1 NOTES CONCERNING AMALGAMATION
 
 1.0 Scheme of Arrangement (Scheme) - The Scheme sanctioned by
 Honble High Court of Delhi is for the amalgamation of the Usha
 International Ltd. (UIL -Transferor Company No. 1) and Shriram Fuel
 Injection Industries Ltd. (SFIIL-Transferor Company No. 2) with the Jay
 Engineering Works Ltd. (JEW - Transferee Company)
 
 The products manufactured by JEW as well as SFIIL are marketed mainly
 through UIL and thus there is synergy of business interest between the
 three Companies. Accordingly, their businesses are combined
 conveniently/ advantageously and would enure for the benefit of the
 Shareholders, the employees and all the stakeholders of all the three
 Companies.
 
 2.0 SalientfeaturesoftheSchemeare:
 
 2.1 The name of the Transferee Company The Jay Engineering Works
 Limited shall stand changed to Usha International Ltd.
 
 2.2 The Scheme would be operative from the Appointed Date, i.e.
 01.04.07 and would be effective from the date on which copies of the
 order of Honble High Court of Delhi sanctioning the Scheme has been
 filed with the Registrar of Companies, NCT of Delhi and Haryana.
 
 2.3 Authorised Share Capital of the Transferee Company would be sum
 total of the Authorised Share Capital of all the three Companies.
 
 2.4 Based on the business valuation of JEW, UIL and SFIIL, Equity
 Shareholders of UIL would get 44 Equity Shares for every 1 Equity
 Share held in UIL and Equity Shareholders of SFIIL would get 31 Equity
 Shares for every 10 Equity Shares held in SFIIL of the Transferee
 Company after canceling the crossholdings.
 
 Accordingly, Equity Share Capital of the Transferee Company would
 become Rs. 110,74,31,930 comprising of 11,07,43,193 Equity Shares.
 
 The Scheme provides for the reduction in the issued and paid up
 Equity Share Capital by canceling of 9,96,68,873 Equity Shares of Rs.
 10/- each and the amount of Rs. 99,66,88,730 would be credited to
 General Reserves and will not be paid to the Shareholders.
 
 Accordingly, Equity Shares would be allotted to the Shareholders of all
 the three Companies as on the Record Date as under:- 44 New Equity
 Shares of Rs 10/- each fully paid -up of Transferee Company for every
 10 Equity Shares of Rs 10/- each fully paid-up held in Transferor
 Company No.1, i.e. UIL.  31 New Equity Shares of Rs 10/- each fully
 paid -up of Transferee Company for every 100 Equity Shares of Rs 10/-
 each fully paid-up held in Transferor Company No.2, i.e SFIIL.  1 New
 Equity Share of Rs 10/- fully paid -up of Transferee Company for every
 10 Equity Shares of Rs 10/- each fully paid-up held in Transferee
 Company, i.e. JEW.  New Equity Shares allotted after cancellation of
 cross holdings of each Company are as under- Erstwhile Usha
 International Limited (Transferor Company No 1) : 100% Erstwhile
 Shriram Fuel Injection Industries Limited (Transferor Company No 2) :
 34.16% Erstwhile The Jay Engineering Works Limited (Transferee Company)
 : 10.61%
 
 2.5 The incidence of adopting uniform Accounting Policies, if any,
 would be quantified and adjusted in the Revenue Reserves.
 
 2.6 All Assets, Liabilities, Rights and Obligations of Transferor
 Companies No. 1 and 2 would vest with the Transferee Company at Book
 Value as on the Appointed Date, i.e. 1.4.2007.
 
 3.0 The Scheme of amalgamation has been sanctioned by Hon able High
 Court of Delhi vide its Order dated 26.5.2008.The scheme became
 effective on 2.6.2008, the Appointed Date of the Scheme being 1st April
 2007.
 
 The Name of The Jay Engineering Works Ltd. has been changed to Usha
 International Ltd and New Equity Shares have been allotted to the
 Shareholders on 25.06.2008.
 
 3.1 The accounts of the Company have been prepared following the
 principles and procedures of the Pooling of Interest Method of
 Accounting for Amalgamation as per Accounting Standard - 14.
 
 3.2 The difference of Rs. 10353.44 lacs between the Equity Share
 Capital allotted to the Shareholders of both the Transferor Companies
 after cancellation of cross holdings and their Equity Share Capital
 prior to Amalgamation has been adjusted in General Reserve.
 
 OTHER NOTES
 
 4.0 As per Accounting Standard 15 Employee Benefits, the disclosures
 of Employee benefits as defined in the Accounting Standard are as below
 :-
 
 5.0 Provision for Income Tax
 
 The amalgamated company Usha International Limited (Formerly known as
 The Jay Engineering Works Limited) intends to file its Income Tax
 Return based on amalgamated accounts. Accordingly in view of the carry
 forward losses (including unabsorbed depreciation) the Company is
 liable to tax under section 115JB of the Income Tax Act, 1961.
 
 6.0 Deferred Tax Assets/Liabilities
 
 Deferred Tax Assets (net) amounting to Rs. 452.44 Lacs has been
 computed on the date of Balance Sheet subsequent to amalgamation and
 includes Rs. 241.41 Lacs (MAT) as per Section 115 JB of the Income Tax
 Act 1961.
 
 7.0 The management is of the opinion that there is no impairment of
 Assets as contemplated in Accounting Standard-28. Fixed Assets retired
 from active use and awaiting disposal - Rs. 3.02 lacs (PY Rs. 3.02
 lacs). The Company is of the view that the realization against these
 Assets would be higher than the above amount.
 
 8.  Balance with certain suppliers await reconciliation and
 confirmation.
 
 9.  Previous Year Figures are on stand alone basis of the Transferee
 Company and are, therefore, not comparable with the figures of Current
 Year and have been reworked, regrouped, rearranged and reclassified
 wherever necessary.