2. 55,07,249 Equity Shares of Rs. 10/- each fully paid-up,issued as Bonus Shares on Capitalisation of Capital redemption reserve, Securities premium, General Reserve. Out of which total 5187249 fully paid up shares were alloted as bonus shares in FY 2011-12.

3. 21,75,000 Equity Shares of Rs.10/- each alloted otherwise than on payment of cash to the Shareholders of erstwhile M/s.Tikmani Steel Co. Ltd & M/s. A.A. Alloys Ltd.as per the Scheme of Amalgamation approved by the Karnataka High Court.

4. Company has alloted 2,000,000 warrants during March 2008 with an option to acquire 1 equity share at the option of warrant holder at a price of Rs. 100.20 per equity share by way of preferential issue as per SEBI Guidelines. The warrant-holders have paid 10% of the total issue price before the allotment in terms of SEBI Guidelines which ls liable to be forfeited if option to apply for equity shares is not exercised on or before due date. The option attached with Warrants may be exercised within a period of 18 months from the date of allotment, i.e., 11th March, 2008, Since Wanant holders have not exercised the option, the Warrants have been forfeited during FY 2009-10.

5. Related Party Disclosure

Related party disclosures have been made in accordance with the accounting Standards on related party Disclosure (AS 18) issued by The Institute of Chartered Accountants of India.

A) Following are the name of related parties with whom the transactions were carried out by the company:

Name of the Related Parties                 Relationship

Bhuwalka Steel Industries FZC Parties where Control Exists

Balchand Suresh Kumar                       Parties where Control Exists

Bhuwalka Jewellers Limited                  Parties where Control Exists

Shri Durga Trade Links Private Limited Parties where Control Exists

Nava Karnataka Steels Private Limited Parties where Control Exists

Mahesh Sponge Iron and Power Limited Parties where Control Exists

Suresh Kumar Bhuwalka                       Key Management Personnel-
                                            Director

Ajay Kumar Bhuwalka                         Key Management Personnel-
                                            Managing Director

Ankit Bhuwalka                              Key Management Personnel-
                                            Director

Accounting Standard 19 is applicable only in the case of lease transactions entered into on or after 1st April; 2001 .The Company has taken office & residential properties for its employees under cancelable operating lease agreement after 1st April, 2001. The company intends to renew the agreements in the normal course of its business. These properties cannot be subleased to any other person.

Total lease rentals recognized in the Profit & Loss Account for the year with respect to the above is Rs. 57.45 Lacs (Previous half year Rs. 28.12Lacs).

7. Accounting standard 20- Earning Per Share

Basic earnings per share has been calculated by dividing profit for the year attributable to equity share holders by the weighted average number of equity shares outstanding during the year. The basic earnings per share and diluted earnings per share are the same as there is no change in capital structure in the company.

8. TAXATION

During the year company has not made provision for tax in accordance with Income Tax Act, 1961.

The deferred tax Asset is recognised, subject to the consideration of prudence, on timing differences, being the difference between taxable incomes and accounting income that originate in one accounting period and are capable of reversal in one or more subsequent periods. The deferred tax is accounted for, using the tax rates and laws that have been substantively enacted as of the balance sheet date. Deferred tax assets are recognized on unabsorbed depreciation and carry forward of losses as there is virtual certainty that such deferred tax asset can be realized against future taxable profits.

The Company has provided deferred tax asset amounting to Rs.9,31,72,740/-(Previous year deferred tax liability has reversed for Rs. 5,96,05,139/-) on account of timing difference. Refer Note 21 for computation of deferred tax liability.

9. Accounting Standard 26- Intangible Assets

"Accounting Standard 26 - Intangible assets" requires an enterprise to recognize an intangible asset if future economic benefits are expected to arise from it. It also requires that such an asset should be stated after providing depreciation / amortization over the useful life of the asset. Presently, the reporting enterprise does not own any intangible assets.

10. Accounting Standard 28- Impairment of Assets

The Company has identified that there is no material impairment of assets and as such no provision is required as per AS-28 issued by the ICAI.

11. Accounting standard 29- Contingent Liabilities & Contingent assets

In the opinion of the management, no provision is required against contingent liabilities referred in Note '23'.

12. Sale of raw material has been regrouped under Sales and Other Operational Income in Current Financial year as well as for previous year.

13. Sundry Creditors under Current Liabilities in Note '5' include Rs. Nil (Rs.Nil) due to Small Scale undertakings.

This amount has been determined to the extent such parties have been identified from available information.

14. Other Disclosures

i) The financial statements of the company have been prepared in accordance with Generally Accepted Accounting Principles in India to comply with the Accounting Standard specified under section 133 of the Companies Act 2013. The financial statement have been prepared on accrual basis under the historical cost convention except in case of Finance Cost including Exorbitant charges/penal charges/ penal interest to the extent of Rs. 42,24,11,280/- including accrued interest is disputed on account of unilateral withdrawal of CDR Package by the Banks.

Further the company has approached Debt Recovery Tribunal for resolving above dispute by filing application on 18.02.2015 Respondents Canara Bank and IDBI Bank And on 16.02.2015 Respondent Indian Overseas Bank. The matter is still pending on 31.03.2015

ii) The Banks have served Notice under section 13(2) of the SARFAESI Act by Canara Bank on 02.12.2014 IDBI Bank on 21.11.2014 And IOB on 10.05.2014. In view of this company filed an application before Debt Recovery Tribunal on 18.02.2015 Respondent Canara Bank and IDBI Bank And on 16.02.2015 Respondent Indian Overseas Bank to resolve the said issue. The matter is still pending on 31.03.2015. The company has defaulted in repayment of Due of Rs.220.75Crores to the Banks mentioned above. The matter is still pending on 31.03.2015

15. Balance of Sundry Debtors, Sundry Creditors and Bank Balances are subject to confirmation by the respective parties.

16. The previous year's figures are regrouped/re-arranged wherever found necessary

PREVIOUS YEAR'S FIGURES ARE SHOWN IN THE BRACKETS