Notes to Accounts of Magnum Ventures Ltd.

Mar 31, 2024

10. PROVISIONS, CONTIGENT LIABILITIES AND CONTIGENCT ASSETS

A Provision is recognized when the company has a present legal or constructive obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which reliable estimate can be made. Provisions (including retirement benefits) are not discounted to its present 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 estimate. Contingent liabilities are not recognized in profit & loss account but are disclosed in Notes to the Accounts.

11. BORROWING COST

Borrowing Cost that are attributable to the acquisition or construction of qualifying assets are capitalised 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 revenue.

12. RETIREMENT AND OTHER EMPLOYEE BENEFITS

a. Defined Contribution Plan

Employee benefits in the form of provident fund, superannuation, employees’ state insurance fund and labour welfare fund are considered as defined contribution plans and the contributions are charged to the profit and loss during the year when the contributions to the respective funds are due and as and when services are rendered by employees

b. Defined Benefit Plan Gratuity

In accordance with the Payment of Gratuity Act, 1972, as amended, the Company provides for gratuity, a defined benefit retirement plan (‘the Gratuity Plan’) covering eligible employees. The Gratuity Plan provides a lump-sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee’s salary and the tenure of employment with the Company. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation at each Balance Sheet date using the projected unit credit method. The Company fully contributes all ascertained liabilities to the gratuity fund maintained with the Insurer.

Defined benefit costs are categorized as follows:

a. service cost (including current service cost, past service cost, as well as gains and losses on curtailments and settlements);

b. net interest expense or income; and

c. re-measurement

The Company presents the first two components of defined benefit costs in profit or loss in the line item ‘Employee benefits expense’. Curtailment gains and losses are accounted for as past service costs. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset.

c. Short-term and other long-term employee benefits

The employees of the Company are entitled to compensate absences. The employees can carry forward a portion of the unutilized accumulating compensated absences and utilize it in future periods or receive cash at retirement or termination of employment. The Company records an obligation for compensated absences in the period in which the employee renders the services that increases this entitlement. The Company measures the expected cost of compensated absences as the additional amount that the Company expects to pay as a result of the unused entitlement that has accumulated at the end of the reporting period. The Company fully contributes all ascertained liabilities to the fund maintained with the Insurer. The Company recognizes accumulated compensated absences based on actuarial valuation. Non-accumulating compensated absences are recognized in the period in which the absence occur.

d. Salary and other short-term benefits

The salary and other short-term benefit i.e. Bonus etc. is being paid to the employees when it becomes due.

Actuarial assumptions in respect of provisions for gratuity and leave encashment at balance sheet date are as follows:

4.1 In preparing this report we have heavily relied on the completeness and accuracy of the information, data and assumptions provided to us orally and in writing by or on behalf of the Company and its advisors. We have not completed any detailed validation checks/ investigation on the information, data and assumptions provided, however preliminary broad consistency is viewed in respect of data. As compared to previous valuation assumptions, changes, if any, may be due to change in yield to government bonds/change in entity’s long term views for future.

4.2 This report is based on going concern basis and as per requirements of Accounting Standard mentioned above and its application to the Plan. These results should not be used for any other purpose. In particular, this Report does not constitute a formal funding actuarial valuation of the Plan and does not present any recommendation of contributions or funding levels and hence results will not hold good incase company is closed or mass attrition. This report is provided solely for the company use and for the specific purposes indicated above. Except where I expressly agree in writing, it should not be disclosed or provided to any third party. In the absence of such consent and an express assumption of responsibility, no responsibility whatsoever is accepted by me for any consequences arising from any third party relying on this report or any advice relating to its contents. In any case, irrespective of vendor agreement etc. liability of under signed towards entity or anyone is strictly limited to the billed amount for this report. The Company may provide copy of this Report to its auditors along with rules of the plan, but I make no representation as to the suitability of this report for any purpose other than that for which it was originally provided and accept no responsibility or liability to the company or its auditors in this regard. The company should draw the provisions of this paragraph to the attention of its auditors.

5.1 Principal assumptions are discount rate and salary increase. The discount rate is based upon the yield on govt bonds and the salary increase should take account inflation, seniority, promotion and other relevant factors. However no explicit allowance is used for disability. As per Accounting Standard, selection of appropriate assumption is responsibility of the entity. Though entity has been advised on the suitability wherever applicable, the report is based on assumptions finalized by the entity (after considering long term view entity might have considered these assumptions prudent).

Risk Factors: Other assumptions would have produced different results e.g. a decrease in discount rate or an increase in salary inflation will lead to an increase in reported liability as per table of sensitivity analysis. Similarly change in attrition rates will also impact the liability. Funded plan carries usual investment risks including asset liability mismatch which will impact net liability/expenses and OCI if any.

9. Sundry Creditors:

The dues payable to Micro and Small Enterprises is based on the information available with the Company and takes into account only those suppliers who have responded to the enquiries made by the Company for this purpose.

MSME

The Management has identified enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises as defined under the Micro, Small and Medium Enterprises Development Act, 2006. Accordingly, the disclosure in respect of amounts payable to such enterprises as at 31 March 2024 has been made based on the information available with the Company and interest amounting to H28,04,416/- is computed in regards to the delayed payment.

10. Lease

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the Risks and rewards of ownership to the lessee. All other leases are classified as operating leases. In respect of assets taken on operating lease, lease rentals are recognized as an expense in the Statement of Profit and Loss on straight line basis over the lease term unless another systematic basis is more representative of the time pattern in which the benefit is derived from the leased asset; or the payments to the lessor are structured to increase in the line with expected general inflation to compensate for the lessor’s expected inflationary cost increases

11. Preference Shares

In accordance to Ind AS 109 read with Ind AS 32, redeemable preference shares are classified as financial liability. Therefore, the treatment has been given in the financials in accordance with the aforesaid Ind AS.

Financial liabilities: Classification, subsequent measurement and gains and losses financial liabilities are classified as measured at amortised cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held for trading, or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognised in the Statement of Profit or Loss. Other financial liabilities are subsequently measured at amortised cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognised in the Statement of Profit or Loss. Any gain or loss on de-recognition is also recognised in the Statement of Profit or Loss.

The company has redeemed 7,72,500 preference share of face value of H100 during the year at par and the correspondence effect has been taken towards financial liability and its reserve.

12. Impairment of Assets

In accordance with IND AS 36 ‘Impairment of Assets’ issued by Institute of Chartered Accountants of India, the company has assessed the potential generation of economic benefits from its business units as on the balance sheet date and is of the view that assets employed in continuing business are capable of generating adequate returns over their useful lives in the usual course of business: there is no indication to the contrary and accordingly, the management is of the view that no impairment provision is called for in these accounts.

13. Depreciation

In accordance with IND AS 16 ‘property, Plant and Equipment’ issued by institute of Chartered Accountants of India, the company has calculated the depreciation on the revised carrying amount (after revalution) of PPE. Accordingly, the new depreciation is higher than the original depreciation. The amount of additional depreciation charged excess on revalued assets, has been moved though Profit & Loss Account. Further, the company has transffered the amount of excess depreciation net of tax impact (if any) has been moved from revalution reserve to retained earnings.

16. Corporate Social Responsibility

CSR amount required to be spent as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof by the Company during the year is H23.13 lacs (previous year Nil), the company has duly spent the same.

17. The debt of the company was assigned by the banks to M/s Alchemist Asset Restructuring Company Limited (AARCL) in earlier year(s). During the year under consideration, the company had prepaid the entire outstanding debt due to Alchemist Asset Reconstruction Company Limited and had obtained No Dues Certificate form AARCL. The company has received One Time Settlement benefits to the tune of H586.88 lacs.

18. During the year under consideration, the Company has issued Listed, Secured 18% Coupon, Non Convertible Debentures of face value of H1 lac each on Private Placement basis to Neo Special Credit Opportunity Fund under the Trusteeship of Catalyst Trusteeship Limited of H15,000 lacs (for security and repayment schedule, refer Schedule 13).

19. PLEDGING OF SHARES

The promoters of the company had earlier pledged 1,39,72,490 equity shares in favour of Lenders/AARC to the company as security, later on the company had prepaid all the loan due to AARC in the financial year 2023-24 and get the securities released.

During the month of March 2024, the company has issued 18% Secured, Listed, Redeemable, Non-Convertible Debentures to the tune of H15,000 lacs to M/s Neo Special Credit Opportunity Fund under the Trusteeship of Catalyst Trusteeship Limited. The pledging of 50% i..e 83,24,255 equity shares of Mr. Parveen Jan shareholding in favour of Catalyst Trusteeship Limited is under process.

20. Earning Per Share

The calculations of profit attributable to equity shareholders and weighted average number of equity shares outstanding for purposes of basic earnings per share calculation are as follows:

(iv) No proceedings have been initiated or pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder during the year ended March 31^st, 2024 and March 31^st, 2023.

(v) The company has not obtained any borrowings from the banks and financial institutions on the basis of security of current assets.

(vi) The Company has not been declared as willful defaulter by any bank or financial Institution or other lender during the year ended March 31^st, 2024 and March 31^st, 2023.

(vii) The company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

(viii) The Company does not have any subsidiary as at March 31^st, 2023 and March 31^st, 2022 and accordingly clause (87) of section 2 of the Act read with Companies (Restriction on number of Layers) Rules, 2017 is not applicable.

(ix) Undisclosed Income

There are no transactions not recorded in the books of accounts during the year ended March 31^st, 2024 and March 31^st, 2023 that has been surrendered or disclosed as income in the tax assessments under the Income Tax Act, 1961.

There are no previously unrecorded income and related assets to be recorded in the books of account during the year ended March 31^st, 2024 and March 31^st, 2023.

(x) Details of Crypto Currency or Virtual Currency

The Company has not traded or invested in Crypto currency or Virtual Currency during the year ended March 31^st, 2024 and March 31^st, 2023.

(xi) Utilization of Borrowed funds and share premium:

(A) During the year ended and as at March 31^st, 2024 and March 31^st, 2023, the Company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding (whether recorded in writing or otherwise) that the Intermediary shall :

(i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

(B) During the year ended and as at March 31^st 2024 and March 31^st 2023, the Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall

(i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

22. Previous year figure has been regrouped and reclassified wherever considered necessary to make them comparable to those of the current year.

The above Note on Significant Accounting Policies 1 to 13 and Other Note 1 to 21 form an integral part of the Balance Sheet as at 31^st March 2024 and has been authenticated as such.

For Sahni Bansal & Associates For and On Behalf of the Board of Directors

Chartered Accountants F.R.N: 514470C

Sd/- Sd/- Sd/-

Pardeep Surrinder Sahni Mr. Pardeep Kumar Jain Mr. Abhay Jain

Partner Managing Director Managing Director

Membership No. 093866 Din: 00024879 Din: 01876385

UDIN:24093866BKEFHE1663

Sd/- Sd/-

Date: May 27, 2024 Mr. Parv Jain Ms Aaina Gupta

Place: Ghaziabad Chief Financial Officer Company Secretary

M.No. A43233

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Mar 31, 2015

1. The Company has one class of equity shares having a par value of Rs. 10 per share. Each holder of equity share is entitled to one vote per share. The paid-up equity shares of the Company rank pari- passu in all respects including dividend. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

2 Redeemable, Non convertible and Non-Cumulative Preference Shares of Face value of Rs. 100/- on such terms and conditions including but not limited as to the rate of dividend, period and manner of redemption as the Board in its absolute discretion may determine for the purpose of agmenting the long term resource base of the company.

3. Issued to bankers against their sacrifice (341200 Debentures of Rs. 1000/- each payable on 31-03-2026)

Working Capital Limit (Paper Divison)

First charge by way of hypothecation of raw materials, stock in process, finished goods, receivables & other current assets of the Paper Division ranking pari-passu basis with the consortium members (OBC, PNB, SYB, IOB & Allahabad Bank).

4. Term Loan (Paper Division)

First charge on the entire fixed assets of the Paper Division present & future (Excluding PCC) ranking on pari-passu basis. (OBC, PNB, SYB, IOB & Allahabad Bank, Vijaya Bank). Exclusive charge on all PCC project assets in favour of Syndicate Bank. Collateral Pari-Passu second charge on the entire fixed assets of the company (present & future) along with other consortium member banks.

5. Term Loan-Hotel Division

First charge on present/future blocks assets of Hotel division ranking pari-passu with other lenders of the project. (OBC, PNB, SYB, IOB & Allahabad Bank, Vijaya Bank).

6. Collateral

Working capital facilities shall be collaterally secured by way of Second Charge on entire fixed assets (present & future) of the company on pari-passu basis with the members of consortium. First charge against these assets shall continue with term lending banks.

Term loan facilities shall be collaterally secured by way of Second Charge on entire current assets (present & future) of the company on pari-passu basis with the members of consortium. First charge against these assets shall continue with working capital lender banks.

7.

For the Year For the Year ended as on ended as on DEFERRED TAX ASSETS / DEFERRED TAX LIABILITY 31.03.2015 31.03.2014

Deferred Tax Assets (A) - 448,952,191.00

Deferred Tax Liabilities (B) Net Deferred Tax Asset/ (Liability) (A-B) - 272,679,101.00

8

For the Year For the Year ended as on ended as on

Long Term Loans & Advances 31.03.2015 31.03.2014

Security Deposit

Unsecured, Considered good 12,404,267.63 10,242,892.63

Zero Coupon Non-Convetiable Debentures (Non-Current) 341,200,000.00 341,200,000.00

Total 353,604,267.63 351,442,892.63

9. Issued to bankers against their sacrifice (341200 Debentures of Rs. 1000/- each payable on 31-03-2026)

(B) OTHER NOTES

10. CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF THE FOLLOWING :

Name of Name of the Amount(Rs.) the Statue Dues

Custom & CENVAT 8, 28, 510/- Central Credit Excise

Custom & Excise Duty 20,97,503/- Central on Production Excise loss

Sale Tax Central Sale 91,437/- tax

Excise Law Duty on 26,135/-(Plus Waste Interest 26,135 Penalty)

Excise Law Duty on 1,73,115/-( Waste Plus Interest and 1,73,115)

Excise Law Duty on 1,58,816/- Waste (Plus Interest)

Excise Law SCN for Duty 14,62,96,594/- of excise on (Interest and paper board Penalty)

Service Tax Demand of 90,11,674/- Law Service Tax 21,458/- Hotel 15,393/- (Interest & penalty)

Service Tax SCN for 1,64,00,749/- Law Service Tax (Interest & from Hotel penalty)

Excise Law Departmental 30,80,824/- Appeal against refund order of Newsprint

Excise Law Paper 13,28,43,130/- Division- ( Interest Newsprint- Penalty) SCN

Excise Law Paper Division 5,83,68,368/- Newsprint- (Interest SCN Penalty)



Name of Period to Status/Forum the Statue which the where Dispute is amount Pending relate

Custom & 2006 Custom & Central Central Excise Department Excise has filed appeal in Allahabad high Court.

Custom & 2005-06 Addl. Commissioner Central of Excise show Excise cause notice pending

Sale Tax 2010-11 Demand due U/S 28(1) is not paid yet. May 12,2014

Excise Law Sept 2010 Appeal (A No. to April E/3763/2012) has 2011 been filed against the Show cause Notice (dt. 8.8.2011)

Excise Law Feb 2009 Appeal (A No. to August E/2162/2012) has 2010 been filed against the Show cause Notice (dt. 9.12.2010)

Excise Law 2004-05 to Appeal (A No. 2007-08 E/2039/2011) has been filed against the Show cause Notice (dt. 29.04.2009)

Excise Law Letter sent to Commissioner ,GZB to refer withdrawal of SCN

2006-2010 Tribunal Delhi, Stay Service Tax Granted and stay Law extended.



Service Tax 2010-2011 Order Passed by Law Comm. And Appeal filed before Tribunal,

Delhi on 27.08.2013

Excise Law Tribunal Delhi, Next Hearing Date yet to be notified



Excise Law The company is under preparation of Reply

Excise Law The company is under preparation of Reply

Total Export Obigation Rs. 50,31,14,020/-

Export Turnover /Earning in Foreign Rs. 38,38,83,983/-

Currency up to 31-03-2015

Export Turnover yet to achieve Rs. 11,92,30,037/-

11. On April 8, 2014, a SIB search by Sale Tax Department of Uttar Pradesh was conducted at Paper Division of the company some loose papers consisting challans etc were taken in customer by the department.

Further no tax demand has been raised yet.

12. REMUNERATION PAID TO AUDITORS:

Particular Current Year Last Year

As Statutory Auditors 2,45,000/- Fee 243089/- Service Service Tax 30282/- Tax 30045/-

Tax Audit Fees 55,000/- Fee 55000/- Service Service Tax 6798/- Tax 6798/-

In other matter NIL NIL

13. In the opinion of the management, current assets, loans and advances are of the value stated if realised in the ordinary course of business except otherwise stated. The provision for all the known liabilities is adequate and not in excess of the amount considered reasonable.

14. During the year company has suffered loss & hence no provision for taxation has been made for the year ended 31.03.2015 in accordance with the provision of Income Tax Act, 1961.

15. Remuneration paid to the Directors of the company is as under:

Particular Current Year Last Year

Mr. Pradeep Kumar Jain 720000.00 -

Mr. Parmod Jain 480000.00 -

Mr. Abhey Jain 480000.00 -

Mr. S. P. Chaturvedi 586400.00 -

16. INCREASE IN AUTHORISED CAPITAL

During the year there is no increase in authorized capital of the company

17. DEBTORS

The debtors outstanding as on 31.03.15 are inclusive of debtors amounting to Rs. 2348.49 lakhs which are due for more than six months. Some of the debtors mentioned above are not presently dealing with the Company and created disputes for quality/rate out of which, Debtors of Rs. 110.13 lacs are under litigations.

18. Additional information (as certified by the management and relied upon by the Auditors)

19. PAPER DIVISION

I) Quantitative information with regard to the licensed & installed capacity, production & sales of Paper manufactured by the company:

S. No. Particular Current Year Last Year Qty. in MT Qty in MT.

(a) Licensed Capacity 85000 85000

(b) Installed Capacity NA N.A

20. RELATED PARTY TRANSACTION DISCLOSURE:

The related parties, as defined by Accounting Standard 18 'Related Party Disclosure' issued by the Institute of Chartered Accountants of India, in respect of which disclosure have been made, have been identified on the basis of disclosure made by the managerial persons and taken on record by the board.

We have identified all the related parties and transactions with all such information provided to you as under complete in all respects:

21 The Directors have given Interest Free Unsecured Loan to the Company.

Names of the related parties and descriptions of relationships

Mr. Pradeep Kumar Jain

Mr. Praveen Kumar Jain

Mr. Parmod Kumar Jain

Mr. Abhey Jain

Key Management Mr. Kishan Jain

Mr. RakeshGarg

personne Mr. SubhashOswal

Mr. Naveen Jain

Mr. Bikash Narayan Mishra

Mr. S. P. Chaturvedi

Ms. Monisha Company Secretary

Father of Director

Mr. Salek Chand Jain

Brother of Director

Mr. Vinod Kumar Jain

Wife of Director

Mrs. Veena Jain

Mrs. Rita Jain

Mrs. Asha Jain

Mrs. Monika Jain

Son of Director

Mr. Rishabh Jain

Mr. Ritesh Jain

Relatives of key

Mr. Parv Jain

2 management Daughter of Directors

personnel Mrs. Priyanka Jain

HUF of Father of Director

M/S Salek Chand Jain (HUF)

HUF of Brother of Director M/S Vinod Jain (HUF)

HUF of Directors

M/S Praveen Kumar Jain (HUF)

M/S Pramod Kumar Jain (HUF)

M/S Pradeep Kumar Jain (HUF)

M/S Abhay Jain (HUF)

Sister of Director Mrs. Shashi Jain

Firm of Brother in Law of Director

Johri Mal Kama! Kishore

22. SUNDRY CREDITORS:

As per the best available information with the company, No creditor has intimated their MSME status to us and accordingly there is no amount outstanding which is payable to small scale industrial undertaking.

Further the company raised claim on its suppliers for Quality/Quantity/Rate Issues and an amount of Rs. 13,94,87,714/- included in Short term Loan and Advances as Claim Receivables. The amounts have not been realised so far and Company is regularly following up with them and is hopeful of recovery, the same has been considered as good for recovery. No provision has been created and as such company will take necessary steps for realising/recovering/adjustment for the claim as and when settled and the unrecoverable amount shall be charged in the profit & Loss Accounts.

23. DEFERRED TAX LIABILITY:

In view of huge accumulated losses of the company and absence of virtual certainty regarding availability of future taxable income, the management has decided not to recognise any deferred tax assets for the year ended March 31,2015.

Further, as per the provisions of Accounting standard 22 Issued by The Institute of Chartered Accountant of India in the absence of virtual certainty of future taxable income and considering the losses, the existing deferred tax assets (net) of Rs 27,26,79,101 recognized in previous years has been derecognized in the current year.

24. IMPAIRMENT OF ASSETS

In accordance with Accounting Standard 28 'Impairment of Assets' issued by Institute of Chartered Accountants of India and made applicable from 1st day of April 2004, the company has assessed the potential generation of economic benefits from its business units as on the balance sheet date and is of the view that assets employed in continuing business are capable of generating adequate returns over their useful lives in the usual course of business: there is no indication to the contrary and accordingly, the management is of the view that no impairment provision is called for in these accounts.

25. SEGMENT REPORTING

The Company is having two segment Paper division and Hotel Division. The segment reporting of the company has been prepared in accordance with Accounting Standard - 17 'Accounting for Segment Reporting' issued by Institute of Chartered Accountants of India.

26. Primary -

The Company has considered Business segments as primary format for segment reporting, namely Paper Division & Hotel Division.

27.Geographical Segment

No Geographical segment reporting is required as per the Accounting Standard 17 issued by the Institute of Chartered Accountants of India.

28.PLEDGING OF SHARES

Presently the promoter of company has pledged the shares in favour of Lenders to the Company as Security to the tune of 70% of their shareholding in the Company. Further as per CDR 2nd Re-work package, balance 30% of their shareholding shall also be pledged and it is under process of pledging in favour of lenders.

29. CORPORATE DEBT RESTRUCTURING

The Company got approval from CDR EG for second rework vide LOA dated 30th December 2013. The Key Features of the re-work packages is as under:

30 Cut Off Date : 01st April 2013

b) Reduction in Interest Rate on Term Loans for Paper & Hotel Units, Additional WCTL and Working Capital Borrowings to 11.50% (base rate of MI 1.25%).

31 Reduction in Interest Rate on WCTL, FITL to 10.25% (base rate of MI).

32 Re-payment of principal for Paper Term Loans Rs. 36.58 Cr, PCC - Rs. 24.89 Cr, FITL - Rs. 21.40 Cr, WCTL - Rs. 8.81 Cr to be made in 40 structured quarterly instalments in 10 years commencing form 30.06.13 to 31.03.23.

33 Re-payment of principal for Hotel Loans - Rs. 126.75 Cr to be made in 52 structured quarterly instalments in 13 years commencing form 30.06.13 to 31.03.26.

34 Re-payment of Additional WCTL - Rs. 48.14 Cr to be made in 36 structured quarterly instalments in 13 years commencing form 30.06.14to 31.03.23.

35 Principal Instalment Repayments during the year are proposed to be serviced 10% in Qtr I, 15% in Qtr II, 40% in Qtr III and 35% in Qtr IV.

36 Funding of interest for April - June 2013 on Term Loan and WC Limits of Rs. 8.66 Cr as FITL and to be repaid in 5 years. Interest on FITL shall be 10.25% i.e. Base Rate of MI

37 Working Capital Limits of Rs. 46 Cr be Continue.

38 100% pledge of Promoter's Shareholding of the Company.

39. The Company to sell surplus land of Rs. 40 Cr approx and its sale proceeds estimated to be realized Rs. 12 Cr in FY 13-14; Rs. 15 Cr in FY 14-15; Rs. 7 Cr in FY 15-16 and Rs. 6 Cr in FY 16-17. 40 Promoters to bring in Rs. 9.93 Cr i.e. 25% of Sacrifice of Rs. 39.73 Cr, before implementation of package and Rs. 5 Cr p.a. from FY 2014-15 till all the loans are repaid in full.

41 Bank's Sacrifice: Total Bank's Sacrifice is Rs. 39.73 Cr out of which; Company will issue Zero Coupon Non Convertible Debentures of Rs. 34.12 Cr redeemable on 31.03.2026. These NCDs shall be secured by first pari- passu charge on fixed assets of the company and charge shall be created accordingly.

42. As per CDR Circular, the package should be implemented within 120 days i.e. by April 23, 2014 by all the banks without waiting for their individual sanctions for the re- structuring package. However banks wait for sanction from the authorities and the MRA &other documents were signed on 31st July 2014 and implementation of package in the system by Banks is pending at their end.

43. As per CDR package, Promoters has inducted Rs. 10.05 Cr against the stipulated contribution of Rs. 9.93 Cr before 31st March 2014.

44 As per CDR Package, promoters signed and submitted the documents to the lenders for pledging their balance 30% shareholding.

45. As per CDR Package, The company has to sell surplus land situated at A-35/1 and A-40/2 Sahibabad Industrial Area, Ghaziabad. The Company submitted request to UPSIDC for sub-division of plots in August 2014 and entered into agreement to sell with the parties to sell the plots after sub-division from UPSIDC and collected advance of Rs. 7.85 Cr during FY 13-14 & FY 14-15. The Sub-division of the plots is pending at UPSIDC and sales documents of these plots shall be executed after subdivision permission from UPSIDC.

46. As per CDR package, Non Convertible Debenture (Zero Coupon Bond) of Rs. 34.12 Cr has been issued by the company on 31st March 2014 in favour of lenders for their sacrifice repayable on 31st March 2026.

47. Further as per RBI Guideline & CDR Circular on Re-structuring, The Banks has to classify the re-structured account as sub-standard. Hence all banks categorized our account as sub-standard.

48. The Company recorded the interest (including the provision) on term loans and working capital as per interest rate stipulated in the CDR 2nd re-work package.

49. The Accumulated losses of the company as on March 31, 2015 are more than the net worth of the Company.

50. The Company had filed a case against Shree Laxmipati Balajee (Trader) for recovery of One Crore before the Honb'le District Court Ghaziabad, Uttar Pradesh u/s 138 of Negotiable Instrument Act, 1881.

51. Previous year figure have been regrouped and reclassified wherever considered necessary to make them comparable to those of the current year.

52. All other information required to be given is either Nil or Not applicable.

53. Figures in {brackets} pertain to the previous year.

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Mar 31, 2014

(A) OTHER NOTES

1. CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF THE FOLLOWING :

(a) CUSTOM AND CENTRAL EXCISE

i) The company had received a Show Cause Notice for claim of CENVAT CREDIT for the year 2006

and demand of Rs. 8,28,510 was raised. However, the matter was decided against the department by Honb''le CESTAT. Subsequent to which the Department filed a Writ Petition before the Hon''ble High Court Allahabad which is still pending.

ii) The Central Excise Department had issued Show Cause Notice (''SCN") 12/ADC/2007 for excess consumption of waste paper during April 2005 to September 2005 and demandof Rs. 20,97,503 was raised on the company. The company has filed an appeal against the SCNwhich is pending before the Additional Commissioner of Central Excise Ghaziabad till date.

iii) The Central Excise Department had issued Show Cause Notice for Non-payment of excise duty on waste, subsequently the company filed an appeal before the Additiontional Commissioner of Central Excise which was dismissed and following demands were raised upon the company

- Rs. 26,135 (Plus Interest and Penalty) for the period September 2010 to April 2011.

- Rs. 1, 73,115 (Plus Interest and Penalty) for the period February 2009 to August 2010.

- Rs. 1,58,816 (Plus Interest and Penalty) for the period F/Y 2004-05 to F/Y 2007-08.

However, the Company has filed an appealagainst the above order before Honb''le CESTAT which is still pending for adjudication.

(b) Sale Tax Department issued notice on July 5, 2013 and demand of

Rs. 91,437 was raised as Central Sale Tax for the financial year 2010-11.Companyhasfiled an appeal against the order before Additional Commissioner Appealwhich is pending for adjudication.

(C)EPCG LICENSE:- Under the EPCG scheme of the Government of India, the company imported capital goods for its Hotel Project during the year 2008-09 & 2009-10 at import duty rates less than the regular import duty rates and has saved import duty of equivalent INR Rs.6.38 Crores on import of capital goods and hence to fulfill an export obligation (including average basic export) in the next 8 year equal to Rs.51.04 crore.

During the year 2011-12, Paper Division utilized EPCG License 8.89 Lac on import of capital goods and hence to fulfill an export obligation (including average basic export) in the next 8 year equal to Rs.71.04 Lac.

Non- fulfillment of obligation will result into company liability to pay the duty so saved along with interest and such other sum as specified by the concerned authority.

2. Fixed assets installed and put to use have been certified by the management and relied upon by the auditors, being a technical matter. The Company capitalized Inward Freight of Capital Asset at the end of month.

4. In the opinion of the management, current assets, loans and advances are of the value stated if realised in the ordinary course of business except otherwise stated. The provision for all the known liabilities is adequate and not in excess of the amount considered reasonable.

5. During the year company has suffered loss & hence no provision for taxation has been made for the year ended 31.03.2014 in accordance with the provision of Income Tax Act, 1961.

6. The accounts of the parties are subject to their respective confirmation

8. INCREASE IN AUTHORISED CAPITAL

The Authorized Share Capital of the Company has been increased from Rs. 64,00,00,000 to 69,00,00,000 divided into 3,90,00,000 equity shares of Rs. 10/- each and 30,00,000 Preference Share of Rs. 100/- each.

9. ALLOTMENT OF ZERO COUPON NON-CONVERTIABLE DEBENTURES

During the year the Board of Directors of the Company had allotted 341200 Non-Convertible, Zero Coupon Non-Cumulative Redeemable Debentures of face value of Rs. 1000/- each at par payable on 31-03-2026 as per the CDR Terms and Conditions.

10. Additional information pursuant to the provision of paragraph 3, 4C and 4D of the schedule-VI to the Companies Act, 1956 (as certified by the management and relied upon by the Auditors)

11. RELATED PARTY TRANSACTION DISCLOSURE:

The related parties, as defined by Accounting Standard 18 ''Related Party Disclosure'' issued by the Institute of Chartered Accountants of India, in respect of which disclosure have been made, have been identified on the basis of disclosure made by the managerial persons and taken on record by the board.

We have identified all the related parties and transactions with all such information provided to you as under complete in all respects:

1 Key Management personnel

Mr. Pardeep Kumar Jain

Mr. Praveen Kumar Jain

Mr. Parmod Kumar Jain

Mr. Abhey Jain

Mr. Kishan Jain

Mr. RakeshGarg

Mr. SubhashOswal

Mr. Naveen Jain

Mr. Bikash Narayan Mishra

Mr. S. P. Chaturvedi

2 Relatives of key management personnel

Father of Director

Mr. Salek Chand Jain

Brother of Director

Mr. Vinod Kumar Jain

Wife of Director

Mrs. Veena Jain Mrs. Rita Jain Mrs. Asha Jain

Mrs. Monika Jain

Son of Director

Mr. Rishabh Jain Mr. Ritesh Jain Mr. Parv Jain

Daughter of Directors

Mrs. Priyanka Jain Ms. Shilpi Jain

HUF of Father of Director

M/S Salek Chand Jain (HUF)

HUF of Brother of Director

M/S Vinod Jain (HUF)

HUF of Directors

M/S Praveen Kumar Jain (HUF) M/S Pramod Kumar Jain (HUF) M/S Pradeep Kumar Jain (HUF) M/S Abhay Jain (HUF)

Sister of Director

Mrs. Shashi Jain

12. SUNDRY CREDITORS:

As per the best available information with the company there is no amount outstanding which is payable to small scale industrial undertaking.

13. DEFERRED TAX LIABILITY:

Deferred tax assets and liabilities are attributable to the following items:

14. IMPAIRMENT OF ASSETS

In accordance with Accounting Standard 28 ''Impairment of Assets'' issued by Institute of Chartered Accountants of India and made applicable from 1st day of April 2004, the company has assessed the potential generation of economic benefits from its business units as on the balance sheet date and is of the view that assets employed in continuing business are capable of generating adequate returns over their useful lives in the usual course of

15. SEGMENT REPORTING

The Company is having two segment Paper division and Hotel Division. The segment reporting of the company has been prepared in accordance with Accounting Standard – 17 ''Accounting for Segment Reporting'' issued by Institute of Chartered Accountants of India.

Primary –

The Company has considered Business segments as primary format for segment reporting, namely Paper Division & Hotel Division.

17. CORPORATE DEBT RESTRUCTURING

During the Year Company had requested for second rework proposal to CDR, and approved by CDR EG at its meeting on 24-12-2013. The package is under process of implementation by the individual bankers. The Key Features of the re-work packages is as under:

a) Cut Off Date : 01st April 2013

b) Reduction in Interest Rate on Term Loans for Paper & Hotel Units, Additional WCTL and Working Capital Borrowings to 11.50% (base rate of MI 1.25%).

c) Reduction in Interest Rate on WCTL, FITL to 10.25% (base rate of MI).

d) Re-payment of principal for Paper Term Loans Rs. 36.58 Cr, PCC – Rs. 24.89 Cr, FITL – Rs. 21.40 Cr, WCTL – Rs. 8.81 Cr to be made in 40 structured quarterly instalments in 10 years commencing form 30.06.13 to 31.03.23.

e) Re-payment of principal for Hotel Loans – Rs. 126.75 Cr to be made in 52 structured quarterly instalments in 13 years commencing form 30.06.13 to 31.03.26.

f) Re-payment of Additional WCTL – Rs. 48.14 Cr to be made in 36 structured quarterly instalments in 13 years commencing form 30.06.14to 31.03.23.

g) Principal Instalment Repayments during the year are proposed to be serviced 10% in Qtr I, 15% in Qtr II, 40% in Qtr III and 35% in Qtr IV.

h) Funding of interest for April – June 2013 on Term Loan and WC Limits of Rs. 8.66 Cr as FITL and to be repaid in 5 years. Interest on FITL.

i) Working Capital Limits of Rs. 46 Cr be Continue.

j) 100% pledge of Promoter''s Shareholding of the Company.

k) The Company to sell surplus land of Rs. 40 Cr approx and its sale proceeds estimated to be realized

Rs. 12 Cr in FY 13-14; Rs. 15 Cr in FY 14-15; Rs. 7 Cr in FY 15-16 and Rs. 6 Cr in FY 16-17.

l) Promoters to bring in Rs. 9.93 Cr i.e. 25% of Sacrifice of Rs. 39.73 Cr, before implementation of package and Rs. 5 Cr p.a. from FY 2014-15 till all the loans are repaid in full.

m) Bank''s Sacrifice: Total Bank''s Sacrifice is Rs. 39.73 Cr out of which; Company will issue Zero Coupon Non pokll Convertible Debentures of Rs. 34.12 Cr redeemable on 31.03.2026. These NCDs shall be secured by first pari-passu charge on fixed assets of the company and charge shall be created accordingly.

18. As per Section 3(1) (o) of the Sick Industrial Company Act, 1985 the company is not a sick industrial company as on 31st March 2014.

19. The Hotel Division of the Company is having exemption from payment of Luxury Tax for a period of 5 years from 05-11-2009

20. Previous year figure have been regrouped and reclassified wherever considered necessary to make them comparable to those of the current year.

21. All other information required to be given is either Nil or Not applicable.

22. Figures in {brackets} pertain to the previous year.

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Mar 31, 2013

1. Fixed assets installed and put to use have been certified by the management and relied upon by the auditors, being a technical matter.

2. In the opinion of the management, current assets, loans and advances are of the value stated if realised in the ordinary course of business except otherwise stated. The provision for all the known liabilities is adequate and not in excess of the amount considered reasonable.

3. During the year company has suffered loss & hence no provision for taxation has been made for the year ended 31.03.2013 in accordance with the provision of Income Tax Act, 1961.

4. The accounts of the parties are subject to their respective confirmation

5. Remuneration paid to the Directors of the company is as under:

6. RECLASSIFICATION OF AUTHORISED CAPITAL

The Authorised Share Capital of the Company is reclassified from Rs. 64,00,00,000 divided into 3,90,00,000 equity shares of Rs. 10/- each and 25,00,000 Preference Share of Rs. 100/- each.

7. ALLOTMENT OF PREFERENCE SHARES

During the year the Board of Directors of the Company had allotted 25,00,000 Non-Convertible, Non- Cumulative Redeemable Preference Shares of face value of Rs. 100/- each at par.

8. Additional information pursuant to the provision of paragraph 3, 4C and 4D of the schedule-VI to the Companies Act, 1956 (as certified by the management and relied upon by the Auditors)

I) Quantitative information with regard to the licensed & installed capacity, production & sales of paper manufactured by the company:

9. RELATED PARTY TRANSACTION DISCLOSURE:

Related party disclosures have been set out in separate statement annexed to this schedule. The related parties, as defined by Accounting Standard 18 ‘Related Party Disclosure'' issued by the Institute of Chartered Accountants of India, in respect of which disclosure have been made, have been identified on the basis of disclosure made by the managerial persons and taken on record by the board.

10. SUNDRY CREDITORS:

Sundry creditors include nil amounts due to small-scale industrial undertakings. The information regarding small scale industrial undertakings have been determined to the extent such parties have been identified on the basis of information available with the Company.

11. DEFERRED TAX LIABILITY:

Deferred tax assets and liabilities are attributable to the following items:

12. BORROWING COST

Borrowing Cost that are attributable to the acquisition or construction of qualifying assets are capitalised 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 revenue. Interest and other borrowing cost amounting Rs. Nil (Previous year Nil) have been capitalised to the carrying cost of fixed assets & Capital Work in Progress

13. In accordance with Accounting Standard 28 ‘Impairment of Assets'' issued by Institute of Chartered

Accountants of India and made applicable from 1st day of April 2004, the company has assessed the potential generation of economic benefits from its business units as on the balance sheet date and is of the view that assets employed in continuing business are capable of generating adequate returns over their useful lives in the usual course of business: there is no indication to the contrary and accordingly, the management is of the view that no impairment provision is called for in these accounts.

14. SEGMENT REPORTING

The Company is having two segment Paper division and Hotel Division. The segment reporting of the company has been prepared in accordance with Accounting Standard – 17 ‘Accounting for Segment Reporting'' issued by Institute of Chartered Accountants of India.

Primary –

The Company has considered Business segments as primary format for segment reporting, namely Paper Division & Hotel Division.

PLEDGING OF SHARES

The Promoter of Company has pledged the shares in favour of Lenders to the Company as Security to the tune of 70% of their shareholding in the Company.

CORPORATE DEBT RESTRUCTURING

Due to the worldwide recession in the Hotel industry the company has not been in a position to generate revenue as envisaged at the time of project financing. Therefore the company applied to CDR Cell and the account of the company is under CDR Mechanism since 01-04-2009. Since then the Company had two round of Debt restructuring with the protection of NPV (Net present Value) of future cash flows of interest and principal. The company is again approaching the bankers for certain reliefs and concessions and the rework proposal is under their active consideration.

15. As per Section 3(1)(o) of the Sick Industrial Company Act, 1985 the company is not a sick industrial company as on 31st March 2013.

16. Previous year figure have been regrouped and reclassified wherever considered necessary to make them comparable to those of the current year.

17. All other information required to be given is either Nil or Not applicable.

18. Figures in {brackets} pertain to the previous year.

Note 1 to 27 form an integral part of the Balance Sheet as at 31st March -2013 and have been authenticated as such.

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Mar 31, 2012

1. CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF THE FOLLOWING :

Name Nature of the Amount Period Present Status of the Dues (Rs.) Statue

Excise Excise Duty 2097503/- 2005-06 Addl. Law On Production Commissioner of Loss Excise Show Cause Notice pending not yet decided

With regard to 828510/- Hon'ble Allahabad amount of CENVAT High Court Credit of Rs.828510/- availed from the purchase made by the company, as the question on genuineness of the supplier is raised by the Department of Excise, for which the company has filed an appeal before the Custom Excise Service Tax Appellate Tribunal which was decided in favour of the Company vide order dated 02/06/06. The Commissioner of Custom & Central Excise, Ghaziabad has filed an appeal before Hon. High Court of Allahabad u/s 35-G of Central Excise Act.

Excise Duty on Kachra 158816/- 01-04-08 Matter pending Law (Waste) (Plus to before Tribunal 15-01-09 not yet decided Interest)

EPCG Under the EPCG scheme of the Government of India, the License company imported capital goods for its Hotel Project during the year 2008-09 & 2009-10 at import duty rates less than the regular import duty rates and has saved import duty of equivalent INR Rs.6.38 Crore on import of capital goods and hence to fulfill an export obligation (including average basic export) in the next 8 year equal to Rs.51.04 crore.

During the year 2011-12, Paper Division utilized EPCG License 8.89 Lac on import of capital goods and hence to fulfill an export obligation (including average basic export) in the next 8 year equal to Rs.71.04 Lac. Non- fulfillment of obligation will result into company liability to pay the duty so saved along with interest and such other sum as specified by the concerned authority.

Income A Search and seizure operation was conducted on January 18, Tax 2007 by the Income Tax Department u/s 132 of the Income Tax Act, 1961 on the company's administration and production facilities at 18/31 and 18/41,site IV, Industrial Area, Sahibabad, Ghaziabad; and the residence of the promoters

at 113/3, Daryaganj, New Delhi & survey operation was conducted u/s 133A of the Income Tax Act, 1961 on the Company's Properties at A-35/1, A-40/2, and 64/6, Site IV, Industrial Area, Sahibabad, Ghaziabad. The Assessment has been completed with addition of Rs. 15.95 Crores. The CIT (Appeal) vide its order dated 13-12-2010 has deleted the addition to the tune of Rs. 15.17 Crore. For the balance addition of Rs. 0.78 Crore, the company has filed an appeal before Hon'ble ITAT, Delhi.

2. Fixed assets installed and put to use have been certified by the management and relied upon by the auditors, being a technical matter. Capital Work in Progress includes advances for capital assets Rs.Nil (previous year Nil)

3. In the opinion of the management, current assets, loans and advances are of the value stated if realised in the ordinary course of business except otherwise stated. The provision for all the known liabilities is adequate and not in excess of the amount considered reasonable.

4. During the year company has suffered loss & hence no provision for taxation has been made for the year ended 31.03.2012 in accordance with the provision of Income Tax Act, 1961.

5. The accounts of the parties are subject to their respective confirmation

6. Remuneration paid to the Directors of the company is as under:

Particular Current Year Last Year

Remuneration Paid Nil Nil

7. RIGHT ISSUE

The Board of Directors of the company in its meeting held on 13th August 2010 had discussed and approved for rising of funds by the Company by way of issue of shares or any other securities however the company had deferred the right issue for the time being.

8. Additional information pursuant to the provision of paragraph 3, 4C and 4D of the schedule-

VI to the Companies Act, 1956 (as certified by the management and relied upon by the Auditors)

9. RELATED PARTY TRANSACTION DISCLOSURE:

Related party disclosures have been set out in separate statement annexed to this schedule. The related parties, as defined by Accounting Standard 18 'Related Party Disclosure' issued by the Institute of Chartered Accountants of India, in respect of which disclosure have been made, have been identified on the basis of disclosure made by the managerial persons and taken on record by the board.

10. SUNDRY CREDITORS:

Sundry creditors include nil amounts due to small-scale industrial undertakings. The information regarding small scale industrial undertakings have been determined to the extent such parties have been identified on the basis of information available with the Company.

11. BORROWING COST

Borrowing Cost that are attributable to the acquisition or construction of qualifying assets are capitalised 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 revenue. Interest and other borrowing cost amounting Rs. Nil (Previous year Nil) have been capitalised to the carrying cost of fixed assets & Capital Work in Progress

12. In accordance with Accounting Standard 28 ‘Impairment of Assets' issued by Institute of

Chartered Accountants of India and made applicable from 1st day of April 2004, the company has assessed the potential generation of economic benefits from its business units as on the balance sheet date and is of the view that assets employed in continuing business are capable of generating adequate returns over their useful lives in the usual course of business: there is no indication to the country and accordingly, the management is of the view that no impairment provision is called for in these accounts.

13. SEGMENT REPORTING

The Company is maintaining separate records for Manufacturing of Duplex Board & Writing Printing Paper and News Prints.

The segment reporting of the company has been prepared in accordance with Accounting Standard - 17 ‘Accounting for Segment Reporting' issued by Institute of Chartered Accountants of India.

Primary -

The Company has considered Business segments as primary format for segment reporting, namely Paper Division & Hotel Division.

Geographical Segment

No Geographical segment reporting is required as per the Accounting Standard 17 issued by the Institute of Chartered Accountants of India.

14. Sundry Debtors and creditors are subject to the confirmations

15. Note to Schedule III of the Balance Sheet (Security for the Term Loans & Working Capital)

Paper Division

a Working Capital Limit First charge by way of hypothecation of raw materials, stock in process, finished goods, receivables & other current assets of the Paper Division ranking pari-passu basis with the consortium members (OBC,PNB, SYB, IOB & Allahabad Bank).

b Term Loan First charge on the entire fixed assets of the Paper Division present & future (Excluding PCC) ranking on pari-passu basis. (OBC, PNB, SYB, IOB & Allahabad Bank, Vijaya Bank).

c Term Loan PCC Exclusive charge on all PCC project assets in favour of Syndicate Bank. Collateral Pari-Passu second charge on the entire fixed assets of the company (present & future) along with other consortium member banks.

Hotel Division

a Term Loan First charge on present/future blocks assets of Hotel division ranking pari-passu with other lenders of the project. (OBC, PNB, SYB, IOB & Allahabad Bank, Vijaya Bank).

Collateral

a Working capital facilities shall be collaterally secured by way of Second Charge on entire fixed assets (present & future) of the company on pari-passu basis with the members of consortium. First charge against these assets shall continue with term lending banks.

b Term loan facilities shall be collaterally secured by way of Second Charge on entire current assets (present & future) of the company on pari-passu basis with the members of consortium. First charge against these assets shall continue with working capital lender banks.

Pledging of Shares

The Promoter of Company has pledged the shares in favour of Lenders to the Company as Security to the tune of 70% of their shareholding in the Company.

16. Previous year figure have been regrouped and reclassified wherever considered necessary to make them comparable to those of the current year.

17. All other information required to be given is either Nil or Not applicable.

18. Figures in brackets pertain to the previous year.

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Mar 31, 2010

1.CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF THE FOLLOWING

Name of the Statue Nature of the Dues Amount (Rs.) Period Present Status

Excise Law Excise DutyOn Production Loss 2097503/- 2005-06 Addl. Commissioner

of Excise With regard to amount of CENVAT 828510/- Honble Allahabad

Credit of Rs.828510/- availed from the High Court purchase made by the company, as the question on genuineness of the supplier is raised by the Department of Excise, for which the company has filed an appeal before the Custom Excise Service Tax Appellate Tribunal which was decided in favour of the Company vide order dated 02/06/06. The Commissioner of Custom & Central Excise, Ghaziabad has filed an appeal before Hon. High Court of Allahabad u/ s 35-G of Central Excise Act.

Central Sales Commercial Tax 617083/- 1996-1997 Honble Allahabad

Tax Laws The Company has filed writ petition on High Court

08.01.2004 with Hon. High Court stay granted

Allahabad against the process of re- on 08-01-04

assessment in pursuance of the notice dated 25.11.2003 under section 21 of the U.P. Trade Tax Act for quashing the circular of CST/ UP dated 25.01.2003 regarding non inclusion of stock transfer in achieving Base Production U/s 4A . Hon. High Court has granted stay on 08.01.2004.

The Company has been purchasing diesel oil against Form 3B on concessional rate of tax @ 2.50 %. The Commissioner (Trade Tax) issued a Circular denying the concessional rate of tax to the industry using diesel oil for generating the power, the company and other companies filed Writ Petition in Honble Allahabad High Court against the State of UP to quash the Circular that was decided in favor of the company and other Petitioners. The State of UP filed an appeal before the Honble SC of India against order of Honble HC of Allahabad. The Management of the Company is not actively pleading the case in Honble SC as there are a number of other respondent also.

EPCG License

Under the EPCG scheme of the Government of India, the company imported capital goods for its Hotel Project during the year 2008-09 & 2009-10 at import duty rates less than the regular import duty rates and has saved import duty of equivalent INR Rs.6.38 Crore on import of capital goods and hence to fulfill un export obligation (including average basic export) in the next 8 year equal to Rs.51.06 Crore, this includes Export obligation of Rs. 0.63 Lac for Paper division. Non- fulfillment of obligation will result into company liability to pay the duty so saved along with interest and such other sum as specified by the concerned authority.

Name of the Statue Nature of the Dues Amount (Rs.) Period Present Status

Excise Law Excise DutyOn Production Loss 2097503/- 2005-06 Addl. Commiss- ioner of Excise

Income Tax

A Search and seizure operation was conducted on January 18, 2007 by the Income Tax Department u/s 132 of the Income Tax Act, 1961 on the companys administration and production facilities at 18/31 and 18/41, site IV, Industrial Area, Sahibabad, Ghaziabad; and the residence of the promoters at 113/3, Daryaganj, New Delhi & survey operation was conducted u/s 133A of the Income Tax Act, 1961 on the Companys Properties at A-35/1, A-40/2, and 64/6, Site IV, Industrial Area, Sahibabad, Ghaziabad. The Assessment has been completed raising a Demand of Rs. 9.98 Crores. The demand has been raised without considering the Advance Tax, Self Assessment Tax of Rs. 2.27 Crores for which a rectification u/s 154 has been filed and for balance demand the Company had filed an appeal before the CIT (Appeal).

2. Fixed assets installed and put to use have been certified by the management and relied upon by the auditors, being a technical matter. Capital Work in Progress includes advances for capital assets Rs.3409843.53 (previous year 446719600).

3. In the opinion of the management, current assets, loans and advances are of the value stated if realised in the ordinary course of business except otherwise stated. The provision for all the known liabilities is adequate and not in excess of the amount considered reasonable.

4. During the year company has suffered loss & hence no provision for taxation has been made for the year ended 31.03.2010 in accordance with the provision of Income Tax Act, 1961.

5. The accounts of the parties are subject to their respective confirmation During the year the Company is having inadequacy of Profit/Loss U/s 309(5)/198/349. The Company is having Losses during the year the remuneration is provided in accordance with Part II of Schedule XIII of the Companies Act, 1956.

6. RIGHT ISSUE The Board of Directors of the company in its meeting held on 26th June 2008 had discussed and approved for rising of funds by the Company by way of issue of shares or any other securities.

7. Additional information pursuant to the provision of paragraph 3, 4C and 4D of the schedule-VI to the Companies Act, 1956 (as certified by the management and relied upon by the Auditors).

8. RELATED PARTY TRANSACTION DISCLOSURE:

Related party disclosures have been set out in separate statement annexed to this schedule. The related parties, as defined by Accounting Standard 18 ‘Related Party Disclosure issued by the Institute of Chartered Accountants of India, in respect of which disclosure have been made, have been identified on the basis of disclosure made by the managerial persons and taken on record by the board.

9. SUNDRY CREDITORS:

Sundry creditors include nil amounts due to small-scale industrial undertakings. The information regarding small scale industrial undertakings have been determined to the extent such parties have been identified on the basis of information available with the Company.

In the opinion of the management the company expects to generate taxable income in the coming years, which would enable it to utilize the unabsorbed depreciation.

10. BORROWING COST

Borrowing Cost that are attributable to the acquisition or construction of qualifying assets are capitalised 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 revenue. Interest and other borrowing cost amounting Rs.133337754/- (Previous year Rs.90181429/-) have been capitalised to the carrying cost of fixed assets & Capital Work in Progress.

11. In accordance with Accounting Standard 28 ‘Impairment of Assets issued by Institute of Chartered Accountants of India and made applicable from 1st day of April 2004, the company has assessed the potential generation of economic benefits from its business units as on the balance sheet date and is of the view that assets employed in continuing business are capable of generating adequate returns over their useful lives in the usual course of business: there is no indication to the country and accordingly, the management is of the view that no impairment provision is called for in these accounts.

12. SEGMENT REPORTING

The segment reporting of the company has been prepared in accordance with Accounting Standard – 17 Accounting for Segment Reporting issued by Institute of Chartered Accountants of India.

Primary -

The Company has considered Business segments as primary format for segment reporting, namely Paper Division & Hotel Division.

Geographical Segment

No Geographical segment reporting is required as per the Accounting Standard 17 issued by the Institute of Chartered Accountants of India.

13. Sundry Debtors and creditors are subject to the confirmations

14. Note to Schedule III of the Balance Sheet (Security for the Term Loans & Working Capital) Paper Division a Working Capital Limit First charge by way of hypothecation of raw materials, stock in process, finished goods, receivables & other current assets of the Paper Division ranking pari-passu basis with the consortium members (OBC, PNB, SYB, IOB & Allahabad Bank).

b. Term Loan

First charge on the entire fixed assets of the Paper Division present & future (Excluding PCC) ranking on pari-passu basis. (OBC, PNB, SYB, IOB & Allahabad Bank, Vijaya Bank).

c Term Loan PCC

Exclusive charge on all PCC project assets in favour of Syndicate Bank. Collateral Pari-Passu second charge on the entire fixed assets of the company (present & future) along with other consortium member banks.

Hotel Division

a Term Loan

First charge on present/future blocks assets of Hotel division ranking pari-passu with other lenders of the project. (OBC, PNB, SYB, IOB & Allahabad Bank ,Vijaya Bank).

ollateral a Working capital facilities shall be collaterally secured by way of Second Charge on entire fixed assets (present & future) of the company on pari-passu basis with the members of consortium. First charge against these assets shall continue with term lending banks. b Term loan facilities shall be collaterally secured by way of Second Charge on entire current assets (present & future) of the company on pari-passu basis with the members of consortium. First charge against these assets shall continue with working capital lender banks.

15. Previous year figure have been regrouped and reclassified wherever considered necessary to make them comparable to those of the current year.

16. All other information required to be given is either Nil or Not applicable.

17. Figures in brackets pertain to the previous year. Schedule I to XIX form an integral part of the Balance Sheet as at 31st March -2010 and have been authenticated as such.

Note: Names of the related parties and descriptions of relationships

1. Key Management personnel

Mr. Pardeep Kumar Ja Mr. Praveen Kumar Ja Mr. Parmod Kumar Jai Mr. Vinod Jain Mr. Abhey Jain Mr. Kishan Jain Mr. Rakesh Garg Mr. Subhash Oswal Mr. Naveen Jain Mohd Sahid Aftab

2. Relatives of key management personnel

Mr. Salek Chand Jain

Mrs. Asha Jain

Mr. Rishabh Jain

Mr. Ritesh Jain

Mrs. Monika Jain

Mrs. Rita Jain

Mrs. Veena Jain

Mrs. Priyanka Jain

Ms. Shilpi Jain

Mr. Parv Jain

M/S Praveen Kumar Jain (HUF)

M/S Pramod Kumar Jain (HUF)

M/S Pradeep Kumar Jain (HUF)

M/S Vinod Jain (HUF)

M/S Abhay Jain (HUF)

M/S Salek Chand Jain (HUF)