1) a) Accounting standard 17(Segment reporting) is not applicable to
 the  company in the absence of any commercial operations.
 
 b) Related party transactions:-
 
 Nameofthe            Nature of
 Related person       Relations ship
 
 SriJ B Reddy         Director
 
 During the year an amount of Rs. 14,86,313/- was obtained as Unsecured
 Loan from the above related party. The total amount of Unsecured Loans
 obtained from the directors and outstanding as on 31.03.2009 is
 Rs.2,55,71,283/-
 
 c) Accounting standard 19(Leases) is not applicable as there are no
 lease transactionsentered into by the company.
 
 Though the company has unabsorbed depreciation.carry forward Losses and
 current losses, deferred Tax assets has not been recognized in the
 books of account since generation of sufficient taxable income in the
 near future is not certain.
 
 2) AUDIT COMMUTE:
 
 As a part of good corporate governance and in.order to-facilitate the
 Board of Directors in fulfilling the financial responsibilities an
 audit committee has been constituted.
 
 The brief description ofTerms of Reference of the Audit Committee.
 
 a) To review the companys financial reporting process and the
 disclosure of its financial information to ensure the financial
 statement as correct,sufficient and credible.
 
 b) To reviewfinancialand risk management policies.
 
 c) To review the financial statementaudited by the statutory auditors.
 
 d) The Audit committee has been constituted with the following three
 directors
 
 1)JB Reddy                   Chairman
 2) K.Niranjan Reddy          Member
 3) J. Ravindranath Reddy     Member
 
 The Audit committee has met 4 times during the year and all the members
 of the committee were presentforthe meetings.
 
 3) Contingent Liabilities:         As on      As on
                               31.03.2009    31.3.2008 
                                      Rs.       Rs.
 
 a) Excise demands against the    2560989        2560989 
 company contested and
 pending
 
 in appeal b)lncome-Tax demands 
 against the                       670813         670813
 company contested and pending
 in appeal
 
 4) There are no dues to the Small Scale Industries as on 31 March 2009.
 
 5) The Term Loan Originally obtained from ICICI Bank Ltd which has
 assigned the said loan infavour of the Standard Chartered Bank, which
 in turn has assigned the loan in favour of Shri Venkatasesha Reddy K,
 is secured by first charge on all movable and immovable properties both
 present and future. The said loan is further guaranteed by the personal
 guarantees of one of the present DirectorsandanEx-Directorofthecompany.
 
 6) a) No provision has been made for gratuity in the absence of the
 eligible employees forthe year.
 
 b) As Per the information and explanations given to us, the provisions
 of Employees Provident Fund Act and Employees State Insurance
 Actarenotapplicable to thecompanyfortheyearof account.
 
 7) Capital Work-in-progress represents the expenditure on capital
 account in respect of development of Land, Ponds formation and
 CivilWorks.
 
 8) Quantitative details of the stocks, production and turnover of the
 finished goods are not given since the company did not carry on
 commercial operations for the past six years and there are no stocks of
 finished goods.
 
 9) Deposits and advances receivable, creditors and advances from the
 customers are subject to confirmation from the concerned parties.
 
 10) Since the Company became sick and the negotiations for settlement
 of dues to the assignee Bank,The Standared Chartered Bank which has
 again assigned the debt in favor of Shri Venkatasesha Reddy K are in
 progress. No interest has been provided in the books of account for and
 from the Financial Year 2002-03 and the total interest accrued at the
 contracted rate on the said loan up to the Financial Year ended on 31st
 March,2008 was Rs. 1996.40 Lakhs approximately and the interest for the
 year of account accrued on the said Loan at the contracted rate of
 interest works out to Rs.  105.00 Lakhs. Had the sa id amount of
 interest of Rs. 105.00 Lakhs for the year of account been provided in
 the books of account the loss forthe year would have been more by Rs.
 105.00 Lakhs.