1.  Contingent Liabilities:
 
                                                       (Rs. in crores)
 
                                 As at March 31,2011  As at March 31,2010
 
 i) In respect of excise matters               30.36                13.72
 
 The above matters are subject to legal proceedings in the ordinary
 course of business. The legal proceedings when ultimately concluded
 will not, in the opinion of management, have a material effect on the
 result of operations or the financial position of the Company.
 
 2.  Estimated amount of contracts remaining to be executed on capital
 account and not provided for Rs. 101.54 crores (previous year Rs. 59.32
 crores).
 
 3.  The Company has entered into operating lease agreements for motor
 vehicles, dies and data processing machines.  These lease arrangements
 are cancellable in nature and range between two to four years. The
 aggregate lease rentals under these arrangements amounting to Rs. 12.40
 crores (previous year Rs. 9.04 crores) have been charged under Lease
 rentals in Schedule 10.
 
 4.  As the Company''s business activity falls within a single primary
 business segment viz. Two wheelers and its parts and is a single
 geographical segment, the disclosure requirements of Accounting
 Standard (AS-17) Segment Reporting, notified in the Companies
 (Accounting Standards) Rules, 2006 are not applicable
 
 5.  Related party disclosures under Accounting Standard 18
 
 a) i) Parties in respect of which the Company is a joint venture (upto
 March 22,2011) refer note 15.
 
 Honda Motor Co. Limited, Japan Hero Cycles Limited (upto May 30,2010)
 Bhadurchand Investments Private Limited Hero Investments Private
 Limited
 
 ii) Parties in respect of which the Company is an associate.  Hero
 Investment Private Limited (w.e.f March 22,2011)
 
 iii) Associate of the Company Hero Honda Finlease Limited
 
 b) Key management personnel and their relative
 
 Mr. Brijmohan Lall Munjal - Chairman
 
 Mr. Pawan Munjal - Managing Director & CEO
 
 Mr. Toshiaki Nakagawa -Joint Managing Director (upto March 22,2011)
 
 Mr. Sumihisa Fukuda - Whole time Director (upto March 22,2011)
 
 Mr. Suman Kant Munjal -Relative
 
 Mr. Sunil Kant Munjal -Relative
 
 c) Enterprises over which key management personnel and their relatives
 are able to exercise significant influence:-
 
 Brijmohan Lall & Associates, A.G. Industries Private Limited, Highway
 Industries Limited, Rockman Industries Limited, Cosmic Kitchen Private
 Limited, Hero Management Services Limited, Hero Cycles Limited (w.e.f
 May 31, 2010), Hero Corporate Services Limited, Hero Mindmine Institute
 Limited, Easy Bill Limited and Raman Kant Munjal Foundation.
 
 Enterprises not related party in the current year
 
 Majestic Auto Limited, Munjal Auto Industries Limited, Munjal Showa
 Limited, Sunbeam Auto Limited, Satyam Auto Components Limited, Hero
 Motors Limited, Shivam Autotech Limited and Indian School of Business.
 
 6. The Company has entered into Discretionary Portfolio Management
 Agreements, administered through ICICI Prudential Asset Management
 Company Limited-PMS, Escorts Securities Limited, Reliance Capital Asset
 Management Ltd, Birla Sunlife Asset Management Company Private Limited
 collectively called Portfolio Managers. In terms of the said
 agreements, the Portfolio Managers have dealt in mutual funds,
 debentures, bonds, government securities, equity shares, equity stock
 futures, equity stock options, equity index options and such other
 securities, made on behalf of the Company. However, there are no
 outstanding derivative contracts as at March 31,2011.
 
 7.  The Company''s borrowing facilities, comprising fund based and non
 fund based limits from various bankers, are secured by way of
 hypothecation of inventories, receivables, movable assets and other
 current assets.
 
 8.  The Company has identified parties covered under the The Micro,
 Small, and Medium Enterprises Development Act, 2006'' on the basis of
 the confirmation received. The outstanding balance payable as at the
 close of the financial year to such parties amount to Rs. 2.87 crores.
 Further, no interest has been paid or payable to such parties under the
 said Act.
 
 9.  Employee Benefits
 
 Defined benefit plans
 
 In accordance with the Payment of Gratuity Act 1972, Company provides
 for gratuity, as defined benefit plan. The gratuity plan provides for a
 lumpsum payment to the employees at the time of separation from the
 service on completion of vested period of employment i.e. five years.
 The liability of gratuity plan is provided based on actuarial valuation
 as at the end of each financial year based on which the Company
 contributes the ascertained liability to Life Insurance Corporation of
 India by whom the plan assets are maintained.
 
 10. During the year, the Company has entered into a Memorandum of
 Understanding (MOU) with Honda Motor Company Limited Japan (Honda)
 dated December 16,2010 which is effective from January 1,2011, and in
 accordance therewith has entered into New License Agreements pursuant
 to the Share Transfer agreement, wherein Honda has given to the Company
 right and license to manufacture, assemble, sell and distribute certain
 products/parts and export license for certain products and their
 service parts under the intellectual property rights.
 
 The amount to be paid by the Company for licenses granted as stated
 above of Rs. 1928.37 crores for manufacture, assembly, selling and
 distribution and Rs. 550.96 crores for export license, has been
 capitalised as Intangible Assets along with applicable Cess and taxes,
 based on probability that the future economic benefits attributable to
 these assets will flow to the Company, as with effect from January 1,
 2011 onwards the company''s liability to pay ongoing royalty for all the
 existing / modified products/ parts would cease.
 
 These Intangible Asset has been amortised over a period of forty two
 months uptoJune30,2014. Accordingly, liability payable upto March 31,
 2012 has been included under Current Liabilities and the balance has
 been disclosed as Deferred Payment Credit.
 
 Further, joint venture has ceased on March 22, 2011 pursuant to
 transfer of shares held by Honda Motor Company to the Indian joint
 venture partners.
 
 11.  Exceptional item of Rs. 79.84 crores represents estimates made
 mainly for probable claims arising out of litigations/ disputes pending
 with statutory authorities in accordance with Accounting Standard
 (AS-29) Accounting Standard on Provisions, Contingent Liabilities and
 Contingent Assets specified in the Companies (Accounting Standard)
 Rules, 2006.
 
 12.  In line with Notification No. G.S.R. 225(E) dated March 31,2009
 issued byThe Ministry of Corporate Affairs, Government of India, the
 exchange differences arising after April 1,2007 on reporting of long
 term foreign currency monetary items at rates different from those at
 which they were initially recorded during the period, or reported in
 previous financial statements, in so far as they relate to the
 acquisition of a depreciable capital asset, have been added to or
 deducted from the cost of the asset and shall be depreciated overthe
 balance useful life of the asset.
 
 13.  Previous year''s figures have been recast/regrouped wherever
 necessary.
 
 14.  Schedules 1 to 12 form an integral part of the accounts.