The Directors present the TWENTY-SEVENTH ANNUAL REPORT with the audited
 statements of accounts of the Company for the year ended December 31,
 2010.
 
 1.  FINANCIAL RESULTS :
 
 Particulars                             Year ended      Year ended
                                  December 31, 2010   December 31, 2009
                                      (Rs. in lacs)     (Rs. in lacs)
 
 Sales & Other Income                    136377            118137
 
 Operating Profit                         15188             19446
 
 Less: Interest                               8                61
 
 Depreciation                              1290              1186
 
 Profit for the year                      13890             18199
 
 Provision for tax                         3655              5762
 
 Deferred Tax Adjustment                   (270)             (843)
 
 PROFIT AFTER TAX                         10505             13280
 
 Profit brought forward from the previous 
 year                                     30908             19991
 
 Profit available for appropriations      41413             33271 
 
 APPROPRIATIONS
 
 General Reserve                           1050              1328
 
 Proposed Dividend                          884               884
 
 Tax on proposed dividend                   147               150
 
 BALANCE CARRIED FORWARD                  39332             30909
 
 2.  DIVIDEND:
 
 The Directors recommend a dividend @Rs.10/- per share for the financial
 year 2010.
 
 3.  OPERATIONS:
 
 The Management Discussion and Analysis Report annexed herewith provides
 full details of operational performance and business analysis of these
 business units.
 
 - Honeywell Process Solutions (HPS) - business serves core industrial
 sectors of Refining, Oil and Gas, Pulp and Paper, Metal and Cement etc.
 
 - Honeywell Building Solutions (HBS) - business provides solutions and
 services for facilities such as Commercial and Industrial Buildings, IT
 and ITES industry, Hospitals, Hotels, Airports, Mass Rapid Transit
 (MRT) etc.
 
 - Environment and Combustion Control (ECC) - Through multi channels and
 multiple brands, offers environmental and combustion products and
 solutions to commercial, hospitality and industrial segments.
 
 - Sensing and Control (S&C) - Products business provides various
 sensors and switches to manufacturing and automobile industry. This
 business serves primarily OEMs in various manufacturing industries such
 as auto, medical instrumentation, IT, etc.
 
 - Global Services (GS) - Addresses manufacturing and engineering
 services needs of Honeywell along with some other non Honeywell
 customers across the globe, leveraging the cost, skills and knowledge
 arbitrage.
 
 4.  COMMUNITY DEVELOPMENT WORK:
 
 Your Company, Honeywell Automation India Ltd. (HAIL) is committed to
 its Corporate Social Responsibility (CSR) activities and strongly
 believes that helping out even in a small way, can bring about a
 difference in the lives of many. We focus our CSR activities on issues
 related to health, education and environment.
 
 HAIL has a dedicated CSR Committee staffed with employees volunteering
 to dedicate time and commitment for this important initiative. Funding
 for CSR activities is generated from both the Company and also
 voluntary contributions from the employees through payroll. Multiple
 CSR projects were undertaken this year. Major ones are listed below:
 
 - Sponsoring 50 children from Kolwan Valley Mulshi Taluka in close
 co-ordination with Sadhana Village - an NGO. This sponsorship aims at
 providing academic support as well as health check up and medical
 insurance to the villagers.
 
 - HAIL continues to be associated with Aabha, an organization that
 focuses on educating people in rural areas on the health aspect, once
 again focusing on the Kolwan Valley with 10-12 villages benefiting from
 these programs. This program aims towards educating the villagers on
 general health and hygiene aspects.
 
 - Health check up program with the help of B.J.Medical College, in
 Gurukul - a centre for orphans situated in Veer, a small village near
 Pune.
 
 - With a focus on improving teaching skills, HAIL conducted a discovery
 workshop to enhance skills of teachers to understand the principles of
 Maths, Science and Geography. Teachers from 12 schools were covered
 under this workshop, which was to empower and to catalyze children to
 learn. This will help the students to develop interest in learning.
 
 - The Company has also contributed to the Lila Poonavala Foundation for
 the work it carries out in the field of education of women and building
 women leaders and technical experts.
 
 In addition to the above, HAIL employees also actively participate in
 various initiatives through DISHA, an employee engagement program.
 
 Projects undertaken this year through DISHA were:
 
 - Teaching a structured syllabus to children with disability in a
 school in Wanowrie, Pune. Employees visit the school on Saturday/Sunday
 to teach children of standards 9 and 10, Creation of audio CDs for
 standard 9 from which 5 schools for the visually impaired benefited,
 Joy of giving week (collection of clothes, books, toys), Blood donation
 drives, Tree Planting and Trekking - Clean up drives along the path
 uphill.
 
 5.  DIRECTORS:
 
 As per the provisions of the Companies Act, 1956 and Articles of
 Association of the Company, Mr. S.L. Rao and Mr. Norman Gilsdorf,
 retire by rotation and are eligible for reappointment.
 
 6.  MANAGEMENT DISCUSSION AND ANALYSIS/CORPORATE GOVERNANCE REPORT:
 
 As per Clause 49 of the Listing Agreement with the Stock Exchanges,
 Management Discussion and Analysis Report and Corporate Governance
 report are annexed and form part of the Directors Report.
 
 7.  CODE OF CONDUCT COMPLIANCE:
 
 As per Clause 49 of the Listing Agreement with the Stock Exchanges, the
 declaration signed by the Managing Director affirming compliance with
 the Code of Conduct by Directors and Senior Management, for the
 Financial Year 2010 is annexed and forms part of the Directors Report.
 
 8.  DIRECTORS RESPONSIBILITY STATEMENT:
 
 Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors,
 based on the representations received from the Operating Management,
 confirm that -
 
 a) In the preparation of the annual accounts, the applicable accounting
 standards have been followed and that there are no material departures;
 
 b) They have, in the selection of the accounting policies, consulted
 the Statutory Auditors and have applied them consistently and made
 judgements and estimates that are reasonable and prudent so as to give
 a true and fair view of the state of affairs of the Company at the end
 of the financial year and of the profit of the Company for that period;
 
 c) They have taken proper and sufficient care, to the best of their
 knowledge and ability, for the maintenance of adequate accounting
 records in accordance with the provisions of the Companies Act, 1956,
 for safeguarding the assets of the Company and for preventing and
 detecting fraud and other irregularities;
 
 d) They have prepared the annual accounts on a going concern basis.
 
 9.  AUDITORS:
 
 M/s. Price Waterhouse & Co., the Statutory Auditors retire at the
 forthcoming Annual General Meeting and are eligible for reappointment.
 The Company has received the certificate from the retiring auditors to
 the effect that the appointment, if made, will be in accordance with
 the limits specified in Section 224(1-B) of the Companies Act, 1956.
 
 10.  OTHER INFORMATION:
 
 Information as per Section 217 (2A) of the Companies Act, 1956, read
 with the Companies (Particulars of Employees) Rules, 1975 is given as
 an Annexure to this Report and forms part of it.
 
 As per provisions of Section 219(1)(b)(iv) of the Act, this Directors
 Report and Accounts are being sent to the shareholders excluding the
 statement giving particulars of employees under Section 217(2A) of the
 Act. Any Shareholder interested in obtaining a copy of the statement
 may write to the Company Secretary at the Registered Office of the
 Company. The Annual Report and the statement under Section 217(2A) of
 the Act is available for inspection at the Registered Office of the
 Company during working hours for a period from March 28, 2011.
 
 Information pertaining to absorption of technology, foreign exchange
 earnings is given as an Annexure to this Report and forms part of it.
 
 11.  ACKNOWLEDGEMENT:
 
 The Board would like to place on record its appreciation and thanks to
 all its employees for their contribution. The Board also wishes to
 acknowledge the support it has received from its investors, customers,
 vendors, regulatory authorities and bankers.
 
                                   For and on behalf of the Board
                                                    M. N. BHAGWAT
 
 Mumbai, February 9, 2011                                Chairman
 
 Registered Office:
 
 56 & 57, Hadapsar
 Industrial Estate,
 Pune411 013