1.  Contingent Liabilites:
 
 Description                                      As at        As at
                                               March 31,    March 31,  
                                                    2011         2010
                                              Rs.million  Rs. million
 
 Excise, Customs and Service Tax
 
 Alleged improper re-credit of duty paid          318.58       318.58
 through PLA under Notification no. 
 39/2001-CE dated July 31, 2001 in respect 
 of goods sold from the factory during the 
 period from February 2006 to September 
 2007. The Assistant Commissioner of 
 Central Excise passed the order against 
 the Company.The Company paid pre-deposit 
 of Rs. 100 million as required by Central 
 Excise authorities and obtained stay on 
 payment of remaining amount. The case was 
 remanded back to the lower authority to 
 consider the claim of the Company by 
 Commissioner Appeals.
 
 Further, separate show cause notice had 
 been issued by Commissioner of Central 
 Excise  seeking recovery of allegedly 
 improper re-credit of duty along with 
 interest and penalty.  The Company is 
 in the process of filing reply against 
 this show cause notice. The case is 
 remanded back by Tribunal to lower 
 authority and directed them for 
 reassessments of liability vide order 
 dated March 29, 2011.
 
 Alleged improper grant of refund for              69.57        69.57
 duty paid through PLA by Assistant
 Commissioner under Rule 18 of Central 
 Excise Rules during the period from 
 September 2005 to July 2006. The 
 Commissioner (Appeals) of Customs
 and Central Excise had passed the 
 order against the Company. TheCompany 
 has filed Revision Application with 
 the Joint Secretary,Ministry of 
 Finance, Department of Revenue.
 
 Alleged improper Cenvat credit availed             3.67         3.50        
 and non-payment of excise duty under 
 Notification No. 214/86 -CE dated 
 25-03-1986, on furnace oil used for 
 manufacturing of goods on job work  
 during the period April 2002 to May 2005. 
 The Company has filed its reply against 
 the show cause notices issued by Joint 
 Commissioner and Commissioner of Customs
 and Central Excise, Daman.
 
 Alleged improper abatement of service             50.46        47.98         
 tax on payments made to Goods Transport 
 Agency under Notification No. 32/04-ST 
 dated December 31,2004. The Company has 
 filed its reply against the show cause 
 notice issued by the Commissioner of 
 Central Excise and Customs, Daman.
 
 Alleged availment of service tax credit               -         0.16
 based on improper documents.The Company 
 has received an order from Commissioner, 
 Central Excise andCustoms, Daman 
 demanding the amount of duty, interest 
 and penalty.The Company filed an appeal 
 against the order with Commissioner of 
 CentralExcise & Customs (Appeals), Daman
 
 Alleged improper Cenvat credit availed on          2.00         1.91 
 racksclassified as capitalgoods, which 
 are used for storage of finished goods. 
 The Companyreceived an order from 
 Additional Commissioner, Central Excise 
 &Customs; Daman dated 11.02.2009 
 demanding the amount of duty,interest
 and penalty. The Company paid Rs.0.69 
 million under protest and filed
 an appeal against the order with 
 Commissioner  of Central Excise & 
 Customs (Appeals), Daman in March 2009. 
 The Company has obtained stay order with 
 respect to the payment of duty.
 
 Alleged improper availment of Cenvat                  -         0.04
 credit on service tax paid oninsurance 
 premium paid for availing insurance 
 services that are not used in or in 
 relation to manufacture of final 
 products. During the year Commissioner 
 of Central Excise and Customs (Appeals),
 Daman decided this matter in favour of 
 the Company.
 
 Alleged non-reversal of cenvat credit             10.52        96.40
 contained in raw material stock,raw 
 material in process and raw material 
 contained in finished stock on exit 
 from cenvat scheme. The Commissioner 
 of Central Excise issued a show cause 
 notice seeking recovery of the non- 
 reversed amount. During the year, the 
 Company has received favorable order 
 with respect to part of the amount in 
 dispute.The Company has filed an appeal 
 before Commissioner of Central Excise 
 and Customs (Appeals) for the balance 
 amount disallowed.
 
 Alleged erroneous sanction of refund of            3.04         3.04
 service tax by Assistant Commissioner 
 of Central Excise. The Deputy Commissioner 
 of Central Excise issued a show cause 
 notice regarding recovery of the refund 
 erroneously sanctioned. The Company has 
 submitted its reply to the Deputy 
 Commissioner of Central Excise.
 
 Alleged improper availment of Cenvat              20.24            -
 credit on service tax paid on sales 
 commission.The Company has received 
 a show-cause notice from Assistant 
 Commissioner of Central Excise and 
 Customs, Vapi against which a reply 
 has been filed by the Company.
 
 Alleged improper availment of Cenvat               7.49            -
 credit on service tax on outward 
 freight of transportation for export 
 clearance. The Company has received 
 a show-cause notice from Additional 
 Commissioner Central Excise Custom 
 and Service Tax (Daman) against 
 which reply has been submitted to 
 Commissioner of Central Excise.
 
 Alleged improper availment of Cenvat               0.04            -
 credit on service tax on commission 
 on sales. The Company has submitted 
 its reply for the show cause notice 
 received to Commissioner of Central 
 Excise.
 
 Alleged misinterpretation of Notification          1.24            -
 No 4/ 2006-2007 under the Customs Act for 
 which a reply to the show causes notice 
 has been submitted.
 
 Alleged availment of Cenvat credit on              0.20            -
 service tax. The Company has received an 
 order from Commissioner, Central Excise 
 and Customs, demanding the amount of duty, 
 interest and penalty. The Company has filed 
 an appeal against the order with 
 Commissioner of Central Excise and Customs 
 (Appeals).
 
 Alleged dual availment of duty drawback            1.14            -
 and DEPB scheme simultaneously. Appeal of 
 Central Excise department was rejected by 
 Central Excise and Customs (Appeals). The 
 Central Excise Department has filed 
 appeal with Revisionary Authority, 
 New Delhi.
 
 Alleged improper payment of service tax on         0.35            -
 services received and used in export of 
 goods and applied for refund under 17/2009
 -ST without taking credit of the same. 
 The department has rejected the refund
 claims made by the Company and issued a 
 show cause notice dated March 7, 2011. 
 The Company has filed its reply against 
 the show cause notice to Deputy 
 Commissioner, Central Excise Division, 
 Gandhidham.
 
 Alleged availment by the Company re-credit         3.74            - 
 under 39/2001-CE to the extent of balance of 
 cenvat credit lying as at 31-03-2005, which 
 was rejected by the department. The show 
 cause notice is being contested by the 
 Company with Additional Commissioner of 
 Central Excise and Service tax on the 
 grounds of devoid of merits.
 
 Stamp Duty :
 
 Disputed stamp duty liability on De-merger         4.46         4.46
 Scheme. The Company paid Rs.1.74 million 
 under protest.
 
 Sales Tax :
 
 The Deputy Commissioner of Sales Tax has           1.28         1.17
 issued an assessment order for the financial 
 year 2003 to 2004 and raised the demand on 
 purchase of Furnace oil during the year 2003 
 to 2004 in respect of purchases made by the 
 Company at a concessional rate of tax. The 
 Company had deposited Rs. 0.09 million under 
 protest and has filed an appeal with the 
 Joint Commissioner of Sales Tax, Vadodra.
 
 The Deputy Commissioner of Sales Tax has           7.87         7.31
 issued an assessment order for the 
 financial year 2004 to 2005 and raised the 
 demand on purchase of Furnace oil during 
 the year 2004 to 2005 in respect of purchases 
 made by the Company at a concessional rate 
 of tax. The Company has filed an appeal with 
 the Joint Commissioner of Sales Tax, Vadodra.
 
 The Assistant Commissioner of Sales Tax has        1.46         1.32
 passed an order vide No.3442 dated February 
 24, 2005 on purchase of Furnace oil during 
 the year 2000-2001 at a concessional rate of 
 tax. Deputy Commissioner Sales Tax 
 re-assessed and passed revised order vide 
 No.3181/83 on December 5,2005 increasing the 
 original demand. The Tribunal has granted 
 stay order for this matter
 
 Others:
 
 Claims against the Company not acknowledged        7.85         2.89
 as debts 
 
 Bills discounted in respect of export 
 debtors                                               -        75.96
 
 
 4. During the year, the Company has recognised deferred tax assets
 aggregating Rs. 303.64 million on the incremental unabsorbed Income-tax
 depreciation arising out of its treatment of certain Excise and Value
 Added Tax incentives as ‘capital receipts'' for income tax purposes
 based on the favorable decision received from the Commissioner of
 Income Tax (Appeals) in its own case and judgment in re Commissioner of
 Income Tax, Mumbai v/s. Reliance Industries Limited of the Honourable
 High Court of Judicature at Bombay.  However, the judgment given by the
 High Court of Judicatue at Bombay has been challenged by the tax
 authorites in the apex court.  If the final decision in the mater is
 eventually decided against the Company, then the carrying value of the
 deferred tax assets at the year end could be significantly impacted.
 
 2.  Pursuant to loan agreement with Welspun USA Inc., the loan
 outstanding as on March 31,2011, aggregating Rs. 111.49 million
 recoverable from Welspun USA Inc. is to be converted into equity
 investments and pending conversion modalities, the same has been
 disclosed as Share Application Pending Allotment and grouped under
 Loans and Advances.
 
 3.  Borrowing Costs aggregating Rs. Nil (Previous Year: Rs. 15.46
 million) (net of interest subsidy of Rs. Nil; Previous Year: Rs. 13.18
 million) atributable to the acquisition or construction of qualifying
 assets are capitalised during the year as part of the cost of such
 assets.
 
 4.  (a) In the meeting of the Board of Directors of the Company held on
 May 11, 2011, it was resolved that the business of Welspun Mexico S.A.
 de C.V. (a wholly-owned downstream subsidiary of Welspun AG which, in
 turn, is a wholly owned subsidiary of the Company), involved in
 manufacturing decorative bedding products for Welspun AG, shall be
 re-organised in view of the adverse law and order conditions in the
 region in which the manufacturing premises of Welspun Mexico S.A. de
 C.V is situated which has severely impacted its business prospects and
 its ability to contain the sustained losses and reverse the accumulated
 losses. Further, there has been breach of the lease agreement by the
 landlord necessitating the vacating of the premises.  The aforesaid
 business reorganization involves exiting the current manufacturing
 premises of Welspun Mexico S.A. de C.V. and setting up trading
 activities only in new premises, disposing of the assets and
 discontinuing the employment of the majority of its employees.  The
 Board of Directors further resolved in the aforesaid meeting that the
 consequential impairment in the value of the Company''s investments in
 Welspun AG, and loans given to Welspun AG, shall be determined and
 recognized.  Other than the business of Welspun Mexico S.A. de C.V,
 Welspun AG does not have any substantial business actvities. As at
 March 31, 2011, the Company had investments, aggregating Rs. 739.12
 million, in Welspun AG, and outstanding loans at zero rate of interest,
 aggregating Rs. 936.23 million, and other advances, aggregating Rs 1.68
 million, due from Welspun AG. Accordingly, a provision of Rs. 739.12
 million towards diminution in the value of investments in Welspun AG,
 and a provision of Rs 937.91 million towards the aforesaid loans and
 advances to Welspun AG, have been recognized and disclosed as
 extraordinary items in the Profit and Loss Account for the year.
 
 (b) As at March 31, 2011, the Company has trade receivables aggregating
 Rs. 696.02 million, due from a related Company, Welspun Retail Limited
 (WRL), (March 31,2010: Rs. 475.93 million). Of the said amount Rs.
 108.33 million (March 31, 2010: Rs. 52.07 million) is outstanding for
 more than one year. WRL continues to incur significant losses from
 operations which could impact its ability to settle the aforesaid
 receivables. In order to turnaround its operations, WRL has made a
 robust plan for widening its reach in the market by using new marketing
 strategies with aggressive cost reduction programs. Accordingly, in the
 opinion of the Management, the aforesaid receivable from the said
 related Company as at March 31, 2011 is considered good and
 recoverable.
 
 8.  Consequent to the demerger of the marketing arm of the Company
 efective April 1, 2009, the Company is dependent upon Welspun Global
 Brands Limited (WGBL) for all marketing of its products and WGBL is the
 Company''s principal customer as regards international sales of its
 products. Most of the domestic sales of the Company are made to WRL, a
 subsidiary of WGBL. The Company does not have any long term definitive
 agreements with either WGBL or WRL for marketing the Company''s
 products. In the event that WGBL or WRL ceased to purchase or market
 the Company''s products, it could have an adverse effect on the business
 of the Company.
 
 5.  The Company has issued a corporate guarantee of Rs. 3,593 million
 (March 31, 2010: Rs. 3,593 million) on behalf of WGBL in favor of a
 consortium of bankers in relation to post-shipment debt facilities
 provided by them to WGBL. WGBL has also given a corporate guarantee of
 Rs. 5,887.40 million (March 31, 2010: Rs. 5,887.40 million) in favour
 of the consortium of bankers in relation to pre-shipment debt
 facilities provided by them to the Company. If WGBL is unable to meet
 their obligation to bankers as they fall due, the Company would be
 required to pay the guaranteed amounts, which could adversely affect
 its financial condition and cash flows.
 
 6.(a) The Company has allotted 15,603,000 equity shares of Rs. 10 each
 at Rs. 100 per share on April 19,2010 to Qualified Institutional Buyers
 (QIBs) in accordance with Chapter VIII of the Securities and Exchange
 Board of India (Issue of Capital and Disclosure Requirements)
 Regulations, 2009. The equity share issue expenses related to Qualified
 Institutional Placement (QIP) aggregating Rs. 87.64 million has been
 adjusted against Securities Premium Account as per Section 78 of the
 Act.
 
 (b) Pursuant to the resolution passed in the Annual General Meeting of
 the Company held on August 31, 2010 for approval of final dividend for
 the year ended March 31, 2010; the Company has declared final dividend
 for equity and preference shareholders of Rs. 106.10 million and paid
 dividend tax thereon of Rs. 17.63 million (including dividend of Rs.
 15.60 million to QIBs referred supra and dividend tax thereon of Rs.
 2.6 million). The final dividend paid to QIBs for the year has been
 presented as Final Dividend for Previous Year as an appropriation in
 the Profit and Loss Account for the year.
 
 7. On June 30, 2009, the Company issued Employee Stock Options under
 the Employee Stock Options Scheme (the Scheme) to employees of the
 Company and its subsidiaries with a right to subscribe to equity shares
 (New Options) at a price of Rs. 35.60 per equity share (closing
 market price as on June 30, 2009) with an option to existing grantees,
 who were granted options on May 17, 2006 (Old Options), to receive
 New Optons on surrender of Old Options.  All employees holding Old
 Options on June 30, 2009 chose to surrender the Old Options. The
 salient features of the Scheme are as under:
 
 (i) Vesting: Options to vest over a period of four years from the date
 of their grants as under:
 
 - 20% of the Options granted to vest at each of the 1st and 2nd
 Anniversaries of the date of grant.
 
 - 30% of the Options granted to vest at each of the 3rd and 4th
 Anniversaries of the date of grant.
 
 (ii) Exercise: Options vested with an employee will be exercisable
 within 3 years from the date of their vesting by subscribing to the
 number of equity shares in the ratio of one equity share for every
 option, at the Exercise Price.  In the event of cessation of employment
 due to death, resignation or otherwise the Options may lapse or be
 exercisable in the manner specifically provided for in the Scheme.
 
 The compensation costs of stock options granted to employees are
 accounted by the Company using the intrinsic value method. Since, on
 the date of grant of option, quoted market price of the underlying
 equity shares of the Company was equal to the exercise price of an
 option, no expense or liability arising from the Scheme has been
 recognised.
 
 The fair value of the options as per the ‘Black Scholes'' model as on
 the date of grant was Rs. 17.49. Had the Company adopted fair value
 method in respect of options granted, the employee compensation cost
 would have been higher by Rs. 9.11 million (March 31,2010: Rs.13.33
 million), Loss after Tax would have been higher by Rs. 6.27 million
 (March 31, 2010: Profit after tax would have been lower by Rs. 8.80
 million) and the basic loss per share would have been higher by Rs.
 0.07 (March 31, 2010: basic earnings per share would have been lower by
 Rs. 0.12) and diluted loss per share would have been higher by 0.07
 (March 31, 2010: diluted earnings per share would have been lower by
 Rs. 0.17), respectively.
 
 8.  Pursuant to High Court Order, 500,000 (March 31, 2010 : 500,000)
 0% Redeemable Preference Shares of Rs. 100 each fully paid up are
 redeemable at par on or after repayment of all outstanding term
 liabilities and preference shares held by banks and financial
 institutions as on April 1, 2000 and interest and dividend thereon.
 Accordingly, the Preference Shares are expected to be redeemed by
 January 2012.
 
 9.  (a) Term loans from banks including interest thereon are secured
 by way of first charge on entire movable and immovable properties of
 the Company, both present and future, ranking pari passu, subject to
 prior charge on specific assets as per 13(b) below.
 
 (b) In addition to 13(a) above, term loans from Banks Rs. 11,442.60
 million (March 31, 2010: Rs. 3,880.09 million) and interest thereon,
 are secured by lien on fixed deposits of the Company.
 
 (c) The working capital loans, which includes cash credit and packing
 credit from banks, are secured by hypothecation of raw materials,
 stock-in-progress, finished and semi finished goods, stores and spares
 and book debts and other current assets of the Company and second
 charge on entire fixed assets of the Company and by a Corporate
 Guarantee issued by Welspun Global Brands Limited.
 
 10.  Loan/ Deposits of Rs. Nil (March 31, 2010: Rs. 48.18 million) were
 given to Companies in which some of the Directors are interested as
 members.
 
 11.  Interest in Joint Venture
 
 (a) The Company has accounted the investments in Joint Ventures in
 Welspun Zucchi Textiles Limited (WZTL) and MEP Cotton Limited (MCL) in
 accordance with Accounting Standard 13, Accounting for Investments.
 
 (b) The Company''s share of contingent liability of WZTL is Rs. 13.88
 million (March 31, 2010: Rs.14.85 million).
 
 (c) The Company''s share of the aggregate amounts of assets and
 liabilities as on March 31, 2011 and income and expenditures of WZTL
 for the year ended March 31, 2011 are as under
 
 12. Additional information pursuant to Part II of Schedule VI to the
 Companies Act, 1956.  
 
 a) Licensed Capacity                Not Applicable
 
 As per the Industrial Policy declared in July 1991, as amended in April
 1993, no licences are required for the products manufactured by the
 Company. 
 
 Installed Capacity as at March 31, 2011 (As certified by Management) 
 
 Cotton Terry Towels       41,500 (March 31, 2010 : 41,500) M.T.
 
 Cotton Yarn               33,130 (March 31, 2010 : 33,130) M.T.  
 
 Bed Sheets                45,000 (March 31, 2010 : 45,000) 000'' Mtrs 
 
 Rugs                      10,151 (March 31, 2010 : 10,151) M.T.
 
 
 13. Derivative Instruments outstanding as at March 31, 2011:
 
 The Company is exposed to foreign currency fluctuations on foreign
 currency assets/ liabilities, forecasted receivable, payables
 denominated in foreign currency.
 
 In line with the company''s risk management policies and procedures, the
 Company enters into foreign currency forward contracts and swap
 contracts to manage its exposure. These contracts are for a period of
 maximum twelve months and forecasted transactions are expected to occur
 during the same period.
 
 (a) The following are outstanding foreign currency forward, swaps and
 other derivative contracts against the future forecasted payables.
 
 (b) The movement in Hedging Reserve during the year ended March 31,
 2011 for derivatives designated as Cash Flow Hedges is as follows:
 
 The entire balance of Hedging Reserve Account as at March 31, 2009 of
 Rs. 294.94 million pertaining to ‘Marketing Division'' of the Company
 was transferred to Welspun Global Brands Limited with effect from April
 1, 2009, pursuant to demerger and transfer of ‘Marketing Division'' to
 Welspun Global Brands Limited
 
 c) As at the Balance Sheet date, the foreign currency exposure not
 hedged by a derivative instrument or otherwise aggregates Rs. 1,127.20
 million (March 31, 2010 Rs. 678.77 million) for receivables and Rs.
 1,008.75 million (March 31, 2010 Rs. 825.21 million) for payables.
 
 
 14 (i). Related Party Disclosures
 
 (i) Relationships
 
 (a) Subsidiary Companies    Welspun AG (WAG)
                             Besa Developers and Infrastructure  
                             Private Limited (BESA) 
                             Welspun Mexico S.A. de C.V (WMEX)  
                             (Held through WAG)
 
 (b) Joint Venture           Welspun Zucchi Textiles Limited (WZTL)
 Companies                   MEP Cotton Limited (MCL) (up to January 
                             31, 2010)
 
 (c) Associate Company       Welspun USA Inc., USA (WUSA)
                             Welspun Holdings Private Limited, 
                             Cyprus (WHPL) 
                             Welspun Captive Power Generation Limited
                             (WCPGL) 
                             (with effect from January 27, 2011)
 
 (d) Enterprises over wh     Welspun Global Brands Limited (WGBL)  
 ich Key Management Per      Welspun Investments and Commercials    
 sonnel or relatives of      Limited (WICL)
 such personnel exercise     Welspun Sorema Europe, S.A. (SOREMA)
 significant influence       Welspun UK Limited (WUKL)
 or control  and with        Welspun Home Textiles Limited (WHTL)  
 whom transactions have      Welspun Retail Limited (WRL
 taken place during          Welspun Corp Limited (WCL) (Formerly
 the year                    known as Gujarat Stahl
                             Rohren Limited (WGSRL))
                             Welspun Power and Steel Limited 
                             (WPSL)
                             Welspun Syntex Limited (WSL)
                             Welspun Trading Limited (WTL)
                             Welspun Wintex Limited (WWL) 
                             Welspun Mercantile Limited (WML)
                             Krishiraj Trading Limited (KTL)
                             Welspun Logistics Limited (WLL)
                             Welspun Realty Private Limited (WRPL)
                             Vipuna Trading Limited (VTL)
                             Mertz Securities Limited (MSL)
                             Welspun Polybuttons Limited (WPBL)
                             Wel-treat Enviro Management Organisation 
                             Limited (WEMO)
                             Remi Metals Gujarat Limited (RMGL)
                             Welspun Maxsteel Limited (WMSL)
                             Welspun Projects Limited ( WPL)
                             Methodical Investment and Trading 
                             Company Private Limited (MITCPL)
                             Welspun FinTrade Limited (WFTL)
                             Welspun Finance Limited (WFL)
                             Welspun Foundation for Health and 
                             Knowledge (WFHK)
                             Welspun Urja Gujarat Private Limited 
                             (WUGPL)
 
 (e) Key Management          B.K.Goenka (BKG)
 Personnel                   M. L. Mital (MLM) 
                             R. R. Mandawewala (RRM) 
                             (Upto October 31, 2009)
 
 (f) Relatives of Key 
 Management Personnel        Dipali Goenka (DBG)
 
 
 15.  In accordance with the Company''s policy given in Note 1(x) (a)
 above, net exchange loss of Rs. 42.64 million (Previous Year: net
 exchange gain Rs. 104.29 million) has been accounted in the Profit and
 Loss Account.
 
 16.  Segment Information for the year ended March 31, 2011.
 
 (i) Information about Primary Business Segment
 
 The Company is exclusively engaged in the business of Home Textiles
 which, in the context of Accounting Standard 17 on Segment Reporting,
 issued by the Institute of Chartered Accountants of India, is
 considered to constitute a single primary segment. Thus, the segment
 revenue, carrying amount of segment assets and capital expenditure
 incurred to acquire segment assets during the year are all as refected
 in the financial statements for the year ended March 31, 2011 and as on
 that date.
 
 (iii) Notes:
 
 (a) The Segment revenue in the geographical segments considered for
 disclosure are as follows:
 
 -Revenue within India includes sales to customers located within India
 and earnings in India.
 
 -Revenue outside India includes sales to customers located outside
 India, earnings outside India and export benefits on sales made to
 customers located outside India.
 
 (b) Segment revenue and assets include the respective amounts
 identified to each of the segments and amounts allocated on a
 reasonable basis.
 
 17. Leases
 
 B. Where the Company is a lessee:
 
 Operating Lease
 
 The Company has taken various residential, office premises, godowns,
 equipment and vehicles under operating lease agreements that are
 renewable on a periodic basis at the option of both the lessor and the
 lessee. The initial tenure of lease is generally for eleven months to
 sixty months.
 
 The aggregate rental expenses of all the operating leases for the year
 are Rs. 94.32 million (Previous Year: Rs.  84.13 million).
 
 18. Prior year comparatives have been reclassified to conform with the
 current year''s presentation, wherever applicable.