Notes to Accounts of Majestic Auto Ltd.

Mar 31, 2025

s) Provisions, contingent liabilities and contingent assets

A provision is recognised when the Group has a present
obligation as a result of past event, it is probable that an
outflow of resources embodying economic benefits will be
required to settle the obligation and a reliable estimate can
be made of the amount of the obligation. Provisions

determined based on the best estimate required to settle
the obligation at the reporting date and adjusted to reflect
the current best estimates.

Provisions are discounted to their present values, where the
time value of money is material.

Contingent liabilities are disclosed on the basis of judgement
of management after a careful evaluation of facts and legal
aspects of matter involved.

Contingent assets are disclosed when probable and
recognised when the realization of income is virtually
certain.

1.4 Significant management judgments in applying accounting
policies and estimation uncertainty

The preparation of the Company''s financial statements requires
management to make judgments, estimates and assumptions
that affect the reported amounts of revenues, expenses, assets
and liabilities and the related disclosures.

Significant management judgments

Recognition of deferred tax assets - The extent to which deferred
tax assets can be recognized is based on an assessment of the
probability of the future taxable income against which the
deferred tax assets can be utilised.

Provisions, contingent liabilities and contingent assets - The

Company is the subject of legal proceedings and tax issues
covering a range of matters, which are pending in various
jurisdictions. Due to the uncertainty inherent in such matters, it
is difficult to predict the final outcome of such matters. The cases
and claims against the Company often raise difficult and complex
factual and legal issues, which are subject to many uncertainties,
including but not limited to the facts and circumstances of each
particular case and claim, the jurisdiction and the differences in
applicable law. In the normal course of business, management
consults with legal counsel and certain other experts on matters
related to litigation and taxes. The Company accrues a liability
when it is determined that an adverse outcome is probable and
the amount of the loss can be reasonably estimated.

Impairment of financial assets - At each balance sheet date,
based on historical default rates observed over expected life, the
management assesses the expected credit loss on outstanding
financial assets.

Evaluation of indicators for impairment of assets - The

evaluation of applicability of indicators of impairment of assets
requires assessment of several external and internal factors which
could result in deterioration of recoverable amount of the assets.

Significant estimates

Useful lives of depreciable/amortisable assets - Management
reviews its estimate of the useful lives of depreciable/amortisable
assets at each reporting date, based on the expected utility of
the assets. Uncertainties in these estimates relate to technical
and economic obsolescence that may change the utility of certain
software, IT equipment and other plant and equipment.

Defined benefit obligation - Management''s estimate of the DBO
is based on a number of critical underlying assumptions such as
standard rates of inflation, mortality, discount rate and
anticipation of future salary increases. Variation in these
assumptions may significantly impact the DBO amount and the
annual defined benefit expenses.

Fair value measurements

Management applies valuation techniques to determine the fair
value of financial instruments (where active market quotes are
not available). This involves developing estimates and
assumptions consistent with how market participants would price
the instrument.

Valuation of investment property

Investment property is stated at cost. However, as per Ind AS 40
there is a requirement to disclose fair value as at the balance
sheet date. The Company engaged independent valuation
specialists to determine the fair value of its investment property
as at reporting date. The determination of the fair value of
investment properties requires the use of estimates such as
future cash flows from the assets (such as lettings, future revenue
streams, capital values of fixtures and fittings, any environmental
matters and the overall repair and condition of the property)
and discount rates applicable to those assets. In addition,
development risks (such as construction and letting risk) are also
taken into consideration when determining the fair value of the
properties under construction. These estimates are based on local
market conditions existing at the balance sheet date.

Impairment of Property, plant and equipment

Impairment exists when the carrying value of an asset or cash
generating unit exceeds its recoverable amount, which is the
higher of its fair value less costs of disposal and its value in use.
The value in use calculation is based on a DCF model. The cash
flows are derived from the budgets. The recoverable amount is
sensitive to the discount rate used for the DCF model as well as
the expected future cash-inflows and the growth rate used.

Other equity

(i) Nature and purpose of other reserves
General reserve

General reserve is created out of the accumulated profits of the Company as per the provisions of Companies Act.

Retained earnings

All the profits made by the Company are transferred to retained earnings from statement of profit and loss.

Securities premium reserve

Securities premium reserve represents the amount received in excess of par value of securities (equity shares). Premium on redemption of
securities is accounted in security premium available. Where security premium is not available, premium on redemption of securities is
accounted in statement of profit and loss. Section 52 of Companies Act, 2013 specify restriction and utilisation of security premium.
Other comprehensive income

Other comprehensive income represents balance arising on account of changes in fair value of FVOCI equity instruments and gain/(loss)
booked on re-measurement of defined benefit plans.

Financial instruments by category
(i) Fair values hierarchy

Financial assets and financial liabilities measured at fair value in the statement of financial position are companied into three Levels of a
fair value hierarchy. The three levels are defined based on the observability of significant inputs to the measurement, as follows:

Level 1: Quoted prices (unadjusted) in active markets for financial instruments.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which
maximise the use of observable market data rely as little as possible on entity specific estimates.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

The management assessed that cash and cash equivalents, trade receivables, other receivables, trade payables and other current financial
liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments. The fair value of the financial
assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing
parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values:

(i) Long-term fixed-rate and variable-rate receivables are evaluated by the Company based on parameters such as interest rates, individual
creditworthiness of the customer and other market risk factors. Based on this evaluation, allowances are taken into account for the
expected credit losses of these receivables.

(ii) The fair values of the Company''s interest-bearing borrowings, loans and receivables are determined by applying discounted cash
flows (''DCF'') method, using discount rate that reflects the issuer''s borrowing rate as at the end of the reporting period. The own non¬
performance risk as at 31 March 2025 was assessed to be insignificant.

Note - 31

Financial risk management

The Company''s activities expose it to credit risk, liquidity risk and market risk. The Company''s board of directors has overall responsibility
for the establishment and oversight of the Company''s risk management framework. This note explains the sources of risk which the entity
is exposed to and how the entity manages the risk and the related impact in the financial statements.

(A) Credit risk

Credit risk is the risk that a counterparty fails to discharge its obligation to the Company. The Company''s exposure to credit risk is influenced
mainly by cash and cash equivalents, trade receivables and financial assets measured at amortised cost. The Company continuously monitors
defaults of customers and other counterparties and incorporates this information into its credit risk controls.
a) Credit risk management

i) Credit risk rating

The Company assesses and manages credit risk of financial assets based on following categories arrived on the basis of assumptions,
inputs and factors specific to the class of financial assets. The Company assigns the following credit ratings to each class of financial assets
based on the assumptions, inputs and factors specific to the class of financial assets.

A: Low
B: Medium
C: High

The Company provides for expected credit loss based on the following:

(B) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are
settled by delivering cash or another financial asset. The Company''s approach to managing liquidity is to ensure as far as possible, that it
will have sufficient liquidity to meet its liabilities when they are due.

Management monitors rolling forecasts of the Company''s liquidity position and cash and cash equivalents on the basis of expected cash
flows. The Company takes into account the liquidity of the market in which the entity operates.

Maturities of financial liabilities

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

Note - 33

Related party transactions

In accordance with the requirements of Ind AS 24 the names of the related party where control exists/ able to exercise significant influence
along with the aggregate transactions and year end balances with them as identified and certified by the management are given below:
i) Parties where control exists:

(a) Holding Company:

- M/s Anadi Investments Private Limited

(b) Subsidiary:

- Majestic IT Services Limited

- Emirates Technologies Private Limited

(c) Key Management Personnel (KMP) and their Relatives:

- Mr. Mahesh Munjal (Managing Director)

- Mr. Aayush Munjal (Joint Managing director)

- Mr. Anil Kumar Sharma (Independent Director)

- Mr. Rajesh Kumar Yaduvanshi (Independent Director)

- Ms. Ayushi Jain (Director)

- Mr. Tripurari Pandey (Independent Director) w.e.f 8th February 2024

- Mr. Ajay Kumar (Chief Financial Officer) w.e.f 08th August 2024

- Ms. Parul Chadha (Company Secretary)

- Mr. Prateek Garg (Independent Director) retired w.e.f 17th April 2024

- Mr. Rajpal Singh Negi (Chief Financial Officer) resign w.e.f 22nd May 2024

- Mr. Kartik Khandelwal (Company secretary of subsidiary company) resign w.e.f 15th September 2023

- Mrs. Renuka Munjal (wife of Managing Director)

¹Due to increase in current liabilities (increase in Advance from customer)

²Due to decrease in borrowing (repayment during the current year)

³Due to decrease in profit and increase in principal repayment of non-current borrowings.

⁴Due to decrease in profit (decrease in total income)

⁵Due to decrease in revenue from operations
⁶Due to decrease in trade payables

⁷Due to decrease in income generated from invested funds

Note - 40

Other disclosures

(a) Relationship with Struck off Companies - The Company does not have any transactions or relationships with any companies struck off
under Section 248 of the Companies Act, 2013 or Section 560 of the Companies Act, 1956.

(b) There are no transactions that have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax
Act, 1961 which have not been recorded in the books of account.

(c) There are no charges or satisfaction of charges yet to be registered with Registrar of Companies beyond the statutory period.

For Hari S & Associates For and on behalf of Majestic Auto Limited

Chartered Accountants

Firm Registration No. 007709N

Kapil Vohra (Ajay Kumar) (Mahesh Munjal)

Partner Chief Financial Officer Managing Director

Membership No. 523735 Place: Delhi DIN-00002990

Place: Delhi Place: Delhi

(Parul Chadha) (Dr. Rajesh Kumar Yaduvanshi)

Company Secretary Director

Date : 26 May 2025 M. No. A50171 DIN-07206654

Place: Delhi Place: Delhi

---

Mar 31, 2018

Note - 1

Other equity (i) Nature and purpose of other reserves

General reserve

General reserve is created out of the accumulated profits of the Company as per the provisions of Companies Act. Retained earnings

All the profits made by the Company are transferred to retained earnings from statement of profit and loss.

Securities premium reserve

Securities premium reserve represents the amount received in excess of par value of securities (equity shares). Premium on redemption of securities is accounted in security premium available. Where security premium is not available, premium on redemption of securities is accounted in statement of profit and loss. Section 52 of Companies Act, 2013 specify restriction and utilisation of security premium.

Other comprehensive income

Other comprehensive income represents balance arising on account of changes in fair value of FVOCI equity instruments and gain/(loss) booked on re-measurement of defined benefit plans.

Nature of security

(i) The secured working capital loans from banks are secured by hypothecation of stock in trade and book debts and other current assets of the Company both present and future on pari-passu basis and also secured by second pari-passu charge on the immovable properties and entire fixed assets (both present and future) of the Company. These loans are further secured by personal guarantee of Managing Director of the Company.

(ii) The secured working capital loans are secured by subservient charge on all the current assets and movable fixed assets of the borrower (both present and future) of the Company. These loans are further secured by personal guarantee of Managing Director of the Company.

* Changes in tax rate

The reduction of the Indian corporate tax rate from 30% to 25% is effective from 1 April 2018. As a result, the relevant deferred tax balances have been remeasured. Deferred tax expected to reverse in the year to 31 March 2019 has been measured using the effective rate that will apply in India for the period (25%).

The impact of the change in tax rate has been recognised in tax expense of statement of profit or loss, except to the extent that it relates to items previously recognised outside the statement of profit or loss.

Note - 2

Discontinued operations

(i) Description

Pursuant to official notification issued on Bombay Stock Exchange (“BSE”) dated 2 August 2017 and 7 September 2017 for electrical motor business of its “Electricals” division and official notification issued on Bombay Stock Exchange (“BSE”) dated 5 October 2017 for fine blanking components business of its “Fine blanking components” division, the Company has discontinued both the divisions due to lack of viable orders, profitability and capital investment requirements for new technology. Consequently, revenue and expenses, gains and losses relating to the discontinuation of these divisions have been eliminated from profit or loss from the Company’s continuing operations and are shown as a single line item in the statement of profit or loss.

(ii) The fair values of the Company’s interest-bearing borrowings, loans and receivables are determined by applying discounted cash flows (‘DCF’) method, using discount rate that reflects the issuer’s borrowing rate as at the end of the reporting period. The own nonperformance risk as at 31 March 2018 was assessed to be insignificant.

Note - 3

Financial risk management

The Company’s activities expose it to credit risk, liquidity risk and market risk. The Company’s board of directors has overall responsibility for the establishment and oversight of the Company’s risk management framework. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the related impact in the financial statements.

(A) Credit risk

Credit risk is the risk that a counterparty fails to discharge its obligation to the Company. The Company’s exposure to credit risk is influenced mainly by cash and cash equivalents, trade receivables and financial assets measured at amortised cost. The Company continuously monitors defaults of customers and other counterparties and incorporates this information into its credit risk controls.

(a) Credit risk management

(i) Credit risk rating

The Company assesses and manages credit risk of financial assets based on following categories arrived on the basis of assumptions, inputs and factors specific to the class of financial assets. The Company assigns the following credit ratings to each class of financial assets based on the assumptions, inputs and factors specific to the class of financial assets.

A: Low B: Medium C: High

Life time expected credit loss is provided for trade receivables.

Based on business environment in which the Company operates, a default on a financial asset is considered when the counter party fails to make payments within the agreed time period as per contract. Loss rates reflecting defaults are based on actual credit loss experience and considering differences between current and historical economic conditions.

Assets are written off when there is no reasonable expectation of recovery, such as a debtor declaring bankruptcy or a litigation decided against the Company. The Company continues to engage with parties whose balances are written off and attempts to enforce repayment. Recoveries made are recognised in statement of profit and loss.

ii) Concentration of trade receivables

The Company’s exposure to credit risk for trade receivables is presented as below. Loans and other financial assets majorly represents loans to employees and deposits given for business purposes.

(ii)Expected credit loss for trade receivables under simplified approach

The Company’s trade receivables pertaining to income from sale of products and services has higher credit risk and accordingly allowance for expected credit loss is created using provision matrix approach.

(B) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach to managing liquidity is to ensure as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due.

Management monitors rolling forecasts of the Company’s liquidity position and cash and cash equivalents on the basis of expected cash flows. The Company takes into account the liquidity of the market in which the entity operates.

© Market risk

(I) Foreign exchange risk

The Company has international transactions and is exposed to foreign exchange risk arising from foreign currency transactions (imports and exports). Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the company’s functional currency. The Company does not hedge its foreign exchange receivables/payables.

(ii) Interest rate risk Liabilities

The Company’s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.

The Company’s variable rate borrowing is subject to interest rate. Below is the overall exposure of the borrowing:

(iii) Price risk

The Company’s exposure to price risk arises from investments held and classified as FVOCI. To manage the price risk arising from investments, the Company diversifies its portfolio of assets.

Sensitivity analysis

Profit or loss and equity is sensitive to higher/lower prices of instruments on the Company’s profit for the year -

Note - 4

Capital management Risk management

The Company’s objectives when managing capital are to

- Safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and

- Maintain an optimal capital structure to reduce the cost of capital.

The Company monitors capital on the basis of the carrying amount of equity less cash and cash equivalents as presented on the face of balance sheet.

The Company manages its capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares.

Note - 5

Related party transactions

In accordance with the requirements of Ind AS 24 the names of the related party where control exists/ able to exercise significant influence along with the aggregate transactions and year end balances with them as identified and certified by the management are given below:

i) Parties where control exists:

(a) Holding Company:

- M/s Anadi Investments Private Limited

(b) Subsidiary:

- Majestic IT Services Limited

- Emirates Technologies Private Limited

(c) Key Management Personnel (KMP) and their Relatives:

- Mr. Mahesh Munjal (Managing Director)

- Ms. Aashima Munjal (Joint Managing Director)

- Mr. Aayush Munjal (Whole Time Director)

- Ms. Juhi Garg (Company Secretary) with effect from 3rd October 2017

- Mr. Rahul Tiwari (Company Secretary) till 30th August 2017

- Mr. Rajpal Singh Negi (Chief Financial Officer) with effect from 14th November 2017

- Mr. Prakash Chander Patro (Chief Financial Officer) till 30th August 2017

- Mr. Vikas Nanda (Independent Director) with effect from 14th February 2017

- Mr. Mohamad Abdul Zahir (Independent Director)

- Mr. Shavinder Singh Khosla (Independent Director)

- Mr. G.P. Sood (Independent Director) till 14th February 2017

(d) Enterprises over which Key Management Personnel is able to exercise significant influence with whom transactions has been undertaken:

- M/s Munjal Showa Limited

- M/s OK Hosiery Mills Private Limited

Excise duty/sales tax paid under protest amounting to Rs. 4.02 lakhs (previous years 31 March 2017 and 1 April 2016: Rs. 3.51 lakhs and Rs. 3.51 lakhs respectively) is appearing under the head balance with government authorities.

(a) It is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above pending resolution of the respective proceedings.

(b) The Company does not expect any reimbursement in respect of the above contigent liabilities.

(c) Future cash outflows in respect of the above are determinable only on receipt of judgements/decisions pending with various forums/authorties.

Note - 6

Leases disclosure as lessee Operating leases

The Company has taken on lease certain assets with lease term of 3 months, which are subject to renewal at mutual consent thereafter. These arrangements can be terminated by either party after giving due notice. The other information pursuant to Ind AS 17 is given hereunder:

Note - 7

Disclosures as per Indian Accounting Standard (Ind AS) 108 “Operating Segments”

a) Operating segments

Management currently identifies the Company’s three service lines as its operating segments as follows:

Fine blanking components Electricals

Facility management services During the year ended 31 March 2018, Company has discontinued the ‘Fine Blanking Components’ and ‘Electrical’ operations and have included in Discontinued Operations.

b) Segment revenue and expenses

Revenue and expenses directly attributable to the segment is considered as ‘Segment Revenue and Segment Expenses’.

c) Segment assets and liabilities

Segment assets and liabilities include the respective directly identifiable to each of the segments.

These operating segments are monitored by the Company’s chief operating decision maker and strategic decisions are made on the basis of segment operating results. Segment performance is evaluated based on the profit of each segment.

The following tables presen

t revenue and profit information and certain asset and liability information regarding the Company’s reportable segments for the years ended 31 March 2018 and 31 March 2017.

Geographical information

The operations of the Company are mainly carried out in India and therefore, geographical information is not disclosed. Information about major customer

During the year ended 31 March 2018 revenue of approximately 38.49% (previous year 31 March 2017: 46.41%) are derived from a single external customer under ‘Electrical Segment’.

B First time adoption of Ind AS

These are the Company’s first financial statements prepared in accordance with Ind AS.

The accounting policies have been applied in preparing the financial statements for the year ended 31 March 2018, the comparative information presented in these financial statements for the year ended 31 March 2017 and in the preparation of an opening Ind AS balance sheet at 1 April 2016 (the Company’s date of transition). An explanation of how the transition from previous GAAP to Ind AS has affected the Company’s financial position, financial performance and cash flows is set out in the following tables and notes.

C Ind AS optional exemptions

1 Deemed cost for property, plant and equipment and intangible assets

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

2 Designation of previously recognised financial instruments

Ind AS 101 allows an entity to designate investments in equity instruments at FVOCI on the basis of the facts and circumstances at the date of transition to Ind AS. The Company has elected to apply this exemption for its investment in equity investments.

D Ind AS mandatory exemptions 1 Estimates

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

Ind AS estimates as at 1 April 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP The Company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under previous GAAP:

a) Investment in equity instruments carried at FVTPL or FVOCI

b) Impairment of financial assets based on expected credit loss model.

2 Classification and measurement of financial assets and liabilities

The classification and measurement of financial assets will be made considering whether the conditions as per Ind AS 109 are met based on facts and circumstances existing at the date of transition.

Financial assets can be measured using effective interest method by assessing its contractual cash flow characteristics only on the basis of facts and circumstances existing at the date of transition and if it is impracticable to assess elements of modified time value of money i.e. the use of effective interest method, fair value of financial asset at the date of transition shall be the new carrying amount of that asset. The measurement exemption applies for financial liabilities as well.

Applying a requirement is impracticable when the entity cannot apply it after making every reasonable effort to do so. It is impracticable to apply the changes retrospectively if:

a) The effects of the retrospective application or retrospective restatement are not determinable;

b) The retrospective application or restatement requires assumptions about what management’s intent would have been in that period;

The retrospective application or retrospective restatement requires significant estimates of amounts and it is impossible to distinguish objectively information about those estimates that existed at that time.

3 De-recognition of financial assets and liabilities

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

The Company has elected to apply the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.

E Other reconciliations between previous GAAP and Ind AS

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following tables represent the reconciliations from previous GAAP to Ind AS.

Note - 1

Borrowings Ind AS 109 requires transaction costs incurred towards origination of borrowings to be deducted from the carrying amount of borrowings on initial recognition. These costs are recognised in the profit or loss over the tenure of the borrowing as part of the interest expense by applying the effective interest rate method. Under previous GAAP, these transaction costs were shown as prepaid expense under non-current/current assets as and when incurred. Accordingly, borrowings as at 31 March 2017 have been reduced with a corresponding adjustment to prepaid expense head in non-current/current asset respectively.

Note - 2.

Provision for trade receivables using provision matrix approach.

Under previous GAAP, provision for trade receivables is recognised on specific identification method based on management assessment of recoverability of trade receivables. As per Ind AS 109, the Company is required to apply expected credit loss model (provision matrix approach) for recognising the allowance for doubtful receivables.

Note - 3

Investments designated at fair value through other comprehensive income

Under previous GAAP, investments are shown at cost. Under Ind AS, such instruments are required to be evaluated under Ind AS 109 which requires the Company to account for such instruments either at amortised cost or fair value. Ind AS requires the Company to record the fair value gains or (losses) on FVOCI equity instruments in case of fair value instrument. Accordingly ‘Investments’ has been increased with a corresponding adjustment to other comprehensive income

Note - 4

Remeasurement of post-employment benefit obligations Under Ind AS, actuarial gains and losses on defined benefit plan liabilities and plan assets are recognised in other comprehensive income instead of profit or loss. Under the previous GAAP, such measurements were charged to profit or loss for the respective year.

Note - 5.

Prior period errors Under Ind AS, prior period errors need to be restated retrospectively and such restatement is made in the earliest comparative period presented and the amount of the adjustment is made in the opening balance of retained earnings of earliest year presented.

Note - 6

Leases

The Company has applied the transition provision of Ind AS 17, “Leases”, and has assessed all arrangement as at the date of transition. Basis the assessment the Company has done the accounting for vehicle given on finance lease. The accounting has been done retrospectively and the impact on transition date has been recognised in retained earnings. For lease accounting on transition, Property, Plant and Equipment is derecognised and current/non-current other financial assets recognised. Difference towards reversal of retrospective depreciation and finance lease recognised as revenue instead of recovery of lease receivable adjusted against retained earnings.

Note - 7

Tax impact on adjustments Under previous GAAP, deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required Under previous GAAP

Note - 8

Minimum alternate tax Ind AS 12 requires classification of MAT credit as deferred tax asset. Accordingly, the Company has reclassified MAT credit from loans and advances to deferred tax asset on each reporting date. There is no impact on the total equity or profit as a result of this adjustment.

Note - 9

Retained earnings Retained earnings as at 1 April 2016 has been adjusted consequent to the above Ind AS transition adjustments.

Note - 10

Other comprehensive income Under Ind AS, all items of income and expense recognised in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognised in profit or loss but are shown in the statement of profit and loss as ‘other comprehensive income’ includes re-measurements of defined benefit plans and fair value gains or (losses) on FVOCI equity instruments and their corresponding income tax effects. The concept of other comprehensive income did not exist under previous GAAP

---

Mar 31, 2016

b) Rights, preferences and restrictions attached to Equity shares

Equity shares: The company has one class of equity shares having a par value of Re. 10/- per share. Each shareholder is eligible for one vote per share held. The dividend if any proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount, in proportion to their shareholding.

e) There are NIL number of shares (Previous year Nil) reserved for issue under option and contracts/commitment for the sale of shares/disinvestment including the terms and amounts.

f) For the period of five years immediately preceding the date as at which the balance sheet is prepared

g) There are NO securities (Previous year No) convertible into Equity/ Preferential Shares.

h) There are NO calls unpaid (Previous year No) including calls unpaid by Directors and Officers as on balance sheet date.

i) 1500 equity shares of Rs.10/- each were forfeited by Company against unpaid call money of Rs.5/- per equity share.

Nature of Security

i) The Secured working capital Loans from Banks are secured by hypothecation of stock in trade and book debts and other current assets of the Company both present and future on pari-passu basis and also secured by second pari-passu charge on the immovable properties and entire fixed assets (both present & future) of the Company. These Loans are further secured by personal guarantee of Managing Director of the Company.

ii) The Secured working capital Loans are secured by Subservient charge on all the Current Assets and Movable Fixed Assets of the Borrower (both present and future) of the Company. These Loans are further secured by personal guarantee of Managing Director of the Company.

(d) Excise duty /Sale Tax paid under protest amounting to Rs.351,036 (Previous Year Rs.66,036) is appearing under the head amounts recoverable.

a) It is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above pending resolution of the respective proceedings.

b) The Company does not expect any reimbursement in respect of the above contingent liabilities.

c) Future cash outflows in respect of the above are determinable only on receipt of judgments / decisions pending with various forums / authorities.

The expected return on plan assets is based on market expectation, at the beginning of the period, for returns over the entire life of the related obligation. The gratuity scheme contribution is invested in a group gratuity-cum-life assurance cash accumulation policy offered by LIC of India. The expected return on plan assets is taken on the basis of the LIC fund statement received.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

SUPERANNUATION BENEFIT

"SUPERANNUATION BENEFIT” Apart from being covered under the Gratuity Plan, certain employees of the Company participate in a Superannuation Benefit; a defined contribution plan administrated by Life Insurance Corporation (""LIC""). The Company makes contributions based on a specified percentage of salary of each covered employee. The Company does not have any further obligation to the superannuation plan beyond making such contributions. Upon retirement or separation (only after completion of 5 years of services) an employee becomes entitled for superannuation benefit, as determined by LIC, which is paid directly to the concerned employee. The Company contributed Rs.515,181 (Previous Year Rs.901,810 ) to the Superannuation Plan."

1. Borrowing costs amounting to Rs. Nil (previous year Rs. Nil) attributable to acquisition and construction of fixed assets have been capitalized during the year.

2. In the opinion of the Board, all assets other than fixed assets and non-current investments have a value on realization in the ordinary course of business at least equal to the value at which they are stated in the foregoing Balance Sheet.

3. As per Section 135 of the Companies Act, 2013, a Corporate Social Responsibility (CSR) committee has been formed by the Company. The areas for CSR activities are of promoting education, eradicating poverty, hunger and malnutrition, sanitation and empowering women etc. projects which are specified in Schedule VII of the Companies Act, 2013.
During the financial year 2015-16, Company has not spent towards schemes of Corporate Social Responsibility as prescribed under section 135 of the Companies Act, 2013.

---

Mar 31, 2015

1. Rights, preferences and restrictions attached to Equity shares

Equity shares: The company has one class of equity shares having a par value of Re. 10/- per share. Each shareholder is eligible for one vote per share held. The dividend if any proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount, in proportion to their shareholding.

2. There are NO securities (Previous year No) convertible into Equity/ Preferential Shares.

3. There are NO calls unpaid (Previous year No) including calls unpaid by Directors and Officers as on balance sheet date.

4. 1500 equity shares of Rs. 10/- each were forfeited by Company against unpaid call money of Rs.5/- per equity share.

5. Nature of Security

i) The Secured working capital Loans from Banks are secured by hypothecation of stock in trade and book debts and other current assets of the Company both present and future on pari-passu basis and also secured by second pari-passu charge on the immovable properties and entire fixed assets (both present & future) of the Company. These Loans are further secured by personal guarantee of Managing Director of the Company.

ii) The Secured working capital Loans are secured by Subservient charge on all the Current Assets and Movable Fixed Assets of the Borrower (both present and future) of the Company. These Loans are further secured by personal guarantee of Managing Director of the Company.

6. CONTINGENT LIABILITIES AND COMMITMENTS

(I) Contingent Liabilities

(a) Claims against the company not acknowledged as debts Sales Tax matters under U.P. Trade Tax Act 198,108 198,108

(b) Bank Guarantees 25,418,900 18,996,800

(c) Letter of Credit 8,293,917 10,369,934

(d) Excise duty /Sale Tax paid under protest amounting to Rs.66,036 (Previous Year Rs.220,036) is appearing under the head amounts recoverable.

a) It is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above pendingresolution of the respective proceedings.

b) The Company does not expect any reimbursement in respect of the above contigent liabilities.

c) Future cash outflows in respect of the above are determinable only on receipt of judgements / decisions pending with various forums / authorties.

(II) Commitments

Estimated value of contracts in capital accounts remaining to be executed and not provided for (net of advance) 12,088,474 3,115,411

7. SUPERANNUATION BENEFIT

Apart from being covered under the Gratuity Plan, certain employees of the Company participate in a Superannuation Benefit; a defined contribution plan administrated by Life Insurance Corporation (""LIC""). The Company makes contributions based on a specified percentage of salary of each covered employee. The Company does not have any further obligation to the superannuation plan beyond making such contributions. Upon retirement or separation (only after completion of 5 years of services) an employee becomes entitled for superannuation benefit, as determined by LIC, which is paid directly to the concerned employee. The Company contributed Rs.901,810 (Previous Year Rs.973,645) to the Superannuation Plan."

8. Borrowing costs amounting to Rs. Nil (previous year Rs. Nil) attributable to acquisition and construction of fixed assets have been capitalized during the year.

9. In the opinion of the Board, all assets other than fixed assets and non-current investments have a value on realization in the ordinary course of business at least equal to the value at which they are stated in the foregoing Balance Sheet.

10. Related party disclosure under Accounting Standard 18

During the year the company had entered into transactions with related parties. Those transactions along with related balances as at March 31,2015 and for the year then ended are presented in the following table. List of related parties along with nature and volume of transaction is given below:

a) Holding Company : M/s Anadi Investments Pvt. Ltd.

b) Subsidiary Company : M/s Majestic IT Services Ltd.

c) Enterprises in which the Company has significant influence : -

d) Key Management Personnel : Mr. Mahesh Munjal (Managing Director)

e) Relatives of Key Management : Mr. Ayush Munjal & personnel Ms. Ashima Munjal

f) Other Key Management Personnel : Mr. Rajesh Saini (Company Secretary)

: Mr. Prakash Chandra Patro (Chief Financial Officer)

g) Enterprises over which key management personnel and their relatives are able to exercise significant influence : M/s Munjal Showa Ltd.

h) Employee welfare trust where : i) Majestic Auto Ltd. - there is control Employee Gratuity Fund

ii) Majestic Auto Ltd. - Superannuation Fund

11. As per Section 135 of the Companies Act, 2013, a Corporate Social Responsibility (CSR) committee has been formed by the Company. The areas for CSR activities are of promoting education, eradicating poverty, hunger and malnutrition, sanitation and empowering women etc. projects which are specified in Schedule VII of the Companies Act, 2013.

12. During the financial year 2014-15, Company has not spent towards schemes of Corporate Social Responsibility as prescribed under section 135 of the Companies Act, 2013.

---

Mar 31, 2014

1 CONTINGENT LIABILITIES AND COMMITMENTS

(I) Contingent Liabilities Year Ended Year Ended 31.03.2014 31.03.2013 (Rs.) (Rs.)

(a) Claims against the company not acknowledged as debts

Sales Tax matters under Punjab Value Added Tax Act, 2005 - 42,700

Sales Tax matters under U.P. Trade Tax Act 198,108 198,108

(b) Guarantees Bank Guarantees 18,996,800 24,996,800

(c) Letter of Credit 10,639,934 9,503,520

(i) Excise duty /Sale Tax paid under protest amounting to Rs. 191,636 (Previous Year Rs.234,336) is appearing under the head amounts recoverable.

a) It is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above pending resolution of the respective proceedings.

b) The Company does not expect any reimbursement in respect of the above contigent liabilities.

c) Future cash outflows in respect of the above are determinable only on receipt of judgements / decisions pending with various forums / authorties.

SUPERANNUATION BENEFIT

Apart from being covered under the Gratuity Plan, certain employees of the Company participate in a Superannuation Benefit; a defined contribution plan administrated by Life Insurance Corporation ("LIC"). The Company makes contributions based on a specified percentage of salary of each covered employee. The Company does not have any further obligation to the superannuation plan beyond making such contributions. Upon retirement or separation (only after completion of 5 years of services) an employee becomes entitled for superannuation benefit, as determined by LIC, which is paid directly to the concerned employee. The Company contributed Rs.300,000 (Previous Year Nil) to the Superannuation Plan.

2. Borrowing costs amounting to Rs. Nil (previous year Rs. 9,860,154) attributable to acquisition and construction of fixed assets have been capitalized during the year.

3. In the opinion of the Board, all assets other than fixed assets and non-current investments have a value on realization in the ordinary course of business at least equal to the value at which they are stated in the foregoing Balance Sheet.

4. Related party disclosure under Accounting Standard 18

During the year the company had entered into transactions with related parties. Those transactions along with related balances as at March 31, 2014 and for the year then ended are presented in the following table. List of related parties along with nature and volume of transaction is given below:

a) Holding Company : M/s Anadi Investments Pvt. Ltd.

b) Subsidiary Company : M/s Majestic IT Services Ltd.

c) Enterprises in which the Company has significant influence : M/s. Brij Mohan Lall & Associates (Dissolved in June-2013)

d) Key Management Personnel : Mr. Mahesh Munjal (Managing Director)

e) Relatives of Key Management personnel : Mr. Aayush Munjal & Ms. Ashima Munjal

f) Enterprises over which key management personnel and their relatives are able to exercise significant influence : M/s Munjal Showa Ltd.

g) Employee welfare trust where there is control : i) Majestic Auto Ltd. - Employee Gratuity Fund

ii) Majestic Auto Ltd. - Superannuation Fund

5. The Companies (Accounting Standards) (Second Amendment) Rules 2011 has further amended AS-11, "The effects of changes in foreign exchange rates" vide Notification No. G.S.R 914(E) dated December 29, 2011 which amends the principal regulation published vide Notification No. G.S.R 739(E) dated December 7, 2006, and subsequently amended vide Notification No. G.S.R 212(E) dated March 27, 2008, G.S.R 225(E) dated March 31,2009 and G.S.R 378(E) dated May 11,2011. Before these amendments, AS-11 required the exchange gain/losses on the long term foreign currency monetary items in so far as they relate to the acquisition of depreciable Capital Asset to be charged off fully in the Profit & Loss Account. The amended AS-11 provides an irrevocable option to the company to add or deduct the exchange rate fluctuation on long term foreign currency monetary items from the cost of the Capital asset and depreciate the same over the balance life of the Capital asset. The amendment is applicable retrospectively from the financial year beginning on or after December 7, 2006. The Company had not earlier exercised the option as per above said principal regulation and opts not to exercise the option under Companies (Accounting Standards) (Second Amendment) Rules 2011 for accounting year ended on March 31, 2014 and accordingly has charged exchange difference related to the long term foreign currency monetary items to the statement of profit and loss.

---

Mar 31, 2013

1. Borrowing costs amounting to Rs. 98,60,154 (previous year Rs. 31,59,784) attributable to acquisition and construction of fixed assets have been capitalized during the year.

2. In the opinion of the Board, all assets other than fixed assets and non-current investments have a value on realization in the ordinary course of business at least equal to the value at which they are stated in the foregoing Balance Sheet.

3. Related party disclosure under Accounting Standard 18

During the year the company had entered into transactions with related parties. Those transactions along with related balances as at March 31, 2013 and for the year then ended are presented in the following table. List of related parties along with nature and volume of transaction is given below:

a) Holding Company : M/s Anadi Investments Pvt. Ltd.

b) Subsidiary Company : M/s Majestic IT Services Ltd.

c) Enterprises in which the Company has significant influence : M/s. Brij Mohan Lall&Associates

d) Key Management Personnel : Mr. Mahesh Munjal (Managing Director)

e) Relatives of Key Management personnel : Mr. Ayush Munjal & Ms. Ashima Munjal

f) Enterprises over which key management personnel and their relatives are able to exercise significant influence : M/s Munjal Showa Ltd.

: M/s Highway Industries Ltd.

: M/s Munjal Auto Ind. Ltd.

: M/s Satyam Auto Component Ltd.

g) Employee welfare trust where there is control : i) Majestic Auto Ltd. - Employee Gratuity Fund

ii) Majestic Auto Ltd. - Superannuation Fund

4. The Companies (Accounting Standards) (Second Amendment) Rules 2011 has further amended AS-11, "The effects of changes in foreign exchange rates" vide Notification No. G.S.R 914(E) dated December 29, 2011 which amends the principal regulation published vide Notification No. G.S.R 739(E) dated December 7, 2006, and subsequently amended vide Notification No. G.S.R 212(E) dated March 27, 2008, G.S.R 225(E) dated March 31,2009 and G.S.R 378(E) dated May 11,2011. Before these amendments, AS-11 required the exchange gain/losses on the long term foreign currency monetary items in so far as they relate to the acquisition of depreciable Capital Asset to be charged off fully in the Profit & Loss Account. The amended AS-11 provides an irrevocable option to the company to add or deduct the exchange rate fluctuation on long term foreign currency monetary items from the cost of the Capital asset and depreciate the same over the balance life of the Capital asset. The amendment is applicable retrospectively from the financial year beginning on or after December 7, 2006. The Company had not earlier exercised the option as per above said principal regulation and opts not to exercise the option under Companies (Accounting Standards) (Second Amendment) Rules 2011 for accounting year ended on March 31, 2013 and accordingly has charged exchange difference related to the long term foreign currency monetary items to the statement of profit and loss.

---

Mar 31, 2012

A) Rights, preferences and restrictions attached to Equity shares

Equity shares: The company has one class of equity shares having a par value of Re. 10/- per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount, in proportion to their shareholding.

a) Nature of Security

The Term Loans are secured by mortgage over the immovable properties on pari-passu basis and first charge on entire fixed assets of the Company both present & future on pari-passu basis and also secured by Second Charge on entire current assets of the Company both present and future. These Term Loans are also further secured by personal guarantee of Managing Director of the Company.

a) The Secured working capital Loans from Banks are secured by hypothecation of stock in trade and book debts and other current assets of the Company both present and future on pari-passu basis and also secured by second pari-passu charge on the immovable properties and entire fixed assets (both present & future) of the Company. These Loans are further secured by personal guarantee of Managing Director of the Company.

b) The Unsecured working capital Loans from Banks are secured by personal guarantee of Directors of the Company.

c) The Unsecured working capital Loans from others are secured by personal guarantee of Managing Director of the Company.

Disclosure as per amendment to clause 32 of the Listing Agreement (Loans and advances in the nature of loans to subsidiaries)The company has given loans & advances of Rs. 43,650,000 (Previous Year Rs. 21,850,000) in the nature of loans to Majestic IT Services Limited (MITSL), the Wholly Owned Subsidiary Company and the maximum balance outstanding during the year is Rs.43,650,000 (Previous Year Rs. 21,850,000. This loan is interest free with no specified re-payment schedule. MITSL has not made any investment in the shares of the parent company. MITSL is also company under the same management as defined under section 370 (I-B) of the Companies Act, 1956.

1. CONTINGENT LIABILITIES AND COMMITMENTS

(I) Contingent Liabilities

(a) Claims against the company not acknowledged as debts

Sales Tax matters under Punjab Value Added Tax Act, 2005 42,700 220,057

Sales Tax matters under U.P. Trade Tax Act 198,108 198,108

(b) Guarantees

Bank Guarantees# 32,687,562 31,177,992

(c) Other money for which the Company is contingently liable Bills Discounted with the Company's bankers - 1,690,000

# Including Bank Guarantee of USD235,000 (Rs. 11,987,562) Previous year USD235,000 (Rs.10,477,992)

(i) Excise duty/Sale Tax paid under protest amounting to Rs. 142,254 (Previous Year Rs. 201,374) is appearing under the head amounts recoverable.

(ii) The Company has taken legal and other steps necessary to protect its position in respect of the claims mentioned at point no. 20 (I) (a) which in its opinion, based on legal advice are not expected to devolve. It is not possible to make any further determination of the liabilities which may arise or the amounts which may be refundable in respect of these claims.

(II) Commitments

Estimated value of contracts in capital account remaining to be executed and not provided for (net of advance) 73,076,449 71,041,447

SUPERANNUATION BENEFIT

Apart from being covered under the Gratuity Plan, certain employees of the Company participate in a Superannuation Benefit; a defined contribution plan administrated by Life Insurance Corporation (""LIC""). The Company makes contributions based on a specified percentage of salary of each covered employee. The Company does not have any further obligation to the superannuation plan beyond making such contributions. Upon retirement or separation (only after completion of 5 years of services) an employee becomes entitled for superannuation benefit, as determined by LIC, which is paid directly to the concerned employee. The Company contributed Rs. Nil (Previous Year Nil) to the Superannuation Plan.

2. Borrowing costs amounting to Rs. 31,59,784 (previous year Rs. Nil) attributable to acquisition and construction of fixed assets have been capitalized during the year.

3. In the opinion of the Board, all assets other than fixed assets and non current investments have a value on realization in the ordinary course of business at least equal to the value at which they are stated in the foregoing Balance Sheet.

4. The financial statement for the year ended 31 March 2011 had been prepared as per the then applicable pre-revised Schedule VI to the Companies Act, 1956. Consequent to the notification of the revised schedule VI under the Companies Act, 1956, the financial statement for the year have been prepared as per revised schedule VI. Accordingly, the previous year figures have been classified to conform this year classification. The adoption of revised schedule VI for the previous year figures does not impact the recognition and measurement principles followed for the preparation of the financial statements.

5. The Companies (Accounting Standards) (Second Amendment) Rules 2011 has further amended AS-11, "The effects of changes in foreign exchange rates" vide Notification No. G.S.R 914(E) dated December 29, 2011 which amends the principal regulation published vide Notification No. G.S.R 739(E) dated December 7, 2006, and subsequently amended vide Notification No. G.S.R 212(E) dated March 27, 2008, G.S.R 225(E) dated March 31,2009 and G.S.R 378(E) dated May 11,2011. Before these amendments, AS-11 required the exchange gain/losses on the long term foreign currency monetary items in so far as they relate to the acquisition of depreciable Capital Asset to be charged off fully in the Profit & Loss Account. The amended AS-11 provides an irrevocable option to the company to add or deduct the exchange rate fluctuation on long term foreign currency monetary items from the cost of the Capital asset and depreciate the same over the balance life of the Capital asset. The amendment is applicable retrospectively from the financial year beginning on or after December 7, 2006. The Company had not earlier exercised the option as per above said principal regulation and opts not to exercise the option under Companies (Accounting Standards) (Second Amendment) Rules 2011 for accounting year ended on March 31, 2012 and accordingly has charged exchange difference related to the long term foreign currency monetary items to the statement of profit and loss.

---

Mar 31, 2011

1. CONTINGENT LIABILITES

Year ended Year ended 31.03.2011 31.03.2010 (Rs. in lacs) ( Rs. in lacs)

i) a) Bank Guarantee/Margin Money Guarantee 217.83 208.00

b) Bills Discounted with the Company's bankers 16.90 Nil

ii) Penalty u/s 51(7) (b) of Punjab Value Added Tax Act, 2005 of Rs. 2,20,057/- (Previous year Rs.2,20,057/-) was disputed by the Company for which appeal has been filed with Dy. Excise & Taxation Commissioner (Appeals), Patiala.

iii) Penalty under U.P. Trade Tax of Rs.1,98,108/-(Previous year Rs.1,98,108/-) was disputed by the Company for which appeal has been filed with Assistant Commissioner (Appeals), U.P. Trade Tax Act, Noida. The Company has taken legal and other steps necessary to protect its position in respect of the claims mentioned at point no. (ii) & (iii) which in its opinion, based on legal advice are not expected to devolve. It is not possible to make any further determination of the liabilities which may arise or the amounts which may be refundable in respect of these claims.

2. Excise duty/Sale Tax paid under protest amounting to Rs. 2.01 Lacs (Previous Year Rs. 2.01 Lacs) is appearing under the head amounts recoverable.

3. Estimated amount of contracts remaining to be executed on capital account and not provided for Rs.1,132.69 Lacs (Previous Year Rs.1,302.56 lacs) against which a sum of Rs.84.70 Lacs (Previous Year Rs.408.69 Lacs) has been paid as advance.

4. In the opinion of management, current assets have a value on realization in the ordinary course of business at least equal to the value at which they are stated in the foregoing Balance Sheet.

5. The staff quarter at Dugri Road, Ludhiana have been allotted in the name of an Ex-Director of the Company.

6. Loans and Advances in the nature of loans:

The company has given loans & advances of Rs. 218.50 Lacs (Previous Year - Nil) in the nature of loans to Majestic IT Services Limited (MITSL), the Wholly Owned Subsidiary Company and the maximum balance outstanding during the year is Rs.218.50 Lacs. This loan is interest free with no specified re-payment schedule. MITSL has not made any investment in the shares of the parent company. MITSL is also company under the same management as defined under section 370 (I-B) of the Companies Act,1956.

7. Previous year's figures have been regrouped/rearranged wherever considered necessary. Figures have been rounded off to the nearest rupee.

8. Borrowing cost capitalized during the Current year Rs. Nil (Previous year Rs. Nil).

9. During the year the company has migrated to a new ERP system wherein stocks have been valued on "Moment Moving weighted average Basis" as against the "Monthly Moving Weighted average", for more appropriate and relevant presentation of the financial statements. The impact resulting from such change is not ascertainable.

10. During the year, the company has executed transfer deeds with the original allottee's / lessee's for acquiring 90 years lease hold rights for industrial property situated at Greater Noida, (U.P.) at a total cost of Rs. 32,45,74,589. The aforesaid amount including registration and other charges directly related to the acquisition of the said rights have been capitalized under the head "Leasehold Land". Considering the limited useful life and absence of any clause for renewal or extension of lease and/or transfer of ownership at the end of lease term, the said amount has been amortised over the period of lease.

11. Related party disclosure under Accounting Standard 18

a) Holding Company M/s Anadi Investments Pvt. Ltd.

b) Subsidiary Company M/s Majestic IT Services Ltd.

c) Enterprises which has significant influence over the Company Hero Cycles Ltd

d) Enterprises in which the Company has significant influence M/s.Brij Mohan Lall& Associates f e) Key Management Personnel Mr. Mahesh Chander Munjal

Managing Director

f) Enterprises over which key management personnel and their relatives are able to exercise significant influence :

M/s Munjal Showa Ltd. M/s Highway Industries Ltd.

M/s Amar Sons M/s Amar Udyog

M/s Munjal Auto Ind. Ltd. M/s Amtier Infotech Ltd.

M/s Aayush Finance Investment (P) Ltd.

g) Employee welfare trust where there is control :

i) Majestic Auto Ltd. - Employee Gratuity Fund

ii) Majestic Auto Ltd. - Superannuation Fund

12. GRATUITY PLANS :

SUPERANNUATION BENEFIT

Apart from being covered under the Gratuity Plan, certain employees of the Company participate in a Superannuation Benefit; a defined contribution plan administrated by Life Insurance Corporation ("LIC"). The Company makes contributions based on a specified percentage of salary of each covered employee. The Company does not have any further obligation to the superannuation plan beyond making such contributions. Upon retirement or separation (only after completion of 5 years of services) an employee becomes entitled for superannuation benefit, as determined by LIC, which is paid directly to the concerned employee. The Company contributed Rs. Nil (Previous Year Nil) to the Superannuation Plan.

---

Mar 31, 2010

1. CONTINGENT LIABILITES

Year ended Year ended

31.03.2010 31.03.2009

(Rs. in lacs) ( Rs. in lacs)



i) Bank Guarantee/Margin

Money Guarantee 208.00 203.00

ii) Penalty u/s 51 (7) (b) of Punjab Value Added Tax Act, 2005 of Rs. 2,20,057/- (Previous year Rs.2,20,057/-) was disputed by the Company for which appeal has been filed with Dy. Excise & Taxation Commissioner (Appeals), Patiala.

iii) Penalty under U.P. Trade Tax of Rs. 1,98,108/- (previous year of Rs. 1,98,108/-) was disputed by the Company for which appeal has been filed with Assistant Commissioner (Appeals), U.P. Trade Tax Act, Noida.

2. Excise duty/Sale Tax paid under protest amounting to Rs. 2.01 Lacs (Previous Year Rs. 2.01 Lacs) is appearing under the head amounts recoverable.

3. Estimated amount of contracts remaining to be executed on capital account and not provided for Rs.1302.56 Lacs (Previous Year Rs. 43.53 lacs) against which a sum of Rs. 408.69 Lacs (Previous Year Rs. 13.43 Lacs) has been paid as advance.

4. The Company is a member of M/s Brij Mohan Lall & Associates (AOP), whose constitution as at 31.03.2010 is as under:

SI.No. Name of the Members Profit Sharing Ratio

1. M/s Satyanand & Sons (HUF) 20%

2. M/s Brij Mohan Lall & Sons (HUF) 20%

3. Mr. Naveen Munjal 20%

4. Majestic Auto Limited 20%

5. Mr. Pankaj Munjal 20%



The Company has contributed Rs.12,00,000/- as fixed capital and balance of Rs. 9,64,470/- (Previous Year Rs. 8,96,515/-) is in the current account with the above AOP.

5. In the opinion of management, current assets have a value on realization in the ordinary course of business at least equal to the value at which they are stated in the foregoing Balance Sheet.

6. There are no Loans and Advances in the nature of Loans given to Subsidiaries/Associates/Firms and Companies in which directors are interested.

7. Previous years figures have been regrouped/rearranged wherever considered necessary. Figures have been rounded off to the nearest rupee.

8. Borrowing cost capitalized during the current year Rs. Nil (Previous year Rs. Nil).

9. The Board of Directors of the Company in its meeting held on 26th October, 2009 agreed to form a new Wholly Owned Subsidiary for setting up business of providing a broad range of information and technology related services and accordingly a company under the name and style of "MAJESTIC IT SERVICES LIMITED" has been incorporated & registered at Registrar of Companies, NCT of Delhi & Haryana with an authorized capital of Rs. 4,75,00,000/- divided into 47,50,000 equity shares of Rs. 10/- each.