ashiana ispat limited · ashiana has recorded a gross revenue of ` 3005.51 the pbt grew by 1.52% to...

Annual Report20th

Ashiana Ispat Limited(AN ISO 9001-2008 COMPANY)

2011-2012

AAAAAAAAAAAAAAAAAAAAAAAAAAAAAA

1.2.3.4.5.6.7.8.9.

Shri Sukhbir Singh JainShri Naresh ChandShri Neeraj Kumar JainShri Sanjay Kumar JainShri Puneet JainShri Ram Kumar GargShri T. C. KansalShri Rajesh Kumar PalShri Rajender Prasad Bansal

COMPANY SECRATARYHarun Rashid Ansari

OFFICE & WORK :A-1116, Phase-III, RIICO Industrial Area,Bhiwadi-301 019, Distt. Alwar (Rajasthan)E-mail : [email protected]

CORPORATE OFFICE :C-9/36, Sector-8,Rohini, Delhi-110 085

AUDITORS :M/s S. Singhal & CompanyChartered AccountantsE-127, Industrial Area,Bhiwadi-301 019, Distt. Alwar (Rajasthan)

SECRETARIAL AUDITORS :M/s Bir Shankar & Co.G-6/77, Sector-16, Rohini,New Delhi-110089

SHARE TRANSFER AGENT :Link Intime India Private Ltd.A-40, 2nd Floor, Naraina Industrial Area,Phase-II, New Delhi-110028Ph- 011-41410592-94

BANKERS :State Bank of Bikaner & JaipurA-1/19,Safderjung Enclave,New Delhi-110029

---------

ChairmanManaging DirectorWhole Time DirectorWhole Time DirectorWhole Time DirectorDirectorDirectorDirectorDirector

CONTENTS

MANAGING DIRECTORS' MESSAGE

NOTICE

DIRECTORS' REPORT

CORPORATE GOVERNANCE

MANAGEMENT DISCUSSION

& ANALYSIS

AUDITORS' REPORT

BALANCE SHEET

STATEMENT OF PROFIT & LOSS

NOTES ON FINANCIAL STATEMENTS

CASH FLOW STATEMENT

SIGNIFICANT ACCOUNTING POLICIES

PAGE NO.

2

4

5

10

17

19

22

23

24

35

36

BOARD OF DIRECTORS

AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAshiana Ispat Ltd

1

MANAGING DIRECTOR'S

Dear Shareholders,THWELCOME TO THE 20 ANNUAL GENERAL MEETING OF ASHIANA ISPAT LIMITED

thI extend a hearty welcome to you all on behalf of Board of Directors, to this 20 Annual General Meeting of the Company.

We meet today on the eve of landmark in the history of your Company, which has completed 20 years since the date of incorporation in 1992. We draw considerable satisfaction that we have achieved quite a lot during these years and we look to the future with the same conviction as we carried these years.

I am pleased to report that the Company has significantly exceeded expectations and registered a satisfactory performance in 2011-12. The growth was, however, accompanied by high inflation which has remained above normal levels throughout the year, and is equally cause of concern for us along with National concern.

Company's Performance

Last couple of years has experienced an unprecedented economic turmoil worldwide.

In terms of the developed economies, steel industry is not recession proof, but is insulated to some extent than other industries.

stIt is now my pleasure to present our company's financial results for the year ended 31 March, 2012. Ashiana has recorded a gross revenue of ̀ 3005.51 The PBT grew by 1.52% to 35.31 million from `34.78 million and PAT grew by 2.32% to ` 2.38 million in financial year 2011-12 from ` 2.32 million during the previous financial Year. The growth in revenue and profits has been driven by volume growth and better realizations from businesses.

We have taken initiatives to improve internal control systems and optimise and enhance realizations for our saleable products. Our continuous endeavor is to maximize the revenue and enhance the shareholders funds that could contribute in maximization of the net worth of the shareholders.

MESSAGE

`Million


2


Opportunity:

Being a core sector, steel industry reflects the overall economic growth of an economy in the long term. Also, steel demand, being derived from other sectors like automobiles, consumer durables and infrastructure, its fortune is dependent on the growth of these user industries. We have rich mineral resources and are the fourth largest iron ore reserves (10.3 billion tonnes) after Russia, Brazil, and Australia. Therefore, many raw materials are available at comparatively lower costs.

The Indian rural sector remains fairly unexposed to their multi-faceted use of steel. The rural market was identified as a potential area of significant steel consumption. Enhancing applications in rural areas assumes a much greater significance now for increasing per capital consumption of steel.

The usage of steel in cost effective manner is possible in the area of housing, fencing, structures and other possible untapped rural market necessities and increasing interest of domestic and overseas producers in capacity creation to serve the domestic and overseas markets.

Going forward, your Company will continue to strengthen its leadership position in Iron & Steel Industry. We have a plan to modernize the plant, improved cost optimization, higher productivity and strong fundamentals augur well for the Company in the years to come

We have continued to build on our product capabilities. Your company has identified infrastructure development as a key driver of providing thrust to the growth story of the Company. We shall achieve that goal through our operational excellence and maintaining a commitment of providing the highest standards of TMT Bar at competitive rates.

Our people

The mainstay of the company is its people. Your Company has been successful in providing a platform that has helped in introducing productive working environment and ensure that our people continue to deliver the best performance in the current challenging environment. It is through our talented and creative people that we have earned our reputation for ingenuity. We believe in developing a congenial team culture that has helped the company and its employees in moving towards excellence and continuous performance improvement. Your company has successfully invested in development of leadership competencies among its employees to translate our aspiration into reality.

Ashiana, being a responsible corporate citizen understands its responsibility, and is committed to work towards the Health, Safety and Environment. The focus is on Sustainable development, providing safe work place for employees and enriching the quality of life of employees, environment and community as a whole.

Acknowledgement:

Before I conclude, I would like to express my sincere appreciation to our shareholders for the support and confidence reposed in us, and all other stakeholders and Government agencies, our Banker State Bank of Bikaner & Jaipur for the continuing commitment and support in your Company's onward march. We look forward for their continued association with the company.

I assure that our co-operation will help us to scale new heights and eventually serving the society in a better way. I thank you all for giving us an opportunity to help Ashiana grow as a successful organization.

Sd/-

(Naresh Chand)

Managing Director


3

NOTICE TO MEMBERS

NOTICE is hereby given that the TWENTIETH ANNUAL GENERAL MEETING of the Shareholders of ASHIANA ISPAT LIMITED will

thbe held on Saturday, the 29 day of September, 2012 at 11.30 A.M. at the Registered Office of the Company at A-1116, Phase-III, RIICO Industrial Area, Bhiwadi-301019 Dist. Alwar- Rajasthan, to transact the following business:

ORDINARY BUSINESS:.

1. To receive, consider and adopt the Audited Statement of Profit and Loss for the year

stended 31 March, 2012 and the Balance Sheet as at that date, together with the Report of the Board of Directors and the Auditors thereon.

2. To appoint a Director in place of Mr. T. C. Kansal who retires by rotation and being eligible, offers himself for reappointment.

3. To appoint a Director in place of Mr. Rajesh Kumar Pal who retires by rotation and being eligible, offers himself for reappointment.

4. To appoint Auditors of the Company and fix their remuneration. M/s. S. Singhal & Company, Chartered Accountants, Bhiwadi retire at the Annual General Meeting and being eligible offer themselves for re appointment.

By Order of the BoardFor ASHIANA ISPAT LIMITED

Sd/-Place: Bhiwadi Naresh ChandDate : 31.07.2012 Managing Director

NOTES:

[a] A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF / HERSELF AND SUCH PROXY NEED NOT BE A MEMBER OF THE COMPANY.

[b] The instrument(s) appointing the proxy, if any, shall be delivered at the Regd. Office of the Company at A-1116, Phase-III, RIICO Industrial Area, Bh iwad i -301019 , D is t . A lwar - Rajasthan, not less than forty eight (48) hours before the commencement of the Meeting and in default, the instrument of proxy shall be treated as invalid. Proxies shall not have any right to speak at the meeting.

[c] The Register of Members and Share Transfer Books of the Company will

rd remain closed from 23 September th2012 to 29 September 2012 (both

days inclusive).

[d] Members are requested to intimate the Registrars and Share Transfer Agents of the Company – M/s. Link Intime India

ndPrivate Limited of A-40, 2 Floor, Naraina Industrial Area, Phase-II, New Delhi-110028, immediately of any change in their address in respect of equity shares held in physical mode and to their Depository Participants (DPs) in respect of equity shares held in dematerialized form.

[e] Members desirous of having any information regarding Accounts are requested to address their queries to the Manager (Finance & Accounts) at the Registered Office of the Company at least seven days before the date of the meeting, so that the requisite information is made available at the meeting.


4

7

Balance (Cr.)

carried forward to the Balance Sheet

6 Balance (Cr.)

brought forward

from the previous year

5

Profit/ (Loss) for

the year before tax

4

Depreciation

3

Interest

2

Profit before

Depreciation

interest and Tax

1 Gross Sale

1182.55

952.42

347.85

133.58

386.19

867.62

28409.86

1410.91

1182.55

353.13

144.69

543.30

1041.12

29946.37

Sl. No.

Particulars 2011-2012

2010-2011

[f] Members holding Share certificates under different folio numbers but in the same order of name are requested to apply for consolidation of such folios and send relevant Share certificates to the Registrars and Share Transfer Agents of the Company.

[g] The Securities and Exchange Board of India (SEBI) has mandated the submission of Permanent Account Number (PAN) by every participant in securities market. Members holding shares in electronic form are, therefore, requested to submit the PAN to their Depository Participants with whom they are maintaining their demat accounts. Members holding shares in physical form can submit their PAN details to the Company / Registrars and Transfer Agents,

[h] Members/Proxies are requested to bring the attendance slip duly filled in.

[i] As an austerity measure, copies of Annual Report will not be distributed at the Annual General Meeting. Members are requested to bring their copies to the meeting.

By Order of the BoardFor ASHIANA ISPAT LIMITED

Sd/-Place: Bhiwadi Naresh ChandDate : 31.07.2012 Managing Director

Link Intime India Pvt. Ltd.

DIRECTORS' REPORT

Dear Shareholders,

Your Directors are pleased to present the Twentieth Annual Report of your Company along with the Audited Accounts for the financial

styear-ended 31 March, 2012.

STANDALONE FINANCIALS:

The Ministry of Corporate Affairs (MCA) vide notification no. S.O. 447(E) dated 28th February, 2011 amended the existing Schedule VI to the Companies Act, 1956. The Revised Schedule VI is applicable from financial year commencing from 1st April, 2011. The financial statements of your Company for the year ended 31st March, 2012 have been prepared in accordance with the Revised Schedule VI and accordingly, the previous year`s figures have been reclassified/ regrouped to conform to this year`s classification.

OPERATIONS

During the year under review, your Company has exceeded expectations and recorded a robust financial performance with revenue growth of 5.27 % to ` 30055.08 Lacs, PBT

` in lacs


5

growth of 1.52% to ` 353.13 Lacs and PAT growth of 2.32% to ̀ 238.11 Lacs.

Despite of the economic recession your Company has set new milestones and Turnover volume touched all time high record ` 30055.08 Lacs (previous year ` 28551.27 lacs). Higher productivity has been accompanied by strong focus on cost control and better market pricing, increased market share in addressable markets and turnover incentive to dealers and distributors. Being a core sector, steel industry reflects the overall economic growth of an economy in the long term.

On account of thrust on infrastructure development the demand and prices of restructure bar see better future ahead. While steel continues to have a stronghold in traditional sectors such as construction, housing and ground transportation, special steels are increasingly used in engineering industries such as power generation, petrochemicals and fertilisers.

DIVIDEND

Keeping in view the current economic scenario and future fund requirements of the company for achieving the long term growth objectives, the Board of Directors has not recommended any dividend and transferred all the distributable profit to the general reserve account of the company.

CAPITAL STRUCTURE:

During the year under review, the issued share capital of your company remained unchanged.

FIXED DEPOSITS

Your Company has not accepted any Fixed Deposits from the public and is therefore not required to furnish information in respect of outstanding deposits under Non- Banking Non- Financial Companies (Reserve Bank) Directions, 1966 and Companies (Acceptance of Deposits) Rules, 1975.

DIRECTORS

Retirement by Rotation

Mr. T. C. Kansal and Mr. Rajesh Kumar Pall, Directors, liable to retire by rotation at the forthcoming Annual General Meeting and being

eligible, offer themselves for re-appointment. The proposals regarding their re-appointment as Directors are placed for your approval.

Mr. T. C. Kansal is specialized in operations process improvement, cost and spend rationalization, and enhanced resource utilization. During his carrier he has been associated with iron and steel industry in different capacities.

Mr. Rajesh Kumar Pal having more than 10 years experience of iron and steel industry.

presence on the Board is immense beneficial for the company in long run.

AUDITORS

M/s. S. Singhal & Co., Chartered Accountants, of Bhiwadi, Alwar, Rajasthan, Auditors of the Company will retire at the conclusion of the ensuing Annual General Meeting and have confirmed their eligibility and willingness to accept the office of the Auditors' if approved.

COST AUDITOR:

Your Board has appointed M/s. R.S. Roy as Cost Auditor for the financial year ended 31.03.2012 pursuant to the direction from the Ministry of Corporate Affairs, Government of India.

DEPOSITORY SYSTEM

M/s. Link Intime India Private Limited ( old name- M/s. Intime Spectrum Registry Limited),

ndA-40,2 Floor, Naraina Industrial Area, Phase-II, Near Batra Banquet Hall, New Delhi-110028, Ph-011-41410592-94, as per SEBI Guidelines has been working as share transfer agent.

C O N S E R VAT I O N O F E N E R G Y & TECHNOLOGY ABSORPTION

The scope of energy conservation in our industry is limited. However, your company is doing is best efforts to give high priority to energy conservation by opting for more power efficient replacements.

Every effort is made by the company to update the technical skills of every employee for smooth functioning of the operations and to successfully achieve the desired growth objective.

Their


6

Particulars of Energy Conservation/ Technology Absorption and Foreign Exchange earnings and out go as per Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are given as an Annexure to this report. (Annexure-i)

PARTICULARS OF EMPLOYEES

Particulars of employees as required under Section 217(2A) of the Companies Act,1956 read with the Companies (Particulars of employees) Rules 1975, are not applicable because none of the Directors or employees of the Company getting remuneration exceeding the limit prescribed therein.

CORPORATE SOCIAL RESPONSIBILITY:

Committed to enhancing prosperity as a responsible corporate Ashiana is fully aware of its responsibility towards planet earth and society and has focused on ensuring health services to its external community. It has been associated with Mahaveer International, a premier social organization with an aim to make the Capital Delhi free from Cataract.

M A N A G E M E N T D I S C U S S I O N A N D ANALYSIS REPORT:

As required by Clause 49 of the Listing Agreements with Stock Exchanges, the Management discussion and Analysis Report is enclosed as a part of this report.

DEMATERIALISATION OF SHARES:

33.43 % of the company's paid up Equity Share Capital is in dematerialized form as on March 31st, 2012 and balance 66.57 % is in physical form.

The Company's Registrars are M/s. Link Intime ndIndia Pvt. Ltd. A-40, 2 Floor, Naraina Industrial

Area, Phase-II, New Delhi-110028.

LISTING WITH STOCK EXCHANGES:

The Company confirms that it has paid the Annual Listing Fees for the year 2012-2013 to BSE, where the Company's Shares are listed and is in the process to get the shares delisted from the Magadh Stock Exchange Association Limited, Patna, The Delhi Stock Exchange Association Limited, Delhi, and the Jaipur Stock

Exchange Limited, Jaipur.

THE DIRECTOR'S RESPONSIBILITY STATEMENT (UNDER SECTION 217 (2AA) OF COMPANIES ACT, 1956)

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following Statement in terms of Section 217 (2AA) of the Companies Act, 1956.

1. That in the preparation of the Annual Accounts for the year ended 31st March, 2012 the applicable Accounting Standards have been followed along with proper explanation relating to material departures, if any

2. That such accounting policies as mentioned in Notes on Accounts have been selected and applied consistently and judgments and estimates that are reasonable and prudent made so as to give a true and fair view of the State of affairs of the Company at the Financial year 31st March,2012 and of the profit of the Company for that year.

3. That proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. That the Annual Accounts for the year ended 31st March, 2012 has been prepared on a going concern basis.

CORPORATE COMMUNICATION

The Company endeavors to promote communication, both external and internal, for the purpose of effectively communicating with its stakeholders and also for brand building of the organization.We have successfully upheld the confidence of our stakeholders by proactively sharing the company' achievements by utilizing the media innovatively.

The external communication is maintained through :

1. Ensuring publication of advertisements in major dailies.

2. Periodical Maintainance and updation of company' website featuring current updates


7

about company' functioning.

3.Printing and publication of brochures, annual report

THE CORPORATE GOVERNANCE CODE

The company has adopted the best possible corporate governance norms and it has been our endeavor to comply to the changing norms.

A separate section on corporate Governance and a certificate from the Auditors of the company regarding compliance of conditions of corporate as stipulated under clause 49 of the listing agreement with the stock exchange form part of the Annual Report.

In terms of sub-clause (v) of the Clause 49 of the listing Agreement a certificate of the CEO, inter alia, complying the correctness of the financial statements, adequacy of the internal control measures and reporting of matters to the Audit Committee in terms of the said clause, is also enclosed as a part of the report.

AUDITORS' REPORT- OBSERVATION OF THE AUDITORS IN THE ANNUAL ACCOUNT

The observations of the Auditors in the Auditors' report on the accounts of the Company together with the Notes to Accounts are self-explanatory and, therefore, do not call for any further explanation, in the opinion of Directors.

COST AUDITORS' REPORT-

The observations of the Cost Auditors in the their report are self-explanatory and, therefore, do not call for any further explanation, in the opinion of Directors.

INSURANCE:

All the insurable interests of your Company including buildings, plant and machinery and liabilities under legislative enactments are adequately insured.

CEO CERTIFICATION:

Managing Director and Manager Finance & Accounts have certified to the Board that:

1. We have reviewed financial statements and the cash flow statement for the year and that to the best of our knowledge and belief:

(a) These statements do not contain any

materially untrue statement or omit any material fact contain statements that might be misleading.

(b) These statements together present a true and fair view of the Company's affairs and are in compliance with existing accounting standards, applicable laws and regulations.

2. There are, to the best of our knowledge and belief, no transaction entered into by the Company during the year, which are fraudulent, illegal or volatile of the company's code of conduct.

3. We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of the internal control systems of the Company pertaining to the financial reporting and we have disclosed to the auditors and the Audit Committee, deficiencies in design or operation of internal controls, if any, of which they are aware and the steps they have taken or propose to take rectify these deficiencies.

4. We have brought in notice to the auditors and the Audit Committee all the material transaction, which have substantial effect on the financial health of the company

ACKNOWLEDGEMENT:

Your Directors wishes to place their deep appreciation of the devoted services of the loyal workers, executives and other staff of the Company who have contributed in every possible measure towards the performance and the Company's inherent strength. The Directors are also thankful to the Bankers State Bank of Bikaner & Jaipur and Shareholders' appreciation of the managements' efforts at the General Meetings of the Company which helps to strive for better performance year after year.

Place: Bhiwadi Date: 31.07.2012

For and on behalf of the BoardFor Ashiana Ispat Limited

Sd/-(Sukhbir Singh Jain)

Chairman

Sd/- (Mr. Naresh Chand)Managing Director


8

28680846

13660342

15020504

130757578

174

661

Nil

Nil

Nil

8636.415

58328690

7960.00

70.210

2039070

57.305

27994551

11959475

16035076

140832338

174

660

Nil

Nil

Nil

6486.255

54603897

7319.855

0.000

0.000

13.970

AS AT 31.03.2011

INFORMATION ON ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTFLOW

ANNEXURE-'i'

A

1

a.

B

I

II

2

3

POWER AND FUEL CONSUMPTION

ELECTRICITY

Purchase unit (KWH)

CTD Section

INGOT section

Total Amount (inj)

Consumption (unit/MT)

CTD Section

INGOT Section

Own Generation

Through Diesel Generation

Through Steam turbine

Coal

Purchased (Unit-MT)

Total amount (in `)

Consumption (Unit-MT)

Furnace Oil

Purchased (Unit-KL)

Total amount (in `)

Consumption (Unit-KL)

AS AT 31.03.2012

B Research & Development:

Continuous efforts are being made on research and development to minimize the consumption of power and fuel. However the expenditure on research and development is not substantial. C Foreign Exchange earnings/ outflow 2012 2011 i. Total Foreign Exchange earned Nil Nil ii. Total foreign Exchange utilized Nil Nil


9

CORPORATE GOVERNANCE

1. Company's philosophy on code of corporate governance:

Corporate Governance emphasizes the principal of self- governance. It is about promoting corporate fairness, transparency and accountability. Corporate Governance at Ashiana has been a continuous journey and the business goals are aimed at towards the overall integrity and welfare of all the constituents of the organization. Your Company believes that the true essence of Corporate Governance lies in not merely drafting a code of Corporate Governance but in actual practicing it. Your Company has put in place systems of good corporate governance, as recommended by SEBI and confirms the compliance of Corporate Governance as contained in clause 49 of the Listing Agreement, the details of which are given below:

2. Board of Directors:

The Directors of the Company are appointed by the shareholders at the Annual General Meetings. As per the provisions of Section 256 and 257 of the Companies Act, 1956 and that of

rdthe Articles of Association, 2/3 of the total Directors of the Company are liable to be retire by rdrotation and 1/3 of such Directors as are liable to be retire by rotation shall offer themselves for

re- appointment, if eligible,

(i) The Company has a balance mix of Executive and Non- Executive Directors. Composition and Category of Directors as of March 31, 2012 is as follows:

Board of Directors

The Board of Directors consists of 9 Directors.

Composition and category of Director is as follows:

Executive Directors: Shri Naresh Chand

Shri Neeraj Kumar Jain

Shri Puneet Jain

Shri Sanjay Kumar Jain

Non Executive Director-Chairman Shri S.S. Jain

Non-executive and Independent Directors Shri Ram Kumar Garg

Shri Rajender Prashad Bansal

Shri T. C. Kansal

Shri Rajesh Kumar Pal

(ii) Composition, Attendance at the Board Meetings and the last Annual General Meeting, Outside Directorships and other Board Committees:

No. of membership/Chairmanship in

Committees

1

0

0

0

0

0

3

3

2

Director

1. Mr. Naresh Chand

2. Mr. Neeraj Kumar Jain

3. Mr. Puneet Jain

4. Mr. Sanjay Kumar Jain

5. Mr. Sukhbir Singh Jain

6. Mr. Ram Kumar Garg

7. Mr. T. C. Kansal

8. Mr. Rajender Prashad Bansal

9. Mr. Rajesh Kumar Pal

No. of Board meetings attended

7

7

7

6

1

7

6

6

7

Attendance at previous AGM on 30.09.2011

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

No. of outside Director-

ship held

4

7

5

3

3

0

2

1

0

Executive/Non-executive/ Independent

Executive

Executive

Executive

Executive

Non-executive

Non-executive and independent





10

3. Number of Board meetings held and the date on which held

Seven Board meeting were held during the year. The dates on which the meetings were held are as follows; 14.05.2011, 16.07.2011, 10.08.2011 12.08.2011, 05.09.2011, 12.11.2011, 09.02.2012

4. Audit Committee:

The Audit committee comprises of Mr. T.C. Kansal , Mr. R.P. Bansal and Mr. Rajesh Kumar Pal all being non- executive and independent Directors. Shri Md. Harun Rashid Ansari, Company Secretary acts as the Secretary to the audit committee. The composition, role, functions and power of the audit committee are in tune with the requirements of applicable laws and regulations and guidelines issued/to be issued by the Regulatory Authorities.

The broad terms of appointment of audit committee are as follows :

ØTo review the financial statements before final submission to the Board and to ensure that financial statements are true, correct and reliable ;

Øchanges, if any, in significant accounting policies and reasons for the same ;

ØCompliance with listing and other legal requirement w.r.t financial statements ;

ØDisclosures of related party transactions ;

ØQualifications, if any, in the draft audit report.

ØTo check the internal control system and to review the weaknesses therein as reported by Internal auditor.

Ø To review the appointment, re-appointment, and if required, removal and replacement and remuneration of Internal and Statutory auditors.

ØOther powers as prescribed by Clause 49 of the listing agreement.

During the year, the committee has met Four times. Attendance of each member at the committee meeting were as follows:

SI. No. Name of the Members Status No. of Meeting attended

1. Mr. T.C. Kansal Chairman & Independent Director 4

2. Mr. R.P. Bansal Independent Director 4

3. Mr. Rajesh Kumar Pal Independent Director 4

5. Remuneration Committee:

Remuneration committee consists of Non-executive Independent Directors viz. Sh. T. C Kansal, Sh. R. P. Bansal and Sri Rajesh Kumar Pal. The committee recommends/ reviews the remuneration package of the Managing Director/ Whole-time Director(s) in accordance with the existing industry practice and also with the provisions of the Companies Act, 1956.

Details of remuneration paid to Managing Director/ Whole time –Director are as follows:

Sh. Naresh Chand Managing Director ` 1,25,000/- p.m

Sh. Neeraj Kumar Jain Whole-time Director ` 1,20,000/- p.m

Sh. Puneet Jain Whole-time Director ` 1,20,000/- p.m

Sh. Sanjay Kumar Jain Whole-time Director ` 1,20,000/- p.m


11

Remuneration paid to non-executive directors:

No remuneration is paid to Non-executive Directors except sitting fees for attending the meeting of Board of Directors and committee thereof

6. Code of Conduct for the Board members & Senior Management Team:

Pursuance to the provisions of Clause 49 of the Listing agreement, the board has laid down a Code of Conduct for all Board Members and senior management Team. The Code implies that Board of Directors effectively fulfils its fiduciary obligations towards the stakeholders and that the Board shall act on the principles of honesty, integrity, transparency and impartiality for effectively discharging their duty of protection of interests of all stakeholders.

All Board members and senior management team have affirmed compliance of code of conduct as on 31.03.2012 and a declaration to that effect signed by Chairman & Managing Director is attached and forms part of this report.

7. Shareholders grievances committee:

Shareholders grievances committee is headed by Sh. Naresh Chand, Managing Director of the Company as chairman and comprises two other Directors Sh. T.C. Kansal and Sh. R.P. Bansal as members. Shri Md. Harun Rashid Ansari, Company secretary has been designated as compliance officer. The committee observes and reviews the shareholders grievances and ensures to provide prompt and satisfactory services to the shareholders. The committee generally met four times in a year in each quarter.

As per the latest guidelines M/s. Link Intime India Private Limited ( old name- M/s. Intime ndSpectrum Registry Limited), A-40,2 Floor, Naraina Industrial Area, Phase-II, Near Batra

Banquet Hall, New Delhi-110028, Ph-011-41410592-94, has been working as common share transfer agent for all the work related to both physical and electronic mode of equity shares.

8. General Body Meetings:

Location and time for last three Annual General meeting:

Year Location Date Day Time

` 2008-09 A-1116, Phase-III, RIICO Industrial Area, 30.09.2009 Wednesday 11.30 A.M

Bhiwadi-301019, Dist- Alwar-Rajasthan.

2009-10 A-1116, Phase-III, RIICO Industrial Area, 30.09.2010 Thursday 11.30 A.M


2010-11 A-1116, Phase-III, RIICO Industrial Area, 30.09.2011 Friday 11.30 A.M


No resolution was required to be put through postal ballot.

9. Disclosures

The related party transactions have been disclosed in Notes of Account forming part of the stStatement of Accounts for the financial year ended 31 March, 2012 and since the necessary

disclosures were made in respect of the said transactions to the respective Boards of Directors, no transaction is considered to be in potential conflict with the interests of the company at large.

The Non-Executive Directors had no pecuniary relationships or transactions vis-à-vis the


12

company during the year except receipt of sitting fee for attending the meetings of the Board/Committee.

There has not been any non-compliance, penalties or strictures imposed on the company by the Stock Exchange (s), Securities and Exchange Board of India or any other statutory authority, on any matter relating to the capital markets, during the last three years.

The Company has duly complied with all the mandatory clauses of the Listing Agreement.

10. Means of communication

The Company adheres to the practice of giving timely information on financial performance and other relevant information to the stakeholders and to all Stock Exchanges where the shares of the Company are listed.

The quarterly, Half-yearly and Annual Results are generally published by the Company in all national daily i.e. The Times of India, Nav Bharat Times ( Hindi Edition), Business Standard (All India Edition) and others local news papers. They are also sent to the Stock Exchanges immediately after they are approved by the Board.

The quarterly financial results during the financial year 2011-12 were published as follows :

Quarter Date of publication Name of Newspapers

I 13.08.2011 Business Standard, Navbharat Times, Times of India

II 13.11.2011 Business Standard, Navbharat Times, Times of India

III 10.02.2012 Business Standard, Navbharat Times, Times of India

IV 17.05.2012 Business Standard, Navbharat Times, Times of India

Official news releases and notices etc. are sent to the Stock Exchange at Mumbai where shares of the company are listed.

Annual Report containing Audited Annual Accounts, Director's Report, Auditor's Report and Management Discussion and Analysis Report is circulated amongst the shareholders of the Company.

Managing Director’s speech also forms the part of the Annual Report.

11. General shareholders information:

(a) Annual General Meeting:thDate and time: 29 September 2012 at 11.30 A.M.

A-1116, Phase-III, RIICO Industrial Area, Bhiwadi-301019, Dist- Alwar-Rajasthan.

(b) Financial Calendar (tentative and subject to change)

Annual General Meeting : 29.09.2012

Results for the quarter ending 30.06.2012 : On or before August, 2012

Results for the quarter ending 30.09.2012 : On or before November, 2012

Results for the quarter ending 31.12.2012 : On or before February, 2013

Results for the quarter ending 31.03.2013 : On or before June , 2013

(c) Book Closure Date : 23.09.2012 to 29.09.2012

(d) Listing of Equity Shares : Mumbai (BSE)

Phiroze Jeejebhoy Towers, Dalal

Street, Mumbai-400 001


13

The Company has paid the Annual Listing fees for the Financial Year 2011-12 and

2012-13.

(e) Stock Market Data : Bombay Stock Exchange (BSE

BSE Quote : (ASHISH) -513401

Month High Price Low Price

F.Y. – 2011-2012

Apr 11 17.95 14.11

May 11 16.70 15.50

Jun 11 18.00 12.75

Jul 11 16.70 15.50

Aug 11 16.25 14.75

Sep 11 16.70 13.40

Oct 11 15.95 12.65

Nov 11 14.60 12.17

Dec 11 13.67 12.00

Jan 12 14.98 12.04

Feb 12 14.75 12.71

Mar 12 13.65 11.73

(f) Status of dematerialization as on 31.03.2012

Particulars No. of shares % of of capital

NSDL 840857 18.83

CDSL 651608 14.60

Total Dematerialized 1492465 33.43

PHYSICAL 2972335 66.57

TOTAL 4464800 100

(g) Registrar & Share Transfer Agent and : Link Intime India Private Ltd.ndCommunication regarding all kinds of A-40,2 Floor, Naraina Industrial Area,

Share related matters Phase-II, Near Batra Banquet Hall,

New Delhi-110028, Ph-011-41410592-94

Share Transfer System :

The Board has delegated all powers relating to transfer of shares to the Share Transfer committee, who will approve the relevant transfers and the same will be forwarded to the Registrar & Share Transfer Agent.The decisions of the Share Transfer committee will be considered in the Board Meeting.


14

(h) Shareholding pattern as on 31.03.2012

Sl. No. Category No. of shares Percentage

1 Promoters 1592500 35.67

2 Indian Financial Institutions, Banks, Mutual Funds 0 0

3 Foreign Institutional Investors/ NRIs 0 0

4 Others 2872300 64.33

Total 4464800 100.00

(i) Distribution on shareholding as on 31.03.2012

Shares holding No. of % of No. of Equity % ofof nominal value Shareholders shareholders sharess hareholdingof ` Up to 2500 10519 92.940 1413889 31.6672501-5000 438 3.870 176873 3.9615001-10000 200 1.767 168615 3.77710001-20000 79 0.698 127783 2.86220001-30000 16 0.141 40271 0.90230001-40000 13 0.115 45767 1.02540001-50000 15 0.133 70012 1.56850001-100000 6 0.053 41095 0.921100001 & above 32 0.283 2380495 53.317Total 11318 100 4464800 100.00

The above report was adopted by the Board of Directors at their meeting held on 31.07.2012.

Declaration regarding compliance of code of conduct:

I, Naresh Chand, Managing director of Ashiana Ispat Limited hereby declare that all Board Members and Senior Management Team have affirmed compliance of the code of conduct during the financial year ended 31.03.2012.

Sd/-Place: Bhiwadi. (Naresh Chand)Date: 31.07.2012 Managing Director


15

AUDITORS CERTIFICATE ON COMPLIANCE WITH THE CONDITIONS OF CORPORATE GOVERNANCE UNDER CLAUSE 49 OF THE LISTING AGREEMENTS:

To the Members of ASHIANA ISPAT LIMITED

We have reviewed the implementation of Corporate Governance by ASHIANA ISPAT LIMITED (the company) during the year ended 31.03.2012, with the relevant records and documents maintained by the company, furnished to us for our review and the report on Corporate Governance as approved by the Board of Directors.

The compliance of conditions on Corporate Governance is the responsibility of the Management. Our examination was limited to review of procedures and implementation thereof, adopted by the company for ensuring the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the company.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the company.

On the basis of our review and according to the information and explanations provided to us, the conditions of corporate Governance as stipulated in clause 49 of the Listing Agreement(s) with the Stock Exchange have been complied with in all material respect by the Company.

For S.Singal & CompanyChartered Accountants

Sd/-Place: Bhiwadi (Rakesh Gupta)Date:31.07.2012 Partner


16

MANAGEMENT DISCUSSION AND ANALYSIS[A] FINANCIAL REVIEW

OVERVIEWYour Company registered a healthy performance during 2011-12 with a 5.27% growth in revenues to ` 30055.08 lacs, 20.00% increase in EBIDTA to ` 1041.12 lacs, 1.52% increase in PBT to ̀ 353.13 lacs and 2.32% rise in PAT to ̀ 238.11 lacs. Your Company's performance was driven primarily due to established network of dealer and distributor, better quality & realization value of the products and having prominent market share. The Company's Financial Management under the visionary leadership of Mr. Naresh Chand, Managing Director, has held it in good stead over the years and has given it the unbeatable reputation of being a reliable and trustworthy organization.

[B] INDUSTRIAL OUTLOOKThere is no doubt that India will strive to achieve the status of a global economic and i n d u s t r i a l power by 2020.Crude steel production grew at the rate of 8.2% per annum from 50 .817 million tonnes in 2 0 0 6 -07 to 78.001 million tonnes in 2010-11. Production of finished steel grew at an annual rate of growth of 5.8% from 52.53 million tonnes in 2006-07 to 66.01 million tonnes in 2010-11.For this, India will necessarily need to reach a per capita steel consumption of at least 100 kg , i f not more, by 2020. Further, the uncertain global economic environment continues to pose serious challenges to the sustained growth of Indian economy.The 12th Plan envisages massive investments to the tune of 1 trillion dollars in the infrastructure sector which augurs well for expansion of the base of steel consumption in the economy. On a rough estimate, it may lead to a demand of approximately 40 million tonnes per annum during 2012-13 to 2016-17.The trend towards higher rates of urbanization will lead to increase in intensity of steel as per capita consumption of steel of urban India is many times more than in rural India. It is estimated that India's urban population will increase to 600 million by 2030 from the current level of 400 million. The rising middle class population of India will generate additional demand for automobiles, white goods and other consumer non-durables leading to higher per capita steel consumption. Steel Industry is poised for a period of high growth and there is a distinct possibility of doubling of the capacity in less than ten year. A big challenge before the Indian Steel Industry is to sustain growth, avoid obsolescence of existing facilities and improve the newly adopted technologies.

[C] OPPORTUNITY, THREATS, RISK & CONCERN Opportunities exist for future growth of the sector due to reasons that include potentially huge domestic demand for steel-intensive social and economic infrastructure resulting from all round economic development and particularly because of anticipated growth in urbanization; demographic conditions that favour Increasing demand for consumer durables; untapped rural market and increasing interest of domestic and overseas producers in capacity creation to serve the domestic and overseas markets.While the demand for steel will continue to grow in traditional sectors such as infrastructure, construction, housing automotive, steel tubes and pipes, consumer durables, packaging, and


17

ground transportation, specialized steel will be increasingly used in hi-tech engineering industries such as power generation, petrochemicals, and fertilizers, among others. The new airports and railway metro projects will require a large amount of stainless steel.The Indian steel sector enjoys advantages of domestic availability of raw materials and cheap labour. Iron ore is also available in abundant quantities. This provides major cost advantage to the domestic steel.Despite of opportunity there are some hurdle like Power shortage, low labour productivity and high energy consumption levels, heavy dependence on imported technology, low priority for Research & Development initiatives and diversification Labor productivity is low that needs to be shorted to improve the global market share.Iron ore poses the first challenge as the situation isn't very healthy. Fast exploration is required with the host of new techniques.

[D] OUTLOOKContinuing our preview of the decade to 2020, if India is going to reach and sustain GDP growth of 10% p.a it will need to rapidly develop infrastructure. Your company being a developing company is ideally positioned to seize the emerging opportunities and is committed of doing its best efforts to emerge as a dominant player in the domestic steel market. However, as highlighted in the 12th plan Approach Paper, given the strong fundamentals the economy is very well placed to achieve a growth rate of 9% over the next five years.The domestic growth prospects for the industry therefore remain positive. Thus India's steel production will need to expand rapidly. Your company has drawn a ambitious roadmap for the coming years ,whereby the major objective of the Company will be to become a leader in the domestic steel segment by increasing the market share and having a sharp focus on growth segments.Except for some short term fluctuations due to global disturbances, the medium to long term prospects of steel Industry appears very bright.

[E] CONTROL SYSTEM & THEIR ADEQUACYThe Company has a proper and adequate system of internal control procedures, commensurate with its size and nature of business, to achieve the following business objectives :(i) protection of all assets and resources against loss from unauthorized use or disposition, (ii) that transactions are authorized, recorded and reported correctly.

The internal control system provides for well- documented policies, guidelines, authorizations and approval procedures.

[F] INDUSTRIAL RELATIONS AND HUMAN RESOURCE DEVELOPMENTThe industrial relations have been cordial and satisfactory. The company feels that its employees feel valued and endeavours to create such working environment whereby each one would be able to deliver his best performance for attaining the objectives of the company. We recognise the importance of Human resources and give full respect for its development and are committed in attaining a professional culture by a blend of technology and highly skilled manpower.

[G] CAUTIONARY STATEMENTFacts and figure in the Management's Discussion and Analysis describe the company's views over iron and steel sector, projection and estimates may be “forward looking prediction” based on the national/ international prediction about the prospect of the iron and steel industry. Actual results could differ materially from those expressed or implied, depending on the economic environment, government policies and other incidents.


18

S.Singhal & Co.Chartered Accountants

Plot No. E-127, Industrial AreaBhiwadi –301019, District – Alwar (Raj.)

AUDITORS' REPORTTO THE MEMBERS OFASHIANA ISPAT LIMITED

stWe have audited the annexed Balance Sheet of M/s ASHIANA ISPAT LTD as at 31 March 2012, the Statement of Profit and Loss and the Cash Flow Statement for the year ended on that date annexed thereto. These Financial Statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these Financial Statements based on our audit.1. We have 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 test basis evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used in significant estimates made by management, as well as evaluating the over all financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

2. As required by Companies (Auditor's Report) Amendment Order 2004 issued by the Central Government of India in terms of Section 227 (4A) of the Companies Act, 1956. We enclose in the annexure a statement on the matters Specified in paragraphs 4 & 5 of the said Order.

3. Further to put our comments in the annexure referred to in paragraph 2 above we state that :-(a) We have obtained all the information and explanation, which to the best of our knowledge and belief

were necessary for the purpose of our audit;(b) In our opinion proper books of accounts as required by law have been kept by the Company so far as

appears from our examination of those books;(c) The Balance Sheet, Statement of Profit & Loss and Cash Flow Statement dealt with by this report are in

agreement with the books of accounts;(d) In our opinion the Balance Sheet, Statement of Profit & Loss and Cash Flow Statement dealt with by

this report comply with the Accounting Standards wherever applicable referred to in sub section (3C) of Section 211 of the Companies Act, 1956;

st(e) On the basis of written representation received from the Directors as on 31 March, 2012 and taken on strecord by the Board of Directors, we report that none of the Directors is disqualified as on 31 March,

2012 from being appointed as a Director in terms of Section 274(1)(g) of the Companies Act, 1956;(f) We report that in our opinion and to the best of our information and according to the explanation given to

us the said accounts read together with the Significant Accounting Policies and notes thereon give the information required by the Companies Act, 1956 in the manner so required and give a true & fair view in conformity with the accounting principles generally accepted in India:

st(i) In the case of the Balance Sheet, of the State of Affairs of the Company as at 31 March, 2012;st(ii) In the case of the Statement of Profit & Loss, of the Profit for the year ended on 31 March, 2012

andst(iii) In the case of the Cash Flow Statement, of the Cash Flows for the year ended on 31 March, 2012.

Place: Bhiwadi For S.Singhal & Co.stDate: 31 July 2012 Chartered Accountants

(RegistrationNo.-001526C)(R.K. Gupta)

PartnerMembership No. 073846


19

Annexure to Auditors' ReportReferred to in paragraph 2 of our report of even date of M/s Ashiana Ispat Ltd.1. (a) The Company has maintained records of Fixed Assets in statement form only.

(b) All the fixed assets have been physically verified by the management at reasonable intervals. We are informed that the management on such verification noticed no material discrepancies.

(c) During the year the company has disposed off/discarded old vehicles and old rolling mill rolls which do not affect the going concern status of the company.

2. (a) Physical verification of Inventory has been conducted during the year by the management at reasonable intervals.

(b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

(c) The Company is maintaining proper records of Inventory. As explained to us there were no material discrepancies noticed on physical verification.

3. (a) The Company has taken Loans from Twenty Six Parties covered in the register maintained under section 301 of the Companies Act 1956. The amount involved in loans taken & credited in all accounts is 660.21 Lacs. Opening Balance and Closing Balance of all these

accounts are 1054.29 Lacs and 1256.79 Lacs respectively. The company has not granted loans to Companies, Firm or other parties listed in the register maintained under section 301 of the Companies act, 1956.

(b) The rate of interest and other terms and conditions of loans taken by the company are not prima facie prejudicial to the interest of the Company.

(c) The Company has unconditional right on repayment of Long Term Unsecured Loans and interest and the short term unsecured loans are repayable on demand.

(d) There is no overdue amount in respect of loans taken by the Company.4. In our opinion and according to information and explanation given to us there are adequate

internal control procedures commensurate with the size of the Company and the nature of its business, for the purchase of inventory, fixed assets and for the sale of goods. During the course of audit, we have not observed any major weakness in internal controls.

5. (a) In our opinion and according to the information and explanation given to us the transactions that need to be entered into a register in pursuance of section 301 of the Companies Act 1956 have been so entered.

(b) Transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. The Company has not accepted deposits from the public within the meaning of section 58A and 58AA of the Companies Act, 1956 and the rules framed there under.

7. The Company did not have any formal internal audit system. However internal check and control are maintained by the management.

8. We have broadly reviewed the cost records maintained by the company pursuant to the Companies (Cost Accounting Records) Rules,2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act ,1956 and are of the opinion that Prima facie the prescribed cost records are maintained in general for the product of the Company. We have however not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

9. In respect of statutory dues:a) According to the records of the Company, undisputed statutory dues including Provident

Fund, Employee's State Insurance, Income Tax, Sales tax, Wealth tax, Service Tax, Customs Duty, Excise Duty, Cess and other statutory dues have been generally regularly deposited with the appropriate authorities except delay in few cases. According to the information and explanations given to us, no undisputed amounts payable in respect of the

`` `


20

staforesaid dues were outstanding as at 31 March, 2012 for a period of more than six months from the date of becoming payable.

` b) The disputed statutory dues aggregating to 890.18 Lacs their against 454.33 Lacs has been deposited under protest that have on account of matters pending before appropriate authorities are as under:

10. The Company has no accumulated losses. The Company has not incurred cash losses during the financial year covered by our audit and immediately preceding financial year.

11. Based on our audit procedures and according to the information and explanation given to us, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks

12. In our opinion and according to the information and explanation given to us, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a Chit Fund or a Nidhi/Mutual benefits fund/society. Therefore, clause 4(xiii) of the Companies (Auditor's Report) Amendment Order 2004 is not applicable to the Company.

14. The Company has not carried out of any transactions of trading in securities during the year. 15. The Company has not given guarantees for loans taken by others from banks or financial institutions.16. No Term Loans have been taken during the year by the Company.17. According to the information and explanations given and on an overall examination of the Balance Sheet of

the Company, we are of the opinion that no funds raised on short-term basis have been utilized for long-term investment.

18. During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act, 1956.

19. The Company has not issued any debentures. Hence the question of creating securities in respect of debentures issued does not arise.

20. The Company has not raised any money by way of public issue during the year.21. In our opinion and according to the information and explanations given to us, no fraud on or by the Company

has been noticed or reported during the year, that causes the financial statements to the materially misstated.

For S. Singhal & Co.Chartered Accountants

(R.K. Gupta)PartnerMembership No. 073846

PLACE: BHIWADIstDATE: 31 July 2012

` `

Sr.

No.

1

2

3

4

5

6

Name of the Statute

Central Excise Act, 1944

Central Excise Act, 1944

Finance Act 1994

Haryana VAT Act

Rajasthan VAT Act

Income Tax Act, 1961

Period to which

the amount relates

FY 2001-02

FY 2006-07

FY 08-09

FY 03-04,

04-05, 06-07,

FY 04-05,

FY 05-06

AY 03-04 to

AY 2009-10

Forum where the

dispute is pending

High Court Jaipur

CESTAT Delhi

CESTAT, Delhi

Appeal with Joint

Commissioner, Faridabad

Tax Board, Ajmer

ITAT, Jaipur

Amount.

(In Lacs)

1.02

2.15

38.55

15.46

47.45

785.55

`

`

`

`

`

`


21

BALANCE SHEET AS AT 31ST MARCH, 2012

Particulars Note As at 31.03.2012 As at 31.03.2011` `

I. EQUITY AND LIABILITIES(1) Shareholder's Funds(a) Share Capital 1 42,611,500 42,220,500 (b) Reserves and Surplus 2 141,090,732 118,254,683 (2) Non-Current Liabilities(a) Long-Term Borrowings 3 105,894,422 85,421,750(b) Deferred Tax Liabilities (Net) 4 11,816,771 12,187,724 (c) Other Long Term Liabilities 5 570,770 648,770 (d) Long Term Provisions 6 598,456 540,287 (3) Current Liabilities(a) Short-Term Borrowings 7 306,519,549 231,623,978 (b) Trade Payables 8 217,369,550 236,308,093 (c) Other Current Liabilities 9 117,677,815 77,051,063 (d) Short-Term Provisions 10 22,103,678 18,498,202

Total Equity & Liabilities 966,253,243 822,755,050 II.ASSETS(1) Non-Current Assets(a) Fixed Assets 11(i) Gross Block 196,004,734 223,073,127 (ii) Depreciation 83,261,949 99,234,057 (iii) Net Block 112,742,785 123,839,070 (b) Non-current investments 12 22,602,250 13,825,000 (c) Long term loans and advances 13 15,393,842 13,768,824 (d) Other non-current assets 14 47,276,410 19,493,315 (2) Current Assets(a) Inventories 15 134,555,340 219,443,083 (b)Trade receivables 16 428,995,926 365,699,785 (c) Cash and cash equivalents 17 16,463,670 6,809,398 (d) Short-term loans and advances 18 113,589,695 36,930,625 (e) Other current assets 19 74,633,325 22,945,950

Total Assets 966,253,243 822,755,050 Significant Accounting PoliciesNotes on Financial Statements 1 to 36

As per Our Report of even dateFOR S. SINGHAL & CO.CHARTERED ACCOUNTANTS

(R.K. GUPTA) (Naresh Chand) (Neeraj Kumar Jain)Partner Managing Director Whole Time Director Membership No. : 073846Firm Reg. No.: 001526C

Place:- Bhiwadi (Puneet Jain) (Harun Rashid Ansari)Date:- 31st July 2012 Whole time Director Company Secretary


22

STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31ST MARCH 2012

Particulars Note As at 31.03.2012 As at 31.03.2011` `

INCOMEGross Revenue from operations 20 3,005,508,250 2,855,126,614 Less Excise Duty 268,849,609 262,365,993 Net Revenue from operations 2,736,658,641 2,592,760,621 Other Income 21 1,767,280 898,543 Total Revenue 2,738,425,921 2,593,659,164EXPENDITURE:Cost of materials consumed 22 2,171,141,390 2,155,456,660 Purchase of Stock-in-Trade 143,498,727 29,964,797 Changes in inventories of finished goods, work-in-progress and Stock-in-Trade 23 (25,935,768) (4,333,103)Employee Benefit Expense 24 21,508,648 19,390,377Finance Costs 25 57,805,965 39,978,016Depreciation 14,469,285 13,358,280 Other Expenses 26 320,624,943 305,058,996Total Expenses 2,703,113,190 2,558,874,023Profit before Tax 35,312,731 34,785,141 Tax expense:(1) Current tax 11,873,108 12,124,939 (2) Deferred tax (370953) (610414.00)Profit for the year 23,810,575 23,270,616 Earning per equity share of face value of Rs 10 each:(1) Basic 5.59 5.51Significant Accounting PoliciesNotes on Financial Statements 1 to 36





23

Notes on Financial Statement for the year ended 31st MARCH, 2012

Note 1 : Share Capital ` `

Sr. No Particulars As at 31.03.2012 As at 31.03.2011

1.1 AUTHORIZED CAPITAL50,00,000 Equity Shares of ` 10/- each. 50,000,000 50,000,000

50,000,000 50,000,000 1.2 ISSUED

44,64,800 Equity shares of ` 10/- each fully paid 44,648,000 44,648,000 44,648,000 44,648,000

1.3 SUBSCRIBED & PAID UP CAPITAL44,64,800 Equity shares of ` 10/- each 44,648,000 44,648,000 Less: Calls in Arrear - from others 2,036,500 2,427,500 Total 42,611,500 42,220,500

1.4 The Details of Shareholders holding more than 5% shares:As at 31.03.2012 As at 31.03.2011

Name of shareholders No. of Shares % held No. of Shares % held

Puneet Jain 224600 5.03 224600 5.03Kamdhenu Steel & Alloys Ltd 223835 5.01 220273 4.93

1.5 The Reconciliation of the number of shares outstanding is set out below:Particulars As at 31.03.2012 As at 31.03.2011

No. of Shares No. of SharesEquity Shares at the beginning of the year 4464800 4464800 Addition during the year NIL NILEquity Shares at the end of the year 4464800 4464800

Note 2 : Reserve & Surplus1 Surplus (Profit & Loss Account)

Balance brought forward from previous year 118,254,683 95,242,373 Add: Profit for the period 23,810,575 23,270,616 Less: Income tax of earlier years 974,526 258,306 Total 141,090,732 118,254,683

Note 3 : Long Term Borrowings

1 Secured Borrowings- 5,134,493 Term Loan From SBBJ Bank

From State Bank of Bikaner & Jaipur , Delhi @ 12% p.a. secured by (i) first exclusive charge by way of equitable mortgage of Factory Land & Building at A-1116,A-1119/H-21-25and A-1117, Phase-III, RIICO Indl. Area, Bhiwadi (Raj.) (ii) First charge on the entire Fixed Assets of the Company. Additionally secured by the followings:- a) Extension of first hypothecation charges on the company's entire current assets, including raw material, store and spares, stock in process, finished goods, Book Debts and other current assets etc. b) Personal Guarrantee of two promoters directors


24

` ` Sr. No Particulars As at 31.03.2012 As at 31.03.2011

2 Vehicle Loans Secured againstHypothecation of Vehicles:Tata Capital Ltd. Car Loan 51,437 668,458 BMW Financial Services Pvt. Ltd. 2,136,853 4,481,636 Kotak Mahindra Prime Ltd. - 2,263,596 HDFC Bank Car Loan 184,891 887,563

3 Unsecured Loan from Related Parties 103,521,241 71,986,004 Total 105,894,422 85,421,750

Note 4 : Deferred Tax liabilities(net)

Deferred Tax LiabilitiesOn Diff. in WDV as per IT Act and as per Companies Act 12,014,927 12,367,191Deferred Tax Assets on:-Gratuity(Unfunded) 198,156 179,467 Net Deferred Tax Liabilities 11,816,771 12,187,724

Note 5 : Other Long Term Liabilities

1 Sundry Creditors -Capital goods 570,770 648,770 Total 570,770 648,770

Note 6 : Long Term Provisions

1 Gratuity Payable(Unfunded) 598,456 540,287 Total 598,456 540,287

Note 7 : Short Term Borrowings

a Secured Loan from BankWorking Capital Loan 284,290,047 195,680,246 From State Bank of Bikaner & Jaipur , Delhi secured by first charge on the entire current assets of the company, including raw material, store & spares, stock in process, finished goods, book-debts and other current assets etc. Additionally secured by the followings :- a) Extension of first exclusive charge on Company' s Factory Land and Building at A-1116 &-A-1119/H-21,22 to 24 & 25, Phase III, Bhiwadi, Alwar, Rajasthan (Pertaining to furnace unit).b) Extension of First Charge on Company's entire fixed assets other than land & building covered in (a) and (c) c) Extension of first charge by way of equitable mortgage of machinery installed at A-1117, Phase-III, RIICO Industrial Area, Bhiwadi, Alwar, Rajasthan for TMT Section.


25


b Unsecured LoansFrom Related Parties 22,158,037 33,443,732 From Others 71,465 2,500,000 Total 306,519,549 231,623,978

Note 8 : Trade Payables

1 Sundry Creditors 217,369,550 236,308,093 Total 217,369,550 236,308,093

Note 9 : Other Current Liabilities

1 Current Maturities of Vehicle Term Loans secured against the Vehicles: Tata Capital Ltd. Car Loan 617,020 616,604 BMW Financial Services Pvt. Ltd. 2,344,784 2,126,954 Kotak Mahindra Prime Ltd. 1,290,835 3,171,489 HDFC Bank Car Loan 702,672 647,168

2 Current Maturities of Long term debt (term loan) - 5,118,835 3 Statutory Dues Payable

Excise and Service Tax payable 40,471 66,672 TDS Payable 2,265,805 4,081,551 Vat Payable 17,095,317 5,950,024

4 Employee Benefits PayableSalary Payable 609,075 780,221 Bonus & Ex-Gratia Payable 405,165 322,230 ESI Payable 40,555 42,613 PF Payable 154,640 112,659

5 Advance from customers 86,171,647 42,599,558 6 Expenses Payable 342,352 11,414,485 7 Cheque in Reconciliation 5597477 -

Total 117,677,815 77,051,063

Note 10 : Short Term Provisions

1 Wealth Tax Provision 149,099 155,755 2 Provision of Excise Duty on Closing Stock 6,207,706 2,972,1803 Income Tax Provision 11,873,108 12,124,939 4 Gratuity Payable 12,288 -5 Telephone Expenses payable 87,67 88,261 6 Power Expenses payable 3,444,493 2,854,1827 Audit Fee Payable 129,050 129,0508 ISI Expenses Payable 162,713 165,0509 Professional Charges Payable 37,550` 8,785

Total 22,103,678` 18,498,202


26

NOTE-11

2012

`

`

``

``

``

Intan

gible

Asse

ts Un

der D

evelo

pmen

t


27


Note 12 : Non Current Investment

1 Investment in Equity Instrument 25,000 25,000 Other Investment, Unquoted

a Investment in 2,500 Fully Paid Up Shares of Kamdhenu Imprade Pvt Ltd @ `10/- Per Share

b Shares of Krish Homes Pvt. Ltd. 172500 equity share of ` 10 each 13800000 13800000@ premium of ` 70 per share.

c Shares of Ashiana Manufacturing India Ltd., Investment in 585150 Equity shares 8,777,250 - of ` 10 each @ ` 5 Premium Per share, to the extent of 19.99 % Of the total issued share capital of that company.Total 22,602,250 13,825,000

Note 13 : Long Term Loans and Advances

1 Security DepositUnsecured, Considered Good : 15,393,842 13,768,824 Total 15,393,842 13,768,824

Note 14 : Other Non Current Assets

Others Unsecured, considered good - -1 Cash seized with Income Tax Department 300,000 300,0002 Advances for Capital goods 100,000 100,000 3 Income Tax Deposit against Demand 40,032,361 12,249,266 4 Service Tax Refund filed with Department 3,855,348 3,855,348 5 Vat Recoverable under protest 2,988,701 2,988,701

Total 47,276,410 19,493,315

Note 15 : Inventories

1 Raw Material 68,995,305 176,058,7692 Work-in-Progress 1,762,592 1,268,357 3 Finished Goods 51,672,316 27,046,022 4 Stock of Traded Goods 588,422 - 5 Stores & Spares 5,400,339 3,660,965 6 Waste and Scrap & Runner Riser 1,264,633 1,218,5407 Miscellaneous Scrap (Scrapped Rolls and consumables) 517,523 336,800 8 Others (Furnace Oil, Ferro Alloys, Coal) 4,354,211 9,853,630

Total 134,555,340 219,443,083


28


Note 16 : Trade Recievables

1 Outstanding for more than six monthsUnsecured, Considered Good : 85,792,246 65,360,505

2 Others (less than six months)Unsecured, Considered Good : 343,203,680 300,339,280 Total 428,995,926 365,699,785

Note 17 : Cash & Cash Equivalent

1 Cash on HandCash Balance 8,953,728 6,409,398

2 Bank BalanceIn Current Accounts 4,129,539 400,000 Fixed Deposits with Bank 3,380,403 - Total 16,463,670 6,809,398

Note 18 : Short Terms Loans and Advances

1 Advance Recoverable in cash or in kind or for value to be considered good-Related parties 63,115,597 9,630,284 - Others 38,039,482 7,078,021

2 Balance with Excise & Service Tax Department 2,697,061 12,211,732 3 Advance Income Tax and TDS/TCS 8,877,834 7,432,963 4 FBT Refundable 46,151 46,151 5 Prepaid Expenses 813,570 531,474

Total 113,589,695 36,930,625

Note 19 : Other Current Assets

1 Balance with Sales Tax Department - 1,305,527 2 Advance to Suppliers` 73,786,472 20,921,834 3 Interest Receivable on JVVNL Security 784,118 718,589 4 Insurance Premium Refundable 62,735 -

Total 74,633,325 22,945,950

Note 20 : Revenue from Operations

1 Gross Sale of Products 2,994,637,241 2,840,985,878 2 Other Operating Revenue :`

Power Subsidy 9,260,076 14,140,736Commission on Consignment Sale 1,610,933 -Gross Revenue 3,005,508,250 ,855,126,614 Less Excise Duty 268,849,609 262,365,993 Net Revenue from operation 2,736,658,641 2,592,760,621


29


Note 21 : Other Income

1 Interest Income 1,181,769 898,543 2 Sundry Balances written off 585,511 -

Total 1,767,280 898,543

Note 22 : Cost of Material Consumed

1 Opening Stock Raw Material-M.S Scrap and Sponge 16,732,619 20,854,304 Raw Material-M.S Ingots 159,326,150 160,865,126

2 Add: -PURCHASES Raw Material-M.S Scrap and Sponge 523,288,206 380,098,087 Raw Material-M.S Ingots 1,540,789,720 1,769,697,912

3 Less:- Closing StockRaw Material-M.S Scrap and Sponge 23,336,361 16,732,619 Raw Material- M.S Ingots 45,658,944 159,326,149 Raw Material consumed 2,171,141,390 2,155,456,661

Note 23 : Change in Inventories

1 Opening Stock of Finished Goods and Stock in Trade 27,046,022 22,282,029 Opening Stock of Runner Riser and W &S, Scrapped rolls & consumables 1,555,340 2,109,663 Opening Stock of Stock in Process 1,268,357 1,144,924 Total 29,869,719 25,536,616

2 Closing Stock of Finished Goods and Stock in Trade 52,260,738 27,046,022 Closing Stock of Runner Riser and W & S, scrapped rolls & consumables 1,782,156 1,555,340 Closing Stock of Stock in Process 1,762,592 1,268,357 Total 55,805,486 29,869,719Total (25,935,768) (4,333,103)

Note 24 : Employee Benefit Expense

1 Salaries and Wages 5,263,929 4,412,8342 House Rent Allowance 1,167,646 1,198,275 3 Labour Charges Contractor 2,894,298 2,022,1204 Conveyance Allowance 406,636 405,3675 Contribution to PF 480,366 374,5366 Contribution to ESI 202,230 171,630 7 Directors Remuneration 5,820,000 5,820,000 8 Staff Welfare Expenses 11,455 8,185 9 Gratuity 70,457 91,884 10 Bonus and Ex-Gratia 405,165 322,230 11 Other Labour Charges (including HRA) 4,786,466 4,563,316

Total 21,508,648 19,390,377


30


Defined Contribution PlanAs per Accounting Standard 15 "Employee Benefits" the disclosures as defined in the Accounting Standard are given below:-Contribution to Defined Contribution Plans, recognised as expenses for the year is as under:Employers Contribution to Provident fund 423,535 330,228 Employers Contribution to ESI 202,230 171,630 Defined Benefit PlanThe Present Value of obligation of Gratuity is determined based on actuarial valuation.Reconciliation of opening and closing balances of Defined Benefit obligation

Gratuity Gratuity Defined Benefit obligation at the beginning of the year 540,287 460,403 Interest cost 47,275 37,879 Current Service Cost 126,451 126,453 Benefits Paid - - Actuarial Gain/loss (103269) (84448)Defined Benefit obligation at the end of the year 610,744 540,287 Funded StatusPresent Value of the obligation at the end of the year 610,744 540,287 Fair Value of plan assets at end of the year - - Net Liability (asset) recognised in Balance Sheet and 610,744 540,287 Related analysisFunded Status (610744) (540287)Expenses Recognised during the year Interest cost 47,275 37,879 Current Service Cost 126,451 126,453 Expented Return on plan assets - - Actuarial Gain/loss (103269) (84448)Expenses recognised in the profit and loss account 70,457 79,884 Actuarial Assumptions Discount Rate (in %) 8.75 8.25 Salary Growth rate (in %) 5.00 5.00 Mortality LIC 1994-96- Ultimate 1994-96- Ultimate Expected rate of return -withdrawal rate (in %) per annum 2 2 The estimates of rate of excalation in salary considered in actuarial valuation, take into accountinflation, seniority, promotion and other relevant factors.The above information is cetified by the actuary.


31


Note 25 : Finance Cost

1 Interest Expenses 54,330,081 38,618,547 2 Other Borrowing Costs 3,351,191 1,268,3563 Bank & other Financial Charges 124,693 91,113

Total 57,805,965 39,978,016

Note 26 : Other Expenses

1 Manufacturing Expenses:Consumption of Stores and spares 23,141,090 19,474,487 Power and Fuel 215,503,455 199,019,067 Insurance Plant and Machinery 505,771 34,1087Repair to Plant and Machinery 1,039,230 1,762,459 Increase in Provision of Excise Duty on Closing Stock of finished goods 3,235,525 661,047

2 Other Administrative Expenses:Auditors Remuneration:Statutory Audit Fee 70,000 70,000 Tax Audit 30,000 30,000 Taxation matter 30,000 30,000 Insurance Others 1,471,735 933,511 Repair others 152,164 346,976 Rent 2,242,392 1,837,828 Miscellaneous Expenses 426,268 552,315 Donation 1,725,400 853,800 Vehicle Running Expenses 1,070,674 1,195,436 Loss on Sale of Vehicle 1,259,848 2,954,340 Legal & Professional Charges 291,170 290,314 Printing and Stationery Expenses 233,762 213,624 Telephone Expenses 970,127 1,026,631 Provision for Wealth Tax 149,099 155,755 Rates, Fee & Taxes 613,121 834,919

3 Selling and Distribution Expenses:Brokerage and Commission on Sale 10,551,090 13,759,464 Service Tax on outward freight 473,755 507,751 Freight outward and loading unloading charges 27,433,865 28,871,506 Sales promotion expenses 4,736,044 3,881,283 Advertisement expenses 23,216,075 25,052,900 Rebate and Discounts 53,283 402,496 Total 320,624,943 305,058,996

Note 27 : Earning per shares (EPS)

Net Profit after tax as per P & L statement 23,810,575 23,270,616Weighted average number of equity shares used 4261078 4221971as denominator for calculating EPSEPS (`) -Basic and Diluted 5.59 5.51Face Value per equity share in ` 10 10


32

Note 28 : Related Party disclosures as per Accounting Standard - 18 are as Follow :

(a) Related Parties and their relationships(i) Related Companies and Other Juristic Entities

M/s Kamdhenu Steels & Alloys Ltd. M/s Ashiana Fincap P LtdAshiana Commodities & Derivatives P LtdM/s I Dreams Impex Pvt. Ltd.M/s Ashiana Manufacturing India Ltd.M/s Saurabh GasesChandi Prasad Sukhbir Singh Jain (HUF)Naresh Chand (HUF)Puneet Jain (HUF)V.K.Jain & Sons (HUF) Neeraj Kumar Jain HUFSanjay Kumar Jain HUF

(ii) Key Managerial PersonnelNaresh Chand (Managing Director)Neeraj Kumar Jain (Whole Time Director)Sanjay Kumar Jain (Whole Time Director)Puneet Jain (Whole Time Director)Sukhbir Singh Jain (Director)

(iii) Relatives of Key Managerial PersonnelDisha JainDivya JainKiran Mala JainKritika JainNaman JainRenu JainSudha JainSwati JainTripti AgarwalUma JainVandana JainNote : Related party relationship is as identified by the Company and relied upon the Auditors.

(b) Transactions with related parties In `Nature of Transactions 2011-12 2010-11 Interest on Loans 18123440 15046313Unsecured Loans 125679278 105429736Remunerations 5,820,000 5820000Rent 600000 360000Purchases 21875873 0Sale 73331148 0Commission received 1610933 0

Note : Details of remuneration to key managerial personnel are give below Name of Person 2011-12 2010-11 Naresh Chand 1500000 1500000Neeraj Kumar Jain 1440000 1440000Sanjay Kumar Jain 1440000 1440000Puneet Jain 1440000 1440000


33

Note 29 :Segment Reporting

The Company is manufacturing TMT Bars and Ingots, but M.S. Ingots is used as raw material of TMT Bars I.e. captively consumed, as both the product are inter related cover in single segment of Iron & Steel. Hence, Accounting Standard -17 "Segment Reporting" issued by ICAI is not applicable on the Company.

Note 30 : Provisions for Deferred Tax

Deferred Tax Assets & Liabilities in accordance with the AS-22 : “Accounting for Taxes on Income" issued by the Council of ICAI. The major component of deferred tax assets and deferred tax liabilities as at 31st March 2012 subject to the consideration of prudency of timing differences are shown in note no 4.

Note 31:The Company has not received information from vendors regarding their status under the micro, small and medium enterprises development Act,2006 and hence disclosures relating to amounts unpaid as at the year end together with interest paid/payable under this Act, have not been given.

Note 32: Contingent Liabilities : Claims against the company / disputed demands not acknowledged as debts.

Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past event and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes as given below:-

` ` Particulars As at 31.03.2012 As at 31.03.2011

Sales Tax 6,290,807 6,290,807Income Tax 78,554,876 78,554,876Excise Duty 317,000 102,000Service Tax 3,855,348 3,855,348

Note 33 : Value of imported and indigenous Raw materials, Spares and components consumed and the percentage of each the total consumption :

in `Particulars 2011-12 2010-11

Amount Percentage Amount PercentageRaw Material - Imported 0.00 0.00% 0.00 0.00%Raw Material - Indigenous 2171141390 100.00% 2155456661 100.00%Spares & Consumables - Imported 0.00 0.00% 0.00 0.00%Spares & Consumables- Indigenous 23141090 100.00% 19474487 100.00%

2011-12 2010-11Note 34 : CIF Value of Import are as under :- NIL NIL

2011-12 2010-11Note 35 : Expenditure incurred in Foreign Currency NIL NIL

Note 36 : Financial figures are rounded off to nearest rupees and figures have been regrouped/ rearranged/ reclassified whereever necessary.


34




Year ended31.3.2011

34,785,141

13,358,28039,978,016

2,954,34091,075,777

(64,864,481)(4,829,576)(4,759,307)16,622,413(7,408,158)

9,214,255(258,306)8,955,949

(28,423,428)7,547,736

-(20,875,692)

(39,978,016)-

44,938,9144,960,898

(6,958,845)13,768,243

6,809,398

6,409,398

Particulars

CASH FLOW FROM OPERATING ACTIVITIESNet Profit before TaxAdjustments For :-DepreciationInterest PaidLoss on Sale of VehicleOperating Profit Before Working Capital ChangesIncrease ( Decrease ) in working CapitalTrade & Other ReceivablesInventoriesTrade Payables & Other LiabilitiesCash from OperationIncome Tax-PaidCash Flow Before Extraordinary ItemsIncome Tax Paid for earlier yearNet Cash From Operating Activities

CASH FLOW FROM INVESTING ACTIVITIESPurchase Of Fixed AssetsSale of Fixed AssetsPurchase of InvestmentCash Used in Investing Activities

CASH FLOW FROM FINANCING ACTIVITIESInterest PaidIncrease in share capital (Calls in arrear)Proceeds From Long/ Short Term BorrowingsCash Used/ Generated in Financing Activities

Net Increase/ (Decrease) In Cash and Cash EquivalentsCash and Cash Equivalents (Opening Balances)Cash and Cash Equivalents (Closing Balances)

Balance Sheet AmountCash in HandBalance with Banks:-Current Accounts-Fixed DepositsTotal

Year ended31.3.2012

35,312,731

14,469,28557,805,965

1,259,848108,847,829

(212,172,866)84,887,74313,400,746(5,036,549)(8,877,834)

(13,914,383)(974,526)

(14,888,909)

(10,002,848)5,370,000

(8,777,250)(13,410,098)

(53,805,965)391,000

95,368,24337,953,278

9,654,2726,809,398

16,463,670

8,953,728

400,000-

6,809,398

4,129,5393,380,403

16,463,670

[ A ]

[ B ]

[C]

Note to cash flow statement:

( Amount in ` )

Sl.No.

CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2012

Cash Flow Statement has been prepared as per AS-3 issued by the ICAI.Figures in Bracket represents outflows.Previous year figure have been regrouped/reclassified wherever applicableCash and Cash Equivalents included in the cash flow statement

comprise the following:

(i)(ii)(iii)(iv)




35

Significant Accounting policies1 Basis of Accounting

The financial statements are prepared under historical cost convention on a going concern basis in accordance with the applicable accounting standards issued by the Institute of Chartered Accountants of India and relevant provisions of the Companies Act, 1956

2 Use of EstimatesThe Preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and reported amount of revenues and expenses during the reporting period.

3 System of AccountingThe Company adopts the accrual basis in the preparation of accounts

4 Fixed Asset(a) Fixed Asset are stated at cost less accumulated depreciation. The cost of assets comprises of

purchase price and directly attributable cost of bringing the assets to working condition for its intended use including borrowing cost.

(b) Expenditure on renovation/ modernization relating to existing fixed assets is added to the cost of such assets where it increases its performance / life significantly.

5 InvestmentInvestment are carried at cost. Profit or loss, if any would be accounted for on actual realization.

6 Inventories Valuation(a ) Raw Material , Stock in- Process and stores and spares and Traded Goods are valued at cost.(b ) Waste and Scrap & Runner / Risers are valued at realizable value including the excise duty in value. (c ) Finished Goods are valued at cost or market price whichever is less including the excise duty in

value.7 Depreciation

(a) Cost of Lease Hold Land is not amortized since Lease is for a Long Period.(b) Deprecation on fixed assets is provided on straight line method on prorata & actual shift working basis

in accordance with the rates and in the manner specified in Schedule XIV of the Companies Act, 1956.8 Sale / Revenue Recognition

(a) Sales are net of Sales tax and sales returns. Revenue from sales is recognized when risk and reward of ownership are transferred to the customers.

(b) Interest income is recognized on time proportion basis.(c) RIPS Subsidy received is on actual realisation basis.

9 Impairment of AssetsThere are no indication of overall impairment in assets hence the need to make an estimation of re-coverable amount does not arise.

10 Provisions for Current and Deferred TaxProvision for current tax is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961Provision made for deffered tax is recognized subject to the consideration of prudency, timing difference, being the difference between the taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent years.Deferred tax assets are recognized only if there is reasonable certainty that they will be realized and are reviewed for the appropriateness of their respective carrying values at each Balance Sheet date.




36

AUDITOR'S CERTIFICATE

The above Cash Flow Statement has been compiled from and is based on the audited accounts of

ASHIANA ISPAT LIMITED for the year ended 31st March, 2012 reported upon by us on 31st July

2012. According to the informations and explanations given, the aforesaid Cash Flow Statement

has been prepared in accordance with Clause 32 of the Listing Agreement and reallocations required for

the purpose are as made by the Company.

For S. Singhal & Co.

Chartered Accountants

( R. K. Gupta )

Partner

M.S. No. 073846

Place : Bhiwadi

Date : 31.07.2012


37

ASHIANA ISPAT LIMITEDRegd Office : A-1116, Phase-III, RIICO Industrial Area, Bhiwadi-301 019, Distt. Alwar (Rajasthan)

ASHIANA ISPAT LIMITEDRegd Office : A-1116, Phase-III, RIICO Industrial Area, Bhiwadi-301 019, Distt. Alwar (Rajasthan)

FORM OF PROXY

I/We........................................................................of...................................................................................inthe district of...............................................................................................being a member/members of theASHIANA ISPAT LIMITED, hereby appoint Mr/Mrs/Miss..............................................................................of..............................................................in the drstrict of...............................................................................or failing him/her Mr/Mrs/Miss......................................................................of................................................in the district of ......................................................................as my/our Proxy to vote for me/us on my/our

thbehalf at the 20th Annual Geneal Meeting of the Company to be held on Saturday, the 29 day ofSeptember, 2012 at 11.30 A.M. or at any adjournment thereof.

Signed this................................................day of.....................................2012

Srgnature.......................... Folio No..............................................DP ID .................................................Client ID.............................................

Note : If a member is unable to attend the meeting, he/she may fill this form and send it to the Registered Office of the Company so as to reach atleast 48 hours before the time for holding the meeting./

ATTENDANCE SLIP

Please complete this Attendance Slip and hand it over at the Entrance of the Hall. Only Members or their Proxies are entitled to be present at the meeting.

Name and Address of the Member Folio No.

Client ID No.

DP ID No.

No. of Shares Held

I hereby record my presence at the 20th Annual General Meeting of the Compant at the Registered Office of the Company, on

Signature of the Shareholder

thSaturday, the 29 day of September, 2012 at 11.30 A.M.

Signature of the Proxy

Note : 1. The copy of Annual Report may please be brought to the Meeting Hall. 2. Briefcase, Hand Bags etc. are not allowed inside the Meeting Hall. 3. Please note that no gifts will be distributed at the meeting.

Regd. Office & Works: A-RIICO Industrial Area, Phase-III

Bhiwadi301019 Distt. Alwar (Rajasthan)Phone : 01493-220777-78

Fax: 01493-220598www.ashianaispat.in

1116

ASHIANA ISPAT LIMITED

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