(A) CONTINGENT LIABILITIES AND NOTES:
 
                                                  AS AT         AS AT
                                              31.3.2009     31.3.2008
                                               Rs. Lacs      Rs. Lacs
 
 1. (a) Claims against the Company
 not  acknowledged  as- debts
 (i) Workmen (excluding
 unascertainable  amounts)                      160.24        103.64
 (ii)   Others                                  154.09         91.89
 (b)   Partly paid-up  Equity  Shares of
 Vital  Chemicals  Private   Limited              0.08          0.08
 (c) Disputed Liability for Excise, Sales-tax
 matters and liquidated damages on             1103.30        991.74
 Provident Fund dues (excluding    interest
 unascertainable and undisputed Sales Tax/
 penalty demands (net of provision made of
 Rs. 62.21 Lacs) of Rs. 135.16 Lacs
 ({Note 22(d))
 (d)   Bills   discounted                       427.32        148.59
 
 2.  Estimated amount of contracts remaining to be executed on Capital
 Account Rs.  111.10 Lacs (Previous Year Rs 85.86 Las).
 
 3.  Guarantees given to Sales-tax/Excise Departments on behalf of
 Companies in the same group amounts to Rs.139.42 Lacs (Previous Year
 Rs.139.42 Lacs). Information regarding outstanding position is riot
 available.This excludes guarantees of Rs. 109.63 Lacs (Previous year
 Rs. 10S.B3 Lacs) vacated by Sales Tax Department for which guarantee
 bonds. not yet received back.
 
 4.(a)The Steel Unit is lying closed since 24th January, 1993 due to
 strike/lock-out and thereafter closure was declared with effect from
 24th November, 1993, as the unit was found to be unviable. The company
 has not been able to obtain access to the accounting, financial and
 production records of the unit necessary for updating the said books of
 accounts/compiling the data to prepare the annual accounts as well as
 for finalising the audit for the year ended 31st March, 1993. Even
 though there have been substantial transactions subsequent to the
 closure of the unit like realisation of depot sales/ dues from
 debtors,rental income, payment of full & final dues to ex-employees
 etc.  including loans given to corporates and transfer of funds to/from
 the Units, of the Company, these transactions could not be incorporated
 in the annual accounts of 1992- 93 and onwards in view of pending
 access to the earlier accounts viz., 1st April, 1992 to 24th January,
 1993, the absence of which would leave the books still incomplete.
 However, the Profit & Loss accounts for 2004-05 was incorporated during
 the financial year 2004-05, for the years 2005-06 and 2001-02 to
 2003-04 were incororporated during the financial year 2005-06, Profit &
 Loss Account for the years 2006-07 and 1998-99 to 2000-01 have been
 incorporated during the year 2006-07, Profit and Loss Account for the
 years 2007-08, 1996-97 and 1997-98 have  been incorporated during the
 previous financial year and Profit & Loss Account for the years 2008^09
 and 1993-94 to 1995-96 were incorporated during the current financial
 year.(Refer Schedule 14 of Annual Accounts). As an interim measure,
 Rs.26.69 Lacs (Previous year Rs. 214.07 lacs) which represents (i) Rs.
 120.91 Lacs being net cumulative inter-unit debit balance on account of
 transactions of other units of the company with steel unit during
 01.04.1992 to 31.03.2009 (ii) Payment of unsecured loan of Rs. 45.00
 Lacs {Refer Note (c) below} and (iii) net loss of Rs. 139.22 Lacs for
 the years 1993-94 to 2008- 09 (before inter unit rental income, write
 back of Rs.  278.95 Lacs and provision for depreciation of Rs. 649.37
 Lacs)have been clubbed with current Assets of the company as on
 31.03:2009 and 31.03.2008 respectively as Inter-Unit Balances pending
 incorporation of (i) Annual Accounts for the period 1st April, 1992 to
 31st March, 1993 and (ii) assets and liabilities including inter unit
 balances arising on account of transactions for the period 1st April,
 1993 to 31st March, 2009.
 
 (b) The financial results for the years 1992-93 would be incorporated
 as soon as the company is able to obtain access to/ reconstruct the
 financial, accounting and production records.
 
 (c) In view of above, as per past practice, the audited opening
 balances nf Assets and Liabilities.  Quantitative details contingent
 liabilities and notes of the Steel Unit as on 1st April, 1992, subject
 to(i) reduction of unsecured loans taken by Rs. 278.95 Lacs in view of
 write back on account of one time settlement (OTS) of dues with Hong
 Kong and Shanghai Banking Corporation Limited (HSBC), during the year
 2004-05 and further reduction of Rs. 45.00 Lacs on account of payment
 during 2005-06 of OTS to HSBC (ii) reduction of fixed assets (net) by
 Rs.649.37 Lacs being depreciation provided during 1993-94 to 2008-09 on
 closing balances of fixed assets as on 31st March, 1992 and (iii)
 decrease in Inter-Unit balance by Rs. 184.22 Lacs which represents; (a)
 the sum of net loss of Rs.139.22 Lacs for the years 1993-94 to 2008-09
 (before inter-unit rental income, write back of above amount of Rs.
 278.95 Lacs and provision for depreciation of Rs.649.37 Lacs) and
 repayment of unsecured loan of Rs. 45.00 Lacs. The above inter-unit
 balance will actually represent either net increase in assets or net
 decrease in liabilities as on 31st March, 2009 over balances as on 31st
 March, 1993 of the Steel unit.
 
 (f) The Profit & Loss Accounts of Steel Unit for the years 1993- 94 to
 2008-09 are subject to following notes on accounts: (i)(a) During the
 year 2006-07, a One Time Settlement (OTS) dated 22nd January, 2007 has
 been signed between the Company, Punjab National Bank (PNB).Shri U.K.
 Modi(as Guarantor) and SBEC Sugar Limited (SSL) on the terms as
 contained in the PNB letter dated 28th September, 2006. In terms of
 this settlment, SSL agreed to make payment of Rs. 2810.60 Lacs
 together, with interest to PNB in consideration of PNB agreeing to
 assign its debt of the Steel Section of the company in favour of SSL.
 SSL is making payment under the settlement in instalments for which it
 has deposited post dated cheques and on completion of the payment by
 SSL, PNBs claims against the steel section of the company together
 with all securities and charges created, by the Company in its favour
 shall stand assigned to SSL. Upon SSL completing the above payment, the
 company proposes to enter into terms of settlement of this debt with
 SSL.  (b) As reported last year with reference to the outcomeof the
 settlement with regard to the debt of IDBI Limited, Shri Umesh Kumar
 Modi had stated that a settlement agreement was concluded with IDBI
 Limited alongwith SBEC Bio-Energy Limited (SBEL). This settlement
 agreement was in terms of IDBIs letter dated 9th February, 2007.
 Against payment by SBEL to IDBI of Rs:i232.20 Lacs together with
 interest from- 1st July 2006 and in consideration thereof IDBI had
 agreedto assign to SBEL, all its claims, rights, securities and
 charges created by the company in its favour. SBEL has completed the
 payment of Rs. 1232.20 lacs along with interest to IDBI on 06th
 October, 2007 and IDBI had agreed to assign all its claims (towards
 principal and interest), rights against the Company and also charges
 and securities created by the Company in favour of SBEL. The Company
 had proposed to enter into terms of payment of this debt with SBEL.
 
 (c) As reported last year, Shri M.K.Modi had filed Petitions being OMP
 411/2007 and AA No. 287/07 in the Delhi High Court to enforce an
 Agreement dated 17th November,2006 entered into with Shri Umesh Kumar
 Modi. In the above mentioned Petitions, Shri M.K. Modi, interalia
 claims that the OTS settlement are contrary to the aforesaid Agreement.
 Shri U.K. .Modi has filed replies disputing the existence and validity
 of the said Agreement. One of the shareholders of the Company has also
 intervened in the proceedings pending before the High Court and the
 AAIFR. These matters are still pending hearing and disposal by the High
 court and the AAIFR.  A,s pet SUti U.K. Modi the said settlements ate
 duly approved by the Company and are in the interest of the Company.
 The settlements are legal, valid and binding on all concerned. .
 
 According to Shri M.K. Modi, the other Managing Director the said
 settlements are neither legal nor binding and is without approval of
 the Board. The same is also contrary to the agreement between the two
 Managing Directors, the Board Resolution and the status-quo order of
 AAIFR and Delhi High Court.
 
 (d) In view of non-availablity of book balance of liabilities towards
 PNB and IDBI in the books of Steel Unit of the company on account of
 non-incorporation of annual accounts and balance sheets of Steel Unit
 (Refer Note 4 of Schedule 15 of Annual Accounts), the difference
 between OTS amounts and book balances could not be ascertained. These
 liabilities will now be quantified with the assignees of PNB and IDBI
 debts.
 
 (e) No-provision of interest, amount unascertained, is required to be
 made, on loans from other Financial Institutions as the existing
 amounts appearing in the books of accounts of the company will be more
 than sufficient in view of irt- principle-approval/ discussions being
 held for one time settlement of dues with the Financial Institutions.
 
 (ii) The impact, if any, on account of non-availability and
 consequently non incorporation of audited opening balances of assets
 and liabilities of the Steel Unit as on 1st April,2008; ¦
 
 (iii) Non-provision of obsolete/damaged stocks and fixed assets, if
 any, in view of non-incorporation of earlier years accounts and
 non-physical verification of inventories and fixed assets as on 31st
 March 2009;
 
 (iv) Non-confirmation/reconciliation of balances of debtors, creditors,
 banks, financial institutions etc. and impact, if any, on the Profit
 and Loss Account;
 
 (v) Non-provision of doubtful debts and loans & advances, amount,
 unascertained;
 
 (vi) Non-provision of impairment of Assets, if any, of the fixed assets
 as per Accounting Standards (AS 28) i.e.  Impairment of Assets, amount
 unascertained.
 
 (vii) Uttar Pradesh Electricity Board (UPSEB) raised various demand
 notices against electricity dues and late payment surcharge amounting
 to Rs. 2435.48 Lacs on the Steel unit of the Company. Thecompany filed
 writ petition in Allahabad High Court challenging the said demand
 notices.  The Honble Allahabad Hign Court dismissed the writ petitions
 filed by the Company. Accordingly, UPSEB issued recovery notices on the
 Steel Unit of the Company.  The company filed Special Leave Petition
 (SLP) with Honble Supreme Court of India, who has granted interim stay
 on 14th March, 2005 for stay of recovery by way of sale of property
 which is still continuing.  In view of the above and pending
 incorporation of annual accounts of Steel Unit for 1992-93, no
 provision is considered necessary at this stage. The above includes Rs.
 396.29 Lacs for the years 1993-94 to 1995- 1996(Rs.499.50 lacs for
 1996-97 and 1997-98, Rs. 220.11 Lacs for 1998-99 and 1999-2000), the
 accounts of which have been incorporated during the current year.
 
 5.  Company has two subsidiaries i.e. Your Investment (India) Ltd. and
 Own Investment (India) Limited. These subsidiaries are holding only
 long-term unquoted investments and main objects clause of the company
 was amended to restrict these companies not to acquire any fresh
 investments. Further, these companies are not having any other major
 assets.  % Consequently, these subsidiaries are operating under severe
 long term restrictions, which significantly impairs their ability to
 transfer funds to the holding company. Accordingly, as permitted by
 Accounting Standard 21, consolidated financial statement are not
 prepared.
 
 6.  Undertakings given to Financial Institutions on behalf of Lords
 Chloro Alkali .Limited, Modi Rubber Limited and Bihar Sponge Iron
 Limited :
 
 (a) To procure funds jointly/severally with other promoters to meet any
 shortfall in the resources of the Company for completing their projects
 and/or for working capital. The funds made available/to be made
 available can only be withdrawn with the prior approval of Financial
 Institutions and shall not involve any charge or lien on the assets of
 the said Companies.
 
 (b) That the Company shall not transfer, assign, .pledge, hypothecate
 or otherwise dispose of in any manner its holding in their capital
 without Institutions prior approval in writing.
 
 7.  Deferred Credit including liability for interest payable for
 unexpired period have been guaranteed by the Bankers of the Company
 against hypothecation of Gas Cylinders and Machinery purchased under
 the Scheme in Steel Unit.
 
 8.  The Company has disputed the price of levy sugar fixed during the
 year 1970-71 to 1974-75 and recovered an amount of Rs. 37.73 Lacs in
 excess of the control price which was paid subsequently in pursuance
 of Supreme Cout Order dated 22nd September, 1993. However, the company
 obtained Stay order from Hon!ble- Allahabad High Court against demand
 of interest made by the Food Corporation of India.
 
 In view of the above, interest on excess realisations for the years
 1970-71 to 1974-75 amounting to, Rs.132.05 Lacs upto 31st (March, 2009
 (for the year Rs.2.40 Lacs) will be accounted for as expenses in the
 year of receipt of final claim from the Government/disposal of the
 above writ petition.
 
 9.  (a) In accordance with an Interim Order dated
 
 27th April, 1981 of the Delhi High Court, the Company had availed
 higher .quota, of free sale sugar and concessional excise duty on
 provisional basis as New Unit. The consequent excess price and excise
 duty realised during the period from 1980-81 to 1985-86 amounted to
 Rs.879.88 Lacs and Rs. 103.43 Lacs respectively, which was included in
 sales in the said period. In terms of the interim order, of the High-
 Court, in the event of the Company losing the Writ Petition, it has to
 replenish additional quantity of levy sugar in subsequent years to
 compensate for the excess free sale sugar availed. Honble Delhi High
 Court vide its order dated 28th February, 2005 decided ¦ the matter in
 favour of- the Company.  (b) No provision for Income-tax has been
 considered necessary in respect of the. excess sale price realisation
 and write back of provision for excise duty in view of favourable
 decisions subsequently by various, appellate authorities and Honble
 Calcutta High Court in a similar case. The Company has filed
 application for reference of a question of law to the Delhi High Court
 against the orders of the Income Tax Appellate Tribunal for assessment
 year 1982-83. In case the Company does not succeed, there will be
 additional liability including interest, which is estimated at Rs.
 224.75 Lacs(previous year Rs. 224.75 Lacs) for assessment year 1982-83
 against which Rs. 217.87 Lacs (Net of existing provision for Income Tax
 Rs.  68.08 Lacs) paid/adjusted has been shown as amount recoverable as
 on 31st March 2009.
 
 10.  (a) No provision has been made for the late payment surcharge on
 Electricity Tariff increase amounting to Rs.536.34- Lacs (Previous Year
 Rs.536;34 Lacs) claimed, by UPSEB since the Company (Steel Unit) had
 made representation for its waiver.
 
 (b) The U.P. State Electricity Board had raised demands against the
 Steel Unit towards interest on fuel surcharge amounting to Rs.117.10
 Lacs (Previous Year Rs.117.10 Lacs) consequent to the High Court
 orders. During the year 1997-98 the Company, has .lost the claim in
 Supreme Court. No i provision has been made in the accounts in respect
 thereof.
 
 (c) The Company has entered into an agreement with U.P.  Power
 Corporation Limited for its Residental Feeder SC No.  2005 on
 29th-March, 2000.  In pursuance of that agreement, the Company has paid
 for the existing authorised occupants only after 1st July, 1998
 computed prorata based on covered area of quarters occupied by the
 employees.In view of the above, no provision has been made for
 electricity charges of Rs.131.46 Lacs upto the period of permanant
 disconnection of residential feeder SC.No.  2005 i.e. 31st May, 2001
 (Previous Year Rs. 131.46 Lacs) for the unauthorised occupants and late
 payment surcharge/ recovery charges amounting to Rs. 302.66- Lacs upto
 31st May, 2001 (Previous Year Rs.  302.66 Lacs). In accordance with the
 agreement, matter regarding waiver of late payment surcharge and
 recovery charges after 1st July, 1998 will be referred to the
 Government.
 
 11.  ESI Authorities had raised a demand on the Company for Rs.56.52
 Lacs (upto previous year Rs.55.35 Lacs) (inclusive of interest) towards
 Companys liability for ESI for the years 1968 to 1986. The demand is
 disputed by the company and no provision has been made against this
 liability.
 
 12.  Modinagar Municipal Committee had determined the basis/ liability
 of house-tax payable by the Company for the years 1982-83 to 2006-07 at
 Rs.213.98 Lacs. The said liability/ demand/basis is disputed by the
 company at various levels and has deposited Rs.16.51 Lacs on account
 upto 31st March, 2009. Pending final decision of the Court/settlement
 and after taking into account the provision/payments already made by
 the Company, there is a net liability of Rs.188.63 Lacs (upto the
 previous year Rs.199.54 lacs), which has not been provided for in the
 accounts.
 
 Modinagar Municipal Committee has fixed the House Tax liability for the
 financial year 2007-2012 @ Rs. 20,03,040/- per annum and accordingly
 the company has paid the house tax for the financial year 2007-08 and
 2008-09 during the year ended 31st March, 2009.
 
 13.  Excise Duty on uncleared manufactured finished goods and custom
 duty in respect of imported goods lying in bond in respect of Steel
 Unit amounting to Rs. 43.09 lacs and Rs. 24.35 lacs respectively is
 accounted for as and when such goods are cleared. However, this has no
 impact on the profit of the Company.
 
 14.  (a) In respect of Steel Unit, gratuity liability upto 30th,
 September, 1987 amounting to Rs.84.82 Lacs has not been provided in the
 books on accrual basis.
 
 (b) The Gratuity Liability of continuing employees in Steel Unit was
 being accounted for on cash basis from 1993- 94 to 2001-02. During
 2002-03 past gratuity liability of continuing employees amounting to
 Rs. 14.96 Lacs was provided on accrual basis computed on actual basis
 and w.e.f. 2003-04, Gratuity liability is computed on actuarial basis
 and provided for in the books of account.
 
 15.  The Company has not received information from vendors regarding
 their status under the Micro, Small and Medium Enterprises Development
 Act, 2006 and hence disclosure relating to amounts unpaid as at the
 year end together with interest paid/payable, under this act. has not
 been provided.
 
 16.  Government of India has issued guidelines dated 15th January 1987
 which requires companies raising resources through issue of Debentures
 to create a Debenture Redemption Reserve. The Company has not created
 such a reserve in view of the accumulated losses.
 
 17.  During the year 2006-07, Modipon Limited (MPL), in which the
 company holds investments of 7,00,000 equity shares, has sold its
 Chemical Division alongwith certain, other assets to Indofil Organic
 Industries Limited (IOIL) with effect from 1st October, 2006. As per
 the sale agreement between MPL and IOIL, the company has received
 directly 10,50,000 equity shares of (Rs. 10/- each) at a premium of Rs.
 31.66 per equity share allotted by IOIL on 28th March, 2007 for
 consideration otherwise than in cash.
 
 As per a legal opinton received by the company, an amount of Rs.
 437.43 Lacs being cost of shares has been shown as investments by
 credit to Capital Reserve during the year 2006-07.
 
 18.  Arrears of dividend on Cumulative Preference Shares upto 31st
 March, 2009 Rs. 111.51 Lacs (upto previous year Rs.105.40 Lacs).
 
 19.  No depreciation has been provided on appreciated value of
 Buildings consequent to their revaluation in the books of accounts on
 31st March, 1992. However, the said depreciation as and when decided to
 be charged would be set off against Revaluation Reserve.
 
 20.  Consequent to the losses, theCompany had been declared a Sick
 Industrial Company on. 14th March, 1991 in terms of Section 3(1)(o) of
 the Sick Industrial Companies (Special Provisions) Act, 1985.  Further
 proceedings before the BIFR/ Appellate Authority for Industrial and
 Financial Reconstruction(AAIFR) are pending.  Pending final orders of
 BlFR, the accounts of the company have been prepared on a going concern
 basis.
 
 21.  (a) (i) BIFR in its hearing held on 13th February, 2008 directed
 the company to pay Rs. 2.00 crore to Army Group Insurance
 Fund(AGIF)(debenture holder) in two instalments. Based on the Companys
 offer for One time settlement(OTS), the AGIF has agreed in principle to
 accept principal amount of Rs. 2 crore in full and final settlemenfof
 its dues towards principal amount and interest till date. The company
 has sought the appropriate directions of BIFR for enabling the company
 to make the payment to AGIF.whcih is pending before the Honble bench.
 Pending final payment to AGIF, interest already provided in the books
 of Rs.702.68 Lacs upto 31st March, 2009 will be accounted for as
 revenue in the year of payment.  The amount of interest not provided in
 the books on above debentures of AGIF upto 31st March, 2009 amounts to
 Rs. 3941.04 Lacs which is included in 00 below also.
 
 (ii) No provision has been made for penal/delayed/ simple/compound
 interest amounting to Rs.15,544-45 Lacs upto 31st March, 2009 (for the
 year Rs. 2,740.37 Lacs) on term borrowings of Financial Institutions
 and Debentures pending final order of BIFR.
 
 (b) Interest payable by Vanaspati Unit of the Company to Financial
 Institutions since the date of disbursement of the loan on simple rate
 of interest basis amojnts to Rs. 1086.30 Lacs upto 31st March, 2009 and
 the unit holds total interest provision of Rs. 732.41 Lacs as on 31st
 March, 2009 resulting in the short provision of Rs.  353.89 Lacs on
 simple interest basis.
 
 (c) No provision for interest on cash credit from Bank for the period
 1st October, 1997 to 31st March, 2009 i.e.  after lock-out has been
 made by Vanaspati Unit amounting to Rs.1718.60 Lacs (Previous Year
 Rs.1436.27 Lacs) since the Unit has made representation for waiver and
 also there are no operation in the account. Difference of interest
 payable over books balance, if any, will be accounted for in the year
 of final settlement.
 
 (d) No provision has been made for interest/bank charges amounting to
 Rs.1305.45 Lacs (for the year Rs.18(505 Lacs) in Sugar Unit, since the
 said unit is. disputing these amounts.
 
 (e) Interest on Cash Credit Account has been provided on simple basis
 upto 31st January 2004 in Paint Unit. No interest is being provided in
 the books after 31-01- 2004. Had the same been provided on compound
 basis, the charge of interest would have been higher upto 31-03-2009.
 
 (f) No provision has been made for interest on cash Credit amounting to
 Rs. 108.52 Lacs (for the year Rs.22.94 Lacs) in Distillery Unit.
 
 (g) Till 31st March, 2000, simple interest on matured fixed deposits
 and interest upto date of maturity was provided in the books of
 account. With effect from 1st April, 2000 , no provision has been made
 or interest of Rs. 216.34 Lacs, upto 31st March, 2009 (for the year
 Rs. 23.74 Lacs) computed as per past practice,on these fixed deposits
 in view of a legal opinion received by the Company to the effect that
 as per terms and conditions of Fixed Deposit Scheme, deposits do not
 carry any interest beyond due dates unless these are renewed. Since
 these deposits were never renewed after their due dates as such, the
 question of payment of interest after due dates does not arise at all.
 However, as a prudent measure, the provision made of Rs. 299.97 Lacs in
 the past (net of payments) has been retained in the books of accounts
 as on 31st March, 2009.
 
 22. (a) The Vanaspati Unit had applied for Sales-tax relief/ exemption
 to U.P. Government in terms of Section 4A of U.P. Sales Tax Act.
 Consequent to rejection, the Company has filed a writ petition in
 Lucknow Bench of Allahabad High Court and Court granted stay. Pending
 disposal of the case, no provision has been made for sales-tax
 Rs.2,455.78 Lacs relating to the period May, 1991 to July, 1994
 (Previous Year Rs.2,45578 Lacs).
 
 (b) The Vanaspati Unit had preferred an application for deferment of
 Sales-tax with effect from July, 1994 under Section 38 of the U.P.
 Sales Tax Act and the same has been rejected by the State Government.
 The Company has also filed Writ Petition against the rejection and
 consequent to the orders of the Court, the recovery of Sales-tax has
 been kept in abeyance.  Accordingly, Sales-tax amounting to Rs.440.46
 Lacs (previous year Rs. 441.05 Lacs) relating to the period August,
 1994 to March, 1996 has not been deposited with the authorities.
 
 The above writ petition filed by the company was listed for hearing on
 2nd May, 2008 at High Court, Lucknow Bench. The Company had filed an
 affidavit with the court that BIFR had passed an order dated 26th
 March, 2008 by virtue of which the Bench permitted the Commercial tax
 Department, Government of U.P. to recover its outstanding dues, due
 after 30th June, 2007. The Company had also stated in the said
 affidavit that the Honbie Supreme Court of India had affirmed the
 order of the BIFR and therefore in view of the said orders of BIFR as
 affirmed by the Honble Supreme Court, the said Writ Petition may be
 dismissed as infructuous.  Accordingly The High Court, Lucknow Bench
 has dismissed the said writ petition as infructuous.
 
 (c) In accordance with the scheme announced by UP.  Government
 regarding Waiver of interest & penalty on sales Tax, the Distillery
 Unit of the Company has paid and provided interest during 2005-06 of
 Rs. 54.77 Lacs i.e. 10% of the total interest as per the scheme.  No
 dues certificate of sales tax authorities is awaited.
 
 (d) Trade Tax Department had issued the recovery Notice amounting to
 Rs. 910.96 Lacs. The Company had filed a writ petition before Honble
 High Court at Allahabad against the RC issued by Trade Tax Department.
 The Honble High Court dismissed our writ and the permission granted to
 the department for recovery. The Company has filed a SLP before Honble
 Supreme Court against the order of Honble High Court Allahabad.
 Honble Supreme Court had passed order that Trade Tax Department take
 the permission for recovery from BIFR.  BIFR had issued a order on
 26-03-2008. Therefore, the Bench permits the . Commercial Tax
 Department, Government of Uttar Pradesh to recover its outstanding
 dues, due after 30-06-2007 i.e the cut off date given by the BIFR vide
 its final order dated 12-03-2007 regarding preparation of
 rehabilitation scheme. The Supreme Court had affirmed the order of
 BIFR.
 
 24.  The Distillery Unit declared cessation and lock out of the Unit
 with effect from 19th December, 1991 and 5th January, 1992
 respectively.  The lockout has since been lifted.  The U.P. Government,
 suo moto, has referred the matter to the Industrial Tribunal to decide
 the legality of the lockout.  Pending final decision, no provision has
 been made for wages Rs.  27.46 Lacs for the lockout period.
 
 25.  Interest expenses on fixed loans Rs. 484.73 Lacs (Previous Year
 Rs. 219.57 Lacs ) and oh others Rs. 66.33 Lacs (Previous Year Rs.
 26.75 Lacs).
 
 26.  Income and Expenditure pertaining to previous year included under
 relevant heads amounts to Rs. 11.47 Lacs and Rs. 16.74 Lacs
 (Administration & Selling Rs. 8.30 Lacs, Interest Rs.- 6.15 Lacs,
 Personnel Rs. ¦ 0.22 Lacs, Returns, Rebates & Discount Rs.1.47 Lacs,
 Mfg.& Others Rs. 0.60 Lacs) respectively.
 
 27.  (a)Prdvision/payments (including value of perquisites) has been
 made to Managing Directors for the remuneration of Rs. 80.68 Lacs in
 terms of shareholders resolution, which is subject to approval of the
 Financial Institutions-.
 
 (b) The remineratiori w.e.f. 1st October, 2008 of Dr.  Mahendra Kumar
 Modi, managing Director, is subject to the approval of-Central
 Government. Pending approval, as per the legal advice obtained, the
 company nas made payment amounting to Rs. 5.63 lacs towards
 Remuneration for the period 1st October, 2008 to 31st March, 2009 as
 the approval of the Shareholders. Further, an undertaking has been
 obtained from the Managing Director stating that in the event the
 Central Government not according its approval or approving lower
 remuneration then the excess amount paid, if any, shall be refunded to
 the company and till the approval is accorded by the Central
 Government, the amount received will be held in trust for the company.
 
 28.  No provision has been made for Earned Leaves for Steel Unit- upto
 1991-92, amount unascertained.
 
 29.  There has been diminution, other than temporary, of Rs. 80.00 Lacs
 as on 31st, March, 2009 (Previous year Rs. 80.00 Lacs) in the value of
 one of its investments in Group companies. However, being long term
 investment, this is valued at cost with no provision made for fall in
 market value. This investment is considered staretegic investment and
 also having long term involvement with above company, no provision is
 considered necessary since the decline is also not permanent in nature.
 
 30.(a)Punjab National Bank(PNB) had, prior to the One Time
 Settlement(OTS)concluded and referred to in Note No.4(f)(i)(a),
 instituted suit for recovery of its dues of Rs. 36.63 crores against
 the Company and Others in the Debt Recovery Tribunal(DRT), Delhi.
 Pursuant to the OTS concluded as aforesaid on 22-01-2007 the Debt
 Recovery Appellate Tribunal(DRAT), New Delhi vide their order dated 6th
 February, 2007, had directed the Debts Recovery Tribunal to dispose off
 the case in terms of the said OTS. Further proceedings in that
 connection are pending.
 
 (b) Allahabad *Bank had filed a recovery suit for recovery of Rs. 21.41
 Crores against Modi Industries Limited and others before the Debts
 Recovery Tribunal(DRT), Lucknow, in April, 2005. The Company challenged 
 the recovery suit on the grounds that bank required prior permission 
 under section 22(1) of the Sick Industrial Companies(Special Provisions) 
 Act, 1985 for filing recovery suit. Debts Recovery Tribunal, Lucknow 
 allowed continuation of recovery suit against which company filed appeal 
 with Debts Recovery Appellate Tribunal(DRAT), Allahabad. The Debts 
 Recovery Appellate Tribunal had stayed further proceedings by Debts 
 Recovery Tribunal in the matter.  A writ petition was filed by the 
 Company before the Lucknow bench of Allahabad High Court challenging the 
 orders of the DRT, Lucknow and DRAT Allahabad. The Lucknow bench of 
 Allahabad High Court noting the contention of the Company has disposed 
 off the Writ Petition by its order dated 18th July, 2008. The Company has 
 filed review petition against the said order seeking the quashing of the
 Allahabad Banks suit before the DRT.
 
 31.  IFCI had filed a suit against Modi Industries Limited and others
 for recovery of its dues amounting to Rs. 22.41 Crores in Debts
 Recovery Tribunal, Delhi. The Debts Recovery Tribunal vide its order
 dated 11th December, 2006 dismissed the recovery suit filed by IFCI on
 the grounds that IFCI had no valid authority from Board for Industrial
 and Financial Reconstruction(BIFR) for instituting the recovery suit.
 IFCI has filed a Writ Petition in Honble Delhi High Court against
 order of Debts Recovery Appellate TribunaltDRAT). Further proceedings
 in the matter are pending.
 
 32.  Previous years figures have been regrouped wherever necessary.
 
 33.  No confirmation letters were sent to debtors/creditors and to
 parties who have discounted sale bills. In the absence of such
 confirmations, the balances in respect of Sundry Debtors/ Creditors,
 Bills discounted^ Contingent Liability), Loans taken/ given and
 Advances and other accounts are taken as shown by the boote of accounts
 and are subject to adjustments and reconciliation, if any.
 
 35.  Delhi Excise Authorities issued Show Cause Notices and raised
 demand for Rs. 167.43 Lacs towards Risk-Purchase of Country Liquor in
 view of non-supply of the same by Distillery Unit of the Company.
 Company has disputed the above demand and a Writ Petition was filed
 before the Honble Delhi High Court who ordered case to be referred
 back to Collector of Excise for taking final decision. The Collector of
 Excise vide its order dated 27th June, 2003 has confirmed the above
 demand against which the company has filed a writ petition before the
 Honble Delhi High Court. On thebasis of orders of Honble Delhi High
 Court, the company deposited Rs. 50.00 Lacs till date against the above
 demand. No provision is considered necessary at this stage since the
 matter is sub- judice.
 
 36.  As on 31st March, 2009, there were 171 Public Deposits amounting
 to Rs. 8.63 Lacs which have remained unclaimed and unpaid for a period
 of more than seven years and interest accrued but not paid on these
 unclaimed deposits till the date of maturity amounts to Rs. 2.62 Lacs.
 Details of unclaimed and unpaid debentures for a period of more than
 seven years are presently not available.
 
 The Company has filed a return dated 14th June, 2002 with the Registrar
 of Companies duly certified by practicing Company Secretary stating
 that the Company is a Sick Industrial Company as per orders of BIFR
 dated 14th March,1991 and rehabilitation proposal for payment in
 respect of debentures and fixed deposits etc. is pending before the
 IDBI (as the operating agency)/BIFR for consideration. The Company will
 pay/ credit the amount as per final orders of BIFR.  Accordingly, no
 amount was credited/ paid to Investors Education and Protection Fund
 till date.
 
 Excludes Loss of Steel Unit for the period 1993-94 to 1995-96
 incorporated during the current year and for the period 1996-97 tand
 1997-98 incorporated during the previous year.
 
 37.  Till 31-03-2009 Certain Quarters of the Company are occupied
 unauthorisedly by ex-employees/outsiders. The company has entered into
 Agreement to Sell for 215 (Previous Year 150) including 65 (previous
 year 12) registered agreements entered into during the current year,
 such residential quarters with such parties.  Sale consideration
 amounting to Rs. 504.50 Lacs (Prevoius Year Rs. 325.97 Lacs) has been
 received as interest free advance/ These agreements clearly
 stipulates that final sale of such quarters are subject to approval of
 Financial Institutions to whom these quarters have been mortgaged and
 the company proposes to seek the same before affecting final sale of
 such quarters.  Accordingly the sale of such quarters will be accounted
 for only on receipt of approval of financial Institutions. Further the
 Company has been legally advised that it can enter into such
 Agreements to Sell.
 
 38.  (a)The Steel unit of the company has entered into few leases,
 including perpetual leases, agreements for certain portion of the
 factory land and building(11105.35 Sq.Mtrs.) for which approval of
 financial institution, to whom the factory land and buildings are
 mortgaged, is yet to be obtained. However, the company has been legally
 advised that it can enter into such lease agreements.  Further, the
 lease money has mainly been utilised for payment of workers dues.
 
 (b)The company has entered into a perpetual lease agreement for certain
 portion of closed Soap factory, land & building(1584 sq.  mtrs) to a
 related party. As the said land and building is mortgaged with the
 financiai institutions therefore the company had sought the approval of
 IDBI Limited (the lead financial institution) to ine said transaction
 vide its letter dated 6th September, 2006. Since IDBI Limited did not
 respond, therefore the Company again wrote a letter to IDBI Limited on
 5th April, 2007 requesting for its approval to the said transaction.
 The company in the letter under reference also mentioned that if IDBI
 does not respond to the companys request, it will be deemed that the
 companys request has been approved by IDBI Limited and the company
 will go ahead with the said leasing agreement. The IDBI has so far not
 responded to the companys letter.
 
 39.(a) Recovery Certificate (RC) was issuedon 1st May, 2004 on account
 of non-payment of cane price / commission / interest due to
 Co-operative societies. The Honble High Court has stayed therecovery
 proceedings against the company subject to payment of dues upto 31st
 July, 2004. The Company has complied with the conditions regarding
 payment of cane price and commission on basic SMP upto 31st July, 2004.
 However, the company hasdisputed the payment of interest of Rs. 142.00
 Lacs and recoverycharges of Rs. 236.00 Lacs in the Honble Allahabad
 High Court which is still pending. On consideration of prudence,
 thecompany has made provision for interest of Rs.142.00 Lacs during the
 year 2004-05.
 
 (b) Recovery Certificate (RC) was issued on 10th August, 2007 on
 account of non payment of cane price/commission/interest due to
 Co-operative societies for the sugar season 2006-07.  The above RC also
 includes interest of Rs. 340.66 Lacs upto 7th August, 2007 on cane
 price/ commission payable to.societies and recovery charges of Rs.
 426.95 Lacs which has not been provided for in the books of account. As
 per the Interim Order dated 27th February, 2008 of Honble Supreme
 Court, there shall not be any recovery charges or interest for delayed
 payment at this stage.
 
 (c) Recovery Certificate (RC) was issued on 18th March, 2008 on account
 of non paymeny of cane price/ commission /interest due to co-operative
 societies for the sugar season 2007-08.The above RC also includes
 interest of Rs. 77.37 Lacs upto 15th March, 2008 on cane
 price/commission payable to societies and recovery charges of Rs. 413.
 50 lacs which has not been provided for in the books of account. •
 
 40. The Company, in compliance of the interim order of the Lucknow
 bench of Honble Allahabad High Court dated 15th November, 2007 and
 subsequently confirmed by Honble Supreme Court vide its order dated
 15th May, 2008 has paid cane price of Rs. 110/- per Qtl. for the
 crushing season 2007-08 and has accordingly accounted for the
 liability. The Lucknow bench of Honble Allahabad High Court by a
 subsequent order dated 7th July, 2008 upheld the validity of State
 Advised Price) Rs. 130/- per qtl. for Early variety and Rs.125/- per
 qtl.. for. General variety) fixed by State Government. Aggrieved by the
 said order, the company has filed Special Leave Petition with Honble 
 Supreme Court.  The differential liability of the sugar cane price of 
 Rs.  848.12 lacs(Previous Year Rs. 741.70 Lacs) for sugar season 
 2007-08, if so ordered, will be accounted for in ¦the books at the time 
 of final disposal of the matter by the Honble Supreme Court.
 
 41.  In the previous year, As a result of the government policy
 governing the sale of country liquor w.e.f. 01-07- 2007, the company is
 required to route the sale through the authorised licensee appointed by
 the state government. In view of the above the Distillery Unit sold
 liquor of Rs. 64.82 Crores (5372 K.L.) to authorised licensee and then
 purchased 4912 K.L. as trading goods for Rs 59:72 Crores which were
 then resold as trading goods for Rs 62.02 Crores(4912K.L.).  In the
 current year this policy was abondoned by the government w.e.f.
 01-04-2008. Accordingly, current year figures are not comparable with
 the previous year figures.
 
 42.  Hitherto the closing stock of raw-materials and stores in Gas
 Units were valued at moving average method basis. During the current
 year, due to change in software i.e. from Enterprice Resources Planning
 Solution to Fox Pro, the same has been valued at yearly weighted
 average cost method. Impact on Loss of the company on account of change
 in the method of valuation has not been ascertained.
 
 43.  The Sugar Unit of the Company has discounted sales bills raised on
 SBEC Sugar Limited amounting to Rs.  1789.95 Lacs during the current
 year from certain persons/ limited companies etc. and the same (net of
 discounting charges) has been credited to the account • of SBEC Sugar
 Limited. The above includes Rs. 1267.62 Lacs being bills discounted
 from individual persons/ HUF/Firms. Balance outstanding of bills
 discounted as on 31st March, 2009 amounts to Rs. 278.73 Lacs (paid
 fully subsequently by the drawees) and has been shown in Note1(d) of
 Schedule 15 of Annual Accounts as Bills Discounting.
 
 44.  The following are the particulars of dues on account of sales tax,
 excise duty, income tax and others as at 31st March, 2009 that have
 been disputed by the Company in appeals pending before appellate
 authorities.
 
 45. SEGMENT REPORTING
 
 (i) The Management has identified five reportable Business Segments for
 The current year namely: Sugar comprising Of Cane Sugar, Gas comprising
 of Gases, Distillery comprising of Liquors, ana-Spirit, Paint
 comprising of Paints and Varnish, Electrodes comprising of Welding
 Electrodes (ii) The Vanaspati unit of the company, which is lying
 closed since.2003, has not been treated as business segment, (iii) The
 Steel Unit is lying closed since 24th January,1993 due to strike/
 lock-out. In the meanwhile, opening balances (Assets and Liabilities)
 of the^units as on 01st April,1992 subject to certain modifications as
 per Note 4(c) of Schedule 15 have been incorporated as Assets &
 Liabilities of Steel Unit. (Refer Note 4 of Schedule 15)
 
 46.  As required under Section 293(1 )(d) of the Companies Act 1956,
 the shareholders of the company in their meeting held on 18th November,
 1989 authorised Board of Directors of-the company to borrow money upto
 Rs. 50 crores.  During the current year, the maximum borrowings of the
 company were Rs.61.10 crore which are in excess of the limits of
 Rs.50.00 crores as stated above and the excess is subject to
 ratification by the shareholders.
 
 47.  RELATED PARTIES DISCLOSURE
 
 01 Entities under the Control of the Company: Subsidiaries: Own
 Investment (India) Limited.  Your Investment (India) Limited.
 
 02 Key Management Personnel:
 
 Shri Mahendra Kumar Modi Managing Director
 
 Shri Umesh Kumar Modi Managing Director
 
 03 Other Related parties with whom the Company had transactions etc.
 
 Enterprises over which the key Management Personnel and their relatives
 are able to exercise significant influence:
 
 Modipon Limited Bihar Sponge Iron Limited SBEC Sugar Limited
 
 Morgardshammar India Ltd.  Modi Mundipharma Pvt.  Ltd.  Win-Medicare
 -Pvt.  Limited
 
 Modi Motors Pvt.  Ltd.  SBEC Bio Energy Ltd.  Modi Line Travel Services
 Pvt.  Ltd.
 
 Modi Revlon Pvt.  Ltd.  H.M.  Tubes & Containers Pvt.  Ltd.  Modi
 Senator (I) Pvt.  Ltd.
 
 Ashoka Merchantile Limited Weld Excel India Limited A to Z Holding Ltd.