1.  Segment accounting
 
 a) Segment accounting policies
 
 Segment accounting policies are in line with the accounting policies of
 the Company. In addition, the following specific accounting policies
 have been followed for segment reporting:
 
 i) Segment revenue includes sales and other income directly
 identifiable with/allocable to the segment including inter segment
 revenue.
 
 ii) Expenses that are directly identifiable with/allocable to segments
 are considered for determining the segment result.  Expenses which
 relate to the Company as a whole and not allocable to segments are
 included under unallocable corporate expenditure.
 
 iii) Income which relates to the Company as a whole and not allocable
 to segments is included in unallocable corporate income.
 
 iv) Segment result includes margins on inter-segment capital jobs,
 which are reduced in arriving at the profit before tax of the Company.
 
 v) Segment assets and liabilities include those directly identifiable
 with the respective segments. Unallocable corporate assets and
 liabilities represent the assets and liabilities that relate to the
 Company as a whole and not allocable to any segment.
 
 b) Inter-segment transfer pricing
 
 Segment revenue resulting from transactions with other business
 segments is accounted on the basis of transfer price agreed between the
 segments. Such transfer prices are either determined to yield a desired
 margin or agreed on a negotiated basis.
 
 2.  Taxes on income
 
 Tax on income for the current period is determined on the basis of
 taxable income and tax credits computed in accordance with the
 provisions of the Income Tax Act 1961, and based on the expected
 outcome of assessments/appeals.
 
 Deferred tax is recognised on timing differences between the income
 accounted in financial statements and the taxable income for the year,
 and quantified using the tax rates and laws enacted or substantively
 enacted as on the Balance Sheet date.
 
 Deferred tax assets relating to unabsorbed depreciation/business losses
 /losses under the head capital gains are recognised and carried
 forward to the extent there is virtual certainty that sufficient future
 taxable income will be available against-which such deferred tax assets
 can be realised.
 
 Other deferred tax assets are recognised and carried forward to the
 extent that there is a reasonable certainty that sufficient future
 taxable income will be available against which such deferred tax assets
 can be realised.
 
 3.  Provisions, contingent liabilities and contingent assets
 
 Provisions are recognised for liabilities that can be measured only by
 using a substantial degree of estimation, if
 
 a) the Company has a present obligation as a result of a past event;
 
 b) a probable outflow of resources is expected to settle the
 obligation; and
 
 c) the amount of the obligation can be reliably estimated.
 
 Reimbursement expected in respect of expenditure required to settle a
 provision is recognised only when it is virtually certain that the
 reimbursement will be received.  Contingent liability is disclosed in
 case of
 
 a) a present obligation arising from past events, when it is not
 probable that an outflow of resources will be required to settle the
 obligation;
 
 b) a present obligation arising from past events, when no reliable
 estimate is possible; and
 
 c) a possible obligation arising from past events where the probability
 of outflow of resources is not remote.  Contingent assets are neither
 recognised, nor disclosed.
 
 Provisions,.contingent liabilities and contingent assets are reviewed
 at each Balance Sheet date.
 
 1.  a) Of the equity shares of f 2 each comprised in the subscribed and
 paid-up capital of the Company:
 
 i) 9,19,943 (previous year: 9,19,943) equity shares were allotted as
 fully paid up, pursuant to contracts, without payment being received in
 cash, ii) 44,96,76,280 (previous year: 44,96,76,280) equity shares were
 issued as bonus shares by way of capitalisation of general reserve: Rs.
 2.35 crore (previous year: 7 2.35 crore), securities premium: Rs. 87.47
 crore (previous year: Rs. 87.47 crore) and capital redemption reserve: Rs.
 0.12 crore (previous year: Rs. 0.12 crore).
 
 iii) 2,67,45,064 (previousyear: 2,00,88,346) equity shares were
 allotted as fully paid up on exercise of grants under Employees Stock
 Ownership Schemes.
 
 3. a) Working capital facilities from banks including cash credits,
 demand loans, bank guarantees and letters of credit are secured by
 hypothecation of inventories, book debts and receivables. The total
 charge on these assets is Rs. 1385.12 crore as on March 31, 2011.
 
 b) Other secured loans from banks represent loans amounting to Rs. nil
 (previous year: 7 5.90 crore) availed under bill discounting facility
 and are secured against specific receivables.
 
 4.  Loans and advances include:
 
 a) Rent deposit with whole-time directors: Rs. 0.03 crore (previous year:
 Rs. 0.03 crore). The maximum amount outstanding at any time during the
 year: Rs. 0.03 crore (previous year: Rs. 0.03 crore).
 
 b) Amount, including interest accrued, due from the managing director
 and whole-time directors in respect of housing loan: Rs. 0.34 crore
 (previous year:X 0.61 crore). Maximum amount outstanding at anytime
 during the year: Rs.0.61 crore (previous year: Rs. 0.63 crore).
 
 5.  Sales and service include X 352.04 crore (previous year: Rs. 118.06
 crore) for price variations net of liquidated damages in terms of
 contracts with the customers and shipbuilding subsidy Rs. 32.16 crore
 (previous year: Rs. 56.80 crore).
 
 6.  Extraordinary item during the year represents proportionate
 reversal of Rs. 70.84 crore (previous year: Rs. 62.55 crore), out of the
 provision made in earlier years in respect of the Company''s investment
 in shares of Satyam Computer Services Limited (SCSL), pursuant to sale
 of a part of its holding in SCSL during the year.
 
 7.  Other income for the year ended March 31, 2011 includes the
 following items of exceptional nature [accounting policy no.3]:
 
 a) Profit of Rs. 25.00 crore on sale of the Company''s part stake in Kesun
 Iron & Steel Company Private Limited, a subsidiary of the Company to a
 strategic partner.
 
 b) Gain of Rs. 213.04 crore on sale of the Company''s entire stake in
 L&T-Case Equipment Private Limited, an associate company.
 
 c) Part reversal of provision of Rs. 24.03 crore made in the earlier
 years for diminution in the value of investment in the international
 Seaport Dredging Limited, pursuant to divestment of the Company''s part
 stake in the said company.
 
 8.  The cost of specialised machine tools including jigs, fixtures,
 dyes, gauges and moulds used in the production in Electrical and
 Electronics business was expensed out in earlier years. These items of
 plant & machinery have a useful life of 5 years. During the year, the
 cost of such tools, where useful life has not expired, has been
 capitalized. The amount expensed out in earlier years in respect of
 such tools has been reversed during the year and accordingly, the
 expense under Stores, spares and tools is lower by Rs. 77.32 crore.
 Similarly, the cumulative depreciation based on useful life of such
 tools has been provided in the books during the year and as a result,
 the depreciation for the year is higher by Rs. 51.08 crore.
 
 9.  The expenditure on research and development activities, as
 certified by the management, is Rs. 108.98 crore (previous year: Rs. 97.54
 crore). This includes capital expenditure
 
 (a) on tangible assets of Rs. 16.67 crore (previous year: Rs. 5.56 crore);
 
 (b) on intangible assets being expenditure on new product development
 of Rs. 22.72 crore (previous year: Rs. nil) [accounting policy no.4(b)];
 and
 
 (c) on other intangible assets of Rs. 1.33 crore (previous year: Rs. nil).
 
 In addition, the Company has carried out work of a developmental nature
 of Rs. 16.46 crore (previous year: Rs. nil) which is partially/fully paid
 for by the customers.
 
 10.  a) The useful life of certain tangible assets was revised downward
 during the year as mandated by Accounting Standard (AS) 6
 
 Depreciation Accounting and permitted by Schedule XIV of Companies
 Act. Consequently, depreciation rates have been revised upward
 resulting in additional charge of depreciation of Rs. 43.00 crore. As a
 result, profit before tax for the year is lower to that extent,
 [accounting policy no.8a(ii)]
 
 b) The Company has reviewed the useful life of certain intangible
 assets during the year. Consequently, amortisation rates have been
 revised resulting in lower charge of amortisation of Rs. 3.69 crore. As a
 result, profit before tax for the year is higher to that extent,
 (accounting policy no.9)
 
 11.  Disclosure pursuant to Accounting Standard (AS) 15 (Revised)
 Employee Benefits.
 
 i.  Defined contribution plans: [accounting policy no.5b(i)]
 
 Amount of Rs. 91.25 crore (previous year Rs. 70.03 crore) is recognised as
 an expense and included in Staff Expenses (Schedule N) in the Profit
 and Loss Account.
 
 5 Attrition Rate:
 
 a) For post-retirement medical benefit plan & Company pension plan, the
 attrition rate varies from 2% to 8% (previous year: 2% to 8%) for
 various age groups.
 
 b) For gratuity plan the attrition rate varies from 1% to 6% (previous
 year: 1% to 7%) for various age groups.
 
 6 The estimates of future salary increases, considered in actuarial
 valuation, take into account inflation, seniority, promotion and other
 relevant factors, such as supply and demand in the employment market.
 
 7 The interest payment obligation of trust-managed provident fund is
 assumed to be adequately covered by the interest income on long term
 investments of the fund. Any shortfall in the interest income over the
 interest obligation is recognised immediately in the Profit and Loss
 Account as actuarial losses.
 
 8 The obligation of the Company under the post-retirement medical
 benefit plan is limited to the overall ceiling limits.  At present,
 healthcare cost, as indicated in the principal actuarial assumption
 given above, has been assumed to increase at 5% p.a.
 
 h) General descriptions of defined benefit plans:
 
 1.  Gratuity plan:
 
 The Company operates gratuity plan through a trust wherein every
 employee is entitled to the benefit equivalent to fifteen days salary
 last drawn for each completed year of service. The same is payable on
 termination of service or retirement whichever is earlier. The benefit
 vests after five years of continuous service. The company''s scheme is
 more favourable as compared to the obligation under Payment of Gratuity
 Act, 1972. A small part of the gratuity plan, which is not material is
 unfunded and managed within the Company.
 
 2.  Post-retirement medical care plan:
 
 The Post-retirement medical benefit plan provides for reimbursement of
 health care costs to certain categories of employees post their
 retirement. The reimbursement is subject to an overall ceiling
 sanctioned based on cadre of the employee at the time of retirement.
 
 3.  Company''s pension plan:
 
 In addition to contribution to state-managed pension plan (EPS scheme),
 the Company operates a post retirement pension scheme, which is
 discretionary in nature for certain cadres of employees. The quantum of
 pension depends on the cadre of the employee at the time of retirement.
 
 4.  Trust managed provident fund plan:
 
 The Company manages provident fund plan through a provident fund trust
 for its employees which is permitted under the Provident Fund and
 Miscellaneous Provisions Act, 1952. The plan envisages contribution by
 employer and employees and guarantees interest at the rate notified by
 the provident fund authority. The contribution by employer and employee
 together with interest are payable at the time of separation from
 service or retirement whichever is earlier. The benefit under this plan
 vests immediately on rendering of service.
 
 12 Uncalled liability on shares partly paid is t nil net of advance
 paid against equity commitment (previous year: Rs. 36.62 crore).
 
 b) Segment reporting: segment identification, reportable segments and
 definition of each reportable segment: i) Primary/secondary segment
 reporting format:
 
 [a] The risk-return profile of the Company''s business is determined
 predominantly by the nature of its products and services. Accordingly,
 the business segments constitute the primary segments for disclosure of
 segment information.
 
 [b] In respect of secondary segment information, the Company has
 identified its geographical segments as (i) domestic and (ii) overseas.
 The secondary segment information has been disclosed accordingly.
 
 ii) Segment identification:
 
 Business segments have been identified on the basis of the nature of
 products/services, the risk-return profile of individual businesses,
 the organisational structure and the internal reporting system of the
 Company.
 
 iii) Reportable segments:
 
 Reportable segments have been identified as per the criteria specified
 in Accounting Standard (AS) 17 Segment Reporting issued by the
 Institute of Chartered Accountants of India.
 
 iv) Segment composition:
 
 - Engineering & Construction Segment comprises execution of engineering
 and construction projects in India/ abroad to provide solutions in
 civil, mechanical, electrical and instrumentation engineering (on
 turnkey basis or otherwise) to core/infrastructure sectors including
 railways, shipbuilding and supply of complex plant and equipment to
 core sectors. The segment capabilities include basic/detailed
 engineering, equipment fabrication/supply, erection & commissioning,
 procurement/construction and project management.
 
 - Electrical & Electronics Segment comprises manufacture and sale of
 low and medium voltage switchgear components, custom-built
 switchboards, custom built low and medium voltage switchboards,
 electronic energy meters/protection (relays) systems, control &
 automation products, medical equipment and petrol dispensing pumps &
 systems [up to the date of sale in previous year],
 
 - Machinery & Industrial Products Segment comprises manufacture and
 sale of industrial machinery & equipment, manufacture and marketing of
 industrial valves, construction equipment and welding/industrial
 products.
 
 - Others include property development and integrated engineering
 services.
 
 ii (a) Names of the associates and joint ventures with whom
 transactions were carried out during the year:
 
 Associate companies:
 
 1 Audco India Limited 
 
 2 EWAC Alloys Limited @@ 
 
 3 L&T-Chiyoda Limited 
 
 4 L&T-Komatsu Limited
 
 5 L&T-Ramboll Consulting Engineers Limited                    
 
 6 L&T-Case Equipment Private Limited AA
 
 7 JSK Electricals Private Limited 
 
 8 Feedback Ventures Private Limited
 
 9 L&T Arun Excello Realty Private Limited 
 
 10 Magtorq Private Limited
 
 11 Salzer Electronics Limited
 
 Joint ventures (other than associates):
 
 1 International Metro Civil Contractors 
 
 2 Bauer-L&T Diaphragm Wall Joint Venture
 
 3 Metro Tunneling Chennai L&T SUCG Joint Venture      
 
 4 L&T-Eastern Joint Venture
 
 5 Metro Tunneling Group 
 
 6 L&T Hochtief Seabird Joint Venture
 
 7 Desbuild-L&T Joint Venture 
 
 8 L&T-SUCG Joint Venture
 
 9 L&T-AM Tapovan Joint Venture 
 
 10 HCC-L&T Purulia Joint Venture
 
 II The Dhamra Port Company Limited
 
 @@ Associate became Subsidiary w.e.f. December 14, 2010 AA The Company
 has sold its stake on March 31, 2011
 
 ii (b) Names of the Key management personnel and their relatives with
 whom transactions were carried out during the year:
 
 Key management personnel & their relatives:
 
 1 Mr. A. M. Naik (Chairman & Managing Director) 2 Mr. J. P. Nayak
 (whole-time director)
 
 Mrs. Neeta J. Nayak (wife) Mr. Nitin Nayak (son)
 
 3 Mr. Y. M. Deosthalee (whole-time director) 4 Mr. K. Venkataramanan
 (whole-time director)
 
 Mrs. Jyothi Venkataramanan (wife)
 
 5 Mr. R. N. Mukhija (whole-time director) A 6 Mr. K. V. Rangaswami
 (whole-time director)
 
 Ms. Debika Ajmani (daughter) Ms. Radhika Mukhija (daughter)
 
 7 Mr. V. K. Magapu (whole-time director) 8 Mr. M. V. Kotwal (whole-time
 director)
 
 9 Mr. Ravi Uppal (whole-time director) ~
 
 A Up to October 23, 2010 W.e.f. November 1, 2010
 
 21 Leases:
 
 Where the Company is a lessee:''
 
 a) Finance leases:
 
 i. [a] Assets acquired on finance lease mainly comprise plant and
 machinery, vehicles and personal computers. The leases have a primary
 period, which is fixed and non-cancellable. In the case of vehicles,
 the Company has an option to renew the lease for a secondary period.
 The agreements provide for revision of lease rentals in the event of
 changes in (a) taxes, if any, leviable on the lease rentals (b) rates
 of depreciation under the Income Tax Act, 1961 and (c) change in the
 lessor''s cost of borrowings. There are no exceptional/restrictive
 covenants in the lease agreements.
 
 13 (a) Provision for current tax includes:
 
 i.  Provision for wealth tax Rs. 2.28 crore (previous year: Rs. 2.70
 crorej.
 
 ii.  Rs. 87.39 crore being provision for income tax in respect of earlier
 years (previous year: Rs. 133.29 crore).
 
 iii.  Rs. 3.58 crore in respect of income tax payable outside India
 (previous year: Rs. 70.02 crore).
 
 iv.  Reversal of excess provision for tax on fringe benefits Rs. nil
 (previous year Rs. 10.01 crore) pertaining to earlier years.
 
 (b) Tax effect of Rs. 0.62 crore (previous year: Rs. 6.57 crore) is on
 account of debenture issue expenses which has been credited to
 securities premium account.
 
 14 An amount of Rs. 22.73 crore (net gain) [previous year: Rs. 70.93 crore
 (net loss)] has been accounted under respective revenue heads in the
 Profit and Loss Account towards exchange difference arising on foreign
 currency transactions and forward contracts covered under Accounting
 Standard (AS) 11 The Effects of Changes in Foreign Exchange Rates.
 
 15 In line with the Company''s risk management policy, the various
 financial risks mainly relating to changes in the exchange rates,
 interest rates and commodity prices are hedged by using a combination
 of forward contracts, swaps and other derivative contracts, besides the
 natural hedges.
 
 16 Estimated amount of contracts remaining to be executed on capital
 account (net of advances) Rs.-400.32 crore (previous year: Rs. 577.89
 crore).
 
 17 The Company has given, inter alia, the following undertakings in
 respect of its investments:
 
 a.  Jointly with L&T Infrastructure Development Projects Limited (a
 subsidiary of the Company), to the term lenders of its subsidiary
 companies L&T Transportation Infrastructure Limited (LTTIL):
 
 i. not to reduce their joint shareholding in LTTIL below 51% until the
 financial assistance received from the term lenders is repaid in full
 by LTTIL and
 
 ii. to jointly meet the shortfall in the working capital requirements
 of LTTIL until the financial assistance received from the term lenders
 is repaid in full by LTTIL.
 
 b.  In terms of Company''s concession agreement with Government of India
 and Government of Gujarat, not to change the control over L&T Western
 India Tollbridge Limited (a subsidiary of the Company) during the
 period of the agreement.
 
 c.  To the debenture holders of L&T Infrastructure Development Projects
 Limited (a subsidiary of the Company) and to the lenders of its
 subsidiaries L&T Panipat- Elevated Corridor Private Limited and L&T
 Krishnagiri Thopur Toll Road Limited, not to dilute Company''s
 shareholding below 51%.
 
 d.  To the lender of Offshore International FZC (a subsidiary of Larsen
 & Toubro International FZE), not to pledge or reduce the Company''s
 shareholding in L&T International FZE (a subsidiary of the Company)
 below 100% of the issued and allotted share capital.
 
 e.  To National Highway Authority of India, to hold minimum 26% stake
 in L&T Samakhiali Gandhidham Tollway Private Limited till 180 days from
 the date of concession agreement. However, the Company has decided to
 hold this stake for a period of 2 years after the construction period.
 
 f.  To National Highway Authority of India, to hold minimum 26% stake
 in PNG Tollway Limited (formerly known as PNG Tollway Private Limited)
 till the commercial operations date.
 
 g.  To Gujarat State Road Development Corporation Limited:
 
 (i) to hold in L&T Ahmedabad-Maliya Tollway Limited (formerly known as
 L&T Ahmedabad-Maliya Tollway Private Limited) and in L&T Halol-Shamlaji
 Tollway Limited (formerly known as L&T Halol-Shamlaji Tollway Private
 Limited) alongwith L&T Infrastructure Development Projects Limited:
 
 - 100% stake during the construction period;
 
 - 51% stake for 5 years from the date of commercial operation or end of
 construction of the project, whichever is later; and
 
 - 51% stake during operational period.
 
 (ii) not to divest the stake in L&T Infrastructure Development Projects
 Limited until the aforesaid undertakings are valid.  h.  To Gujarat
 State Road Development Corporation Limited, to hold in L&T
 Rajkot-Vadinar Tollway Limited (formerly known as L&T Rajkot-Vadinar
 Tollway Private Limited):
 
 - 100% stake during the construction period;
 
 - 51% stake for 5 years from the date of commercial operation or end of
 construction of the project, whichever is later; and
 
 - 51 % stake during operational period.
 
 i. To the lenders of L&T Ahmedabad-Maliya Tollway Limited (formerly
 known as L&T Ahmedabad-Maliya Tollway Private Limited) (a subsidiary of
 the Company), not to divest control directly or indirectly without the
 prior approval of the lenders or Gujarat State Road Development
 Corporation Limited.
 
 j. To the lenders of L&T Rajkot-Vadinar Tollway Limited (formerly known
 as L&T Rajkot-Vadinar Tollway Private Limited) (a subsidiary of the
 Company), not to divest control without the prior approval of the
 lenders or Gujarat State Road Development Corporation Limited.
 
 k. Jointly with L&T-MHI Turbine Generators Private Limited (a
 subsidiary of the Company) and Mitsubishi Heavy Industries Limited (JV
 partners in L&T-MHI Turbine Generators Private Limited), to Andhra
 Pradesh Power Development Company Limited (APPDCL) to render
 unconditional and irrevocable financial support for the successful
 execution of APPDCL 2x800 MW Power Project-Steam Turbine Generator
 Package Tender, near Krishnapatnam, Nellore District, Andhra Pradesh.
 
 l. To City and Industrial Development Corporation of Maharashtra
 Limited (CIDCO) that it shall continue to hold not less than 51 % stake
 in L&T Seawood Private limited (LTSPL) until CIDCO execute the lease
 deed for land in favour of LTSPL.
 
 m. To National Highway Authority of India, to hold together with its
 associates in L&T Devihalli Hassan Tollway Limited, minimum 51 % equity
 stake for a period of 2 years after construction period.
 
 n.  To National Highway Authority of India, to hold together with its
 associates in L&T Krishnagiri Walajahpet Tollway Limited:
 
 - minimum 51% equity stake during the construction period;
 
 - minimum 33% stake for 3 years from project completion date; and
 
 - minimum 26% or such lower stake as may be permitted by National
 Highway Authority of India during remaining concession period.
 
 o. To the lenders of PNG Tollway Limited (formerly known as PNG Tollway
 Private Limited), to hold minimum 51% equity stake in PNG Tollway
 Limited, until final settlement date.
 
 p. To the security trustee of the lenders of L&T Sapura Shipping
 Private''Limited, not to sell or transfer equity stake without prior
 approval.
 
 q.  To hold 15,899 shares comprising 9.85% of the issued capital of
 International Seaport Dredging Limited till January 24, 2016.
 
 r. To the security trustee of the lenders of L&T Metro Rail (Hyderabad)
 Limited, to hold and maintain along with L&T Infrastructure Development
 Projects Limited (a subsidiary of the Company) at least 51% stake till
 final settlement date.
 
 s. To hold certain minimum stake in its subsidiary companies namely,
 L&T-MHI Boilers Private Limited and L&T-MHI Turbine Generators Private
 Limited. These undertakings have been given to the customers/potential
 customers of the Company, as also those of L&T-MHI Boilers Private
 Limited. The undertakings will remain valid till the end of defect
 liability period or till such period as prescribed in the related bid
 documents/contracts.
 
 t. To the lenders of L&T Aviation Services Private Limited, to hold
 majority equity stake in L&T Aviation Services Private Limited, until
 any amount is outstanding under buyers credit facility.
 
 u. To the lenders of L&T Seawoods Private Limited, to maintain a
 minimum 51% stake in L&T Seawoods Private Limited, until any amount is
 outstanding under banking credit facilities.
 
 18 There are no amounts due and outstanding to be credited to Investor
 Education & Protection Fund as at March 31, 2011.
 
 19 According to the Company, construction is a service activity and
 therefore, the same is covered under para 3(ii)(c) of Part II of
 Schedule VI of the Companies Act, 1956.
 
 20 Figures for the previous year have been regrouped/reclassified
 wherever necessary.