1.  Contingent Liabilities
 
 Depending on the facts of each case and after due evaluation of
 relevant legal aspects, claims against the Company not acknowledged as
 debts are disclosed as contingent liabilities. In respect of the
 statutory matters, contingent liabilities are disclosed only for those
 demand(s) that are contested by the Company.
 
 Contingent Liabilities not provided for :
 
 A.  Estimated amount of contracts remaining to be executed on capital
 accounts Rs. 106,830,418 after adjusting advances (Previous year Rs.
 117,700,000)
 
 B.  Bank Guarantees issued in favour of Asst./ Dy. Commissioners of
 Customs, Mumbai & New Delhi for Export Obligation is Rs. 5,554,000
 (Previous year Rs. 12,132,980)
 
 Opening         Released during Year    Fresh Guarantees     Closing
                                         during the Year
 
 Rs. 12,131,980   Rs. 6,578,980          Nil                Rs.5,554,000
 
 C.  Disputed statutory demands in appeals before Rajasthan High Court:
 
 Rajasthan Tax on Entry of Goods into Local Area Act 1999 ,
 Rs1,716,840/- & Rs1,351,717/- for FY 2007-08 & 2008-09 respectively.
 
 3.  In the opinion of the Board of Directors, the Current Assets, Loans
 and Advances are having the value at which they are stated in the
 Balance Sheet, if realized in the ordinary course of business.
 
 4.  Claims received against shortage / damage of materials which are
 not of significant value are not being shown separately. The same are
 accounted for on receipt basis.
 
 5.  In pursuance of Micro, Small & Medium Enterprises Development Act,
 2006, the names of the Enterprises to whom the Company owes any sum
 which is outstanding at the year end are as follows:-
 
 b) We have make payment to MSME within permissible time limit under
 Micro, Small & Medium Enterprises Development Act, 2006 during FY
 2010-2011 so there is no interest due on MSME.
 
 c) There is no interest due & payable to MSME as on 31.03.2011.
 
 6.  Title of HSIDC plot no. 24, 25, 26, sector 7 IMT Manesar Gurgaon
 has not been registered in the name of the Company. HSIDC had allotted
 the land in the name of the Company vide its letter of allotment no.
 HSIIDC 1441 dated 10.07.2003.
 
 7.  Company opted for the option to follow principles of notification
 of the Companies (Accounting Standards) Amendment Rules 2006 on 31st
 March 2009. Thereby exchange differences relating to long-term monetary
 items, arising during the year, in so far as they relate to the
 acquisition of a depreciable capital asset are added to/ deducted from
 the cost of the asset under the head “Addition” of Schedule 4 and
 depreciated over the balance life of the asset.
 
 Accordingly, Rs. 197,661 have been deducted from the cost of fixed
 assets and the profit for the year is lower by Rs. 197,661.
 
 8. The Company is primarily engaged in the business of gears and
 transmission components. Inherent nature of both the activities is
 governed by the same set of risk and returns, these have been grouped
 as a single segment in the above disclosures. Hi-Tech (E-Soft) is a
 division of the Company engaged in the business of engineering software
 solutions. Since this business is not required to be reported as per
 AS-17 on Segment Reporting, separate figures of the software division
 are not reported.
 
 9.  During the year the company has allotted 9,384,000 Bonus equity
 shares of Rs.10/- each fully paid up in the ratio of 1:1, out of
 General Reserve.
 
 10.  A part of Land owned by Company situated at Village Sihi, Gurgaon
 was acquired during the year by the Government of Haryana and amount of
 Rs. 35,20,396 was received as compensation against 3 Kanal and 8 Marla
 land. Revaluation Reserve amounting to Rs. 1,56,57,846 pertaining to
 the acquired part of the land has been reversed.
 
 11.  Company is following the principles of Accounting Standard (''AS'')
 30 “Financial Instruments: Recognition and Measurement” in respect of
 its derivative financial instruments.
 
 Derivative financial instruments, which qualify for cash flow hedge
 accounting and where the Company has met all the conditions of
 effective Cash Flow hedge accounting, are fair valued at March 31, 2011
 Consequently Hedging Reserve/Fair Valuation Loss on Derivative balances 
 is reduced to Rs 1,444,208.(Previous Year Rs 6,715,728 )
 
 12.  Related Party Disclosures (AS-18)
 
 (a) Enterprise in which company has control-Nil
 
 (b) Key Management Personnel
 
 1 Sh. Deep Kapuria Chairman&Whole Time Director
 
 2 Sh. Pranav Kapuria Managing Director
 
 3 Sh. Anuj Kapuria Whole Time Director
 
 (c) Transactions with the related parties during the year are as per
 Annexure attached.
 
 13.  Funded status of Gratuity Plan & Leave Encashment
 
 The following tables set out the funded and unfunded status of the
 gratuity plan and leave encashment amounts recognized in the Company''s
 financial statements as at 31March, 2011: