1.  The Company has been in losses and as on year ended 31st March,
 2012, the accumulated losses of the Company had exceeded 100% of its
 net worth, making it a potentially Sick Company.
 
 The Company will be required to file reference with the Board of
 Financial and Industrial Reconstruction as per the provisions of
 Section 15 of the Sick Industrial Companies (Special Provisions) Act,
 1985
 
 a.  Details for the period of five years immediately preceding the date
 as at which the Balance Sheet is prepared:
 
 b.  Forfeiture of share application money:
 
 During the year the company has forfeited shares application money of Rs.
 300.44 Lacs and transferred the same to ''Capital Reserve'' in Reserve &
 Surplus.
 
 2.  CONTINGENT LIABILITIES (Rs. IN LACS):
 
                                                     As at        As at
                                                31.03.2012   31.03.2011
 
 Bank Guarantees                                    229.18       229.18
 
 Claims against the company not 
 acknowledged as debt *                             551.21         0.80
 
 Gratuity                                            29.31        28.81
 
 * The company has been legally advised that the demands raised are
 likely to be either deleted or substantially reduced and accordingly no
 provision has been made.
 
 3.  The company is engaged in manufacturing Partially Oriented Yarn
 (POY), Fully Drawn Yarn (FDY) Polyester Texturised Yarn, Polyester Draw
 Twisted Yarn, Polyester Twisted Yarn and Nylon Yarn. During the
 financial year the company is engaged in trading of fabric and nylon.
 
 4.  The details of amounts outstanding to Micro, Small and Medium
 Enterprises Development Act, 2006 (MSMED Act) based on the available
 information with the company are as under (Rs. In lacs):
 
 5.  During the earlier years quantitative details of production
 comprised of excisable production from all departments and quantitative
 details of sales comprised of clearances made without payment of duty
 and with duty were reported.
 
 However during the year quantitative details of production comprised of
 excisable production meant for sale and quantitative details of sales
 comprised of clearances with duty is reported.
 
 6.  Previous Year''s Figures have been recasted and regrouped wherever
 considered necessary to make them comparable with those of current
 year.
 
 7.  Trade Receivables, Trade Payables, Deposits with Banks, Unsecured
 Short Term Borrowings and Long Term & Short Term Loans and Advances are
 subject to confirmation.
 
 8.  Interest Receivable comprised of Interest Subsidy under Technology
 Upgradation Fund Scheme. During the earlier year 2010-11 the Company
 had credited the interest receivable from the bank as interest subsidy
 under the Technology Upgradation Fund Scheme amounting to Rs. 863.24
 Lacs. Against the said amount the Company has received interest subsidy
 of Rs. 71.72 Lacs during the current year, therefore interest subsidy yet
 to be received is Rs. 791.52 Lacs. The calculation of interest subsidy
 receivable is based on statements provided to us. The balance is
 subject to confirmation from the bank.
 
 Above details are compiled based on the latest sanction letters of
 respective banks produced before us by the management.
 
 9.  Working Capital Facilities, Term loan as well as Working Capital
 from Oriental bank of Commerce Mumbai, ING Vysya Bank Mumbai, State
 Bank of India Mumbai, Industrial Development bank of India Mumbai,
 Standard Chartered Bank Mumbai, and State Bank Of Saurashtra Mumbai are
 secured by way of hypothecation of Stock, Book Debts, Equitable
 Mortgage of Factory Land and Building, Plant and Machinery and personal
 guarantee of all the Promoter Directors.
 
 An unsecured loan from Indian Overseas Bank, Baroda for Rs. 500 Lacs has
 been sanctioned and availed, secured by the personal guarantee of
 Directors of the Company only.
 
 Term loan from HDFC is secured by way of hypothecation of Motor Cars.
 
 10.  The company has defaulted in repayment of dues towards their Term
 Loan Accounts with State Bank of India, ING Vysya Bank Ltd., Industrial
 Development Bank of India and Oriental Bank of Commerce. Details of
 overdue amounts are tabulated below (Rs. In lacs):
 
 Above interest is estimated at the rate of ten per cent per annum on
 the amount outstanding in books of accounts since the date of
 continuing default in repayment.
 
 11.  During the current year it was identified that in earlier years
 banks had charged higher interest rate on term loan and cash credit
 facilities in comparison to the interest rates prescribed by the banks
 in their sanction letters after restructuring. Therefore, the company
 has credited Rs. 359.46 Lacs towards the excess interest charged by banks
 in earlier years.
 
 12.  The balances with SBI Term Loans and Cash Credit Account and IDBI
 Term Loan and Cash Credit Accounts are subject to confirmation from the
 respective banks.
 
 13.  The Company holds investment in 1135800 equity shares of GSL Nova
 Petrochemicals Ltd. and 701000 CIL Nova Petrochemical Ltd. out of which
 323000 shares of both the companies were pledged against the loan
 obtained by GSL Nova Petrochemicals Ltd. and CIL Nova Petrochemical
 Ltd.
 
 14.  LOSS OF STOCK IN FIRE:
 
 On account of fire occurred in the company''s factory premises on
 30.06.2008 stock were destroyed. According to the Company, the
 estimated loss due to fire was Rs. 2051.51 Lacs. The company had made a
 claim with its insurer New India Assurance Co. Ltd. The insurer New
 India Assurance Co. Ltd. vide its letter dated 09.12.2009 repudiated
 liability for any claim. The company made detailed submission on
 16.12.2009 pointing out that the reasons given by the insurer for
 repudiating claim were not germane and correct. The solicitor of the
 company wrote to the insurer for providing copies of papers on which
 the insurer relied. The company also made application under Right to
 Information Act 2005 on 07.12.2009. The insurer did not provide all the
 papers and therefore company again wrote to the insurer on 11.08.2010
 that all the papers should be provided by the insurer. On non receipt
 of the required papers company approached the grievance redressal
 officer IRDA Hyderabad. By letter dated 14.06.2010 IRDA merely
 reproduced what insurance company had informed them without their
 comments. Being aggrieved the company filed complaint under Section
 21(A)(1) of Consumer Protection Act 1986 before the National Consumer
 Disputes Redressal Commission New Delhi on 08.12.2010 and the matter is
 pending before them.
 
 On the basis of abovementioned facts, upto the year ended on 31 March
 2011, the company had separately mentioned the value of destroyed goods
 amounting to Rs. 2051.51 Lacs, which is claimed by the company from
 Insurance company.
 
 During the year the company has removed the amount of loss of stock in
 fire, by crediting the said amount as income under the head ''Claim
 Receivable on Loss of Stock on fire'' and debiting the said amount as
 ''Claim Receivable from Insurance Company''.
 
 For the stock destroyed in fire the Company had amount receivable ofRs.
 111.42 Lacs as excise duty credit from Central Excise Department.
 During the year the company has credited the ''Balance with Central
 Excise Authority'' and debited ''Excise Receivable for Stock Lost in Fire
 from Insurance Company'' by Rs.111.42 Lacs based on the order dated
 20.01.2012 received from Commissioner Central Excise, Customs and
 Service Tax, Vapi.
 
 15.  RELATED PARTY DISCLOSURES:
 
 I.  List of related parties and relationships:
 
 Enterprises over which Key Managerial personnel and relative of such
 personnel are able to exercise significant influence
 
 Sr. No.  Name of the such Related Parties
 
 1.  Kshitij Mohan Gupta
 
 2.  Mohan N. Gupta HUF
 
 3.  Neetadevi P. Gupta
 
 4.  Nandkishore 0. Gupta
 
 5.  Prakash N. Gupta HUF
 
 6.  Umadevi M. Gupta
 
 7.  Gaurav P. Gupta
 
 8.  Jatin P. Gupta
 
 9.  Prakash N. Gupta
 
 10.  Mohan N. Gupta
 
 11.  Sharp Synthetics Pvt. Ltd.
 
 12.  Blue Chip Builders Pvt. Ltd.
 
 13.  Evergreen Synthetics Pvt. Ltd.
 
 14.  Sterlite Synthetics Pvt. Ltd.
 
 15.  GSL Nova Petrochemicals Pvt. Ltd.
 
 Above information regarding related parties have been determined to the
 extent such parties have been identified on the basis of information
 and explanations given to us by the company.
 
 *Note: Opening stock of finished goods comprised of stock Lost in fire.