welspun projects annual report fy2010-11€¦ · welspun projects ltd. (formerly known as msk...

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39

AUDITOR'SREPORT

We have audited the attached Balance Sheet of M/s. Welspun Projects Limited (formerly known as MSK Projects (India)

Limited), as at 31stMarch, 2011 and also the annexed Profit and Loss Account and the Cash Flow statement of the Company

for the year ended on that date. These financial statements are the responsibility of the Company's management. Our

responsibility is toexpress anopinionon these financial statementsbasedonouraudit.

We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we

plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material

misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial

statements. An audit also includes assessing the accounting principles used and significant estimatesmade bymanagement,

as well as evaluating the overall financial statement presentation; we believe that our audit provides a reasonable basis for

ouropinion.

1) As required by the Companies (Auditor's Report) order, 2003 as amended by Companies (Auditor's Report)

(Amendment)Order,2004(together 'theOrder') issuedby theCentralGovernmentof India in termsof Section227 (4-A)

of the Companies Act, 1956, and on the basis of information and explanation given to us and the books and records

examined by us in the normal course of audit and to the best of our knowledge and belief, we enclose in the Annexure a

statementon thematters specified inparagraphs4and5of the saidorder.

a) We have obtained all the information and explanations which to the best of our knowledge and belief were

necessary for thepurposeofourAudit.

b) In our opinion proper books of account as required by law have been kept by the Company so far as appears from

ourexaminationof thebooks.

c) The Balance Sheet and Profit and Loss Account dealt with by this report are in agreement with the books of

accountof theCompany.

d) On thebasis ofwritten representations received from theDirectors and takenon record by theBoard ofDirectors,

we report that none of the Directors is disqualified as on 31st March, 2011 from being appointed as a Director in

termsof clause (g) of sub-section (1) of section274of theCompaniesAct,1956.

e) Inouropinion, subject tononcompliancewith the specifiedaccounting standards relating to :-

The Balance Sheet, the Profit & Loss Account and the Cash flow statement dealt with by this report comply with the

otherAccountingStandardas referred to in theSection211 (3C)of theCompaniesAct,1956and

2) FURTHERANDSUBJECTTOOURCOMMENTS INTHEANNEXUREREFERREDTO INPARAGRAPH1ABOVE.

Disclosure of Cash Subsidy amounting to Rs.82.87 Crores received from Madhya Pradesh Rajya Setu Nirman

Nigam Limited against BOT Projects under the head 'Reserve & Surplus' instead of deducting the same from the

Project Cost as required by the Accounting Standard – 12 “Accounting for Government Grants”(See Note No. 11).

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts

subject to :

and readwith theothernotesappearing thereon, give the information requiredby theCompaniesAct,1956 in the

manner so required and give a true and fair view in conformity with the accounting principles generally accepted

in India.

i) In the case of the Balance sheet of the state of affairs, of the Company as at 31st March, 2011 and;

ii) In the case of the Profit and Loss Account of the Loss for the year ended on that date.

iii) In the case of the Cash flow statement, of the cash flow for the year ended on that date.

For

Firm Registration No. 101676W

Chartered Accountants

Place: Vadodara

Date : 26/05/2011

Partner

Membership No.16642

Disclosure of Cash Subsidy amounting to Rs.82.87 Crores received from Madhya Pradesh Rajya Setu Nirman

Nigam Limited, against BOT Projects under the head 'Reserve & Surplus' instead of deducting the same from the

Project Cost (See Note No. 11).

Chandrakant & Sevantilal & J. K. Shah & Co.

(H. B. Shah)

40

ANNEXURE TO THE AUDITORS' REPORT TO THE MEMBERS OF M/S. WELSPUN PROJECTS LIMITED

(Formerly known as MSK Projects (India) Limited),

BARODA ON THE ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 2011

(REFERREDTO INPARAGRAPH1OFOURREPORTOFEVENDATE)

1. a) The Company has maintained proper records showing full particulars including quantitative details and situation of

its fixedassets.

b) Major portion of fixed assets has been physically verified during the year by the management in accordance with a

programmeof verification,which, inouropinionprovides for physical verificationof all the fixedassets as reasonable

interval having regards to size of the Company and nature of its business. According to the information and

explanation given to us the discrepancies noticed on such verification were not material and have been properly

dealtwith in thebooksof accounts.

c) Nodisposal of a substantial part of fixedassetsof theCompanyhas takenplaceduring theyear.

2. a) As explained to us, the inventories were physically verified by the management at reasonable intervals during the

year.

b) In our opinion and according to the information and explanations given to us, the procedures of physical verification

of inventories followed by themanagement are reasonable and adequate in relation to the size of the Company and

thenatureof its business.

c) As theCompanyhasnotmaintainedquantitative recordsof stock, It is not possible to findout discrepancies between

thephysical stockandbook records.

3. a) The Company has granted unsecured loan to five companies covered in the register maintained u/s 301 of the

Companies Act' 1956. The maximum amount involved during the year was Rs. 1268.12 Lacs and the year end

balanceof loansgranted to theseCompanieswasRs.301.84 Lacs.

The Company has taken interest free unsecured loan from one Company covered in the registered maintained u/s

301 of the Companies act' 1956. The maximum amount involved during the year was Rs.1756.40 Lacs and year

endedbalanceof loan taken fromsuchCompanywasRs.11.40 Lacs.

b) In our opinion, the rate of interest, where applicable and other terms and conditions onwhich loan have been taken

from / granted to the Companies listed in the register maintained us 301 of the Companies act, 1956 are not prima-

facie, prejudicial to the interestof theCompany.

c) The Companies to whom advance in the nature of loan is granted there is no stipulation for repayment there of. As

per the information and explanations given to us the said loan is repayable on demand. The Company is regular in

repaying theprinciple amountwherever stipulated,

4. Inouropinionandaccording to the informationandexplanations given tous, thereare , adequate internal control system

commensurate with the size of the Company and the nature of its business with regard to purchases of inventories and

fixed assets and with regard to the receipts of Civil Contracts. During the course of our audit, we have not observed any

majorweakness in the internal controls.

5. a) To the best of our knowledge and belief, and according to information and explanation given to us, the transactions

that needed to be entered in to the register in pursuance of Section 301 of the Companies Act, 1956, have been so

entered.

b) In our opinion and according to the information and explanations given to us, transactions made in pursuance of

contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and

41

exceeding the value of Rupees five lacs in respect of any party during the year have been made at prices which are

reasonablehaving regard toprevailingmarketprices at the relevant timewhere suchmarketprices areavailable.

6. Inouropinionandaccording to the informationandexplanations given tous, theCompanyhasnot acceptedanydeposits

from the public, Accordingly the provisions of clause (vi) of the Companies (Auditor's Report) order 2003 are not

applicable to theCompany.

7. The Company has appointed a partnership firm of Chartered Accountants, to carry out its internal audit function. In our

opinion, the internal audit system is required to be strengthen in respect of its scope to cover all the area to

commensuratewith the sizeof theCompanyandnatureof its business.

8. The Central Government has not prescribedmaintenance of cost records Under Section 209(1)(d) of the Companies Act,

1956 for anyof theproductsof theCompany.

9. a) According to the records of the Company, the Company is generally regular in depositing undisputed statutory dues

including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income Tax, Sales

Tax,WealthTax, CustomDuty, ExciseDuty, Cess andother statutorydueswith theappropriateauthorities.

b) According to the information and explanations given to us, there are no undisputed amounts payable in respect of

such statutory dues which have remained outstanding as at 31st March, 2011 for a period of more than six months

fromtheday theybecomepayableexcept Sales Tax liabilityofRs.12.96 Lacs.

c) According to the information and explanation given to us, there are no dues of Sales Tax, Income Tax, Custom Duty,

Wealth Tax, Excise Duty and Cess which have not been deposited on account of any dispute except the following

disputed IncomeTaxDemand.

10. The Company has no accumulated losses and has not incurred cash losses in the immediately proceeding financial year.

TheCompanyhas incurredcash losses in the current financial year.

11. TheCompanyhasnotdefaulted in repaymentofdues toany financial institutionorBanks.

12. TheCompanyhasnot granted loans andadvanceson thebasis of security bywayof pledgeof shares, debenturesorother

securities.

13. Theprovisions of any Special Statue applicable to Chit Funds,Nidhis orMutual Benefit Funds/Societies are not applicable

to theCompany.

14. The Company is not dealing in or trading in shares, securities, debentures, or other investments and hence, requirement

ofparagraph4(xiv) arenot applicable to theCompany.

15. In our opinion and according to information and explanation given to us the term and condition on which the Company

has given guarantee for loan taken by others from Bank / Financial Institution are not prejudicial to the interest of the

Company.

16. Inouropinion, the term loanshavebeenapplied for thepurpose forwhich theywere raised.

Sr.

No.

Nature of the

Status

Nature of the

due

Amount

(Rs. In Lacs)

Period to which

the amount relate

Forum where

dispute is Pending

1. Income Tax Act,

1961

Income Tax A.Y. 2007-08 CIT (A) Baroda27.43

Income Tax Act,

1961

Income Tax A.Y. 2008-09 CIT (A) Baroda780.812.

42

17. According to the Cash Flow Statement and other records examined by us and on the basis of information and

explanations given tous, onanoverall basis, funds raisedonShort Termbasis have, prima facie, not beingusedduring the

year for LongTerm investmentandvise versa.

18. During the year, theCompanyhas notmadeanypreferential allotment of shares to parties andCompanies covered in the

RegistermaintainedU/s301of theAct.

19. Since theCompanydoesnothaveanydebentures, thequestionof creationof securities fordebenturesdoesnot arise.

20. TheCompanyhasnot raisedmoneybypublic issueduring theyear.

21. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by

theCompanywasnoticedor reportedduring theyear.

For

Firm Registration No. 101676W


Place: Vadodara

Date : 26/05/2011

Partner

Membership No.16642


(H. B. Shah)

43

44

BALANCE SHEET AS ON 31st MARCH’ 2011

As at

March 31, 2011

(Amount in Rs.)

As at

March 31, 2010

(Amount in Rs.)

SOURCES OF FUNDS

SHARE HOLDERS' FUNDS

4775397812 2990879242

TOTAL (Rs.) 7086530469 5617704822

APPLICATION OF FUNDS

FIXED ASSETS

NET BLOCK 508754323 589264997

BUILD, OPERATE AND TRANSFER PROJECTS EXPENDITURE

2661474418 2669007975

INVESTMENTS

CURRENT ASSETS, LOANS & ADVANCES

2775958226 2442653172

935127894 714070943

TOTAL (Rs.) 7086530469 5617704822

ACCOUNTING POLICIES AND NOTES ON ACCOUNTS 8

SHARE CAPITAL A 400000000 228211120

RESERVES & SURPLUS B 4375397812 2762668122

LOAN FUNDS

SECURED LOANS C 2223876957 2562142580

UN-SECURED LOANS D 1140700 -

2225017657 2562142580

DEFERRED TAX LIABILITY 86115000 64683000

GROSS BLOCK E 1000608783 1001305352

LESS : DEPRECIATION 492654460 412040355

507954323 589264997

REALISABLE VALUE OF IMPAIRED ASSETS 800000 -

F

AS PER LAST YEAR BALANCE SHEET 2669007975 2827379852

COST INCURRED DURING THE YEAR 78125055 6479018

2747133030 2833858870

LESS: UNCLAIMED LIABILITIES WRITTEN BACK - 3783017

LESS: WRITTEN OFF DURING THE YEAR 85658612 161067878

G 2075471395 630849621

INVENTORIES H 556938132 328030039

SUNDRY DEBTORS I 1363961503 1175710926

CASH & BANK BALANCES J 400409218 515120015

LOANS & ADVANCES K 454649373 423792192

LESS : CURRENT LIABILITIES & PROVISIONS

LIABILITIES L 926538873 663902941

PROVISION M 8589021 50168002

NET CURRENT ASSETS 1840830332 1728582229

Schedules

As per our report of even date

For and on behalf of the Board of DirectorsFOR Chandrakant & Sevantilal & J.K. Shah & Company


H. B. Shah

Partner

Membership No. 016642

Place : Vadodara

Date : 26-05-2011

B. K. Goenka

Chairman

Susheela Maheshwari

Company Secretary

Place : Mumbai

Date : 26-05-2011

Sunil Shinde

Managing Director

45

PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31st MARCH’ 2011

Year ended

March 31, 2011

(Amount in Rs.)

Year ended

March 31, 2010

(Amount in Rs.)

INCOME

TOTAL Rs. 2563444670 4247916780

EXPENDITURE

PROVISION FOR TAXATION

PROFIT / (LOSS) AFTER TAXATION

BALANCE CARRIED TO BALANCE SHEET 575778054 904262708

EARNING PER SHARE - (IN RUPEES)


CONTRACT RECEIPTS, SUPPLY AND OPERATING INCOME 1 2062773907 3898801162

TOLL COLLECTION 2 278667496 298490230

OTHER INCOME 3 7878993 8765096

2349320396 4206056488

CHANGE IN WORK-IN-PROGRESS 4 214124274 41860292

MATERIALS CONSUMED 5 1291487761 2006870435

SITE COST & OTHER EXPENSES 6 1226862057 1273439532

FINANCE & BANK CHARGES (NET) 7 167585582 287391138

EXPENDITURE ON BUILD, OPERATE &

TRANSFER CONTRACTS WRITTEN OFF 85658612 161067878

DEPRECIATION 95995652 113530616

2867589664 3842299599

(304144994) 405617181

LESS: COST INCURRED FOR OWNED BOT PROJECT TRANSFERRED

TO BALANCE SHEET - 6479018

PROFIT / (LOSS) BEFORE PRIOR PERIOD INCOME / EXPENDITURE (304144994) 412096199

PRIOR PERIOD ITEM (NET) (2907660) 22749605

PROFIT / (LOSS) AFTER PRIOR PERIOD INCOME/EXPENDITURE (307052654) 434845804

CURRENT TAX - 92500000

FRINGE BENEFIT TAX - (224094)

DEFERRED TAX 21432000 55094000

21432000 147369906

(328484654) 287475898

BALANCE BROUGHT FORWARD FROM PREVIOUS YEAR 904262708 663584810

PROFIT AVAILABLE FOR APPROPRIATION 575778054 951060708

PROPOSED DIVIDEND - 40000000

TAX ON DIVIDEND - 6798000

- 46798000

BASIC & DILUTED -8.48 12.60

Schedules




H. B. Shah

Partner


Place : Vadodara

Date : 26-05-2011

B. K. Goenka

Chairman

Susheela Maheshwari

Company Secretary

Place : Mumbai

Date : 26-05-2011

Sunil Shinde

Managing Director

SCHEDULE - A TO M, AND 8 FORMING PART OF THE BALANCE SHEET

As at

March 31, 2011

(Amount in Rs.)

As at

March 31, 2010

(Amount in Rs.)

SCHEDULE - A

AUTHORISED CAPITAL

ISSUED, SUBSCRIBED, AND PAID UP CAPITAL

TOTAL 400000000 228211120

NOTES

4,10,00,000 (PREVIOUS YEAR 2,50,00,000)

EQUITY SHARES OF RS. 10/- EACH 410000000 250000000

* 4,00,00,000 (PREVIOUS YEAR 2,28,21,112) EQUITY SHARES Rs. 10/-

EACH FULLY PAID UP 400000000 228211120

* OUT OF THE ABOVE SHARES:

1 1874331 Shares are allotted as fully paid up without payment being received in cash earlier Year

2 720897 Shares are allotted as fully paid up by way of bonus shares, during the year 1996-97

3 1454645 Shares are allotted as fully paid up by way of bonus shares during the year 1998-99

4 1235547 Shares are allotted as fully paid up by way of bonus shares during the year 2000-01

3 250000 Shares are issued on preferential basis during the year 2005-06

4 1399566 Shares are issued on conversion of foreign currency convertible bonds during the year 2006-07




30917642

SHARE CAPITAL

46

SCHEDULE - B RESERVES & SURPLUS

1. CAPITAL RESERVE

828729840 828729840

2886599786 945385442

TOTAL (1+2+3+4) 4375397812 2762668122

CASH SUBSIDY

RECEIVED FROMMADHYA PRADESH RAJYA SETU NIRMAN NIGAM LTD

AGAINST BOT PROJECTS


LESS: DEDUCTION DURING THE YEAR - 9270160

AMALGAMATION RESERVES


2. GENERAL RESERVES


3. SECURITIES PREMIUM


ON ISSUE OF SHARES ON PREFERENTIAL BASIS DURING THE YEAR 1941214344 -

4. PROFIT & LOSS ACCOUNT

BALANCE AS PER ANNEXED ACCOUNT 575778054 904262708

47

SCHEDULE - A TO M AND 8 FORMING PART OF THE BALANCE SHEET

SCHEDULE - C SECURED LOANS

As at

March 31, 2011

(Amount in Rs.)

As at

March 31, 2010

(Amount in Rs.)

TERM LOAN FOR EQUIPMENTS & VEHICLES

FROM CORPORATION BANK - BARODA

FROM KOTAK MAHINDRA BANK LIMITED

FROM HDFC BANK LIMITED

FROM TATA CAPITAL LIMITED

FROM AXIS BANK

FROM TATA MOTOR FINANCE LIMITED

FROM SREI INFRASTRUCTURE FINANCE LIMITED

TOTAL (A) 52687278 188598542

TERM LOAN FOR PROJECTS

FROM DENA BANK

25214141 51905370

Secured by hypothecation of the relavant plant & machineries, equipments,

vehicles & the personal guarantee by the directors of the Company.

(Repayable within year Rs. 1,99,24,000/- Previous Year Rs. 1,99,24,000/-)

6833956 16008922

Secured by hypothecation of relevant Plant & Machineries & Vehicles &

Personal guarantee of the some of the Directors of the Company

(Repayable within year Rs. 67,48,003/- Previous Year Rs. 92,52,000/-)

8418467 27240669

Secured by hypothecation of relevant Vehicles, Plant & machineries

and personal guarantee of the some of the directors of the Company

(Repayable within year Rs. 51,86,237/- Previous Year Rs. 1,47,92,000/-)

5565318 24059648

Secured by hypothecation of relevant Plant & machineries & personal

guarantee of some of the Directors of the Company


1970501 4252221

Secured by hypothecation of relevant Plant & machineries &

personal guarantee of some of the Directors of the Company

(Repayable within year Rs. 11,35,371/- Previous Year Rs. 15,79,000/-)

987348 11232218




3697547 53899494




259625597 305228916

The above Loans are Secured by:

- A first mortgage and charged on all the Company's capital assets,

specific & pertaining to the Hoshangabad - Harda - Khandwa

Projects only both present and futures.

- A first Charge on all the revenues / receivable of Hoshangabad-Harda -

Khandwa project account of the Company

- A First charge on all the intangible assets of the Company including but

no limited to Goodwill of the Co

- A first charge on Company's bank accounts including without limitation

the trust and retention account (RTA) / Escrow Account and Debt

Service Reserve Account to be established by the Company

- A First charge/assignment/security on the Company right under the

concession agreement, project document, contract and all licence

permits approvals conserts and insurance policies in respect of

the project



SCHEDULE - C

SCHEDULE - D

SECURED LOANS

UN-SECURED LOANS

As at

March 31, 2011

(Amount in Rs.)

As at

March 31, 2010

(Amount in Rs.)

FROM CORPORATION BANK

FROM PUNJAB NATIONAL BANK

FROM INDUSTRIAL DEVELOPMENT FINANCE CO. LIMITED

INTEREST ACCRUED & DUES

TOTAL (B) 1179367042 1306986314

OTHER LOAN


SHORT DEMAND LOAN

OVERDRAFT ACCOUNT

FROM IDBI BANK LIMITED

FROM BANK OF INDIA

OVERDRAFT ACCOUNT

TOTAL (C) 991822637 1066557724

TOTAL (A) + (B) + (C) 2223876957 2562142580

269878003 300574761

The above Loan is Secured By:

- First Mortgage & charge on all the movable & immovable properties

of the Raisen - Rahathgarh BOT Projects including all receivable both

and present and future.

- Assignment of all rights, title and Interest of the Company in respect

of all the assets of the projects, all Projects agreement and Contracts

including Concession Agreement.

- Assignment of contractors guarantees, performance bond and

liquidated damages

- Personal Guarantees of some of the Directors of the Transferors Company.


92646507 125947741

- (Secured by Ludhiana & Jalandhar Bus Terminal Projects, and Personal

guarantee of some of the directors of the Company).


554524973 572792654

2691962 2442242

- Secured by by way of mortgage in favour of IDFC of all movable properties

pertaining to the Dewas Water Supply Projects Presents, futures.

- a first charge by ways of the hypothecations of the all movables

including movables including movable plant machinery, machinery

spares, tools, & accessories, furniture & fixture, vehicles and all other

movable assets pertaining to the project present & future.

- First charge of all the book debts, operating, Cash Flows, revenue,

receivables of the Company pertaining to the Dewas Water Supply

project, present & Future.

- Assignment of all rights, title and Interest of the Company in respect

of all the assets of the Dewas Water Supply Projects agreement and

Contracts including Concession Agreement.

- First Charge over the Escrow Account. Debt Service Reserve Account

and other Reserve and any Other reserves and any other banks account

the Company wherever maintained.

- Personal Guarantee of the Directors of the Company


13068785 139765340

(Secured by fixed deposits of the Company and third Parties)

458378706 376430627

(Secured by hypothecation of the entire stocks & book debts of the

Company & personal guarantee of some of the directors of the Company).

365262779 341125151

(Secured by pari passu charge on all current assets of the company)

155112367 201103665

Secured by specific Plant & Machineries and second charge on current

assets of the Company.

- 8132941

- Securred by the 10% Cash Margin in the form of TDR

- Pledge of the shares of the promoters in favour of the Bank for Rs. 50 Lacs

FROM COMPANIES 1140700 -

Total 1140700 -

48

49

1GOOD-W

ILL

170

159

2-

-170

159

2-

--

-170

159

2170

159

2

2LAND

10

334

238

3567

140

-1

390

1378

--

--

1390

1378

10

334

238

3BUILDINGS

17087

31

475

300

-2

1840

31

11

18

259

48

254

-1

1665

13

10

175

18

59047

2

4PLANT&MACHINERIES

5270

31

35

21

1296676

27

2475

16

51

10805

12

20

2755

355

4506

175

31

29878

34

2348

29

274

276

25

12

38

324

275998

5CONSTRUCTIONEQUIPMENTS

22

14

36

38

11

24

37489

-2

3387

3870

72

12

285

22

1470

246

-9

359

3098

140

28077

2149

31

35

29

6AIR-CONDITIONERS

1070

34

1549

249

-16

19590

70

1197

1065

35

-8077

32

81

1858

369

144

7VEHICLES

218

34

3100

21

277

375

177

11

21

10

38

16

21

23569957

266864

36

239

37

13

14786

2680

63

17548

29477

314

3

8COMPUTERS

79898

12

3508

358

-1

1498

170

569079

1159487

2-

728566

34

21

2507

22990

21

9OFFICEEQUIPMENTS

534

2708

1175556

-65

18

264

2287560

495

338

-278

2898

37

35

366

3055

148

10

FURNITURE&FIXTURES

6347097

846

117

-7

19

32

14

3794

384

53

22

16

-4

326600

28666

14

255

27

13

*Includesadjustmentsonaccountsofim

pirements

TOTAL

1001305352

34068658

34765227

1000608783

412040355

95995652

15381547

492654460

507954323

589264999

PREVIOUSYEAR

979805946

36092420

14593014

1001305352

307428179

113530616

8918442

412040355

589264999

SCHEDULE-ATOM,AND8FORMINGPARTOFTHEBALANCESHEET

SCHEDULE-E

FIXEDASSETS

FixedAssets

Sr.

GROSSBLOCK

Ason

1/4/2010

Addition

DuringPeriod

Deduction

DuringPeriod

Ason

31/3/2011

Ason

1/4/2010

Addition

DuringPeriod

Deduction

DuringPeriod

DEPRECIATION

Ason

31/3/2011

Ason

31/3/2011

Ason

31/3/2010

NETBLOCK

50

SCHEDULE-ATOM,AND8,FORMINGPARTOFTHEBALANCESHEET

SCHEDULE-F

BUILD,OPERATE&TRANSFERPROJECTSEXPENDITURE

Particulars

HOSHANGABAD-HARDA-KHANDWA

Asat

01/04/2010

Incurred

During

theYear

Asat

31/03/2011

Asat

01/04/2010

Incurred

During

theYear

Asat

31/03/2011

Asat

01/04/2010

Incurred

During

theYear

Asat

31/03/2011

Asat

01/04/2010

Incurred

During

theYear

Asat

31/03/2011

Asat

01/04/2010

Incurred

During

theYear

Asat

31/03/2011

Asat

01/04/2010

Incurred

During

theYear

Asat

31/03/2011

RAISEN-RAHATGARH

BALANCEASPERLASTYEAR

784

3484

32

784

3484

32

58

21

126

17

-58

21

126

17

11

22

20655

-1

12

220655

1355

20949

-1

355

20949

1054805

32

2-

1054805

32

22669007975

-2669007975

MATERIALCONSUMED

--

--

--

--

--

-6

379

14

36

6379

14

36

-6

379

14

36

6379

14

36

SITECOST&OTHEREXPENSE

--

--

--

--

--

-1

3140

198

13

140

198

-1

3140

198

13

140

198

REPAIRS&MAINTENANCE

--

--

--

--

--

-1

19

34

22

119

34

22

-1

19

34

22

119

34

22

LESS:WRITTENOFFDURINGTHEYEAR

--

24

1087

29

--

1588066

3-

-2

35

1549

1-

-17

21

1050

--

494

2679

--

856586

12

TOTAL

784348432

-784348432582112617

-582112617112220655

-112220655135520949

-1355209491054805322

7812505511329303772669007975

781250552747133030

CLOSINGBALANCE

784348432

-760239703582112617

-566231954112220655

-88705164135520949

-1183098991054805322

7812505511279876982669007975

781250552661474418

JALANDHARBUSTERMINALPROJECTLUDHIANABUSTERMINALPROJECT

DEWASWATERSUPPLYPROJECTS

TOTAL

51


SCHEDULE - G

As at

March 31, 2011

(Amount in Rs.)

As at

March 31, 2010

(Amount in Rs.)

INVESTMENT IN SHARES (NON TRADE)

QUOTED, (LONG TERM)

UNQUOTED, ( LONG TERM)

IN-SUBSIDIRY COMPANIES

OTHERS

INVESTMENT IN BONDS

INVESTMENT ON NON CONVERTIBLE DEBENTURES

INVESTMENT IN CERTIFICATE OF DEPOSITS

INVESTMENT IN GOVERNMENT SECURITY

TOTAL 2075471395 630849621

7400 (P.Y. 7400) Equity Sharess in Minar Trading services Limited

of Rs. 10/- each fully Paid up 74000 74000

1500 (P.Y. 1500) Equity Sharess in Sarv Shakti Synthetics Limited

of Rs. 10/- each fully Paid up 15000 15000

1600 (P.Y. 1600) Equity Sharess in Corporation Bank

of Rs. 10/- each fully Paid Up 128000 128000

30000 (P.Y. 30000) Equity Shares in Myraj Consultancy Limited

of Rs. 10/- each fully paid up 300000 300000

517000 517000

Less : Provision for Dimunition in value of Investment 74000 74000

443000 443000

(Market Value Rs. 10,20,800/- P.Y. Rs. 7,69,600/-)

242000 (P.Y. 242000) Equity Shares of MSK Projects

(Himmatnagar bypass)Pvt Ltd of Rs. 10/- each fully paid up 23300000 23300000

6730000 (P.Y. 6730000) Equity shares of MSK Projects

(Kim Mandvi Corridor) Private Limited of Rs. 10/- each fully paid up 67300000 67300000

50000 (P.Y. 50000) Equity Shares of Super Infrastructure and Toll Bridge

Private Limited of Rs. 10/- each fully paid up - 500000

25500 ( P.Y. Nil) equity Shares in Welspun Energy Maharshtra Ltd

Rs.10/- each fully paid up 255000 -

500 (P.Y. 500) Equity shares in MSK Finance Limited


48 (P.Y. 48) Equity shares in Nutan Nagrik Sahakari Bank Limited

of Rs. 100/- each fully paid up. 4800 4800

37652 (P.Y. 37652) Equity shares in Baroda Peoples Co-Op. Bank Limited

of Rs.10/- each fully paid up 376521 376521

63 (P.Y. 63) Equity shares in Baroda City Co-Op. Bank Limited


1000 (P.Y. 1000) Equity shares in Classic Organisors Private Ltd


960 (P.Y. 960) Equity shares in Sindh Mechantile Co-Op. Bank Ltd

of Rs.10/- each fully paid up 9600 9600

50000 (P.Y. 50000) Equity shares in Bul MSK Infrastructure

(India) Private Limited of Rs.10/- each Fully Paid up 27800150 27800150

50000 (P.Y. 34100) Equity shares in Dewas Bhopal Corridor Limited

of Rs. 10/- each fully paid up. 510210900 510051900

178 ( P.Y. Nil) Bonds of IFCI - 2030 @9.70% of Rs. 1000000 each fully paid up. 183340000 -

500 ( P.Y. Nil) Bonds of IDBI - 2030 @9.65% of Rs. 1000000 each fully paid up. 514900000 -

257 ( P.Y. Nil) Bonds of West Bengal Electricity Distco Ltd - 2025

@9.34% of Rs. 1000000 each fully paid up. 263792500 -

1260 ( P.Y. Nil) Bonds of DHFCL 2015 10% of Rs. 100000 each fully paid up. 127802304 -

590 ( P.Y. Nil) Bonds of DHFCL 2020 10.40 % of Rs. 100000 each fully paid up. 59857220 -

1500 ( P.Y. Nil) NCD of CBI Rs. 100000/- each fully paid up. 146586600 -

1500 ( P.Y. Nil) NCD of PNB Rs. 100000/- each fully paid up. 147429150 -

Indira Vikash Patra 500 500

Two (P.Y. One) Bonds of Rs. 10,00,000/-

Sardar Sarovar Narmada Nigam Limited 2000000 1000000

INVESTMENTS


As at

March 31, 2011

(Amount in Rs.)

As at

March 31, 2010

(Amount in Rs.)

52

SCHEDULE - H

INVENTORIES

TOTAL 556938132 328030039

(as taken valued and certified by the management)

WORK-IN-PROGRESS 416187464 202063190

RAWMATERIAL 140750668 125966849

CURRENT ASSETS, LOAN & ADVACNES

SCHEDULE - I

SUNDRY DEBTORS

OTHER DEBTS:

TOTAL 1363961503 1175710926

(UNSECURED CONSIDERED GOOD)

DEBT EXCEEDING SIX MONTHS 91948122 7465705

LESS: PROVISION FOR DOUBTFUL DEBTS 25633372 -

66314750 7465705

FROM SUBSIDIARIES COMPANIES 316884173 207958159

FROM OTHERS 988775325 960287062

(Including Retention amount Rs.51,83,42,508/- ) 1305659499 1168245221

LESS: PROVISION FOR DOUBTFUL DEBTS 8012746 -

1297646753 1168245221

CURRENT ASSETS, LOAN & ADVACNES

SCHEDULE - J

CASH - ON - HAND 4086158 3787910

IN CURRENT ACCOUNTS 263000543 222575116

IN FIXED DEPOSITS ACCOUNTS 133322517 288756988

BALANCES WITH SCHEDULED BANKS

TOTAL 400409218 515120015

CASH & BANK BALANCES

SCHEDULE - K

(Unsecured, Considered Good)

ADVANCES RECOVERABLE IN CASHOR IN KINDOR FOR VALUE TO BE RECEIVED 216719658 243664240

LESS: PROVISION FOR DOUBTFUL DEBTS 2637198

214082460 243664240

INTEREST ACCRUED BUT NOT DUE ON FIXED DEPOSITS/BONDS 36339827 2001538

TAX DEDUCTED AT SOURCE / ADVANCE TAX 96104637 31544174

(Net of Provision for Tax)

MOBILISATION ADVANCE TO SUB-CONTRACTORS 3819450 -

SUNDRY DEPOSITS 110900111 146582237

LESS: PROVISION FOR DOUBTFUL DEPOSITS 6597112 104302999

TOTAL 454649373 423792190

LOAN & ADVANCES

SCHEDULE - L

CURRENT LIABILITIES

TOTAL 926538873 663902941

SUNDRY CREDITORS 445167055 395191288

MOBILISATION ADVANCE FROM CUSTOMERS 338736095 104009537

OTHER LIABILITIES 142635723 164702115

CURRENT LIABILITIES & PROVISION

SCHEDULE - M

PROVISION FOR LEAVE ENCASHMENT 2241298 657521

PROVISION FOR GRATUITY 6347723 2712481


TAX ON PROPOSED DIVIDEND - 6798000

- 46798000

TOTAL 8589021 50168002

PROVISION

53

SCHEDULE 1 TO 8, FORMING PART OF THE PROFIT & LOSS ACCOUNT

SCHEDULE - 1

SCHEDULE - 2

SCHEDULE - 3

SCHEDULE - 4

SCHEDULE - 5

CONTRACT RECEIPTS, SUPPLY, OPERATIONAL INCOME

TOLL COLLECTION

OTHER INCOME

CHANGE IN STOCK

MATERIAL CONSUMED

For the Year Ended

March 31, 2011

(Amount in Rs.)

For the Year Ended

March 31, 2010

(Amount in Rs.)

CIVIL CONTRACTS 2080555984 3992298353

LESS: SERVICE TAX 57250077 93497191

2023305907 3898801162

(Tax Deducted at Source Rs. 5,13,24,829/- P.Y. Rs. 6,94,65,542/-)

TECHNICAL SERVICES 44000000 -

LESS: SERVICE TAX 4532000 -

39468000 -

(Tax Deducted at Source Rs. 45,32,200/- P.Y. Rs. - NIL -)

TOTAL 2062773907 3898801162

HOSHANGABAD - HARDA - KHANDWA PROJECTS 76646054 95306393

RAISEN-RAHATGARH PROJECTS 64245784 69821047

JALANDHAR PROJECTS 47149255 41419709

JALANDHAR PROJECT - RENT 14179708 11926662


LUDHIANA PROJECTS 42739986 39633996

LUDHIANA PROJECTS - RENT 9649882 8599939


DEWAS WATER SUPPLY PROJECTS 24056828 31782484

TOTAL 278667496 298490230

OTHER INCOME

DIVIDEND ON NON-TRADE INVESTMENT 26400 46643

INSURANCE CLAIM 590995 855921

UNCLIAM LIABILITIES WRITTEN BACK 4155946 3577719

PROFIT ON SALES OF ASSETS 1581645 2118510

MISCELLANIOUS INCOME 1524007 2166303

TOTAL 7878993 8765096

OPENING STOCK

- WORK-IN-PROGRESS 202063190 160202898

LESS: CLOSING STOCK

- WORK-IN-PROGRESS 416187464 202063190

TOTAL 214124274 41860292

STOCK AT COMMENCEMENT 125966849 69296450

ADD : PURCHASE & EXPENSES 1306271580 2063540834

1432238429 2132837284

LESS : STOCK AT CLOSE 140750668 125966849

TOTAL 1291487761 2006870435


SCHEDULE - 6 SITE COST & OTHER EXPENSE

For the Year Ended

March 31, 2011

(Amount in Rs.)

For the Year Ended

March 31, 2010

(Amount in Rs.)

AIR CONDITIONING WORK 4520400 -

PROVISION FOR BAD DEBTS 42880428 4286469

BITUMANIOUS WORK 16163162 18870

BLASTING WORK 2814921 11808725

BOLDER WORK 6017319 19881212

BRIDGE WORK 10064825 13706329

CULVERT & DESIGN WORK 259100 3591902

CIVIL WORK 12576342 614443

CONCRETE WORK 15431137 7500067

CONSULTANCY CHARGE 52614895 26711621

DONATION 684429 481991

DOORS & WINDOWS WORK 5029639 5022845

EARTH WORK 148386025 167673544

ELECTRIC EXPENSE 57026515 36842390

ELECTRIC POLL SHIFTING 8703120 8462286

FABRICATION WORK 29740638 27002047

FLOORING WORK 21333404 1384144

HUTMATE 2051067 1609274

INSURANCE 3881958 4537472

MACHINERY HIRE CHARGES 20366807 47267000

MASONERY WORK 26824303 25553380

MISCELLANIOUS WORK 15616729 123004895

LAND SCAPPING WORK 3820283

PAINTING WORK 7465448 5149429

PAYMENT TO SITE WORKERS 69448618 78629269

PIPE LAYING WORK 6565067 2029106

RATE & TAXES 91047515 113283963

REINFORCEMENT WORK 22274323 40561547

RENT 15075602 17746709

ROAD WORK 63302175 66715769

SAFTY EXPENSE - 420709

SALARIES & BONUS 181193286 187944239

(Including remuneration to the Directors Rs.1,06,92,070 P.Y. Rs. 2,83,00,000/-)

CONTRIBUTION TO PROVISION FUND 3986354 1543054

(Including Rs.2710/- P.Y. Rs. 7200/- to Directors)

ESIC 115572 321258

PROJECT MONITORING FEES 5572891 -

TENDER FEES 10625330 -

SANITARY WORKS 1572311 783864

PILING WORK 5311015 400000

SECURITY SERVICE CHARGES 5414874 6574064

SHUTTERING WORK 44483933 25970440

STAFF WELFARE EXPENSE 25987834 36778946

TOLL PLAZA 3200829 1164163

TRAVELLING EXPENSE 9911606 9348390

VEHICLE HIRE CHARGES 7312227 13815869

WATER PROOFING WORK 9946840 1568471

LOSS ON SALES OF INVESTMENTS 4805661 -

PENALTY SLOW PROGRESS 17817 -

WBMWORK 551824 334276

54


SCHEDULE - 6

SCHEDULE - 7

SITE COST & OTHER EXPENSE

FINANCIAL EXPENSE

For the Year Ended

March 31, 2011

(Amount in Rs.)

For the Year Ended

March 31, 2010

(Amount in Rs.)

SITE EXPENSE 25601325

UNDER DESK INSULATION 6107362

INTEREST ON INCOME TAX 119379 -

BAD DEBTS 2206100 -

PROVISON FOR DIMUNITION IN VALUE OF INVESTMENT - 74000

IMPAIREMENT OF FIXED ASSET 6738590 -

REPAIRS & MAINTENANCE FOR

MACHINERIES 15716097 42222395

ROAD MAINTAINANCE 1636117 1968721

VEHICLE, TRUCKS, TRACTORS & OTHERS 41907916 43064235

AUDITOR REMUNERATION

AUDIT FEES 1000000 800000

TAXATION MATTER - 100000

CERTIFICATION WORK 41362 141000

SERVICE TAX - 104502

MISCELLANIOUS EXPENDITURE 23791411 36650232

TOTAL 1226862057 1273169526

INTEREST ON TERM LOAN 183843002 163811782

OTHER INTEREST 144542323 77544567

BANK CHARGES 43954752 73569379

372340076 314925728

LESS: INTEREST RECEIVED ON BONDS & FIXED DEPOSITS 204754494 27534590

(Tax Deducted at Source Rs. 49,80,925/- P.Y. Rs. 24,34,297/-)

TOTAL 167585582 287391138

55

56

SCHEDULE FORMING PART OF THE ACCOUNTS

Schedule - 8 ACCOUNTING POLICIES AND NOTES ON ACCOUNTS FOR THE YEAR ENDED 31st MAR'2011

1. SIGNIFICANTACCOUNTINGPOLICIES

A-1. REVENUERECOGNITIONONCONTRACTS

A-2 EXPENDITURE INRESPECTOFBUILD,OPERATEANDTRANSFER (B.O.T)PROJECT

B. ADVANCESANDPROGRESSPAYMENTSANDRETENSION

C. FIXEDASSETS

D. DEPRECIATION

E. BORROWINGCOST

F. VALUATIONOF INVENTORIES

a. All revenuesandexpensesareaccountedonaccrual basis except to theextent statedotherwise.

b. Contract Prices are either fixed or subject to price escalation clause. The Revenue is recognized on the basis of

percentage of completion method and the stage of completion is determined on the basis of physical

completionofproportionof contractwork.

c. Amount due in respect of the price escalation claimand/or variation in contractwork approved by the customers

are recognized as revenue onlywhen there are conditions stipulated in the contracts for such claims or variations

and/or thesameareevidenced interaliabywayofconfirmationorthesameareacceptedbythecustomers.

d. Disputed amount under the contractworks are recognized as revenuewhen the sameare settled and amounts

are received.

e. Liquidated damages payable, if any, as per the terms of the contract, for the delays, if any, are accounted only

whensuchdelay is attributable to theCompany.

a. Expenditure (net of corresponding interest incomeearnedondeployment or otherwise of fund attributable to

the projects) incurred on Build, Operate and Transfer (BOT) Project which does not represent Company's own

assets is classified as “BOT PROJECT EXPENDITURE” and is amortized / written off based on the projected toll

revenue. Theprojected total revenue isbasedon the toll rate&expected increase.

b. Thematerials and stores etc. acquired / purchased for the construction activities of owned Build, Operate and

Transfer Projects (BOT) are classified / reflected as B.O.T. Projects Expenditure and / orwork in progress, as the

casemaybe. Accordingly suchpurchasesaredisclosedas itemofB.O.T. Project Expenditure.

a. Advances received fromcustomers in respectof contracts are treatedas liability.

b. Progress payments received are adjusted against receivables from customers in respect of the contract work

performed.

c. Amount(s) retained by the customers until the satisfactory completion of the contract are recognized in the

final statement as receivables. Where such retention has been released by the customers against submission

of bank guarantee the amount so released is adjusted against receivables from the customers and value of

Bankguarantees is disclosedas contingent liabilityunderbankguaranteesoutstanding.

a. Fixedassets are statedat costof acquisitionas reducedbyaccumulateddepreciation.

b. All direct expensesattributable to fixedassets are capitalized.

a. Depreciation is providedonwritten downvalue basis as per the rates andmethodprescribedunder Schedule –

XIV to theCompaniesAct,1956.

b. Goodwill is notdepreciated.

Borrowing costs directly attributable to the acquisition or construction of fixed assets are capitalized as part of

the cost of the assets, up to the date the assets are put to use. Other borrowing costs are charged to the profit

and loss account in theyear inwhich theyare incurred.

a. RawMaterials are valuedat lowerof cost andnet realizable value. Cost is determinedonFIFObasis.

57


Schedule - 8 ACCOUNTING POLICIES AND NOTES ON ACCOUNTS FOR THE YEAR ENDED 31st MAR'2011 (Contd.)

b. Contract Work in progress is valued at tender rate having regards to unbilled work, outstanding running bills

andexpected recovery thereof.

c. Stores and sparesarewrittenoff in theyearofpurchase.

Long terms investments are stated at cost. Provision for diminution in the value of investments is made only if

suchdecline is other than temporary in theopinionof themanagement.

Provision is made in accounts for doubtful debts / advances which in the opinion of the management are

considereddoubtful of recovery.

Disputed and / or contingent liabilities are either provided for / or disclosed depending on management's

judgmentof theoutcome.

a. Short TermEmployeebenefits:

Short TermEmployeeBenefits are recognized in theperiodduringwhich the serviceshavebeen rendered.

b. LongTermEmployeebenefits:

i. Provident Fund, FamilyPension fund

As Per Provident Fund Act 1952 all employees of the Company are entitled to receive benefits under the

provident fundand familypension fundwhich is definedcontributionplan. These contributionsare made

to theplanadministeredandmanagedbyGovernmentof India.

The Company's contribution to these scheme are recognized as expense in the profit and loss account

during the year in which the employee renders the related service, The Company has no further obligation

under theseplansbeyond itsmonthly contribution

c. Leaveencashment:

The Company has provided for the liability at year end on account of un-availed earned leave as per the

actuarial valuation.

d. Gratuity :

The Company provides for gratuity obligations through a Defined benefits retirement plan (“The Gratuity

Plan”) covering all employees. The present value of the obligation under such defined benefit plan is

determined based on the actuarial valuation using the project unit credit method, which recognizes each

period of service as giving rise to additional unit of employees benefits entitlement and measure each unit

separately to build up final obligation. The obligation is measured at the present value of the estimated cash

flows. Thediscount rateused for determiningpresent valueof thedefinedobligationunder thedefinedbenefit

plan is based on the market yield on Government Securities as at the balance sheet date. Actuarial gains and

losses are recognized inProfit andLossAccountas andwhendetermined.

TheCompanymakesannual contribution to LIC for thegratuityplan in respectof all theemployees.

a) Provision for current tax is made based on taxable income for the current accounting year and in accordance

with theprovisionsof the IncometaxAct,1961.

b). Deferred tax resulting from “timing difference” between book and taxable profit for the year is accounted for

using the tax rates and laws that have been enacted or substantially enacted as on the balance sheet date. The

G. INVESTMENTS

H. PROVISIONFORDOUBTFULDEBTS/ADVANCES:

I. CLAIMS,DEMANDSANDCONTINGENCIES

J. RETIREMENTBENEFITS

K. PROVISIONFORCURRENTANDDEFERREDTAX

deferred tax asset is recognized and carried forward only to the extent that there is a virtual certainty that the

assetswill beadjusted in future.

Transaction in foreign currency is recorded at the exchange rate prevailing on the date of the transaction,

exchange rate differences resulting from foreign exchange transaction settle during the period including year

end transaction of current assets and liabilities are recognized in the profit & loss accounts. Exchange rates

differences arising in relation to liabilities incurred for acquisition of fixed assets are adjusted to the carrying

valueof the fixedassets.

In respect of forwardexchange contract, except in caseof fixedassets, thedifferencebetween forward rate and

the exchange rate at the inception of the forward exchange contract is recognized as income / expenses over

the lifeof the contract.

Lease of assets under which all the risk and rewards of ownership are effectively retained by the lessor are

classified as operating leases. Lease payments under operating leases are recognized as expenses on accrual

basis in accordancewith respective leaseagreements.

Assets acquired under leases where Company has substantially all the risk and rewards of ownership are

classified as finance lease. Assets acquired under finance are capitalized and corresponding lease liability is

recorded at an amount equal to the fair value of the leased assets at the inception of the lease. Initial costs

incurred in connection with the specific leasing activities directly attributable to activities performed by the

Companyare includedaspartof theamount recognizedasanassetunder the lease.

If internal / external indications suggest that an asset of the Company may be impaired, the recoverable

amount of asset / cash generating asset is determined on the Balance – Sheet date and if it is less than its

carrying amount of the asset / cash generating unit the carrying amount of asset is reduced to the said

recoverable amount. The recoverable amount ismeasured as the higher of net selling price and value in use of

such asset / cash generating unit, which is determined by the present value of carrying amount of the

estimated future cash flow.

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires

estimates and assumption to be made that affect the reported amount of the assets and liabilities and

disclosure of contingent liabilities on the date of financial statements and the reported amount of revenue and

expenses during the reporting period. Actual results could differ from these estimates and differences

between actual results and estimates are recognized in the period in which the results are known /

materialized.

a. Guarantees issuedby theCompany's banker onbehalf of the Company amounting to Rs.17543.18 Lacs (P. Y. Rs.

9733.75 Lacs)

b. Guarantee given by the Company to the bankers for the facilities granted to its wholly owned subsidiary

companiesMSK Projects (Himmatnagar Bypass) Private Limited&MSK Projects (KimMandvi Corridor) Private

Limited. Amounting toRs.1667 Lacs (P.Y. Rs.1667 Lacs)Outstanding amount as on31stMarch,2011Rs1267.44

Lacs (Previous Year1345.75 Lacs) and to integrated joint ventureDewasBhopal Corridor Limited, amounting to

Rs. 38500 Lacs (Previous year Rs. 34500 Lacs) Out standing amount as on 31st March 2011 Rs. 38597.66 Lacs

(P.Y Rs.34831.35Lacs)

L. FOREIGNCURRENCYTRANSACTION

M. LEASE

a. OPERATINGLEASE

b. FINANCELEASE

N. IMPAIRMENTOFASSET

O. USEOFESTIMATES

2. CONTINGENTLIABILITIESNOTPROVIDEDFOR INRESPECTOF:

58



59



c. Letterof credit issuedby theCompany's bankonbehalf of theCompanyRs.502.05 Lacs (P.Y.Rs.1353.72 Lacs)

d. IncomeTaxDemandofRs.1045.79Lacs (PreviousYearRs.282.40 Lacs) disputedby theCompany.

e. Civil suit filedagainst theCompanyRs.38.58Lacs (Previous yearRs.23.46 Lacs)

Incomplete Contract work under Contract Work In Progress at the various sites is estimated by the

managementhaving regards tounbilledwork, outstanding runningbill andexpected recovery thereof.

Security Deposits deducted from contract receipt and mobilization advances received against contracts are

subject to confirmationandadjustment, if any, on finalizationof account.

i. The Company has obtained the contract on Build, Operate and Transfer (BOT) basis from theMadhya Pradesh

State IndustrialDevelopmentCorporation forexecutionofDewasWater Supplyproject.

In terms of the contract the ownership of the said property vests in the government immediately. Under the

contract the Company is entitled to collect Water supply charge during the concession period of 32 years

(including theperiodof construction).

The Company has completed construction of the said project in the earlier year. Having regard to the accounting

policies followed by the Company the entire expenditure incurred is treated as BOT Project Expenditure and

proportionateamountofRs.49.43Lacs (P.Y.Rs.388.36Lacs)hasbeenwrittenoffduringtheyear.

ii. The Company has obtained the contract on Build, Operate and Transfer (BOT) basis from the Punjab

InfrastructureDevelopmentBoard forexecutionof JalandharBusTerminal project.


contract the Company is entitled to collect Toll Charge and Rent on Shops during the concession period of 8

years5monthsand2days for JalandharBusTerminal Project (including theperiodof construction).



proportionateamountofRs.235.15Lacs (P.Y.Rs.320.35Lacs)hasbeenwrittenoffduringtheyear.

iii. The Company has obtained the contract on Build, Operate and Transfer (BOT) basis from the Punjab

InfrastructureDevelopmentBoard forexecutionof LudhianaBusTerminal Project.



years3months for LudhianaBusTerminal Project (including theperiodof construction).



proportionateamountofRs.172.11Lacs (P.Y.Rs.256.05Lacs) hasbeenwrittenoffduringtheyear.

iv. TheMSK Infrastructure&Toll BridgePrivate Limited ('TransferorCompany') hadobtained thecontractonBuild,

Operate and Transfer (BOT) basis from Madhya Pradesh Road Development Authority for construction of

Hoshangabad–Harda–KhandwaRoadProject. In Termsof theContract theTransferorCompanywasentitled to

collect the toll during the concession period of 5440 days (Including the period of the construction). The

Transferor Companywas amalgamatedwithMSKProjects (India) Limitedpursuant to schemeof amalgamation

asapprovedby theHonorableHighCourtofGujaraton2ndNovember,2006witheffect from01.01.2005.

The Transferor Company had completed the construction of the above project and was put open to traffic

during theearlier year.

The Cost of the said project and right to collect the toll charges is transferred to and vested in the Company as

per the schemeof amalgamation.

3.

4.

5. BUILD,OPERATE&TRANSFER (BOT)PROJECTS:

60



Having, regard to the accounting policies followed by the Company the expenditure incurred thereon, is

treated as BOT Project Expenditure and proportionate amount of Rs. 241.09 Lacs (P.Y. 356.84 Lacs) has been

written off during the year after considering the Cash Subsidy received/receivable fromMadhya Pradesh State

RoadDevelopmentAuthority.

v. The MSK Highways Limited (“Transferor Company) had obtained the contract on Build, Operate and Transfer

(BOT Basis) from Madhya Pradesh Road Development Authority for construction of Raisen–Rahatgarh. In

Terms of the Contract the Transferor Company entitled to collect the toll during the concession period of 5440

days (Including the period of the construction). The Transferor Company was amalgamated withMSK Projects

(India) Limited pursuant to scheme of amalgamation as approved by the Honorable High Court of Gujarat on

2ndNovember,2006witheffect from01.01.2005.

The Transferor Company had completed the construction of the above project and was put open to traffic

during theearlier year.

The Cost of the said project and right to collect the toll charges is transferred to and vested in the Company as

per the schemeof amalgamation.


treated as BOT Project Expenditure and proportionate amount of Rs.158.81 Lacs (P.Y. 289.08 Lacs) has been



Hitherto up to 31st March 2010 expenditure incurred on above i to v, Build, Operate & Transfer (BOT) Projects

was amortized / written off over the period of concession. The Company has changed the policy and the said

BOTexpenditure is amortized /writtenoff on thebasis of projected toll revenueover theperiodof concession.

Had there been on change in the method of amortization the amount of the amortization for the year would

have been higher by Rs.688.30 Lacs. Consequently loss for the year would have been higher and Reserves and

Surpluswouldhavebeen lower to that extent.

As the policy of amortization is changed prospectively no effect of change up to 31stMarch 2010 is given to the

accounts.

TheCompany isoperating ina single segmentonlyduring theyear i.e. Civil ConstructionContract.

During the year, the Company has accounted for deferred tax in accordancewith the Accounting Standard 22 –

“Accounting for Taxeson Income” issuedby the InstituteofCharteredAccountantsof India.

TheBreakupofdeferred tax liabilities&assets:

5-A CHANGEOFPOLICYOFAMORTISATION:

6.

7.

Rs. In Lacs

As On

31-03-2011

Particulars As On

31-03-2010

Deferred Tax Liabilities

Depreciation

Deferred Tax Assets

Retirement Benefits

Provision for Bad debts

Net Deferred Tax Liabilities

Deferred Tax liabilities provided during the year

1032.81

7.28

164.39

861.14

214.31

171.67

649.06

2.23

-

646.83

550.94

61



Disclosure inaccordancewithAccountingStandard - 7 (Revised).8.

Rs. In Lacs

2010-11Particulars 2009-10

Contract Revenue

Contract Cost Incurred

Recognized Profits / Losses

Advances Received

Retention Money

Gross Amount due from Customers For Contract Work

122447.91

97506.72

9055.09

4364.48

4359.17

9011.49

103736.42

90402.31

11836.43

7390.33

1160.47

10101.24

In respect of the construction contracts, the Company follows the percentage of completion method for

recognizing profit / loss but noprovision ismade for contingencies in respect of contract in progress, consistent

with the practice of the Company. Accounting Standard (AS) 7 on “Accounting for Construction Contracts”

issuedbythe instituteofCharteredAccountantof India requires thatanappropriateallowancebemadefor future

unforeseenfactors. In theopinionof theCompany,suchaprovision isnotrequiredandhasnofinancialeffect.

During theyearCompanyhas recognized the followingamount in the financial statements

Contribution toDefinedContributionPlan recognizedasExpense for theyear asunder:

9. Disclosures relating toEmployeeBenefits –AsperRevisedAS-15:

a. DEFINEDCONTRIBUTIONPLAN:

Rs. In Lacs

Particulars

Employer Contribution to Provident Fund 39.86

(15.43)

Rs. In Lacs

Gratuity

(Funded)

Particulars Leave Encashment

(Non Funded)

ReconciliationofopeningandclosingbalancesofDefinedBenefit obligation

b. DEFINEDBENEFITPLAN

Defined Benefit obligation at the beginning of the year

Current Service Cost

Interest Cost

Actuarial gain/(loss)

Benefits Paid

Defined Benefit obligation at the year end

27.12

(13.40)

5.07

(7.94)

2.27

(1.11)

29.00

(4.68)

NIL

(NIL)

63.47

(27.12)

6.58

(3.82)

58.43

(4.43)

0.55

(0.32)

(43.14)

(1.99)

NIL

(NIL)

22.41

(6.58)

62



Reconciliation of opening and closing balances of fair value of plan Assets

Rs. In Lacs

Particulars Gratuity

(Funded)

Fair value of plan assets in the beginning of the year

Expected return on plan assets


Employer contribution

Benefits Paid

Fair Value of plan assets at the end of the year

32.77

(18.03)

2.62

(2.29)

(2.62)

(0.99)

0.00

(13.44)

NIL

(NIL)

32.77

(32.77)

Reconciliation of Fair Value of Plan Assets and Benefit Obligation.

Expenses recognized during the year (Under the head “Salaries & Bonus” – Refer Schedule 6)

Rs. In Lacs


(Funded)

Leave Encashment

(Non Funded)

Fair Value of Assets as at 31st March, 2011

Present Value of obligation as at 31st March, 2011

Amount recognized in Profit & Loss Account

32.77

(32.77)

63.48

(27.12)

36.35

(12.42)

2.76

(NIL)

22.41

(6.58)

15.84

(2.76)

Rs. In Lacs


(Funded)

Leave Encashment

(Non Funded)


Interest Cost

Expected return on Plan Assets


Expense Recognized in Profit and Loss Account

5.07

(7.94)

2.28

(1.11)

(2.62)

(2.28)

31.62

(4.67)

36.35

(12.42)

58.43

(4.43)

0.55

(0.32)

NIL

(NIL)

(43.14)

(1.99)

15.84

(2.76)

63



Actuarial AssumptionsRs. In Lacs


(Funded)

Leave Encashment

(Non Funded)

Discount Rate ( Per Annum)

Salary Escalation ( Per Annum)

8.28%

(8.28%)

6.00%

(6.00%)

8.40%

(8.28%)

6.00%

(6.00%)

- Welspun Corp Limited

- Welspun Infratech Limited

- MSK Projects (Himmatnagar Bypass) Private Limited

- MSK Projects (Kim Mandvi Corridor) Private Limited

- Welspun Energy Maharashtra Private Limited

- Bul MSK Infrastructure Private Limited

- Dewas Bhopal Corridor Limited

- Welspun Maxsteel Limited

- Welspun Steel Limited

- Welspun India Limited

- Welspun Retail Limited

- Welspun Captive Power Generation Limited

- B.K. Goenka- Chairman

- R.R. Mandawewala

- M.L. Mittal

- Asim Chakraborthy

- Ashok M Khurana -Director

10. Transactionwith relatedparties (as certifiedby themanagement)

A. HoldingCompanies:

B. SubsidiaryCompanies:

C. Integrated JointVentures:

D. AssociateConcern:

E. KeyManagementPersonnel:

Sr. Transaction with

Related Parties

Holding

Company

Integrated

Joint

Venture

Associate

Company

Key

Management

Relative of

Key

Management

Rs. In Lacs

Subsidiary

Companies

1

2

3

995.97

( - )

440.00

( - )

1582.71

( - )

1106.50

(1461.90)

12.26

(1.22 )

-

( - )

1708.87

(11906.92)

104.81

( 13.27 )

3546.28

( - )

-

( - )

757.74

( - )

-

( - )

-

( - )

-

( - )

-

( - )

Civil Construction

Receipt

Miscellaneous Income

Material Purchase

64



Cash Subsidy of Rs.82.87 Crores (P.Y. 82.87 Crores) received from Madhya Pradesh Rajya Setu Nirman Nigam

Limited, against the Build, Operate & Transfer Project Expenditure Cost, is not reduced from the relevant

project cost but the same is shownas “Capital Reserve” in theBalanceSheet.

A. Sundrydebtors include

11.

12.

Rs. In Lacs

4

5

6

7

8

9

10

11

12

13

14

15

16

Loan Received

Repayment of Loan

Received

Loan Given

Repayment of Loan

Given

Guarantee Given

Advance for Commer-

cial Property Purchase

Mobilization advance

Received

Mobilization advance

repaid

Investment in

Shares/Application

Remuneration to the

Directors

Sales of Properties

Receivable at the end

of the year

Payable at the end of

the year

5726.40

( - )

5715.00

( - )

3.02

( - )

-

( - )

-

( - )

-

( - )

1355.54

( - )

1005.54

( - )

-

( - )

-

( - )

-

( - )

3.02

( - )

2137.05

( - )

-

( - )

-

( - )

241.95

(197.24)

51.58

(554.63)

1267.44

( 1345.74 )

-

( - )

-

( - )

-

( - )

2.55

(-)

-

( - )

-

( - )

3385.50

(2114.74)

-

( - )

-

( - )

2245.79

(20.00)

321.95

(1000.00)

-

( - )

38500

(34500)

-

( - )

-

( - )

-

(1296.86)

-

( - )

-

( - )

-

( - )

1899.53

(2125.26 )

-

( - )

-

( - )

-

( - )

-

( 5.76)

-

( 120.82)

-

( - )

-

( - )

830.27

( - )

259.28

( - )

-

( - )

-

( - )

-

( - )

447.84

( - )

731.20

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

106.90

(283.00)

-

(28.83)

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

( - )

-

(41.58 )

-

( - )

-

( - )

Company Under the Same Management

Dewas Bhopal Corridor Limited

Bull MSK Infrastructure Private Limited

1745.97

(1017.34)

71.41

(71.41)

2856.76

(1017.34)

71.41

(91.41)

Rs. In Lacs

Particulars Closing Balance Maximum Amount

out standing during

the year

Wholly Owned Subsidiary Companies

MSK Projects (Kim Mandvi Corridor) Private Limited

MSK Projects (Himmatnagar Bypass) Pvt. Ltd.

3048.76

(1964.38)

120.09

(115.19)

3048.76

(1971.80)

120.09

(115.19)

Contd.

65



Disclosure of Loans and advances to subsidiaries, associates and others (pursuant to clause 32 of listing

agreement)

LoansandAdvances Include:

13.B.

Rs. In Lacs


out standing during

the year

Holding Company

Wholly Owned subdiary Co.

Company under same management

- Welspun Infra Projects Private Limited

- MSK Projects (Kim Mandvi Corridor) Pvt. Ltd

- MSK Projects (Himmatnagar bypass) P Ltd

- Bull MSK Infrastructure Private Limited

- Dewas Bhopal Corridor Limited

3.02

(-Nil-)

203.53

(26.29)

13.13

(8.74)

36.51

(36.51)

45.66

(1019.94)

3.02

(-Nil-)

203.53

(186.82)

13.13

( 8.74)

36.51

(36.51)

1011.95

(1019.94)

Earningper share:-14.Rs. In Lacs

2010-11 2009-10

A. Net profit after Tax available for equity

shareholders. (Rs. In Lacs)

B. Weighted average number of Equity Shares of Rs. 10/-

each outstanding during the year (Nos. of Shares)

C. Basic Earning Per Share (Rs.)

D. Diluted Earning Per Share (Rs.)

(3284.84)

38729233

(8.48)

(8.48)

2874.76

22821112

12.60

12.60

Confirmations of certain parties for amounts due from themas per accounts of the company are not obtained.

Amount due from customers include amounts due/with held on account of various claims. The claims will be

verified and necessary adjustments, if any, shall bemade in the year of settlement. Subject to this, company is

confident of recovering the dues and accordingly they have been classified as “debt considered good” and

thereforenoprovision is considerednecessary, thereagainst.

Under theMicro, Small andMediumEnterprise Development Act, 2006 (“MSMEDAct”) which came into force

effective from 2nd October, 2006, certain disclosures relating to amounts due to micro, small and medium

enterprises and remained unpaid after the appointed date etc. of principal and interest amounts are required

tobemade. TheCompany is in theprocess of compiling the relevant information.As the relevant information is

not yet readily available and / or not given or confirmed by such enterprises, it is not possible to give required

information in the accounts. However, in view of the management, the impact of interest, if any, which may

subsequently become payable to such enterprise in accordance with the provisions of the Act, would not be

material and the same, if any,wouldbedisclosed in theyearofpaymentof interest.

In the absence of the necessary information with the Company relating to the registration status of the

suppliers under the Micro, Small and Medium Enterprises Development Act' 2006, the information required

under the saidAct couldnotbecompiledanddisclosed.

15.

16.



66

In the opinion of the Directors, Current Assets, Loans and Advances have value at which they are stated in the

Balance Sheet, if realized in the ordinary course of business. The provision for depreciation and for all known

liabilities is adequateandnot inexcessof theamount reasonablynecessary.

Remuneration toDirectors

17.

18.Rs. In Lacs

Managing Director /

Joint Managing

Director / Chairman

Director

Salaries

Contribution to P.F.

Total

37,78,737

(2,00,00,000)

Nil

(Nil)

37,78,737

(2,00,00,000)

69,13,333

(83,00,000)

2,710

(7,200)

69,10,623

(83,07,200)

Previous year's figureshavebeen regrouped, rearrangedand reclassifiedwherevernecessary.

Additional information as requiredbyPara3, 4 and4-A to 4-Dof Part – II of ScheduleVI to theCompaniesAct,1956.

1. Civil Work/Supply Rs. 2,08,05,55,984

(Rs 3,99,22,98,353)

2. Toll Collection Rs. 27,86,67,496

(Rs.29,84,90,230)

i. Imported Nil Nil

(Nil) (Nil)

ii. Indigenous. Rs. 1,29,14,87,761 100

(Rs. 2,00,68,70,435) (100)

Rs. -Nil-

(Rs. -Nil-)

Rs. Nil

(Rs. Nil)

Rs. -Nil-

Rs. -Nil-

Rs. -Nil-

Rs. -Nil-

(Figures in brackets indicate corresponding figures of previous year)

19.

20.

a. TURNOVER

b). Value of Indigenous and Imported Material together with percentage of consumption

Value Percentage

c). C I F Value of Import

d). Expenditure in Foreign Currency Dividend

e). Earning in Foreign Exchange

f). Remittance in Foreign Currency




H. B. Shah

Partner


Place : Vadodara

Date : 26-05-2011

B. K. Goenka

Chairman

Susheela Maheshwari

Company Secretary

Place : Mumbai

Date : 26-05-2011

Sunil Shinde

Managing Director

67

CASH FLOW STATEMENT

2010-11 2009-10

A. CASH-FLOW FROM OPERATIING ACTIVITIES

Operating Profit before Working Capital Changes 101087055 972703428

NET CASH GENERATED/(USED) FROM OPERATING ACTIVITIES (130397170) 326961747

B. CASH FLOW FROM INVESTING ACTIVITIES

NET CASH USED IN INVESTING ACTIVITIES (1548169315) (34731713)

C. CASH FLOW FROM FINANCING ACTIVITIES

NET CASH FROM FINANCING ACTIVITIES 1563855687 (209589191)

Net (Loss) / Profit before tax & Prior Period items (304144994) 412096199

Depreciation 95995652 113530616

Amortisation of BOT Projects Cost 85658612 161067878

Interest Paid (Net) 167585582 287391138

Profit on sale of fixed assets (1581645) (2118510)

Bad Debts 42880428 4286469

Unclaimed Liability written back (4458964) (3577719)

Impairment of Fixed Assets 6738590 -

Surplus & Deficit 209414 -

Provision for Diminution in value of Investment - 74000

Sundry Debit Bal written off 2206100 -

Loss on sale of Investment 4805661 -

Provision for leave encasement and gratuity 5219019 -

Dividend Received (26400) (46643)

Adjustment For :

Inventories (228908093) (98530691)

Trade & Other Receivables (197427727) (246927126)

Trade Payable & Provisions 262319718 (238090379)

Cash Subsidy - (9270160)

(164016102) (592818356)

Cash Generated From Operations Before Tax, & Prior Period Items (62929047) 379885072

Less: Direct Taxes (Including FBT) Paid 64560463 75672930

Cash Generated From Operations Before Prior Period Items (127489510) 304212142

Less: Prior Period Income / (Expense) 2907660 (22749605)

Purchases of Fixed Assets (34068658) (36092420)

Sales of Fixed Assets 13425434 7793082

Investments (1449427435) -

BOT Expenditure incurred during the year (78125055) (6479018)

Dividend Received 26400 46643

Borrowings (Net) 1140700 104501507

Repayment during the year (338265623) -

Issue of shares on Preferential basis 2113003224 -

Dividend Paid (Including tax thereon) (46643600) (26699560)

Interest Paid (Net) (165379014) (287391138)

Net Changes In Cash & Cash Equivalents (A+B+C) (114710797) 82640843

Cash & Cash Equivalent - Opening Balance 515120015 432479172

400409218 515120015

Cash & Cash Equivalent - Closing Balance 400409218 515120015




H. B. Shah

Partner


Place : Vadodara

Date : 26-05-2011

B. K. Goenka

Chairman

Susheela Maheshwari

Company Secretary

Place : Mumbai

Date : 26-05-2011

Sunil Shinde

Managing Director

68

Balance Sheet Abstract & Company's General Business Profile

(Pursuant to the provision of Part IV of Schedule VI to the Companies Act, 1956)

Registration No. 2 3 9 2 0 State Code 0 4

Balance Sheet Date 3 1 0 3 2 0 1 1

Date Month YEAR

( Amount Rs. In thousand)

Public Issue N I L Right Issue N I L

Bonus Issue N I L Private Placement 1 7 1 7 8 8

Other (Conversion of FCCB) N I L

(Amont Rs. In Thousand)

Total Liabilities 7 0 8 6 5 3 0 Total Assets 7 0 8 6 5 3 0

Paid Up Capital 4 0 0 0 0 0 Reserves and Surplus 4 3 7 5 3 9 8

Share Application Money N I L Secured Loans 2 2 2 3 8 7 7

Unsecured Loan 1 1 4 1 Deferred Tax Liability 8 6 1 1 5

Net Fixed Assets 5 0 8 7 5 4 Investment 2 0 7 5 4 7 1

Net Current Assets 1 8 4 0 8 3 0 BOT Assets 2 6 6 1 4 7 4

Accumulated Losses N I L Misc. Expenditure N I L

(Amount Rs. In thousand)

Turnover 2 3 4 9 3 2 0 Total Expenditure 2 8 6 7 5 9 0

Profit / Loss before Tax (3 0 7 0 5 3) Profit/Loss after Tax (3 2 8 4 8 5)

Earning per share (Rs.) (Basic) (8 . 4 8) Divident Rate (%) N I L

Earning per share (Rs.) (Diluted) N I L

Not Applicable Construction Activity

I. Registration Details

II. Capital Raised during the year

III. Position of Mobilisation and Deployment of Funds

Sources Of Fund

Application

IV. Performance of Company

V. Generic Names of The Principal Product of the Company

Item Code Product Description




H. B. Shah

Partner


Place : Vadodara

Date : 26-05-2011

B. K. Goenka

Chairman

Susheela Maheshwari

Company Secretary

Sunil Shinde

Managing Director

69

AUDITORS' REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS TO THE BOARD OF DIRECTORS

OF WELSPUN PROJECTS LIMITED

(Formerly Known as MSK Projects (India) Ltd)

1. We have audited the attached Consolidated Balance Sheet of Welspun Projects Limited (Formerly known as MSK Projects (India) Ltd), its Subsidiaries

and Joint Ventures, as at 31 March 2011 and also the consolidated Profit and Loss Account and the consolidated Cash Flow Statement for the year

ended on that date annexed there to. These financial statements are the responsibilities of the Company's management. Our responsibility is to

express anopinionon these financial statementsbasedonouraudit.

2. We conducted our audit in accordancewith auditing standards generally accepted in India. Those standards require thatweplan andperform the audit

to obtain reasonable assurance aboutwhether the financial statements are free ofmaterialmisstatement, and audit includes examining on a test basis,

evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and

significant estimates made by management, as well as evaluating the over all financial statement presentation. We believe that our audit provides a

reasonablebasis forouropinion.

3. We did not audit the financial statements of two Subsidiaries and One Joint Venture whose financial statements reflected total assets of Rs.653.10

Crores as atMarch 31 2011 and total revenue of Rs.56.32Crores and net cash inflow fromoperating activities amounting to Rs.-1.02Crores for the year

then ended. These financial statements and other financial information have been audited by other auditors whose reports have been furnished to us

andouropinion is based solelyon the reportof theother auditors.

4. The financial statements of Bul-Msk Infrastructure Private Limited , a Joint Venture, and Welspun Energy Maharashtra Private Limited, a Subsidiary

Company have been consolidated based on themanagement estimate and therefore un-audited. These financial statements reflect, the total assets of

Rs.7.00 Crores as at March 31 2011 and total revenue of Rs.2.87 Crores, and net cash inflow from operating activities amounting to Rs.1.12 Crores for

theyear thenended

5. Subject tononcompliancewith the specifiedaccounting standards relating to :-

a). Disclosure of Cash Subsidy amounting to Rs.126.54 Crores received fromMadhya PradeshRajya SetuNirmanNigamLimited andGujarat State Road

Development Corporation against BOTProjects under thehead 'Reserve&Surplus' insteadof deducting the same from theProject Cost as required

by theAccountingStandard–12 “Accounting forGovernmentGrants” (SeeNoteNo.10)

We report that the consolidated financial statements have been prepared by the Welspun Projects Limited's management in accordance with the

requirements of Accounting standard (AS) 21 Consolidated Financial Statements and Accounting Standard (AS) 27, Financial Reporting of Interest in

JointVentures, issuedby the InstituteofCharteredAccountantsof India.

6. Based on our audit and on the consideration of the reports of other auditors on separate financial statements of the Subsidiary Companies , and Joint

Ventures, and to thebestofour informationandaccording to theexplanations given tous, subject toour comments in :-

Paragraph 5 relating toDisclosure of Cash Subsidy amounting to Rs.126.54 Crores received fromMadhya Pradesh Rajya SetuNirmanNigam Limited and

Gujarat State Road Development Corporation against BOT Projects under the head 'Reserves& Surplus' instead of deducting the same from the Project

Cost (SeeNoteNo.10).

We are of the opinion that attached consolidated financial statements give true and fare view in conformity with the accounting principal generally

accepted in India.

i). In the caseof the consolidatedBalanceSheet, of the stateof affairs of theWelspunProjects Limited, as at31 March2011.

ii). In caseof the consolidatedprofit& lossAccount, of the Lossof WelspunProjects Limited for theyearendedon thatdateand

iii). In the caseof the consolidatedCashFlowstatement, of the cash flows for theyearendedon thatdate.

FOR

Firm Registration No.101676W


Place: Vadodara

Date: 26/05/2011

Partner

Membership No.16642

��

��

��

��


(H. B. Shah)

70

CONSOLIDATED BALANCE SHEET AS ON 31st MARCH’ 2011

As at

March 31, 2011

(Amount in Rs.)

As at

March 31, 2010

(Amount in Rs.)

SOURCES OF FUNDS

SHARE HOLDERS' FUNDS

245000

LOAN FUNDS

4315800478 4155256901

9497807365 7448179892

APPLICATION OF FUNDS

FIXED ASSETS

NET BLOCK

BUILD, OPERATE AND TRANSFER PROJECTS EXPENDITURE

INVESTMENTS

CURRENT ASSETS, LOANS & ADVANCES

ACCOUNTING POLICIES AND NOTES ON ACCOUNTS

SHARE CAPITAL A 400000000 228211120

RESERVES & SURPLUS B 4714671692 3000028871

5114671692 3228239991

MINORITY INTEREST -

SECURED LOAN C 4314659778 4096943042

UN-SECURED LOAN D 1140700 58313859

DEFERRED TAX LIABILITY 67090196 64683000

TOTAL (Rs.)

GROSS BLOCK E 1272843040 1271119586

LESS : DEPRECIATION 493648366 412521643

779194674 858597943

REALISABLE VALUE OF IMPAIRED ASSETS 800000 -

779994674 858597943

F


COST INCURRED DURING THE YEAR 742367212 1173209783

6076617948 5512110818

LESS: DEDUCTION / WRITTEN OFF DURING THE YEAR 52263051 3783017

LESS: AMORTISATION DURING THE YEAR 160620239 174077065

212883289 177860082

5863734659 5334250736

G 1446665345 2130311

INVENTORIES H 556938132 328030039

SUNDRY DEBTORS I 954049544 858877400

CASH & BANK BALANCES J 491143056 535534872

LOANS & ADVANCES K 435839068 323108559

2437969801 2045550870

LESS : CURRENT LIABILITIES & PROVISIONS

LIABILITIES L 1021918480 743175123

PROVISION M 9572701 50168002

1031491181 793343125

NET CURRENT ASSETS 1406478621 1252207745

MISCELLANIOUS EXPENDITURE N 934066 993157

(to the extent not written off or adjusted)

TOTAL (Rs.) 9497807365 7448179892

8

Schedules

��

For and on behalf of the Board of DirectorsFOR ��


H. B. Shah

Partner


Place : Vadodara

Date : 26-05-2011

B. K. Goenka

Chairman

Susheela Maheshwari

Company Secretary

Place : Mumbai

Date : 26-05-2011

Sunil Shinde

Managing Director

71

CONSOLIDATED PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31st MARCH’ 2011

Year ended

March 31, 2011

(Amount in Rs.)

Year ended

March 31, 2010

(Amount in Rs.)

INCOME

TOTAL Rs. 2609742858 3666828489

EXPENDITURE

PROVISION FOR TAXATION

BALANCE CARRIED TO BALANCE SHEET 478401933 794073457

EARNING PER SHARE - (IN RUPEES)


CONTRACT RECEIPTS, SUPPLY & OPERATING INCOME 1 1781236824 3288241374

TOLL COLLECTION 2 605762767 327960881

OTHER INCOME 3 8618993 8765942

2395618584 3624968197

CHANGE IN WORK-IN-PROGRESS 4 214124274 41860292

MATERIALS CONSUMED 5 1291601069 2006893275

SITE COST & OTHER EXPENSES 6 1265768404 1281010660

FINANCE & BANK CHARGES (NET) 7 386010871 295642909

EXPENDITURE ON BUILD, OPERATE & TRANSFER CONTRACT WRITTEN OFF 160620239 174077065

DEPRECIATION 96517753 113540997

PRELIMINARY EXPENSES WRITTEN OFF 97544 4117

3200615881 3871169023

(590873023) (204340534)

Less : Cost incurred for owned BOT Project transferred to Balance Sheet - 6479018

“Less : Material Cost and Site expenses pertaining to bills raised to

subsidiaries & joint venture companies" 281537083 555914643

281537083 (562393661)

PROFIT / (LOSS) BEFORE PRIOR PERIOD INCOME / EXPENDITURE (309335940) 358053127

PRIOR PERIOD ITEM (NET) 2898351 (22759604)

PROFIT / (LOSS) AFTER PRIOR PERIOD INCOME / EXPENDITURE (312234290) 380812731

CURRENT TAX 980950 92500000

INCOME TAX FOR EARLIER YEAR 49087 -

FRINGE BENEFIT TAX - (224094)

DEFERRED TAX 2407196 55094000

3437233 147369906

-

PROFIT / (LOSS) AFTER TAXATION (315671523) 233442825

BALANCE BROUGHT FORWARD FROM PREVIOUS YEAR 794073457 607428632

PROFIT AVAILABLE FOR APPROPRIATION 478401933 840871457


TAX ON DIVIDEND - 6798000

- 46798000

BASIC & DILUTED -8.15 10.23

��



H. B. Shah

Partner


Place : Vadodara

Date : 26-05-2011

B. K. Goenka

Chairman

Susheela Maheshwari

Company Secretary

Place : Mumbai

Date : 26-05-2011

Sunil Shinde

Managing Director

Schedules

As at March 31, 2011

(Amount in Rs.)


(Amount in Rs.)

72

SCHEDULE - A TO N AND 8 FORMING PART OF THE BALANCE SHEET

As at

March 31, 2011

(Amount in Rs.)

As at

March 31, 2010

(Amount in Rs.)

SCHEDULE - A

AUTHORISED CAPITAL

41,00,00,000 (PREVIOUS YEAR 2,50,00,000)

EQUITY SHARES OF RS. 10/- EACH 410000000 250000000

ISSUED, SUBSCRIBED, AND PAID UP CAPITAL

* 4,00,00,000 (PREVIOUS YEAR 2,28,21,112)

EQUITY SHARES Rs. 10/- EACH FULLY PAID UP 400000000 228211120

NOTES

* OUT OF THE ABOVE SHARES:

1 1874331 Shares are allotted as fully paid up without payment being received in cash in earlier Year

2 720897 Shares are allotted as fully paid up by way of bonus shares in during the year 1996-97








30917642

TOTAL 400000000 228211120

SHARE CAPITAL

SCHEDULE - B RESERVES & SURPLUS

Consolidated

with

Subsidiaries

Consolidated

with

Subsidiaries

Shares of

Joint

Ventures

Shares of

Joint

Ventures

Total Total

RESERVES & SURPLUS

CAPITAL RESERVE

CASH SUBSIDY

860379840 405000000 1265379840 860379840 315900000 1176279840

AMALGAMATION RESERVES

GENERAL RESERVES

SECURITIES PREMIUM

PROFIT & LOSS ACCOUNT

TOTAL (1+2+3+4) 4302002282 412669409 4714671692 2683687544 316341327 3000028871

Received from Madhya Pradesh Rajya Setu Nirman

Nigam Ltd against BOT Projects As per last year

Balance Sheet 828729840 405000000 1233729840 838000000 230373000 1068373000

Less: Written off during the year - - - 9270160 - 9270160

828729840 405000000 1233729840 828729840 230373000 1059102840

Add: Received during the last year - - - 85527000 85527000

828729840 405000000 1233729840 828729840 315900000 1144629840

Received from Guajarat State Road Develeopment

Corporation against BOT Project As per last year

Balance Sheet 31650000 - 31650000 31650000 - 31650000

As per last year Balance Sheet 52112583 - 52112583 52112583 - 52112583



On issue of shares on preferential basis during the year 1941214344 - 1941214344 - - -

2886599786 - 2886599786 945385442 - 945385442

Balance as per annexed account 470732524 7669409 478401933 793632130 441327 794073457

73



(Amount in Rs.)


(Amount in Rs.)


Consolidated

with

Subsidiaries

Consolidated

with

Subsidiaries

Shares of

Joint

Ventures

Shares of

Joint

Ventures

Total Total

TERM LOAN FOR EQUIPMENTS & VEHICLES

FROM CORPORATION BANK - BARODA

FROM KOTAK MAHINDRA BANK LIMITED

FROM HDFC BANK LIMITED

FROM TATA CAPITAL LIMITED

FROM AXIS BANK

FROM TATA MOTOR FINANCE LIMITED

FROM SREI INFRASTRUCTURE FINANCE LIMITED

TOTAL (A) 52687278 - 52687278 188598542 0 188598542

25214141 - 25214141 51905370 51905370

Secured by hypothecation of the relevant plant &

machineries, equipments, vehicles & the personal

guarantee by the some of the directors of the Company.

(Repayable Within Year Rs. 1,99,24,000/-

Previous Year Rs. 1,99,24,000/-)

6833956 - 6833956 16008922 16008922

Secured by hypothecation of relevant Plant &

Machineries & Vehicles & Personal guarantee of the

some of the Directors of the Company

(Repayable Within Year Rs. 67,48,003/-

Previous Year Rs. 92,52,000/-)

8418467 - 8418467 27240669 27240669

Secured by hypothecation of relevant Vehicles, Plant &

machineries and personal guarantee of the some of

the directors of the Company



5565318 - 5565318 24059648 24059648

Secured by hypothecation of relevant Plant &

machineries & personal guarantee of some of

the Directors of the Company



1970501 - 1970501 4252221 4252221

Secured by hypothecation of relavant Plant &




Previous Year Rs. 15,79,000/-)

987348 - 987348 11232218 11232218






3697547 - 3697547 53899494 53899494






74



(Amount in Rs.)


(Amount in Rs.)


Consolidated

with

Subsidiaries

Consolidated

with

Subsidiaries

Shares of

Joint

Ventures

Shares of

Joint

Ventures

Total Total

TERM LOAN FOR PROJECTS

FROM DENA BANK 259625597 - 259625597 305228916 305228916

FROM STATE BANK OF INDIA - COMMERCIAL BRANCH -

INDORE


INDORE

FROM HDFC BANK LTD


FROM STATE BANK OF BIKANAR AND JAIPUR

FROM STATE BANK OF INDIA

FROM STATE BANK OF INDORE

(REPAYABLE WITHIN YEAR RS.4,44,00,000/-

PREVIOUS YEAR RS.4,44,00,000/- )

The above Loans are Secured by:

- A first mortgage and charged on all the Company's

capital assets, specific & pertaining to the Hoshangabad-

Harda-Khandwa Projects only both present and futures

- A first Charge on all the revenues / receivable of

Hoshangabad-Harda - Khandwa project account

of the Company

- A First charge on all the intangible assets of the

Company including but no limited to Goodwill of the Co

- A first charge on bank accounts for the specific project

including without limitation the trust and retention

account (RTA) / Escrow Account and Debt Service

Reserve Account to be established by the Company

- A First charge/assignment/security on the Company

right under the concession agreement, project

document, contract and all licence permits approvals

concerts and insurance policies in respect of the project

24153378 - 24153378 28207743 28207743

(REPAYABLE WITHIN YEAR RS.56,04,000/-

PREVIOUS YEAR RS.47,00,000/- )

The above loan is secured by:

- Secured by on the assignment of Project right.

Movable and Immovable property intangible assets

for Himmatnagar bypass projects

- First charge on Company's bank account for the

Himmatnagar project and revenue and receivable

and project account of the Company

- Personal guarantee of the some of the directors

of the Company

102590785 0 102590785 106366749 106366749


PREVIOUS YEAR RS. 69,00,000/-)



Movable and Immovable property intangible assets for

Kim Mandvi Corridor bypass projects

- First charge on Company's bank account for the Kim

Mandvi project and revenue and receivable and

project account of the Company

- Personal guarantee of the some of the directors of the

Company

- - - 83549 83549

Secured by hypothecation of relavant Vehicles, Plant &

machineries and personal guarantee of the some of

the directors of the Company

(REPAYABLE WITHIN YEAR RS.-NIL-

PREVIOUS YEAR RS. 83,549/-)

- 500793980 500793980 390000000 390000000

- 150348770 150348770 117000000 117000000

- 500753069 500753069 390000000 390000000

- 75111311 75111311 58500000 58500000

75



(Amount in Rs.)


(Amount in Rs.)


Consolidated

with

Subsidiaries

Consolidated

with

Subsidiaries

Shares of

Joint

Ventures

Shares of

Joint

Ventures

Total Total

FROM STATE BANK OF TRAVANCOR

FROM DENA BANK


INDORE



- 250475512 250475512 195000000 195000000

- 250411409 250411409 195000000 195000000

INTEREST ACCRUED BUT NOT DUES - 201989414 201989414 12839122 12839122

- Secured by 1st Pari-Passu Charge with other

Term Lenders

- (All Rights including step - in - charge of the project

covered by Tripartita agreement with -Madhya Pradesh

Road Development Corporation Limited).

- First Charge on assignment of Toll Collection rights

along with Escrow on Future Toll Collection.

- Hypothecation of all movables, tangible and intangible

receivable Cash and Investment & monies laying in

trust & retention accounts.

- Further secured by personal guarantee of directors &

Corporate Guarantee of Welspun Projects Limited &

Chetak Enterprises Limited.

- Charge on debt services reserves accounts.

(Installment due within one Year Rs.9,99,99,333/-

Previous year Rs.1,15,97,000/-)

- 34155195 34155195 41803298 41803298



Movable and Immovable property intabgible assets

for BUL-MSK Infrastrcture P Ltd


PREVIOUS YEAR RS.1,54,00,000/-)

269878003 - 269878003 300574761 300574761

The above Loan is Secured By:

- First Mortgage & charge on all the movable &

immovable properties of the Raisen - Rahathgarh

BOT Projects including all receivable both and

present and future.

- Assignment of all rights, title and Interest of the

Company in respect of all the assets of the projects,

all Projects agreement and Contracts including

Concession Agreement.

- Assignment of contractors guarnatees, performance

bond and liquidated damages

- Personal Guarantees of some of the Directors of the

Transferors Company.



92646507 - 92646507 125947741 125947741

(Secured by Ludhiana & Jalandhar Bus Terminal Projects,

and Personal guarantee of some of the directors of the

Company).



76



(Amount in Rs.)


(Amount in Rs.)

SCHEDULE - C

SCHEDULE - D

SECURED LOANS

UN-SECURED LOANS

Consolidated

with

Subsidiaries

Consolidated

with

Subsidiaries

Shares of

Joint

Ventures

Shares of

Joint

Ventures

Total Total

FROM INDUSTRIAL DEVELOPMENT FINANCE CO. LIMITED

TOTAL (B) 1306111205 1964038658 3270149863 1441560806 1400225969 2841786775

OTHER LOAN


SHORT DEMAND LOAN

OVERDRAFT ACCOUNT

FROM IDBI BANK LIMITED

FROM BANK OF INDIA

OVERDRAFT ACCOUNT

TOTAL (C) 991822637 - 991822637 1066557725 - 1066557725

TOTAL (A) + (B) + (C) 2350621119 1964038658 4314659778 2696717073 1400225969 4096943042

554524973 - 554524973 572792654 572792654

INTEREST ACCRUED & DUES 2691962 - 2691962 2442242 2442242

- Secured by way of mortgage in favour of IDFC of all

movable properties pertaining to the Dewas Water

Supply Projects Presents, futures.

- a first charge by ways of the hypothecation of the all

movables including movables plant machinery,

machinery spares, tools, & accessories, furniture &

fixture, vehicles and all other movable assets

pertaining to the project present & future.

- First charge of all the book debts, operating, Cash Flows,

revenue, receivables of the Company pertaining to the

Dewas Water Supply project, present & Future.

- Assignment of all rights, title and Interest of the

Company in respect of all the assets of the Dewas

Water Supply Projects agreement and Contracts

including Concession Agreement.

- First Charge over the Escrow Account. Debt Service

Reserve Account and other Reserve and any Other

reserves and any other banks account the Company

wherever maintained.

- Personal Guarantee of the Directors of the Company/



13068785 - 13068785 139765340 139765340

(Secured by fixed deposits of the Company and

third Parties)

458378706 - 458378706 376430627 376430627

(Secured by hypothecation of the entire stocks & book

debts of the Company & personal guarantee of some of

the directors of the Company).

365262779 - 365262779 341125151 341125151

(Secured by pari passu charge on all current assets

of the company)

- 201103665 201103665

(Secured by specific plant & machineries and second

charge on current assets of the Company)

155112367 - 155112367 8132942 8132942

- Secured by the 10% Cash Margin in the form of TDR

- Pledge of the shares of the promoters in favour of the

Bank for Rs. 50 Lacs

FROM COMPANIES 1140700 - 1140700 - 39426489 39426489

FROM OTHERS - - - 18887370 - 18887370

Total 1140700 - 1140700 18887370 39426489 58313859

77

1GOOD-W

ILL

170

159

2-

-170

159

2-

--

-170

159

2170

159

2

2GOOD-W

ILLCONSOLIDATION

264907868

49000

-264956868

--

--

264956868

264907868

3LAND

1194699

33567

140

-155

14

13

3-

--

-155

14

13

31

194699

3

4BUILDING

17087

31

475

300

-2

1840

31

11

18

259

48

254

-1

1665

13

10

175

18

59047

2

5PLANT&MACHINERIES*

527

12

1299

118

19

177

27

2875

16

51

165

2960

20

2779779

45059474

12998

199

23484

105

32768

11907

324

34

15

20

6CONSTRUCTIONEQUIPMENT

22

389

29

13

124407

35

-2

36

33

3648

72

13784

12

1476

270

-9

36

14

11

114

27

195

38

15

175507

2

7AIR-CONDITIONER

1070

34

1549

249

-16

19590

70

1197

1065

35

-8077

32

81

1858

369

144

8VEHICLES

2190

3254

1345449

75

177

11

21

1860

279

12400

1598

268

3686

12

39

37

13

148444746

634

155

34

950

3094

3

9COMPUTERS

79898

12

47

3607

2-

127

25884

569079

11948

339

-76

39

130

5086755

22990

21

10

OFFICEEQUIPMENT

5368

24

3167

359

2-

704

18

35

229

3658

509695

-280

335

34

23848

33074585

11

FURNITURE&FIXTURES

6379

25

387

2967

-7

25

22

20

37985

21

53

3209

-4

33

17

30

29

2049

125807

32

CAPITALISEDDURINGTHEYEAR

88

1

*Includesadjustmentsonaccountofim

pairment

35605

227.00

15

39

19

12.25

20

21

33

15

134747

24.76

134

254

34.00

49

290.76

TOTAL

1271119586

36528681

34805227

1272843040

412521644

96518634

15391912

493648366

779194674

858597943

TOTAL

1271119586

36528681

34805227

1272843040

412521644

96517753

15391912

493648366

779194674

PREVIOUSYEAR

1128828923

156883676

14593014

1271119586

307756944

113540997

8918442

412521643

858597943

SCHEDULE-ATON,AND8,FORMINGPARTOFTHEBALANCESHEET

SCHEDULE-E

FIXEDASSETS

FixedAssets

Sr.

GROSSBLOCK

Ason

1/4/2010

Addition

DuringPeriod

Deduction

DuringPeriod

Ason

31/3/2011

Ason

1/4/2010

Addition

DuringPeriod

Deduction

DuringPeriod

Ason

31/3/2011

Ason

31/3/2011

Ason

31/3/2010

DEPRECIATION

NETBLOCK

BALANCEASPERLASTYEAR

27

1855655

2-

27

1855655

22

177

128670

-2

177

128670

53

34

2507

36

-5

334

2507

36

INCREASEIN

SHARESOFJOINTVENTURE

--

--

38

228

295

238

228

295

238

228

295

238

228

295

2

PAYMENTTOEPCCONTRACTORS

-1

10649669

110649669

-1664879

20

1664879

20

-277

137589

277

137589

MATERIALCONSUMED

-6

379

14

36

6379

14

36

--

--

6379

14

36

6379

14

36

SITECOST&OTHEREXPENSE

-1477495

21477495

2-

980009

19800090

-2457504

22457504

2

UTILITIESSHIFITNG(NET)

--

--

(196

20650)

(196

20650)

-(196

20650)

(196

20650)

FINANCECHARGES(NETOFINTERESTRECEIVED)

-679

29

20

679

29

20

-188684

10

188684

10

-2566

13

30

2566

13

30

TOLLCOLLECTION

--

--

(11460487)

(11460487)

--1

1460487

(11460487)

LESS:DEDUCTIONDURINGTHEYEAR

--

52

26

305

1-

--

--

52

26

305

1

LESS:WRITTENOFFDURINGTHEYEAR

--

10

105957

2-

-59560667

--

1606

20

239

TOTAL

2718556552

196008977

2914565529

2177128670

546358236

2723486906

5334250736

742367212

6076617948

CLOSINGBALANCE

2718556552

196008977

2761242906

2177128670

546358236

2663926240

5334250736

742367212

5863734659

SCHEDULE-ATON,AND8,FORMINGPARTOFTHEBALANCESHEET

SCHEDULE-F

BUILD,OPERATE&TRANSFERPROJECTSEXPENDITURE

FixedAssets

CONSOLIDATEDWITHSUBSIDIARIES

Asat

01/04/2010

Incurred

DuringtheYear

Asat

31/03/2011

CONSOLIDATEDWITHJOINTVENTURES

Asat

01/04/2010

Incurred

DuringtheYear

Asat

31/03/2011

TOTAL

Asat

01/04/2010

Incurred

DuringtheYear

Asat

31/03/2011

78

79



(Amount in Rs.)


(Amount in Rs.)

SCHEDULE - G INVESTMENTS

Consolidated

with

Subsidiaries

Consolidated

with

Subsidiaries

Shares of

Joint

Ventures

Shares of

Joint

Ventures

Total Total

INVESTMENT IN SHARES (NON TRADE)

QUOTED, TRADE

517000 - 517000 517000 - 517000

443000 - 443000 443000 - 443000

UNQUOTED, TRADE

OTHERS

INVESTMENT IN BONDS

INVESTMENT IN NON - CONVERTIBLE DEBENTURES

INVESTMENT IN CERTIFICATE OF DEPOSITS

INVESTMENT IN GOVERNMENT SECURITY

TOTAL 1446665345 - 1446665345 1687311 - 2130311

7400 (P.Y. 7400) Equity Shares in Minar Trading

Services Ltd of Rs. 10/- each fully paid up. 74000 74000 74000 - 74000

1500 (P.Y. 1500) Equity Shares in Sarv Shakti

Synthetics Limited of Rs. 10/- each fully Paid up 15000 - 15000 15000 - 15000

1600 (P.Y. 1600) Equity Shares in Corporation Bank

of Rs. 10/- each fully Paid Up 128000 - 128000 128000 - 128000

30000 (P.Y. 30000) Equity Shares in Myraj

Consultancy Limited of Rs. 10/- each fully paid up 300000 - 300000 300000 - 300000

Less: Provision for Diminution in Value of Investment 74000 - 74000 74000 - 74000

(Market Value Rs. 10,20,800/- P.Y. Rs. 7,69,600/-)

500 (P.Y. 500) Equity shares in MSK Finance Limited of

Rs. 100/- each fully paid up 50000 - 50000 50000 - 50000

48 (P.Y. 48) Equity shares in Nutan Nagrik Sahakari Bank

Limited of Rs. 100/- each fully paid up. 4800 - 4800 4800 - 4800

37652 (P.Y. 37652) Equity shares in Baroda Peoples

Co-Op. Bank Limited of Rs.10/- each fully paid up 376521 - 376521 376521 - 376521

63 (P.Y. 63) Equity shares in Baroda City Co-Op. Bank

Limited of Rs. 50/- each fully paid up 3150 - 3150 3150 - 3150

1000 (P.Y. 1000) Equity shares in Classic Organisors

Private Ltd of Rs. 10/- each fully paid up 10000 - 10000 10000 - 10000

960 (P.Y. 960) Equity shares in Sindh Mechantile

Co-Op. Bank Ltd of Rs.10/- each fully paid up 9600 - 9600 9600 - 9600

23274 (P.Y. 23274) Equtity shares of Yash Fincon

Private Limited - - - 232740 - 232740

6000 (P.Y. -Nil) 8% Redemeble Preferntial Shares

Worli Relaity P Ltd of Rs. 10/- each fully paid up. 60000 - 60000 - - -

178 ( P.Y. Nil) Bonds of IFCI - 2030 @9.70% of

Rs. 1000000 each fully paid up 183340000 - 183340000 - - -

500 ( P.Y. Nil) Bonds of IDBI - 2030 @9.65% of


257 ( P.Y. Nil) Bonds of West Bengal Electricity Distco Ltd

- 2025 @9.34% of Rs. 1000000 each fully paid up. 263792500 - 263792500 - - -

1260 ( P.Y. Nil) Bonds of DHFCL 2015 10% of


590 ( P.Y. Nil) Bonds of DHFCL 2020 10.40 % of


1500 ( P.Y. Nil) NCD of CBI Rs. 100000/-

each fully paid up 146586600 - 146586600 - - -

1500 ( P.Y. Nil) NCD of PNB Rs. 100000/-

each fully paid up 147429150 - 147429150 - - -

Indira Vikash Patra 500 - 500 500 - 500

Two (P.Y. One) Bonds of Sardar Sarovar Narmada

Nigam Limited 2000000 - 2000000 1000000 - 1000000

80


SCHEDULE - I CURRENT ASSETS, LOAN & ADVANCES

SUNDRY DEBTORS

TOTAL 1047068646 -93019101 954049544 967752765 -108875365 858877400

(UNSECURED CONSIDERED GOOD)

DEBT EXCEEDING SIX MONTHS 91948122 (3570651) (3570651) 7465705 - 7465705

LESS: PROVISION FOR DOUBTFUL DEBTS 25633372 - - - -

66314750 - 66314750 7465705 - 7465705

OTHERS DEBTS 988766641 960287060 (108875365) 851411695

LESS: PROVISION FOR DOUBTFUL DEBTS 8012746 - - -

980753895 (89448450) 891305445 960287060 (108875365) 851411695

(Including Retention amount Rs.51,83,42,508/- )

SCHEDULE - J CASH & BANK BALANCES

CASH - ON - HAND 7873396 2183243 10056639 7380583 363436 7744019

BALANCES WITH SCHEDULED BANKS

IN CURRENT ACCOUNTS 282626367 63912934 346539301 224551568 13582797 238134365

IN FIXED DEPOSITS ACCOUNT 133422517 1124599 134547116 288856988 799500 289656488

TOTAL 423922280 67220776 491143056 520789139 14745733 535534872

SCHEDULE - K LOAN & ADVANCES

(Unsecured, Considered Good)

ADVANCES RECOVERABLE IN CASH OR IN KIND OR

FOR VALUE TO BE RECEIVED 195491154 (1890581) 193600573 241022545 (98973579) 142048966

LESS: PROVISION FOR DOUBTFUL BALANCES 2637198 - 2637198 - - -

192853956 (1890581) 190963375 241022545 (98973579) 142048966

INTEREST ACCRUED BUT NOT DUE ON FIXED

DEPOSITS/BONDS 36359379 - 36359379 2012278 94479 2106757

TAX DEDUCTED AT SOURCE / ADVANCE TAX

(NET OF PROVISION FOR TAX) 96104637 2331791 98436428 31714772 646872 32361644

MOBILISATION ADVANCE TO SUB-CONTRACTORS 3819450 - 3819450 - - -

136283466 2331791 138615257 33727050 741351 34468401

SUNDRY DEPOSITS 110921611 1935937 112857548 146582237 8955 146591192

LESS: PROVISION FOR DOUBTFUL BALANCES 6597112 6597112

104324499 1935937 106260436 146582237 8955 146591192

TOTAL 433461922 2377147 435839068 421331832 -98223273 323108559

SCHEDULE - L CURRENT LIABILITIES & PROVISION

CURRENT LIABILITIES

TOTAL 929642768 92275711 1021918480 702123027 41052097 743175123

SUNDRY CREDITORS 447679741 90551654 538231395 420606112 18638429 439244541

MOBILISATION ADVANCE FROM CUSTOMERS 338736095 - 338736095 104009538 - 104009537

OTHER LIABILITIES 143226932 1724058 144950990 177507377 22413668 199921045


(Amount in Rs.)

Shares of

Joint

Ventures

TotalConsolidated

with

Subsidiaries

SCHEDULE - H CURRENT ASSETS, LOAN & ADVACNES

INVENTORIES

TOTAL 556938132 - 556938132 328030039 - 328030039

(As taken valued and certified by the management)

WORK-IN-PROGRESS 416187464 - 416187464 202063190 - 202063190

RAWMATERIAL 140750668 - 140750668 125966849 - 125966849


(Amount in Rs.)

Consolidated

with

Subsidiaries

Shares of

Joint

Ventures

Total

81


SCHEDULE - M PROVISION

PROVISION FOR LEAVE ENCASEMENT 2241298 - 2241298 657521 - 657521

PROVISION FOR GRATUITY 6347723 - 6347723 2712481 - 2712481

PROVISION FOR TAXATION 663880 319800 983680 - - -

PROPOSED DIVIDEND - - - 40000000 - 40000000

TAX ON PROPOSED DIVIDEND - - - 6798000 - 6798000

9252901 319800 9572701 50168002 - 50168002

SCHEDULE - N MISCELLANEOUS EXPENDITURE

(to the extent not written off or adjusted)

PRELIMINARY EXPENSES

BALANCE AS PER LAST YEAR BALANCE SHEET 966933 26224 993157 789485 29338 818823

ADD: ADDITION DURING THE YEAR 20331 2411 22742 229300 -589 228711

987264 28635 1015899 1018785 28749 1047534

LESS: DEDUCTION DURING THE YEAR 183440 - 183440 - - -

LESS: WRITTEN OFF DURING THE YEAR 92827 4717 97544 51852 2525 54377

TOTAL-1 710997 23918 734915 966933 26224 993157

PRE-OPERATIVE EXPENSE 199151 - 199151 - - -

TOTAL-2 199151 - 199151 - - -

TOTAL (1 + 2) 910148 23918 934066 966933 26224 993157


(Amount in Rs.)


(Amount in Rs.)

Consolidated

with

Subsidiaries

Consolidated

with

Subsidiaries

Shares of

Joint

Ventures

Shares of

Joint

Ventures

Total Total

SCHEDULE - 1 TO 7, FORMING PART OF THE PROFIT & LOSS ACCOUNT

SCHEDULE - 1 CONSTRUCTION WORK CONTRACT

For the year ended March 31, 2011

(Amount in Rs.)


(Amount in Rs.)

Consolidated

with

Subsidiaries

Consolidated

with

Subsidiaries

Shares of

Joint

Ventures

Shares of

Joint

Ventures

Total Total

CIVIL CONTRACTS 1799018901 - 1799018901 3381738564 - 3381738564

LESS: SERVICE TAX 57250077 - 57250077 93497190 - 93497190

1741768824 - 1741768824 3288241374 - 3288241374

(Tax Deducted at Source Rs. 5,13,24,829/-

P.Y. Rs. 6,94,65,542/-)

TECHNICAL SERVICES 44000000 - 44000000 - - -

LESS: SERVICE TAX 4532000 4532000

39468000 39468000


TOTAL 1781236824 - 1781236824 3288241374 - 3288241374

SCHEDULE - 2 TOLL COLLECTION

HOSHANAGABAD - HARDA - KHANDWA PROJECT 76646054 - 76646054 95306393 - 95306393

RAISEN RAHATGARH PROJECT 64245784 - 64245784 69821047 - 69821047

JALANDHAR PROJECT 47149255 - 47149255 41419709 - 41419709

JALANDHAR PROJECTS - RENT 14179708 - 14179708 11926662 - 11926662

(Tax Deducted At Source Rs. 225930/- P.Y. -Nil-)

LUDHIANA PROJECT 42739986 - 42739986 39633996 - 39633996

LUDHIANA PROJECT - RENT 9649882 - 9649882 8599939 - 8599939

(Tax Deducted At Source Rs. 107305/- P.Y. -Nil-) - - - - - -

DEWAS WATER SUPPLY PROJECT 24056828 - 24056828 31782484 - 31782484

HIMMATNAGAR PROJECT 13484950 - 13484950 10416453 - 10416453

KIM MANDVI PROJECT 21787788 - 21787788 - - -

BULL MSK PROJECT (JOINT VENTURE) - 27970692 27970692 - 19054198 19054198

DEWAS BHOPAL PROJECT (JOINT VENTURE) - 263851841 263851841 - - -

TOTAL 313940235 291822533 605762767 308906683 19054198 327960881



(Amount in Rs.)

Consolidated

with

Subsidiaries

Shares of

Joint

Ventures

Total

82

SCHEDULE - 3

SCHEDULE - 4

SCHEDULE - 5

OTHER INCOME

CHANGE IN STOCK

MATERIAL CONSUMED

DIVIDEND ON NON-TRADE INVESTMENT 26400 - 26400 46643 - 46643

INSURANCE CLAIM 590995 10000 600995 855921 - 855921

UNCLIAM LIABILITIES WRT. BACK 4155946 - 4155946 3577719 - 3577719

PROFIT ON SALES OF ASSETS 1581645 - 1581645 2118510 - 2118510

MISCELLANIOUS INCOME 1524007 730000 2254007 2167149 - 2167149

TOTAL 7878993 740000 8618993 8765942 8765942

OPENING STOCK

- WORK-IN-PROGRESS 202063190 - 202063190 160202898 - 160202898

LESS: CLOSING STOCKS

- WORK-IN-PROGRESS 416187464 - 416187464 202063190 - 202063190

TOTAL 214124274 - 214124274 41860292 - 41860292

STOCK AT COMMENCEMENT 125966849 - 125966849 69296450 - 69296450

ADD : PURCHASE & EXPENSES 1306271580 113309 1306384889 2063563674 - 2063563674

1432238429 113309 1432351738 2132860124 - 2132860124

LESS : STOCK AT CLOSE 140750668 - 140750668 125966849 125966849

TOTAL 1291487760 113309 1291601069 2006893275 - 2006893275


(Amount in Rs.)

Consolidated

with

Subsidiaries

Shares of

Joint

Ventures

Total


AIR CONDITIONING WORK 4520400 - 4520400 - - -

BAD DEBTS 2206100 - 2206100 - - -

BITUMANIOUS WORK 16163162 - 16163162 18870 - 18870

BLASTING WORK 2814921 - 2814921 11808725 - 11808725

BOLDER WORK 6017319 - 6017319 19881212 - 19881212

BRIDGE WORK 10064825 - 10064825 13706329 - 13706329

CD WORK 259100 - 259100 3591902 - 3591902

CIVIL WORK 12576342 - 12576342 614443 - 614443

CLEARING & FORWARDING - - - 433031 - 433031

CONCRETE WORK 15431137 - 15431137 7500067 - 7500067

CONSULTANCY CHARGE 52995226 1571125 54566351 23514621 - 23514621

DESIGN CHARGE - - - 3200000 - 3200000

DONATION 684530 - 684530 481991 - 481991

DOORS & WINDOWS WORK 5029639 - 5029639 5022845 - 5022845

EARTH WORK 148386025 - 148386025 167673544 - 167673544

ELECTRIC EXPENSE 57141337 626284 57767621 36893686 79958 36973644

ELECTRIC POLL SHIFTING 8703120 - 8703120 8462286 - 8462286

ESIC 115572 - 115572 321258 - 321258

FABRICATION WORK 29740638 - 29740638 27002047 - 27002047

FLOORING WORK 21333404 - 21333404 1384144 - 1384144

HORTICULTURAL WORK 292747 - 292747 - -

HUTMATE 2051067 - 2051067 1609274 - 1609274

IMPAIRMENT OF FIXED ASSET 6738590 - 6738590 - - -

INSURANCE 3881958 285915 4167873 4559272 18846 4578118

INTEREST ON INCOME TAX 119379 - 119379 - - -

LAND SCAPPING 3820283 - 3820283 - - -

LOSS ON SALES OF INVESTMENT 5015130 - 5015130 - - -

MACHINERY HIRE CHARGES 20411807 2248196 22660003 47275838 - 47275838

MASONERY WORK 26824303 - 26824303 25553380 - 25553380

83



(Amount in Rs.)


(Amount in Rs.)


Consolidated

with

Subsidiaries

Consolidated

with

Subsidiaries

Shares of

Joint

Ventures

Shares of

Joint

Ventures

Total Total

MISCELLANEOUS WORK 15084130 5098481 20182611 122571865 - 122571865

PAINTING WORK 7465448 - 7465448 5149429 - 5149429

PAYMENT TO SITE WORKERS 69457918 334480 69792398 78700577 - 78700577

PENALTY SLOW PROGRESS 17817 - 17817 - - -

PILING FOUNDATION - - - 400000 - 400000

PILING WORK 5311015 - 5311015 - - -

PIPE LAYING WORK 6565067 - 6565067 2029106 - 2029106

PROJECT MONITORING FEES 5572891 5572891 - - -

PROVIDENT FUND 3986354 - 3986354 1543054 - 1543054

PROVISION FOR DIMINISHED VALUE OF INVESTMENT - - - 74000 - 74000

PROVISION FOR DOUBT-FUL DEBTS 42880428 - 42880428 4286469 - 4286469

RATE & TAXES 91047515 - 91047515 113283963 - 113283963

REINFORCEMENT WORK 22274323 - 22274323 40561547 - 40561547

RENT 15148402 82750 15231152 17785309 - 17785309

ROAD WORK 63302175 - 63302175 66715769 - 66715769

SAFTY EXPENSE - - - 420709 - 420709

SALARIES & BONUS 184028265 6088651 190116916 188559664 587931 189147595

SANITARY WORKS 1572311 - 1572311 783864 - 783864

SECURITY SERVICE CHARGES 5414874 7035196 12450070 6574064 2575881 9149945

SHUTTERING WORK 44483933 - 44483933 25970600 - 25970600

SITE EXPENSE 25566661 - 25566661 - - -

STAFF WELFARE EXPENSE 26839457 1643879 28483336 37000328 247082 37247410

SURVEY EXPENSE 274516 - 274516 270006 - 270006

TENDER FEES 10625330 10625330 0 - 0

TOLL PLAZA 3218494 143131 3361625 1189106 - 1189106

TRAVELING EXPENSE 9955209 768797 10724006 9353048 102814 9455862

UNDER DECK INSULATION 6107362 - 6107362 - - -

VEHICLE HIRE CHARGES 7325427 193032 7518459 13815869 - 13815869

WATER PROOFING WORK 9946840 - 9946840 1568471 - 1568471

WBMWORK 551824 - 551824 334276 - 334276

REPAIRS & MAINTENANCE FOR

MACHINERIES 15775896 19931 15795827 42222395 224994 42447389

ROAD MAINTENANCE 1917208 4896155 6813363 1968721 381271 2349992

VEHICLE, TRUCKS, TRACTORS & OTHERS 41907916 392664 42300580 43079729 - 43079729

AUDITOR REMUNERATION

AUDIT FEES 1129051 162500 1291551 827575 - 827575

TAXATION MATTER - - 100000 - 100000

CERTIFICATION WORK 41362 41362 141000 - 141000

SERVICE TAX - - 104502 - 104502

MISCELLANEOUS EXPENDITURE 24284983 1758779 26043762 36776372 2121731 38898103

TOTAL 1232418462 33349942 1265768404 1274670152 6340508 1281010660

SCHEDULE - 7 FINANCE & BANK CHARGES

INTEREST ON TERM LOAN 194325762 207074804 401400566 167298208 4641269 171939477

OTHER INTEREST 144777674 - 144777674 77552567 - 77552567

BANK CHARGES 44073980 598892 44672871 73651186 34269 73685455

383177415 207673696 590851111 318501961 4675538 323177499

LESS: INTEREST RECEIVED FROM BOND & FIXED DEPOSITS 204763306 76934 204840240 27534590 - 27534590

(Tax Deducted at Source Rs. 49,80,925/-

P.Y. Rs. 24,34,297/-)

TOTAL 178414109 207596762 386010871 290967371 4675538 295642909

84

1. BASIS OF CONSOLIDATION:

A. Basis of Accounting:

B. Principle of Consolidation:

C. The subsidiary Companies considered in the consolidated financial statements are :

The Consolidated financial statements relate to M/s. Welspun Projects Limited, (formerly known as MSK

Projects (India) Limited, its subsidiaries Companies, and joint ventures Companies are drawn up to the same

reportingdateasof theCompany, i.e. yearended31 March2011.

a. The Consolidated Financial statements have been prepared by the Company in accordance with the

requirements of Accounting Standard – 21 (Consolidated Financial Statements & Accounting Standard AS-27

(Financial Reporting of interest in joint ventures) issuedby the Institute of CharteredAccountants of India. The

ConsolidatedFinancial Statementshavebeenpreparedon the followingbasis.

i. The financial statement of the Company and its subsidiary Companies are combined on a line by line basis by

adding together the book valueof the like itemof assets, liabilities, incomeandexpenses after fully eliminating

intra group transaction resulting in unrealized profit. Minority Interest in subsidiaries represents the minority

shareholderproportionate sharesof thenet assets andnet income.

ii. The Company's share in each of the assets, liabilities income and expenses of jointly controlled entities are

reportedas separate item.

iii. The difference between the Company's cost of investments in the subsidiaries over its position of equity at the

time of acquisition of the shares is recognized in the consolidated financial statements as goodwill or Capital

Reservesas the casemaybe.

iv. The difference between costs of the Company's interest in jointly controlled entities over its shares of net

assets in the jointly controlled entities at the date on which interest is acquired, is recognized in the

consolidated financial statementasGoodwill orCapital Reservesas the casemaybe.

v. Good-will recognized in theConsolidatedFinancial Statement is not amortized.

vi. The Consolidated Financial Statements are prepared by adopting uniform accounting policies for like

transactions and other events in similar circumstances and presented to the extent possible, in the financial

statementsexceptotherwise statedelsewhere in this schedule.

b. Adjustment is made in the financial statements of the joint venture Company i.e. Dewas Bhopal Corridor

Limited, onaccountofdiverseaccountingpolicy followed in respectof amortizationofBOTCost.

��


Schedule - 8 NOTES ON CONSOLIDATED ACCOUNTS FOR THE YEAR ENDED 31 MARCH'2011��

* Un-audited accounts (as certified by themanagement of the Company) as at 31stMarch 2011 is taken into consideration for consolidated

financial statements.

Name of the Company Country Of

Incorporation

% of Ownership

interest as on

31st March 2010

MSK Projects (Kim Mandvi Corridor) Private Limited

MSK Projects (Himmatnagar Bypass) Private Limited

Welspun Maharashtra Energy Private Limited *

India

India

India

100%

100%

51%

85

D. The significant joint Ventures Companies considered in the consolidated financial statements.


Schedule - 8 NOTES ON CONSOLIDATED ACCOUNTS FOR THE YEAR ENDED 31 MARCH'2011 (Contd.)��

Name of the Company Country Of

Incorporation

% of Ownership

interest as on

31st March 2011

India

India

50%

50%

* Un-audited accounts (as certified by themanagement of the Company) as at 31stMarch 2011 is taken into consideration for consolidated


Bul-MSK Infrastructure Private Limited *

Dewas Bhopal Corridor Limited

2. SIGNIFICANT ACCOUNTING POLICIES

A-1 REVENUE RECOGNITION ON CONTRACTS

A-2 EXPENDITURE IN RESPECT OF BUILD, OPERATE AND TRANSFER (B.O.T. CONTRACT)

B. ADVANCES AND PROGRESS PAYMENTS AND RETENSION

C. FIXED ASSETS

a). All revenues and expenses are accounted on accrual basis except to the extent stated otherwise.

b). Contract Prices are either fixed or subject to price escalation clause. The Revenue is recognized on the basis

of percentage of completion method and the stage of completion is determined on the basis of physical

completion of proportion of contract work.

c). Amount due in respect of the price escalation claim and/or variation in contract work approved by the

customers are recognized as revenue only when there are conditions stipulated in the contracts for such

claims or variations and/or the same are evidenced inter-alia by way of confirmation or the same are

accepted by the customers.

d). Liquidated damages payable, if any, as per the terms of the contract, for the delays, if any, are accounted

only when such delay is attributable to the Company.

a. Expenditure (net of corresponding interest income earned on deployment or other wise of fund

attributable to the projects) incurred on Build, Operate and Transfer (BOT) Project which does not represent

Company's own assets is classified as “BOT PROJECT EXPENDITURE” and is amortized / written off based on

the projected toll revenue. The projected total revenue is based on the toll rate & expected increase.

b. The materials and stores etc. acquired / purchased for the construction activities of owned Build, Operate

and Transfer Projects (BOT Projects) are classified / reflected as B.O.T. Projects Expenditure and / or work in

progress, as the case may be. Accordingly such purchases are disclosed as item of B.O.T. Project

Expenditure.

a. Advances received from customers in respect of contracts are treated as liability.

b. Progress payments received are adjusted against receivables from customers in respect of the contract

work performed.

c. Amount(s) retained by the customers until the satisfactory completion of the contract are recognized in the

financial statement as receivables. Where such retention has been released by the customers against

submission of bank guarantee the amount so released is adjusted against receivables from the customers

and value of Bank guarantees is disclosed as contingent liability under bank guarantees outstanding.

a. Fixed assets are stated at cost of acquisition as reduced by accumulated depreciation.

b. All direct expenses attributable to fixed assets are capitalized.

D. DEPRECIATION

E. BORROWINGCOST

F. VALUATIONOF INVENTORIES

G. INVESTMENTS

H. CLAIMS,DEMANDSANDCONTINGENCIES

I. PROVISIONFORDOUBTFULDEBTS/ADVANCES:

J. RETIREMENTBENEFITS

a. Depreciation is providedonwritten downvalue basis as per the rates andmethodprescribedunder Schedule –

XIV to theCompaniesAct,1956.

b. Goodwill is notdepreciated.

Borrowing costs directly attributable to the acquisition or construction of fixed assets are capitalized as part of

the cost of the assets, up to the date the assets are ready for its intended used. Other borrowing costs are

charged to theprofit and loss account in theyear inwhich theyare incurred.

a. RawMaterials are valuedat lowerof cost andnet realizable value. Cost is determinedonFIFObasis.

b. Contract Work in progress is valued at tender rate having regards to unbilled work, outstanding running bills

andexpected recovery thereof.

c. Stores and sparesarewrittenoff in theyearofpurchase.

Long terms investments are stated at cost. Provision for diminution in the value of investments is made only if

suchdecline is other than temporary in theopinionof themanagement.

Disputed and / or contingent liabilities are either provided for / or disclosed depending on management's

judgmentof theoutcome.

Provision is made in accounts for doubtful debts / advances which in the opinion of the management are

considereddoubtful of recovery.

a. Short Term Employee benefits:

Short Term Employee Benefits are recognized in the period during which the services have been rendered.

b. LongTermEmployeebenefits:

Provident Fund, FamilyPension fund

As Per Provident Fund Act 1952 all employees of the company are entitled to receive benefits under the

provident fund and family pension fund which is defined contribution plan. These contributions are made to

theplanadministeredandmanagedbyGovernmentof India.

The Company's contribution to this scheme are recognized as expense in the profit and loss account during the

period inwhich the employee renders the related service. The Company has no further obligation under these

plansbeyond itsmonthly contribution

c. Leaveencashment:

The Company has provided for the liability at year end on account of un-availed earned leave as per the

actuarial valuation.

d. Gratuity :

The Company provides for gratuity obligations through a Defined benefits retirement plan (“The Gratuity

Plan”) covering all employees. The present value of the obligation under such defined benefit plan is

determined based on the actuarial valuation using the project unit credit method, which recognizes each

period of service as giving rise to additional unit of employees benefits entitlement and measure each unit

separately to build up final obligation. The obligation is measured at the present value of the estimated cash



86

87



flows. Thediscount rateused for determiningpresent valueof thedefinedobligationunder thedefinedbenefit

plan is based on the market yield on Government Securities as at the balance sheet date. Actuarial gains and

losses are recognized inProfit andLossAccountas andwhendetermined.

TheCompanymakesannual contribution to LIC for thegratuityplan in respectof all theemployees.

a) Provision for current tax is made on the basis of estimated taxable income for the current accounting year and

inaccordancewith theprovisionsof the IncometaxAct,1961.

b). Deferred tax resulting from “timing difference” between book and taxable profit for the year is accounted for

using the tax rates and laws that have been enacted or substantially enacted as on the balance sheet date. The

deferred tax asset is recognized and carried forward only to the extent that there is a virtual certainty that the

assetswill beadjusted in future.

Transaction in foreign currency is recorded at the exchange rate prevailing on the date of the transaction,

exchange rate differences resulting from foreign exchange transaction settle during the period including year

end transaction of current assets and liabilities are recognized in the profit & loss accounts. Exchange rates

differences arising in relation to liabilities incurred for acquisition of fixed assets are adjusted to the carrying

valueof the fixedassets.

In respect of forwardexchange contract, except in caseof fixedassets, thedifferencebetween forward rate and

the exchange rate at the inception of the forward exchange contract is recognized as income / expenses over

the lifeof the contract.

a). OPERATINGLEASE

Lease of assets under which all the risk and rewards of ownership are effectively retained by the lessor are

classified as operating leases. Lease payments under operating leases are recognized as expenses on accrual

basis in accordancewith respective leaseagreements.

b). FINANCELEASE

Assets acquired under leases where Company has substantially all the risk and rewards of ownership are

classified as finance lease. Assets acquired under finance are capitalized and corresponding lease liability is

recorded at an amount equal to the fair value of the leased assets at the inception of the lease. Initial costs

incurred in connection with the specific leasing activities directly attributable to activities performed by the

Companyare includedaspartof theamount recognizedasanassetunder the lease.

If internal / external indications suggest that an asset of the Company may be impaired, the recoverable

amountof asset / cashgeneratingunit is determinedon theBalance–Sheetdateand if it is less than its carrying

amount of the asset / cash generating unit, the carrying amount of asset is reduced to the said recoverable

amount. The recoverable amount ismeasured as the higher of net selling price and value in use of such asset /

cash generatingunit,which is determinedby thepresent valueof carrying amountof theestimated future cash

flow.

The preparation of financial statements in conformity with Generally Accepted Accounting Principles requires

estimates and assumption to be made that affect the reported amount of the assets and liabilities and

disclosure of contingent liabilities on the date of financial statements and the reported amount of revenue and

expenses during the reporting period. Actual results could differ from these estimates and differences

between actual results and estimates are recognized in the period in which the results are known /

materialized.

K. PROVISIONFORCURRENTANDDEFERREDTAX

L. FOREIGNCURRENCYTRANSACTION

M. LEASE

N. IMPAIRMENTOFASSET

O. USEOFESTIMATES

2 CONTINGENTLIABILITIESNOTPROVIDEDFOR INRESPECTOF

5). Build,Operate&TransferProjects (BOTProjects)

a. Guarantees issuedby theCompany's banker onbehalf of the Company amounting to Rs.17570.18 Lacs (P. Y. Rs.

9743.76 Lacs)

b. The Company has given a guarantee to the Bank for facilities granted to itswholly owned subsidiary companies

Msk Projects (Himmatnagar Bypass) Private Limited &MSK Projects (KimMandvi Corridor) Private Limited for

the amounting to Rs. 1667 Lacs (P.Y. Rs. 1667 Lacs). Outstanding amount as on 31st March, 2011, Rs. 1267.44

Lacs ( Previous Year1345.73 Lacs) and to integrated joint ventureDewas Bhopal Corridor Limited amounting to

Rs.38500/- Lacs (Previous year Rs.34500/- Lacs) outstanding amount as on 31stMarch 2011 Rs.38597.66 Lacs

(P.Y. Rs.34831.35Lacs).

c. Letterof credit issuedby theCompany's bankonbehalf of theCompanyRs. 502.05 Lacs (P.Y.Rs.1353.72 Lacs)

d. IncomeTaxDemandofRs.1045.79Lacs (PreviousYearRs.282.40 Lacs) disputedby thecompany.

e. Civil Suit filedagainst theCompanyRs.38.51 Lacs ( P.Y. Rs.23.46 Lacs.)

f. Liabilities of Stamp Duty in respect of integrated joint venture Company for Rs.853.28 Lacs (P.Y. 853.28) under

IndianStampAct1899as the liabilityhasbeencontestedby theCompany.

g. Liability of Labour-cess in respect of integrated joint venture Company for Rs.477.84 Lacs (Previous year Rs.

477.84 Lacs) as the liabilityhasbeencontestedby theCompany.

3). Incomplete Contract work under Contract Work In Progress at the various sites is estimated by the

managementhaving regards tounbilledwork, outstanding runningbill andexpected recovery thereof.

4). Security Deposits deducted from contract receipt and mobilization advances received against contracts are

subject to confirmationandadjustment, if any, on finalizationof account.

i). The Company has obtained the contract on Build, Operate and Transfer (BOT) basis from theMadhya Pradesh

State IndustrialDevelopmentCorporation forexecutionofDewasWater Supplyproject.


contract the Company is entitled to collect Water supply charge during the concession period of 32 years

(including theperiodof construction).

The Company has completed construction of the said project in the earlier year. Having regard to the

accounting policies followed by the Company the entire expenditure incurred is treated as BOT Project

ExpenditureandproportionateamountofRs.48.99 Lacs (P.Y.388.36Lacs) hasbeenwrittenoff during theyear.

ii). The Company has obtained the contract on Build, Operate and Transfer (BOT) basis from the Punjab

InfrastructureDevelopmentBoard forexecutionof JalandharBusTerminal project.



years5monthsand2days for JalandharBusTerminal Project (including theperiodof construction).



proportionateamountofRs.235.15Lacs (P.Y.Rs.320.35Lacs) hasbeenwrittenoffduringtheyear.

iii). The Company has obtained the contract on Build, Operate and Transfer (BOT) basis from the Punjab

InfrastructureDevelopmentBoard forexecutionof LudhianaBusTerminal Project.



years3months for LudhianaBusTerminal Project (including theperiodof construction).



88

89



The Company has completed construction of the said project in the earlier year. Having regard to the

accounting policies followed by the Company the entire expenditure incurred is treated as BOT Project

Expenditure and proportionate amount of Rs.172.11 Lacs (P.Y. Rs.256.05 Lacs) has beenwritten off during the

year.

iv). TheCompanyhadobtained the contract onBuild,OperateandTransfer (BOT)basis fromMadhyaPradeshRoad

Development Authority for construction of Hoshangabad–Harda–Khandwa Road Project. In Terms of the

Contract the Companywas entitled to collect the toll during the concession period of 5440 days (Including the

period of the construction). The Company had completed the construction of the above project and was put

open to traffic during theearlier year.


treated as BOT Project Expenditure and proportionate amount of Rs. 241.08 Lacs (P.Y. 355.84 Lacs) has been



v). TheCompanyhadobtained the contract onBuild,OperateandTransfer (BOTBasis) fromMadhyaPradeshRoad

Development Authority for construction of Raisen–Rahatgarh. In Terms of the Contract the Company entitled

to collect the toll during the concession period of 5440 days (Including the period of the construction). The

Company had completed the construction of the above project and was put open to traffic during the earlier

year.


treated as BOT Project Expenditure and proportionate amount of Rs.158.81 Lacs (P.Y. 281.01 Lacs) has been



vi). The company obtained Build, Operate, & Transfer (BOT Contract) from Gujarat State Road Development

Corporation Ltd. for construction of Strengthening and Widening, and maintenance of Kim Mandvi Corridor

Projects. In terms of the contract, the company has been entitled to collect toll during the concession period

of 20 years (Including the period of Construction). The Company has Completed the Construction of the said

project andput toopen for the traffic during theyear.


treatedasBOTProject Expenditure andproportionate amountof Rs.139.64 Lacs (P.Y. –Nil-) hasbeenwrittenoff

during the year after considering the Cash Subsidy received/receivable fromGujarat State Road Development

Corporation.

vii). MSK Projects (Himmatnagar bypass) Private Limited, the subsidiary, has obtained Build, Operate, & Transfer

(BOT Contract) from Gujarat State Road Development Corporation for construction of Strengthen and

Widening, andmaintenanceofHimmatnagar bypass. In termsof the contract, the companyhas beenentitled

to collect toll during theconcessionperiodof15years.( 5112Days )(Including theperiodofConstruction).

Having regards to the Accounting Policies followed by the company, the entire expenditure incurred on

Construction of Road aggregating to Rs.844.47 Lacs is treated as BOT Project and shall be written off over a

period of concession Agreement up to 31.03.2021 (5112 Days) Accordingly Rs. 50.93 Lacs (Previous year Rs.

60.27 Lacs) is amortized in the current year. The amortization starts from the date of start of Toll Collection i.e.

02.04.2006.

viii). Dewas Bhopal Corridor Limited, the integrated Joint Venture Company has obtained Build, Operate & Transfer

(BOTContract) fromMadhyaPradeshRoadDevelopmentAuthority forConstructionof four laneRoadProject.

The Company has commenced the full operation of the projects based on the completion certificate received

fromMadhyaPradeshRoadDevelopmentCorporationon thatdate.

Having regards to the Accounting Policies followed by the Company, the entire expenditure incurred on

Construction of Road is treated as Build, Operate & Transfer Project Expenditure and is over a period of

concession Agreement up to 19.03.2033 and proportionate amount of Rs.537.81 Lacs (Previous year Rs.–Nil-)

(adjustedamountof amortization) is amortized in the current year.

Hitherto up to 31st March 2010 expenditure incurred on above, Build, Operate & Transfer (BOT) Projects was

amortized / written off over the period of concession. The Company has changed the policy and the said BOT

expenditure is amortized /writtenoff on thebasis of projected toll revenueover theperiodof concession.

Had there been no change in the method of amortization the amount of the amortization for the year would

have been higher by Rs. 1178.16 Lacs (including adjustment made in case of joint venture Dewas Bhopal

Corridor Limited Rs. 489.86 Lacs which is following diverse accounting policy), consequently loss for the year

wouldhavebeenhigherandReservesandSurpluswouldhavebeen lower to that extent.

As the practice of amortization is changed prospectively no effect of change up to 31st March 2010 is given to

theaccounts.

TheCompany isoperating ina single segmentonlyduring theyear i.e. Civil ConstructionContract.

During the year, the Company has accounted for deferred tax in accordancewith the Accounting Standard 22 –

“Accounting for Taxeson Income” issuedby the InstituteofCharteredAccountantsof India.

The Break up of deferred tax liabilities & assets into major components at the year end is as follows:

5-A Change inPolicyofAmortization:

6).

7).



90

During theyearCompanyhas recognized the followingamount in the financial statements.

Contribution toDefinedContributionPlan recognizedasExpense for theyear asunder:

8). Disclosure relating toEmployeesBenefits –Asper revisedAS-15:

a) DEFINEDCONTRIBUTIONPLAN:

Rs. In Lacs

Particulars

Particulars AS ON

31-03-2011

AS ON

31-03-2010

DEFERRED TAX LIABILITIES:-

DEFERRED TAX ASSETS:

TOTAL

Depreciation

Retirement Benefits

Provision for Bad Debts

Share of Joint Venture

Deferred tax Liabilities Provided during the year

1032.82

7.27

164.39

190.26

670.90

361.92

649.06

2.23

–

550.94

–

646.83

Employer Contribution to Provident Fund 39.86

(15.43)



91

Reconciliation of opening and closing balances of Defined Benefit obligation

b) DEFINEDBENEFITPLAN:

Reconciliation of opening and closing balances of fair value of plan Assets

Rs. In Lacs


(Funded)

Fair value of plan assets in the beginning of the year

Expected return on plan assets


Employer contribution

Benefits Paid

Fair Value of plan assets at the end of the year

32.77

(18.03)

2.62

(2.29)

(2.62)

(0.99)

0.00

(13.44)

NIL

(NIL)

32.77

(32.77)

Rs. In Lacs


(Funded)

Leave Encashment

(Non Funded)

Defined Benefit obligation at the beginning of the year


Interest Cost

Actuarial (gain)/loss

Benefits Paid

Defined Benefit obligation at the year end

27.12

(13.40)

5.07

(7.94)

2.27

(1.11)

29.00

(4.68)

NIL

(NIL)

63.47

(27.12)

6.58

(3.82)

58.43

(4.43)

0.55

(0.32)

(43.14)

(1.99)

NIL

(NIL)

22.41

(6.58)



Reconciliation of Fair Value of Plan Assets and Benefit Obligation.

Expenses recognized during the year (Under the head “Salaries & Bonus” – Refer Schedule 6)

Rs. In Lacs


(Funded)

Leave Encashment

(Non Funded)

Fair Value of Assets as at 31st March, 2011

Present Value of obligation as at 31st March, 2011

Amount recognized in Profit & Loss Account

32.77

(32.77)

63.48

(27.12)

36.35

(12.42)

2.76

(NIL)

22.41

(6.58)

15.84

(2.76)

92

Actuarial Assumptions

Rs. In Lacs


(Funded)

Leave Encashment

(Non Funded)

Discount Rate ( Per Annum)

Salary Escalation ( Per Annum)

8.28%

(8.28%)

6.00%

(6.00%)

8.40%

(8.28%)

6.00%

(6.00%)

- Welspun Maxsteel Limited

- Welspun Steel Limited

- Welspun India Limited

- Welspun Retail Limited

- Welspun Captive Power Generation Limited

9. Transactionwith relatedparties (as certifiedby themanagement)

a. AssociateConcern:

Rs. In Lacs


(Funded)

Leave Encashment

(Non Funded)


Interest Cost

Expected return on Plan Assets


Expense Recognized in Profit and Loss Account

5.07

(7.94)

2.28

(1.11)

(2.62)

(2.28)

31.62

(4.67)

36.35

(12.42)

58.43

(4.43)

0.55

(0.32)

NIL

(NIL)

(43.14)

(1.99)

15.84

(2.76)



93

- Welspun Corp. Limited

- Welspun Infratech Limited

b. IndirectHoldingCompany

c. HoldingCompany:

d. KeyManagement

Name Position Name of the Company

Director

Director

Director

Director

Director

Director

Director

Director

Director

Director

Director

Director

Balkrishna Goenka

Nirmal Gangwal

Yogesh Verma

Shailesh Vaidya

Aprurva Kumar Dasgupta

Ashok M Khurana

Amit A Khurana

Asim Chakraborty

Banwarilal Biyani

Udailal Anjana

Hukumichand Jain

Shreechand Kukreja

Suraj Kukreja

Welspun Projects Limited

Welspun Projects Limited

Dewas Bhopal Corridor Private Limited



MSK Projects (Himmatnagar Bypass) Private Limited

MSK Projects (KIM Mandvi Corridor) Private Limited






Related Parties

Holding

Company

Indirect

Holding

Company

Associate

Company

Key

Management

Relative of

Key

Management

Contract Receipt &

Operational Income

Material Purchase

Mobilization Advance

Received

Mobilization Advance

Repayment

Loan given

Loan Received

Repayment of

Loan Received

Repayment of

loan given

1

2

3

4

5

6

7

8

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

5729.41

(-)

5715.00

(-)

-

(-)

1435.97

( - )

1582.24

( - )

1355.54

( - )

1005.54

( - )

-

(-)

3.02

(-)

-

(-)

-

(-)

3546.28

( - )

752.46

( - )

830.27

( - )

259.28

( - )

-

( 5.76 )

-

( - )

-

( 5.00)

-

(120.82)

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

-

(-)

Contd.




Related Parties

Holding

Company

Indirect

Holding

Company

Associate

Company

Key

Management

Relative of

Key

Management

Sales of Properties

Advance for purchase

of commercial Property.

Remuneration to

the Directors

Receivable at the

end of the year

Payable at the

end of the year

9

10

11

12

13

-

(-)

-

(-)

-

(-)

-

2208.21

-

(-)

-

(-)

-

(-)

68.04

-

-

(-)

-

(5.00)

( - )

447.84

731.20

-

(28.83)

-

( - )

37.78

(283.00)

-

-

-

( 41.58)

-

( - )

69.11

( - )

-

(0.93)

-

94

Cash Subsidy of Rs.12653.80 Lacs (P.Y. 11762.80 Lacs) received from Madhya Pradesh Rajya Setu Nirman

Nigam Limited, and Gujrat State Road Development Corporation against the BOT. Project cost, is not reduced

fromthe relevantproject cost but the same is shownas “Capital Reserve” in theBalanceSheet.

Loans&Advances includesadvances in thenatureof loangiven to:

10.

11).

Rs. In Lacs


out standing during

the year

( - )

Rs. 3.85

Rs. 3.85

Rs. 3.85

Rs. In Lacs

Earningper share:12).

2010-11 2009-10

Other Companies / Parties

A. Net profit after Tax available for equity

shareholders. (Rs. In Lacs)

B. Weighted average number of Equity Shares of Rs. 10/-

each outstanding during the year (Nos. of Shares)

C. Basic & Diluted Earning Per Share (Rs.)

(3156.71)

38729233

(8.15)

2334.43

22821112

10.48

Confirmations of certain parties for amounts due from themas per accounts of the company are not obtained.

Amount due from customers include amounts due/with held on account of various claims. The claims will be

verified and necessary adjustments, if any, shall bemade in the year of settlement. Subject to this, company is

confident of recovering the dues and accordingly they have been classified as “debt considered good” and

thereforenoprovision is considerednecessary, thereagainst.

Under theMicro, Small andMediumEnterprise Development Act, 2006 (“MSMEDAct”) which came into force

effective from 2nd October, 2006, certain disclosures relating to amounts due to micro, small and medium

enterprises and remained unpaid after the appointed date etc. of principal and interest amounts are required

13).

14).



95

tobemade. TheCompany is in theprocess of compiling the relevant information.As the relevant information is

not yet readily available and / or not given or confirmed by such enterprises, it is not possible to give required

information in the accounts. However, in view of the management, the impact of interest, if any, which may

subsequently become payable to such enterprise in accordance with the provisions of the Act, would not be

material and the same, if any,wouldbedisclosed in theyearofpaymentof interest.

In the absence of the necessary information with the Company relating to the registration status of the

suppliers under the Micro, Small and Medium Enterprises Development Act' 2006, the information required

under the saidAct couldnotbecompiledanddisclosed.

In the opinion of the Directors, Current Assets, Loans and Advances have value at which they are stated in the

Balance Sheet, if realized in the ordinary course of business. The provision for depreciation and for all known

liabilities is adequateandnot inexcessof theamount reasonablynecessary.

Remuneration toDirectors:

15).

16).

Rs. In Lacs

Managing

Director / Joint

Managing Director

Director

Salaries

Contribution to P.F.

Total

37,78,737

(2,00,00,000)

Nil

(Nil)

37,78,737

(2,00,00,000)

69,13,333

(83,00,000)

2,710

(7,200)

69,16,043

(83,07,200)

Previous year's figureshavebeen regrouped, rearrangedand reclassifiedwherevernecessary.17).

��



H. B. Shah

Partner


Place : Vadodara

Date : 26-05-2011

B. K. Goenka

Chairman

Susheela Maheshwari

Company Secretary

Place : Mumbai

Date : 26-05-2011

Sunil Shinde

Managing Director

96

CONSOLIDATED CASH FLOW STATEMENT

2010-11 2009-10

A. CASH FLOW FROM OPERATING ACTIVITIES

Operating Profit before Working Capital Changes 390414576 939935811

Adjustment for :

(91992282) (66765114)

NET CASH USED IN OPERATING ACTIVITIES 235594948 818933515

B. CASH FLOW FROM INVESTING ACTIVITIES

NET CASH USED IN INVESTING ACTIVITIES (2120879093) (1243922891)

C. CASH FLOW FROM FINANCING ACTIVITIES

NET CASH FROM FINANCING ACTIVITIES 1840892330 223796407

Net Profit before tax & Prior Period items (309335940) 358053127

Depreciation 96517753 113540997

Preliminary Expenses 97544 4117

Amortisation of BOT Projects 160620239 174077064

Interest Paid 386010871 295642909

Provision for Bad Debts 42880428 4286469

Unclaimed Liabilities written back (4155946) (3577719)

Impairment of Fixed Assets 6738590 -

Bad Debts 2206100 -

Profit on sales of assets (1581645) (2118510)

Dividend Received (26400) (46643)

Loss on sales of Investment 5015130 -

Provision for Leave Encasement & Gratuity 5219019 -

Provision for Diminution in Value of Investments - 74000

Surplus & Deficit 208833 -

Inventories (228908093) (98530691)

Trade & Other Receivables (141827869) 214618402

Trade Payable & Provisions 278743680 (182852825)

Cash Generated From Operations Before Tax, & Period Item 298422294 873170697

Less: Direct Taxes Paid (65725697) (76996786)

Cash Generated From Operations Before Period Item

Add: Prior Period (Net) 2898351 22759604

235594948 818933515

Purchases of Fixed Assets (36528681) (156883676)

Sales of Fixed Assets 13425434 7793082

Investment (1444535034) 2074003

Less: BOT Expenditures (742367212) (1173209783)

Cash Subsidy (Net) 89100000 76256840

Dividend Received 26400 46643

Issue of shares on Preferential basis 2113003224 -

Borrowing 160543577 546138876

Dividend Paid (Including Tax thereon) (46643600) (26699560)

Interest Paid (386010871) (295642909)

Net Changes In Cash & Cash Equivalents (A+B+C) (44391815) (201192969)

Cash & Cash Equivalents - Opening Balance 535534871 736727840

491143056 535534871

Cash & Cash Equivalents - Closing Balance 491143056 535534871

��



H. B. Shah

Partner


Place : Vadodara

Date : 26-05-2011

B. K. Goenka

Chairman

Susheela Maheshwari

Company Secretary

Place : Mumbai

Date : 26-05-2011

Sunil Shinde

Managing Director

97

SECTION 212

Details of Subsidiary Companies as requried under Section 212 (8) of the Companies Act, 1956 read with General Circular No. 2/2011 issued by Ministry of

Corporate Affairs

MSK Projects

(Kim Mandvi Corridor)

Private Ltd.

Welspun Energy

Maharashtra

Private Ltd.*

MSK Projects

(Himmatnagar Bypass)

Private Ltd.

Name of the Subsidiary

ParticularsSr. No.

Financial Year ending on

Currency

March 31, 2011 March 31, 2011 March 31, 2011

INR INR INR

1 Capital 2,420,000 67,300,000 500,000

2 Reserves 25,828,099 31,582,709 -

3 Total Assets 66,589,794 529,607,407 226,034

4 Total Liabilities 38,341,695 430,724,697 5,515

5 Details of Investment

(except in case of investment in subsidiaries) - - 60,000

6 Turnover 13,484,950 21,787,788 -

7 Profit before taxation 3,106,942 (65,345) -

8 Provision for taxation 709,487 1,946 -

9 Profit after taxation 2,394,527 (67,291) -

10 Proposed dividend - - -




H. B. Shah

PartnerMembership No. 016642

Place : VadodaraDate : 26-05-2011

B. K. Goenka

ChairmanSusheela Maheshwari

Company Secretary

Place : MumbaiDate : 26-05-2011

Sunil Shinde

Managing Director

* Un-audited accounts (as certified by the management of the Company) as at 31st March 2011 is taken into consideration for consolidated


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