapi of the company, Secured by Hypothecation of Plant & Machinery for the Windmill situated on lease land at Village Murvel, Dist Jamnagar. Term loan is Carrying rate of Interest base rate plus 4% per annum and repayable in 60 Installments starting from March 2013 of Rs. 860,000 each along with interest.

8 Vehicle Loan of Rs. 267,033 (460,387)from Nationalised Bank is Secured by way of Hypothecation of Vehicle. The loan is repayable in 36 EMI starting from March 2011 of Rs. 21,942 each.

9 Forklift Loan of Rs. 1,213,127(NIL) from Private Bank is Secured by way of Hypothecation of Forklift. The loan is repayable in 31 MI starting from May 2012 . 14 monthly installments of Rs. 105,000 each, 12 monthly installments of Rs. 78,000 each and 5 monthly installments of Rs. 14,000 each.

2.2 Secured Term Loan from Other

Vehicle Loan of Rs. 2,160,316 (NIL)from NBFC is Secured by way of Hypothecation of Vehicle. The loan is repayable in 36 EMI starting from Jan 2012 of Rs. 113,108 each.

All above secured term loans from Nationalised Bank and from other are secured by way of personal guarantee of Managing Director of the company.

3.1 Cash Credit is Secured by Hypothecation of stocks, book debts, furniture, fixture & fitting, office equipment and Plant and Machinery and equitable mortgage of immovable properties and personal guarantee of Managing Director of the Company. The Cash Credit is repayable on demand and carries interest base rate plus 3% to 4.25%.

4.1 Depreciation on Fixed Assets is provided on the Straight Line Method at the rates and in manner prescribed in Schedule XIV to the Companies Act, 1956 except on cellular handsets having gross block value Rs. 736,654 depreciation calculated @ 25 % and Waste Paper Godown having Gross block value Rs. 463,227 depreciation calculated @ 20 % on SLM basis. Depreciation on additions to assets during the year is provided on pro-rata basis.

5.1 Fixed Deposit with Nationalised Banks

Margin money Deposits with respective carrying amount are subject to first charge to Secure the respective credit facilities

5.2 Unclaimed Dividend Bank Accounts includes amount due to be credited to Investor Education and Protection Fund of Rs. 121,781 on or before 28th Oct 2012.

5.3 Cash and Cash Equivalents as of March 31,2012 and March 31, 2011 includes restricted cash and Bank balances of Rs. 7,542,956 and Rs. 14,031,401 respectively. Other Bank balances maintained by the company with banks comprise of time deposits, which can be withdrawn by the company at any point of time without prior notice or penalty on the principal.

6.1 Depreciation

Depreciation on Fixed Assets is provided on the Straight Line Method at the rates and in manner prescribed in Schedule XIV to the Companies Act, 1956 except on cellular handsets having gross block value Rs. 736,654 depreciation calculated @ 25 % and Waste Paper Godown having Gross block value Rs. 463,227 depreciation calculated @ 20 % on SLM basis. Depreciation on additions to assets during the year is provided on pro-rata basis.

Note : 7 Impairment of Assets

The company has carried out an exercise to ascertain the impairment, if any, in the carrying value of its Fixed Assets. An impairment loss is charged to the Profit and loss account when an asset is identified as impaired. During the year the company has recognized no such impairment loss.

Nature of Provisions

1 The Company has made provision for Gratuity as per provision of Payment of Gratuity Act, 1972.

2 The Company has made provision for Leave encashment as per the rules and regulation of the Company relating to accumulation of leave and its encashment.

3 The Company has made provision for Bonus as per provision of Payment of Bonus Act, 1965.

4 The Company has made provision for Income Tax as per provision of Income Tax Act, 1961.

5 The Company has made provision for Wealth Tax as per provision of Wealth Tax Act, 1957

Note : 8 Related Party Disclosure

8.1 List of related parties where control exists and related parties with whom transactions have taken place and relationships

a) Enterprises Owned by Directors or Major Shareholders

Ajit Steel Centre, Twinkle Investment, Paras Industries, Piyush Export, Ratilal Ujamlal, Kashinda, Shree Samrat Pulp & Paper Pvt Ltd, Shree Samarpan Pulp & Paper Pvt. Ltd

b) Key managerial Personnel

Shri Gautam D Shah, Shri Piyush R Shah

c) Relatives of Key Management Personnel Narmada Sales Corporation

d) Subsidiary Company

Shree Samrudhi Industrial Papers Pvt Ltd

Note : 9 Interest in Joint Venture :

The company hold 50 % interest in Shree Samrat Pulp & Paper Pvt Ltd and Shree Samarpan Pulp & Paper Pvt. Ltd, a jointly controlled entity which is involved in manufacturing activity but not started any activity till the end of the year under consideration. The companyRs.s share of assets, liabilities, income and expenses in the jointly controlled entity for the year ended 31 st March are as follows :

9.1 The Income Tax assessment of the company have been completed up to Assessment Year A.Y.2010-11. The disputed demand outstanding up to the said Assessment Year is Rs. 165,088/-. Based on the decisions of the Appellate authorities and the interpretations of the other relevant provisions, the company has been legally advised that the demand is likely to be deleted and accordingly no provision has been made.

Note : 10

Till the year ended 31 March 2011, the company was using pre -revised Schedule VI to the Companies Act 1956, for preparation and presentation of its financial statements. During the year ended 31st March 2012, the revised Schedule VI notified under the Companies Act 1956, had become applicable to company. The company has reclassified previous year figures to confirm to this year's classification.

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Mar 31, 2011

1. Previous year's figures are re-grouped / re-arranged wherever considered necessary.

2. Contingent Liabilities 2010-2011 2009-2010

(Rs. In 000) (Rs. In '000)

(1) Estimated amount of contracts remaining to be executed 1640.00 Nil on capital account and not provided for, net of advances given

(2) Counter claims by supplier against the company not 2836.62 2836.62 acknowledged as debt

(3) Bank Guarantee 8031.41 6410.00

Note: The Company does not expect any reimbursement in respect of the above contingent liabilities. It is not practicable to estimate the timing of cash outflows any, in respect of matters at 1 to 3 above

b) Nature of Provisions

1. The Company has made provision for Gratuity as per provision of Payment of Gratuity Act, 1972.

2. The Company has made provision for Leave encashment as per the rules and regulation of the Company relating to accumulation of leave and its encashment.

3. The Company has made provision for Bonus as per provision of Payment of Bonus Act, 1965.

4. The Company has made provision for Income Tax as per provision of Income Tax Act, 1961.

5. The Company has made provision for Wealth Tax as per provision of Wealth Tax Act, 1957

4. Impairment of Assets

The company has carried out an exercise to ascertain the impairment, if any, in the carrying value of its Fixed Assets. An impairment loss is charged to the Profit and loss account when an asset is identified as impaired. During the year the company has recognized impairment loss on cellular handsets to the extent of Rs. 204378 and charged to Profit & Loss account.

6. The Market value of GSFC Shares is quoting below the cost price. As this Investment is held on long-term basis, the Directors are of the opinion that the current market price does not reflect true value of Investment and hence the diminution in the value has not been accounted.

7. Related Party Disclosure (As Identified by Management)

(i) Related Party Relationships

(a) Enterprises Owned by Directors or Major Shareholders

(1) Ajit Steel Centre

(2) Ajeet Buildsteel Pvt. Ltd.

(3) Shah Trading Co.

(4) Twinkle Investment

(5) Paras Industries

(6) Piyush Export

(7) Ratilal Ujamlal

(8) Kashida

(9) Shree Samrat Pulp & Paper Pvt. Ltd

(10) Shree Samarpan Pulp & Paper Pvt. Ltd

(b) Key Management Personnel

Shri Gautam D. Shah,

Shri Piyush R. Shah & Shri Gyanprakash H. Gupta

(c) Relatives of Key Management Personnel

Security Product (Brother of the Director is proprietor) Narmada Sales Corporation (Brother of the Director is Partner) Note: In respect of above parties, there is no provision for doubtful debts as on 31st March, 2011 and no amount has been written off or written back during the year in respect of debts due from/to them.

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Mar 31, 2010

1. Previous years figures are re-grouped / re-arranged wherever considered necessary.

2. Contingent Liabilities 2009-2010 2008-2009 (Rs. In 000) (Rs. In 000)

(1) Estimated amount of contracts remaining to be executed on capital Nil 11022.22 account and not provided for, net of advances given

(2) Counter claims by supplier against the company not 2836.62 2836.62 acknowledged as debt

b) Nature of Provisions

1. The Company has made provision for Gratuity as per provision of Payment of Gratuity Act, 1972.

2. The Company has made provision for Leave encashment as per the rules and regulation of the Company relating to accumulation of leave and its encashment.

3. The Company has made provision for Bonus as per provision of Payment of Bonus Act, 1965.

4. The Company has made provision for Income Tax as per provision of Income Tax Act, 1961.

5. The Company has made provision for Wealth Tax as per provision of Wealth Tax Act, 1957

4. Impairment of Assets

The company has carried out an exercise to ascertain the impairment, if any, in the carrying value of its Fixed Assets The exercise has not revealed any impairment in any Fixed assets of the Company.

5. The Market value of GSFC Shares is quoting below the cost price. As this Investment is held on long-term basis, the

Directors are of the opinion that the current market price does not reflect true value of Investment and hence the diminution in the value has not been accounted.

6. Related Party Disclosure (As Identified by Management) (i) Related Party Relationships

(a) Enterprises Owned by Directors or Major Shareholders

(1) M/s Ajit Steel Centre - Vapi (2) M/s Ajeet Buildsteel Pvt. Ltd. - Vapi

(3) M/s Shah Trading Co. - Vapi (4) M/s Twinkle Investment - Mumbai

(5) M/s Paras Industries - Mumbai (6) M/s Piyush Export - Mumbai

(7) M/s Ratilal Ujamlal - Mumbai (8) M/s Kashida - Mumbai

(b) Key Management Personnel

Shri Gautam D. Shah, Shri Piyush R. Shah, Shn P. M. Kanyadi & Shri Gyanprakash H. Gupta

(c) Relatives of Key Management Personnel

Security Product (Brother of the Director is proprietor) Narmada Sales Corporation (Brother of the Director is Partner)

Note: In respect of above parties, there is no provision for doubtful debts as on 31" March, 2010 and no amount has been written off or written back during the year in respect of debts due from/to them.

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Mar 31, 2003

1. Due to Sluggish Stock Market, the Market value of GSFC Shares is quoting below the cost price. As this Investment is held on long-term basis, the Directors are of the opinion that the current market price does not reflect true value of Investment and hence the diminution in the value has not been accounted.

2. Previous years figures are re-grouped / re-arranged wherever considered necessary.

3. Sundry Creditors includes amount due to small scale industrial undertaking a) The parties being small scale / ancillary industrial undertaking to whom amount outstanding for more than 30 days but not overdue: Sood Paper & Allied Chemicals, Prakash Steelage Ltd. b) There were no amounts overdue to small scale and / or ancillary industrial suppliers on account of principal as at the close of the year. c) The above disclosure is based on the information /document available with the company.

4. Related Party Disclosure (As Identified by Management)

(i) Related Party Relationships (a) Where control exists M/s Ajit Steel Centre - Vapi

M/s Ajeet Buildsteel Pvt. Ltd. - Vapi

M/s Security Product - Vapi M/s Shah Trading Co. - Vapi

M/s Twinkle Investment - Mumbai

M/s Paras Industries - Mumbai

M/s Piyush Export - Mumbai

M/s Ratilal Ujamlal - Mumbai

(b) Key Management Personnel

Shri Dhansukhlal G. Shah

Shri Dimple D. Shah

Shri Piyush R. Shah

Shri P. M. Kanyadi

(c) Relatives of Key Management Personnel

Narmada Sales Corporation -(Brother of One of the Directoris Partner)

Note: In respect of above parties, there is no provision for doubtful debts as on 31st March, 2003 and no amount has been written off or written back during the year in respect of debts due from/to them.