CORPORATE INFORMATION

Electrotherm (India) Limited (the Company) is a listed public company domiciled in India and incorporated under the provisions of the Companies Act, 1956.The Company is engaged in the Manufacturing of Electronic furnaces and other capital equipments, Sponge and PIG Iron, Ferrous and Non-ferrous Billets/Bars/Ingots, Duct Iron Pipes, Battery operated vehicles, Electric Power Generation and services relating to Electric furnaces, other capital equipments and battery operated vehicles.

1. SIGNIFICANT ACCOUNTING POLICIES:

(A) BASIS OF brPARATION OF ACCOUNTS:

The Financial Statements are brpared to comply in all material respect with the Accounting Standards notified under the relevant provisions of Companies, Act, 2013. The financial statements have been brpared under the historical cost convention (except for revalued assets which are stated at revalued amount) and on an accrual basis.

(B) USE OF ESTIMATES:

The brparation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Differences between the actual results and estimates are recognized in the year in which the results are known /materialized.

(C) REVENUE RECOGNITION:

Sales are recognized when goods are billed and are accounted net of trade discounts, rebates, VAT & excise duty (except where Exemption is availed) but includes, export incentives. Income on services rendered is accounted for as and when the services are rendered as per the terms.

(D) TANGIBLE ASSETS:

Tangible Assets are stated at cost net of recoverable taxes and includes amounts added on revaluation, less accumulated debrciation and impairment loss, if any. It also includes assets acquired from other division of the Company less debrciation thereon. All costs, including financing costs till commencement of commercial production, net charges on foreign exchange contracts and adjustments arising from exchange rate variations attributable to the fixed assets are capitalized.

(E) INTANGIBLE ASSETS:

An intangible asset is recognized, only where it is probable that future economic benefits attributable to the asset will accrue to the enterprise and the cost can be measured reliably.

(F) DEbrCIATION:

Tangible Assets

(a) The Company has provided debrciation on tangible assets on Straight-line method (SLM) except the assets at Chattral unit over the useful life of the assets as defined in Schedule II of the Companies Act, 2013. The life has been decided by the management considering the type and nature of the assets as defined in Schedule II of the Companies Act, 2013.

(b) The assets at Chattral unit are debrciated to the extent of debrciable amount on the Written Down Value (WDV) Method. Debrciation is calculated based on useful life of the assets as defined in Schedule II of the Companies Act, 2013.

(c) Since the debrciation for the year under consideration has been computed considering the balance useful life of the assets to comply with the requirements of Schedule II of Companies Act, 2013, and being a transitional year, the impact of change in the method of debrciation has been reported.

(d) The amount of Long Term lease hold land is amortized by equal installments during the last fifteen years of the residual lease period.

(e) Debrciation for Power Plant at Kutch is provided at the rates applicable for continuous process plant. Intangible Assets

The intangible assets consist of Computer Software and the same is amortized over a period of 6 years.

(G) INVESTMENTS:

Long term investments including investment in subsidiary companies are stated at cost. Diminution in value, if any, which is of a temporary nature, is not provided.

(H) INVENTORIES:

Finished goods are valued at cost or estimated net realizable value whichever is lower. Raw-material and stores are valued at cost. Work-in-progress value includes raw-material, labour and appropriate overheads. The Cost is worked out on weighted average basis.

(I) RESEARCH AND DEVELOPMENT:

Revenue expenditure on research and development is charged against the profit of the year in which it is incurred, except in case of new projects, where it is accounted for as deferred revenue expenditure and charged to Statement of Profit & Loss from the commencement of the project in five years. Capital expenditure on research and development is shown as an addition to fixed assets.

(J) FOREIGN EXCHANGE TRANSACTIONS:

The transactions in Foreign Exchange are accounted at the exchange rate brvailing on the date of transaction. Foreign Currency monetary assets and liabilities at the date of balance sheet are translated at the rate of exchange brvailing on that date.

Gains/losses arising out of fluctuations in the exchange rates are recognized in the Statement of Profit and Loss in the period in which they arise except in respect of imported Fixed Assets where exchange variance is adjusted in the carrying amount of respective Fixed Assets.

Differences between the forward exchange rates and the exchange rates at the date of transactions are recognized as income or expense over the life of the contracts, except in respect of liabilities incurred for acquiring imported Fixed Assets, in which case such differences are adjusted in the carrying amount of the respective Fixed Assets.

Profit/loss arising on cancellation or renewal of forward exchange contracts are accounted for as income/expense for the period, except in case of forward exchange contracts relating to liabilities incurred for acquiring imported Fixed Assets, in which case such profit/loss are adjusted in the carrying amount of the respective Fixed Asset.

(K) TAXES ON INCOME:

Current tax is determined as the amount of tax payable in respect of taxable income for the period and the credits computed in accordance with the provisions of the Income Tax Act, 1961, and based on the expected outcome of the assessment/appeals.

MAT credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period.

Deferred Tax is recognized, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one year and are capable of reversal in one or more subsequent years. Deferred Tax asset/liability is calculated on the basis of the rate of Income Tax (excluding other levies) applicable for the current year.

Deferred tax assets are recognized and carried forward to the extent that there is virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.

(L) LEASES:

Lease payments for assets taken on operating lease are recognized as an expense in the statement of profit and loss over the lease term.

(M) BORROWING COSTS:

Borrowing costs are recognized as expenses in the period in which they are incurred, except to the extent where borrowing costs that are directly attributable to the acquisition, construction, or production of an asset till put for its intended use is capitalized as part of the cost of that asset. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing cost (except as stated in notes) is charged to revenue.

(N) IMPAIRMENT OF ASSETS:

The company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the assets. If such recoverable amount of the assets is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the Statement of Profit and Loss. If at the balance sheet date there is an indication that if a brviously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of debrciated historical cost.

(O) DEFERRED REVENUE EXPENDITURE:

Expenditure relating to Preliminary Expenses, Capital issues and Deferred Revenue Expenses is amortized on straight line basis over a period of five years.

(P) RETIREMENT / POST RETIREMENT BENEFITS:

Contributions to defined contribution schemes such as Employees Provident fund and Family pension fund are charged to the Statement of Profit & Loss as and when incurred.

The company contributes to Group Gratuity policy with SBI Life Insurance Company Limited and Life Insurance Company Limited, for the Future Gratuity payment of the employees of the Engineering and EV Division on actuarial valuation method, whereas in case of Steel Division liability is provided on the basis of actuarial valuation.

Leave Encashment liability of the company is provided on the basis of actuarial valuation.

(Q) PROVISIONS AND CONTINGENT LIABILITIES:

(i) Provisions are recognized when the brsent obligation of a past event gives rise to a probable outflow, embodying economic benefits on settlement and the amount of obligation can be reliably estimated.Provisions are not discounted to its brsent value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

(ii) Contingent Liabilities are disclosed after a careful evaluation of facts and legal aspects of the matter involved.

(iii) Provisions and Contingent Liabilities are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

(R) SEGMENT REPORTING:

The accounting policies adopted for segment reporting are in line with the accounting policies of the company with the following additional policies for the segment reporting:

Inter segment revenue have been accounted for, based on the transaction price agreed to, between segments which is primarily market led.

Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue and expenses, which relate to the enterprise as a whole and are not allocable to segment on a reasonable basis and have been included under "unallocated corporate expenses".

(S) FINANCE COST:

Finance Costs includes interest, bank charges, amortization of ancillary costs incurred in connection with the arrangement of borrowing and applicable gain/loss on foreign currency transactions and translation arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Finance Costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to statement of profit and loss.

(T) GENERAL:

Accounting policies not specifically referred to are consistent with generally accepted accounting policies.

NOTES TO ACCOUNTS

1 The account under consideration is for the financial year 2014-15 commencing from 1st April 2014 to 31st March 2015 (Referred as "Current year") and the brvious period is for the Six months commencing from 1st October 2013 to 31st March 2014 (Referred as "Previous Period") and therefore figures of the Current Year and Previous Period are not comparable.

2  Details of the Cases of Winding Up of the Company, Recovery by the Lenders / Creditors against the company

(a) Winding Up Petitions:

UCO Bank, Syndicate Bank, Shiv Sales Industries and Shiv Metal Industries have filed winding up petitions under section 433 and 434 of the Companies Act, 1956 against the company before the Hon'ble Gujarat High Court.

The winding up petition filed by UCO Bank, was admitted on March 7, 2012 and the Hon'ble Gujarat High Court has passed an order for advertisement of petition and appointment of Official Liquidator. The Company has challenged the said orders before Hon'ble Division Bench of Hon'ble Gujarat High Court by filing an appeal and the Division bench vide order dated August 13, 2013 has granted the stay against the said orders.

Winding up petition filed by Syndicate Bank, Shiv Sales Industries and Shiv Metals Industries are pending before with Hon'ble Gujarat High Court.

(b) DRT/DRAT Cases:

(i) UCO Bank, Syndicate Bank and ICICI Bank Limited had filed original applications against the Company before the Debt Recovery Tribunal, Ahmedabad ("DRT") under section 19 of the Recovery of Debts due to Banks and Financial Institutions Act, 1993. The company has filed its reply / application in all the three matters and the Ex-parte ad-interim injunction orders has been passed in the matter of UCO Bank and Syndicate Bank. The Company has got ad-interim injunction orders against transfer of certain properties in the matter of UCO Bank and Syndicate Bank. No order has been passed in the matter of ICICI Bank Limited. The company has filed an appeal before Debts Recovery Appellate Tribunal, Mumbai ("DRAT") in the matter of UCO Bank against the order of DRT for rejection of application of cross examination. Syndicate Bank has also filed an appeal before DRAT, Mumbai against the order of DRT for modification of ex-parte ad-interim injunction order.

(ii) Further, Allahabad Bank has filed an original application before Debt Recovery Tribunal, Ahmedabad and the DRT has passed an ex-party ad-interim injection order and the Company is in process of contesting the said order.

(iii) Central Bank of India and Dena Bank has filed original application against the Company before the Debt Recovery Tribunal, Ahmedabad ("DRT") under Section 19 of the recovery of Debt due to Banks/Financial Institution Act, 1993. DRT has passed an ex-party ad-interim injunction order in both the cases. In the matter of Central Bank of India, the Company has filed rejoinder and other submission in the DRT for the same and which is pending for further hearing before DRT.

Accordingly, all the aforesaid original applications / appeal are pending for further hearing before DRT/DRAT or appeal/ Application.

(c) Cases Under section 138 of the Negotiable Instruments Act,1881

UCO Bank, Syndicate Bank, Vijaya Bank, ICICI Bank and Indian Overseas Bank had filed criminal complaints against the company and its Directors/ officers under section 138 of Negotiable Instruments Act, 1881 for dishonor of various cheques issued by the Company and the Company has contested all the said cases and all the matters are pending for further hearing before the respective Hon'ble Metropolitan Magistrate, Ahmedabad.

(d) Willful Defaulters:

(i) UCO Bank had declared the Company and its guarantors as willful defaulter. The action of declaring the company and its guarantors as willful defaulter by UCO Bank has been challenged in the Hon'ble Gujarat High Court and the matter is pending for further hearing.

(ii) State Bank of Travancore, Central Bank of India and Oriental Bank of Commerce had written a letter to the Company for declaring the company & its guarantor as willful defaulter. The company has filed reply of the same. No further communication has been received thereafter.

(e) Notice under SARFAESI Act, 2002

Vijaya Bank had issued a notice under section 13(2) of Chapter III of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ("SARFAESI Act, 2002") for assets of Transmission Line Tower Division of the Company situated at Village : Juni Jithardi, Tal : Karjan, Dist : Vadodara on 19/03/2015 and the bank has not taken any further action. The company has given its reply vide its letter dated 18/05/2015.

3  Net Worth and filing of Reference to BIFR:

As per CDR directives as described in Letter of Approval under the head of "critical conditions" and since the net worth of the Company is fully eroded the company has filed Reference to BIFR on February 28, 2014 and the same has been registered on June 27, 2014 as Case No. 29/2014.

4 Non Provisions of Disputed Advances and Claims/Liability/Impairment of Assets

(a) The Company has VAT tax liability (including interest) of Rs.21.94 Crore (Previous period Rs. 21.94 Crore) under Maharashtra Sales tax Act and out of which the company had paid Rs. 4.00 Crore on 22.07.2011, under protest and the same has been shown as Loans and Advances. Provision as expenditure for the impugned disputed tax liability of Rs.21.94 Crore (Previous period Rs. 21.94 Crore) has not been made as the company is hopeful of matter being decided in its favor by the appellate authority.

(b) During the current year, VAT/CST Assessment for the financial year 2010-11 was completed and competent authority (DCCT, Rajkot) has determined the tax liability of Rs.20.95 Crore against VAT and Rs.11.15 Crore against CST. The company has made part payment of Rs. 1.50 Crore for CST on 12/05/2015 and Rs.3.25 Crore for VAT on 09/05/2015 and company has filed an appeal and the stay for payment of demand has been granted till 14.08.2015.

(c) The Company had filed application for refund of Excise Duty of Rs.12.23 Crore (Previous period Rs. 12.23 Crore) and the same has been treated as recoverable and has been shown as Short Term Loans and Advances. The said claim has been rejected by the Department but the Management is of the opinion that the company will receive the claim on resolution of the dispute on submission of further documents, and therefore the same is treated as good for its realization and not provided for as expenses.

(d) In view of the non-provision of the above items 2.29(a) to 2.29(c), the losses of the company are under stated by Rs. 66.29 Crore and to the extent advances are overstated or the respective liabilities are understated.

(e) During the brvious period, VAT Assessment for financial year 2009-10 was completed and the competent Authority has determined the tax liability of Rs. 5.94 crore and against this demand the company has filed an appeal before the Joint Commissioner, Rajkot and during the year, the Learned Joint Commissioner, Rajkot has deleted the said demand and has determined refund of Rs. 9.50 Crore. The said amount of refund will be accounted on its actual receipt of the refund.

(f) Loan accounts of the Bank of the company have been classified as Non Performing Assets by the Bankers and some of the bankers has not charged interest on the said accounts and therefore provision for Interest (Other than upfront charges) has not been made in the books of accounts and to that extent loss and bankers loan liability has been understated. The extent of exact amount is under determination and reconciliation with the banks, however as per the details available with the company, the amount of un-provided interest, on approximate basis, on the said loans {(Other than the loans which are assigned to Edelweiss Assets Reconstruction Company Limited (EARC)} is as under:-

5  A Special Civil Application in the nature of Public Interest Litigation was filed in the year 2010, inter alia, against the Company before the Hon'ble Gujarat High Court challenging the environment clearance for expansion of steel plant and No Objection Certificate (NOC) & Consolidated Consent and Authorization. The Gujarat High Court by its order dated May 11, 2012 set aside the environment clearance with liberty to the Company to apply once again and to stop the operation of the steel plant. The Company has filed a Special Leave Petition (SLP) before the Hon'ble Subrme Court of India, challenging the impugned order of Hon'ble Gujarat High Court. The Hon'ble Subrme Court of India stayed the order passed by the Hon'ble Gujarat High Court. The Hon'ble Subrme Court of India directed the Central pollution Control Board and Gujarat pollution Control Board to make a joint inspection and submit its report to Hon'ble Subrme Court. Central pollution Control Board and Gujarat pollution Control Board have submitted their joint report before the Hon'ble Subrme Court on 7th July 2014, regarding compliance of jobs done by the company and its next hearing has been fixed on 7th July 2015.

6 Additional Disclosures

(a) Power and Fuel expenses are inclusive of duties and taxes of Rs.11.15 Crore (Previous Period Rs. 3.25 Crore) paid towards power generation.

(b) During the year, the Terminal Excise Duty of Rs. 1.58 Crore (Previous Period Rs. Nil) has been written off considering its reliability as doubtful and has been debited it to cost of Material consumed. During the brvious period Terminal Excise Duty of Rs. 1.58 Crore was included in Short Term Loan and Advance.

(c) During the year, Old Vat Input Credit Receivable of Rs. 69.13 Crore (Previous Period Rs. Nil) has been written off, by debiting it to cost of Material consumed, as company is not hopeful of its realization. During the brvious period Old Vat Input Credit Receivable of Rs. 69.13 Crore was included in Short Term Loan and Advance.

(d) The cost of Material consumed includes freight, Loading and Unloading Expenses, inspection fees, Balance written off, commission, taxes & duties, and ancillary thereof (including reversal of any claims).

(e) In view to heavy accumulated losses and uncertainty of its realization/ payment of taxes in near future, no provision for Deferred Tax Asset/liability has been made by the company.

(f) Product Development Cost includes total Research and Development expenses of Rs. 32.11 Crore (Previous Period Rs. 31.70 Crore) incurred on development of Hybrid Bus/T-Cab/project and CONTIFUR Project, which is still in progress and said expenses, would be written off in five years from the year of completion.

(g) Some of the creditors have filed cases of recovery against the company before the various Hon'ble Courts/Forums for Rs. 1.96 Crore (Previous Period Rs. 1.96 Crore).

(h) During the year old non recoverable amount of Rs.158.15 Crore (Previous Period Rs. 19.57 Crore) and unclaimed amount of Rs. 16.77 Crore (Previous Period Rs. 9.33 Crore) have been written off/ back on account of non realization and payment. Its' net balance of Rs. 141.38 Crore (Previous period Rs. 10.24 Crore) has been charged to the Statement of Profit and loss.

(i) During the brvious period, the company has paid Rs.2.00 Crore to Allahabad Bank which has been adjusted by Bank against un­provided interest, but the company has adjusted the same against the existing liability as appearing in the books of the Company.

(j) Bank of India, the Lead bank of the consortium, Bank of Baroda, State Bank of India, Canara Bank and State Bank of Travancore has assigned their debt to Edelweiss Asset Reconstruction Company Limited (EARC). The Company has entered into settlement agreement on 10th March 2015 for the repayment of the Debts of the said Bank to EARC. In terms of settlement agreement, if all the terms and conditions are fully complied by the company upto the March 2023, there will be reduction in debt, as per Books of accounts of the Company by Rs.403.90 Crore.

(k) During the year, in view of non reliability/ non usability of stock of book value of Rs. 162.91 Crore (brvious period Rs. 145.42 Crore), the company has not considered the said stock for the purpose of stock valuation and accordingly it has been written off.

(l) The Balances of Dena Bank, UCO Bank and Central Bank of India are not being properly confirmed / reconciled by the bank as these banks treated the loan account as NPA Account. Similarly, International Financial Corporation has not issued loan balance confirmation certificate.

(m) In view of the commercial prudence, during the year, the company has not restated the long outstanding export trade receivable at the rate brvailing as on 31st March 2015.

(n) There is dispute with the Subrme Metallurgical Services (P) Ltd (a Micro, Small and Medium Enterprise) in relation to material supplied by the said party and for which the said party has filed a case before the Hon'ble Madhya Pradesh Micro and Small Facilitation Council, Bhopal for the recovery of the principal amount and interest there on. The Hon'ble Council has passed the order dated August 12, 2013 and has ordered to the company to pay Rs. 0.91 Crore (Including interest upto July 31, 2013). The company has filed appeal before District Court Bhopal under Section 34 of Arbitration and Reconciliation Act 1996 against the order passed by Hon'ble Madhya Pradesh Micro and Small Facilitation Council, Bhopal.

(o) The company holds investment in Shree Ram Electrocast Limited, Electrotherm Mali SARL and Bhaskarpara Coal Company Limited (Subsidiaries of the Company).These Companies have incurred heavy losses and/or non operating and therefore the fate of said Companies are uncertain but Provision for the diminishing in the value of investment in subsidiary has not been made, as the Company treat it as temporary nature.

(p) The Central Bureau of Investigation has conducted certain proceedings, on the basis of the complaint filed by Central Bank of India with regard to the utilization of the loan disbursed by Central Bank of India. At brsent, the said matter is pending before the Central Bureau of Investigation for the investigation and the company is supporting them at various stages.

7 The company is contingently liable for the following :-

(a) Claims against the Company not acknowledged as debts amounting to Rs. 0.70 Crore (Previous Period Rs. 0.70 Crore), are pending before various courts, authorities, arbitration, Consumer Dispute Redressal Forum etc.

(b) Guarantees / Counter Guarantees (including un-utilized Letters of Credit) issued Rs.7.47 Crore (Previous Period Rs. 19.50 Crore).

(c) Disputed Statutory Claims/Levies for which the company has brferred appeal in respect,

(i) Excise Duty Liability of Rs. 295.61 Crore (Previous period Rs. 296.97 Crore) and Service Tax Liability of X5.41 Crore (Previous period Rs. 1.84 Crore),

(ii) Custom Duty Liability of Rs.20.31Crore (Previous period Rs. 21.05 Crore),

(iii) Income Tax liability of Rs. 31.55 Crore (Previous period Rs. 25.17 Crore),

(iv) VAT AND CST Liability of X 50.04 Crore against the outstanding liability company has paid the Rs. 4.75 Crore subsequently there of (Previous Period Rs. 17.94 Crore),

(The above amounts (except where specifically stated)are excluding the amount of additional Interest payable and of the amount involved in appeal brferred by the department, if any.)

8  FOREIGN EXCHANGE EARNING & OUTGO (on Cash basis):

(a) Earning in Foreign Exchange for Export of Goods & Services Rs. 112.70 (Previous period Rs. 85.55 Crore).

(b) Expenditure in Foreign Currency for Import of Materials, Traveling & Others is Rs. 58.65 Crore (Previous period Rs. 22.45 Crore).

9  Previous Period amount has been regrouped / re-casted / re-arranged / re-classified / re-determined, wherever necessary, by the company on the basis of data available with the company, to make the figure of the current year with the brvious period comparable.

10 (a) In the opinion of the Management, the current assets, Trade Receivable, Loans & Advances are realizable at the values stated, if realized in the ordinary course of business and the provisions for all known Liabilities are adequate.

(b) (i) The account of "Trade Receivables", "Borrowings", "Trade payables", "Advances from Customer", "Short Term Loans and Advances" and some Bank Balances are subject to confirmation / reconciliation and the same includes very old non moving items and therefore the same are subject to necessary adjustments for accounting or re-grouping /classification.

(ii) The amount of "Advance from Customers" includes, Rs. 1.91 Crore (Previous Period X2.06Crore) (net of receipts and payments) of the parties in the bank accounts of which names are not readily available with the company and which are to be accounted under the correct account head on receipt of accurate information from the Banker/parties.

(iii) During brvious period the amount of account of some of the major single party under the Head "Advance from customers", "Trade Payable", "Advance to Suppliers and Others", "Trade Receivables" are shown on gross basis and the same are not netted off and which has resulted in overstatement of two account heads.

 (c) The amount of current maturity of Long Term Liability of Rs.1374.17 Crore (Previous Period Rs.1919.37 Crore) has been determined on the basis of the data available with the company and has been treated as short term Borrowings.

(d) The classification/grouping of items of the accounts are made by the management, on the basis of the available data with the company and which has been relied upon by the auditors.

(e) The amount of inventory has been taken by the management on the basis of information available with the company and without conducting physical verification of the slow moving inventory. The slow moving inventories have been valued by the management on estimate net realizable value and which has been relied upon by the auditors.

(f) Account of Service Tax Receivables, CENVAT Receivables and Vat input credit Receivables is subject to reconciliation, submission of its return for its claim and/or its assessment, if any.

(g) The management is of the opinion that the uncompleted projects shown as Capital Work in Progress of Rs.10.45 Crore (Previous Period Rs. 10.45 Crore) require some further investment to bring them into commercial use and therefore these are not treated as impaired assets.

(h) In view of the non recovery of the amounts or non settlement of the accounts, the company has determined Rs. 63.26 Crore as doubtful Trade Receivable and Rs.28.78 Crore of Advance to Suppliers and in view of business prudence, the company has made provision of Rs. 28.47 Crore for said doubtful Trade Receivables and Rs.16.50 Crore for said doubtful Advance to Suppliers.

(i) Account of "Advance to staff" is under confirmation, reconciliation and subject to the settlement of the accounts with the respective employees (including ex-employees) of the company.

11 EARNINGS PER SHARE (EPS):

The basic Earnings per Share is calculated by dividing the profit/ loss attributable to the existing Equity Shares outstanding and in view of losses during the year, EPS has not been calculated.

12 Signed Notes No.1 and 2 forms part of the Annexed account of the Company

As per our report of even date attached

For & on behalf of

Mehta Lodha & Co.,

Firm Registration No: 106250W

Chartered Accountants

Prakash D. Shah

M. NO. 34363

Partner

For & on behalf of the Board of Directors

Shailesh Bhandari Managing Director DIN NO : 00058866

JigarShah Company Secretary

Avinash Bhandari Joint Managing Director DIN NO : 00058986

Pawan Gaur Chief Financial Officer

Place : Ahmedabad

Date : 26th May, 2015