DRAFT LETTER OF OFFER

Dated: October 30, 2010

SHREE RAM URBAN INFRASTRUCTURE LIMITED

(Company Registration No.: 002241 of 1934/1935; CIN – L17110MH1935PLC002241)

(Our Company was incorporated as Shree Ram Mills Limited under the Indian Companies Act, 1913 on January 25, 1935 in
Mumbai. Subsequently the name of our Company was changed to “Shree Ram Urban Infrastructure Limited” on March 20, 2007 as
per the Indian Companies Act, 1956. For details of the change in our name, see “History and Corporate Structure of the Company”
on page 35 of this Draft Letter of Offer.)

Registered Office: Shree Ram Mills Premises, Ganpatrao Kadam Marg, Lower Parel, Mumbai – 400 013.
Tel. No.: +91 22 61404900; Fax No.: +91 22 24928617
Contact Person: Ms. Manju B. Batham, Company Secretary & Compliance Officer; Email: [email protected]

FOR PRIVATE CIRCULATION TO THE EQUITY SHAREHOLDERS OF THE COMPANY ONLY

DRAFT LETTER OF OFFER

ISSUE OF [●] EQUITY SHARES HAVING FACE VALUE OF RS. 10 EACH FOR CASH AT A PREMIUM OF RS. [●] PER
EQUITY SHARE FOR AN AMOUNT AGGREGATING UPTO RS. 7500.00 LACS ON A RIGHTS BASIS TO THE EXISTING
EQUITY SHAREHOLDERS OF SHREE RAM URBAN INFRASTRUCTURE LIMITED (“COMPANY”) IN THE RATIO OF [●]
EQUITY SHARES FOR EVERY [●] EQUITY SHARE HELD BY THE EXISTING EQUITY SHAREHOLDERS ON THE RECORD
DATE, THAT IS ON [●]. THE ISSUE PRICE FOR EQUITY SHARES IS [●] TIMES OF THE FACE VALUE OF THE EQUITY
SHARE. FOR FURTHER DETAILS, PLEASE SEE THE SECTION TITLED “TERMS OF THE ISSUE” ON PAGE 149 OF THIS
DRAFT LETTER OF OFFER.

GENERAL RISKS
Investment in equity and equity related securities involve a degree of risk and investors should not invest any funds in this Issue
unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before
taking an investment decision in this Issue. For taking an investment decision, investors must rely on their own examination of the
Issuer and the Issue including the risks involved. The securities have not been recommended or approved by the Securities and
Exchange Board of India (SEBI) nor does SEBI guarantee the accuracy or adequacy of this document.
Specific attention of investors is invited to the statement of „Risk factors‟ under the section titled “Risk Factors” on page
viii of this Draft Letter of Offer before making an investment in this Issue.

ISSUER‟S ABSOLUTE RESPONSIBILITY

The issuer, having made all reasonable inquiries, accepts responsibility for and confirms that this Issue document contains all
information with regard to the issuer and the issue which is material in the context of the issue, that the information contained in the
Issue document is true and correct in all material aspects and is not misleading in any material respect, that the opinions and
intentions expressed herein are honestly held and that there are no other facts, the omission of which make this document as a
whole or any of such information or the expression of any such opinions or intentions misleading in any material respect.

LISTING
The Company’s existing Equity Shares are listed on the Bombay Stock Exchange Limited, Mumbai (BSE Limited). The Equity
Shares to be issued through this Issue would also be listed on the Bombay Stock Exchange Limited. The in-principle approval has
been obtained from BSE Limited vide their Letter No. [●] dated [●].

LEAD MANAGER TO THE ISSUE REGISTRAR TO THE ISSUE

ARYAMAN FINANCIAL SERVICES LTD. BIGSHARE SERVICES PVT. LTD.

60, Ground Floor, Khatau Building, E/2, Ansa Industrial Estate,

Alkesh Dinesh Modi Marg, Saki-Vihar Road, Sakinaka,
Fort, Mumbai – 400 001. Andheri (E), Mumbai - 400 072.
Tel: 91 – 22 – 2261 8264 / 2261 8635; Tel: 91 – 22 – 4043 0200
Fax: 91 – 22 – 2263 0434 Fax: 91 – 22 – 2847 5207
Website: www.afsl.co.in Website: www.bigshareonline.com
Email: [email protected] Email: [email protected]
SEBI Registration No: INM000011344 SEBI Registration No: INR000001385
Contact Person: Mr. Rajan Vora Contact Person: Mr. Ashok Shetty
ISSUE PROGRAMME
ISSUE OPENS LAST DATE FOR RECEIVING REQUEST FOR SPLIT APPLICATION ISSUE CLOSES
ON FORMS ON
[●] [●] [●]
 TABLE OF CONTENTS

PARTICULARS PAGE
SECTION I: GENERAL
Definitions & Abbreviations ……………………………………………………………................ i
Notice to Overseas Shareholders ………………………………….......................................... v
Presentation of Financial Information & Use of Market Data …………................................. vi
Forward Looking Statements……………………………………………………....................... vii
SECTION II: RISK FACTORS viii
SECTION III: INTRODUCTION
Summary of Our Business ………………………………………………………………………. 1
Issue Details in Brief …………………………………………………………………….............. 3
Summary of Financial Information ……………………..………………………….................... 4
General Information ………………………………………………………………...................... 8
Capital Structure …………………..……………………………………………………………… 13
SECTION IV: PARTICULARS OF THE ISSUE
Objects of the Issue …………………………………………………………….......................... 17
Statement of Tax Benefits ………………………………………………………….................... 22
Key Industrial Regulations & Policies ………………………………………………………..…. 29
SECTION V: ABOUT THE ISSUER COMPANY
History & Corporate Structure of the Company …………………………................................ 35
Our Management …………………………………………………………………....................... 42
SECTION VI: FINANCIAL INFORMATION
Limited Review Report ………………………………………………………………………….... 49
Auditors Report ………………………………………………………………………………..…... 57
Accounting Ratios & Capitalization Statement ………………………...…………………..….. 112
Certain other Financial Information ………………………………………................................ 113
Stock Market Data for Equity Shares of the Company …………………………………...…… 114
SECTION VII: LEGAL AND OTHER INFORMATION
Outstanding Litigations & Material Developments...……………………………………..…….. 115
Government & Other Key Approvals …………………………………………………….……… 140
Other Regulatory and Statutory Disclosures ………………………………………………..….. 144
SECTION VIII: OFFERING INFORMATION
Terms of the Issue …………………………………………………………………..…………….. 149
Issue Procedure …………………………………………………………………………..……….. 152
SECTION IX: OTHER INFORMATION
Material Contracts & Documents for Inspection ……………………………………….………. 173
Declaration ………………………………………………………………………………….……… 174
 SECTION I: GENERAL
DEFINATIONS & ABBREVIATIONS

In this Draft Letter of Offer, the terms ―we‖, ―us‖, ―our‖, ―the Issuer‖, ―the Company‖, ―our Company‖ or
―SRUIL‖, unless the context otherwise implies, refers to Shree Ram Urban Infrastructure Limited on a
standalone basis. All references to ―Rupees‖, ―Rs.‖ refer to Indian Rupees, the official currency of
Republic of India; references to the singular also refers to the plural and one gender also refers to any
other gender, wherever applicable, and the words ―Lacs‖ or ―Lakhs‖ mean ―100 thousand‖ and the
word ―10 Lacs‖ means ―1 million‖ and the word ―crore‖ means ―10 million‖ or ―100 Lacs‖ and the word
―100 crores‖ means ―1,000 million‖ or ―billion‖. Any discrepancies in any table between the total and
the sums of the amounts listed are due to rounding off.

Conventional / General Terms

Term / Abbreviation Description

A/c Account
AAIFR Appellate Authority for Industrial and Financial Reconstruction
Act / Companies Act Companies Act, 1956 and amendments made from time to time
AGM Annual General Meeting
Accounting Standards issued by the Institute of Chartered Accountants
AS
of India
AY Assessment Year
BIFR Board for Industrial and Financial Reconstruction
BSE Bombay Stock Exchange Limited
CAGR Compounded Annual Growth Rate
CDSL Central Depository Services (India) Limited
CLB Company Law Board
DIN Director Identification Number
Depositories NSDL and CDSL
Depositories Act The Depositories Act, 1996 as amended from time to time
DP A Depository Participant as defined under the Depositories Act, 1996
EBITDA Earnings Before Interest, Tax, Depreciation and Amortization
EGM Extraordinary General Meeting
EPS Earnings Per Share
FCNR Account Foreign Currency Non Resident Account
FDI Foreign Direct Investment
Foreign Exchange Management Act, 1999 read with rules and
FEMA
regulations there under and amendments thereto
FI Financial Institution
FII(s) Foreign Institutional Investors registered with SEBI under applicable laws
st
Financial Year / Fiscal / FY Period of twelve months ended 31 December of that particular year
GDP Gross Domestic Product
GIR No. General Index Registry Number
GOI Government of India
HNI High Net Worth Individual
HUF Hindu Undivided Family
IFRS International Financial Reporting Standards
Income Tax Act The Income Tax Act, 1961, as amended from time to time
IT Information Technology

i
IT Department Income Tax Department
Indian GAAP Generally Accepted Accounting Principles in India
IPO Initial Public Offering
Mn / mn Million
MoU Memorandum of Understanding
NA Not Applicable
NAV Net Asset Value
NPA Non Performing Assets
NR Non Resident
NRE Account Non Resident External Account
Non Resident Indian, is a person resident outside India, as defined under
NRI FEMA and the FEMA (Transfer or Issue of Security by a Person Resident
Outside India) Regulations, 2000
NRO Account Non Resident Ordinary Account
NSDL National Securities Depository Limited
p.a. Per Annum
PAN Permanent Account Number allotted under the Income Tax Act, 1961
PAT Profit after tax
PBDT Profit before Depreciation and Tax
PBIDT Profit before Interest Depreciation and tax
PBT Profit before tax
PIO Persons of Indian Origin
P/E Ratio Price Earnings Ratio
RBI The Reserve Bank of India
RoC Registrar of Companies
ROI Return on Investment
RONW Return on Net Worth
Rs / INR Indian Rupees
Securities Contracts (Regulations) Rules, 1957 as amended from time to
SCRR
time
The Securities and Exchange Board of India constituted under the SEBI
SEBI
Act, 1992
Securities and Exchange Board of India Act 1992, as amended from time
SEBI Act
to time
SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009
SEBI Regulations
as amended from time to time
Securities and Exchange Board of India (Substantial Acquisition of
SEBI Takeover
Shares and Takeovers) Regulations, 1997, as amended from time to
Regulations
time
Stamp Act The Indian Stamp Act, 1899
State Government The government of a state of India
Stock Exchange BSE
STT Securities Transaction Tax

ii
Issue Related Terms

Term / Abbreviation Description

The abridged letter of offer to be sent to our Equity Shareholders as on
Abridged Letter of Offer the Record Date with respect to this Issue in accordance with SEBI
(ICDR) Regulations, 2009.
Application Supported The application (whether physical or electronic) used by an Investor to
by Blocked Amount/ make an application authorizing the SCSB to block the amount payable
ASBA on application in their specified bank account.
An applicant who intends to apply through ASBA process and:
a. holds the shares of the Company in dematerialized form as on the
record date and has applied for entitlements and / or additional
ASBA Investor shares in dematerialized form;
b. has not renounced his/her entitlements in full or in part;
c. is not a renouncee;
d. is applying through a bank account maintained with SCSBs.
CAF Composite Application Form
Equity Shareholders of the Company whose names appear as Beneficial
Equity Shareholders owners as per the list furnished by depositories in respect of equity
shares held in electronic form and On the Register of Members in
respect of the equity shares held in physical form.
Lead Manager/LM Lead Manager to the issue. i.e. Aryaman Financial Services Limited
The issue of [●] equity shares of Rs.10/- each per Equity Share for cash
at Rs. [●] each on rights basis to the existing Equity Shareholders of the
Issue/Rights Issue Company in the ratio of [●] equity shares for every [●] equity shares held
on [●] (Record Date) aggregating upto Rs. 7500 Lacs as per this Draft
Letter of Offer
The price at which equity shares will be issued by the Company under
Issue Price
this Draft Letter of Offer
The Letter of Offer dated [●] circulated to the Equity Shareholders and
Letter of Offer/LOO/Offer filed with the Stock Exchange containing inter alia the issue price and
Document the number of equity shares to be issued and other incidental
information

Issuer Related Terms

Term / Abbreviation Description

Articles / Articles of
The Articles of Association of Shree Ram Urban Infrastructure Limited
Association / AoA
The Statutory Auditors of our Company, M/s. Habib & Co., Chartered
Auditors
Accountants & Khandelwal Jain & Co., Chartered Accountants.
Board / Board of Directors The Board of Directors of Shree Ram Urban Infrastructure Limited
Director(s) The Director(s) on the Board of Shree Ram Urban Infrastructure Limited
Includes those companies, firms and ventures promoted by our
Group Companies
Promoters
KMP Key Managerial Personnel
The Memorandum of Association of Shree Ram Urban Infrastructure
Memorandum / MoA
Limited
Security(ies) Equity Share(s)
SE/Stock Exchange Bombay Stock Exchange Limited

iii
Industry Related Terms

Term / Abbreviation Description

Acres 1 Acre equals 43,560 Sq. Ft.
CC Commencement Certificate
BMC Brihanmumbai Municipal Corporation
Floor Space Index, which means the quotient of the ratio of the
FSI combined gross floor area of all floors, excepting areas specifically
exempted, to the total area of the plot
IOD Intimation of Disapproval
LOI Letter of Intent
MCGM Municipal Corporation of Greater Mumbai
MHADA Maharashtra Housing Area Development Authority
NA Order Non Agricultural Order
NOC No Objection Certificate
OC Occupation Certificate
RCC Reinforced Cement Concrete
The part of the Developable Area relating to our economic interest in
Saleable Area
each property
Sq. Ft. Square Feet
Sq. Mtrs. Square Meters
Transferable Development Rights, which means, when in certain
circumstances, the development potential of land may be separated from
TDR
the land itself and may be made available to the owner of the land in the
form of transferable development rights.

iv
 NOTICE TO OVERSEAS SHAREHOLDERS

The distribution of this Draft Letter of Offer and the Issue to persons in certain jurisdictions outside
India may be restricted by legal requirements prevailing in those jurisdictions. Persons into whose
possession this Draft Letter of Offer may come are required to inform themselves about and observe
such restrictions. Our Company will dispatch the Letter of Offer and CAFs to such shareholders who
have an Indian address.

This Draft Letter of Offer does not constitute and may not be used for in connection with an offer or
solicitation by anyone in any jurisdiction in which such offer or solicitation is not authorized or to any
person to whom it is unlawful to make such offer or solicitation. In particular, no action has been or will
be taken by our Company or the Lead Manager to permit an offering of Equity Shares or distribution
of this Draft Letter of Offer in any jurisdiction, other than India, where action for that purpose is
required. Accordingly, the Equity Shares may not be offered or sold, directly or indirectly, and neither
this Draft Letter of Offer nor any offering material in connection with the Equity Shares may be
distributed or published in or from any country or jurisdiction except under circumstances that will
result in compliance with any applicable rules and regulations of any such country or jurisdiction.
Persons receiving a copy of this Draft Letter of Offer should not distribute or send the same in any
jurisdiction where to do so would or may contravene local laws or regulations. If this Draft Letter of
Offer is received by any person in any such territory, or by their agent or nominee, they must not seek
to subscribe to the Equity Shares or the rights entitlements referred to in this Draft Letter of Offer.

The Rights Entitlement and the Equity Shares have not been and will not be registered under the
United States Securities Act of 1933, as amended, or any other securities laws of the United States of
America (―United States‖ or ―US‖) and may not be offered, sold, resold, or otherwise transferred within
the United States of America or the territories or possessions thereof, except in a transaction exempt
from the registration requirement of the United States Securities Act of 1933, as amended. The Rights
Entitlement referred to in this Draft Letter of Offer is being offered in India but not in the United States
of America. The offering to which this Draft Letter of Offer relates is not, and under no circumstances
is to be construed as, an offering of any shares or rights for sale in the United States, or as a
solicitation therein of an offer to buy any of the said shares or rights. Accordingly, this Draft Letter of
Offer should not be forwarded to or transmitted in or into the United States by any person other than
our Company at any time. None of our Company, the Lead Manager or any person acting on their
behalf will accept subscriptions from any person, or his agent, who appears to be, or who our
Company has reason to believe is, a resident of the United States and to whom an offer, if made,
would result in requiring registration of this Draft Letter of Offer with the United States Securities and
Exchange Commission. We are informed that there is no objection to a shareholder, resident of the
United States, selling Rights Entitlement in India.

v
 PRESENTATION OF FINANCIAL INFORMATION AND USE OF MARKET DATA

Unless stated otherwise, the financial data in this Draft Letter of Offer is derived from our audited
financial information which has been prepared in accordance with Indian GAAP, the Companies Act
and restated in accordance with SEBI (ICDR) Regulations, 2009, included on Page No. 57 of this
Draft Letter of Offer.
st st
Our fiscal year commences on 1 January of every year and ends on 31 December of that particular
year. In this Draft Letter of Offer, any discrepancies in any table between the total and the sums of the
amounts listed are due to rounding-off, and unless otherwise specified, all financial numbers in
parenthesis represent negative figures.

vi
 FORWARD LOOKING STATEMENTS

We have included statements in this Draft Letter of Offer which contains words or phrases such as
―will‖, ―aim‖, ―is likely to result‖, ―believe‖, ―expect‖, ―will continue‖, ―anticipate‖, ―estimate‖, ―intend‖,
―plan‖, ―seek to‖, ―future‖, ―objective‖, ―goal‖, ―project‖, ―should‖ and similar expressions or variations of
such expressions, that are ―forward looking statements‖.

All forward-looking statements are subject to risks, uncertainties and assumptions about us that could
cause actual results to differ materially from those contemplated by the relevant forward-looking
statement. Important factors that could cause actual results to differ materially from our expectations
include but are not limited to:

• General economic and business conditions in the markets in which we operate and in the local,
regional and national economies;
• Increasing competition in or other factors affecting the industry segments in which our Company
operates;
• Changes in laws and regulations relating to the industries in which we operate;
• Our ability to successfully implement our growth strategy and expansion plans, and to
successfully launch and implement various projects and business plans;
• Our ability to meet our capital expenditure requirements and/or increase in capital expenditure;
• Fluctuations in operating costs and impact on the financial results;
• Our ability to attract and retain qualified personnel;
• Changes in technology in future;
• Changes in political and social conditions in India or in countries that we may enter, the monetary
policies of India and other countries, inflation, deflation, unanticipated turbulence in interest rates,
equity prices or other rates or prices;
• Variations in exchange rates;
• The performance of the financial markets in India and globally;
• Any adverse outcome in the legal proceedings in which we are involved

For a further discussion of factors that could cause our actual results to differ, please refer to the
section titled ―Risk Factors‖ on page no. viii of this Draft Letter of Offer. By their nature, certain market
risk disclosures are only estimates and could be materially different from what actually occurs in the
future. As a result, actual future gains or losses could materially differ from those that have been
estimated. Neither the Company nor the Lead Manager nor any of their respective affiliates have any
obligation to update or otherwise revise any statements reflecting circumstances arising after the date
hereof or to reflect the occurrence of underlying events, even if the underlying assumptions do not
come to fruition. In accordance with SEBI / Stock Exchange requirements, the Company and Lead
Manager will ensure that investors in India are informed of material developments until the time of the
grant of listing and trading permission by the Stock Exchange.

vii
 SECTION II: RISK FACTORS
An investment in equity and equity related securities involves a high degree of risk and you should not
invest any funds in this Issue unless you can afford to take the risk of losing your investment. You
should carefully consider all of the information in this Draft Letter of Offer, including the risks and
uncertainties described below, before making an investment. If any of the following risks, or other
risks that are not currently known or are now deemed immaterial, actually occur, our business,
financial condition and results of operations could suffer, the trading price of the Securities could
decline and you may lose all or part of your investment. The financial and other implications or
material impact of risks concerned, wherever quantifiable, have been disclosed in the risk factors
mentioned below. However, there are some risk factors where the impact is not quantifiable and
hence has not been disclosed below. The ordering of the risk factors is intended to facilitate ease of
reading and reference and does not in any manner indicate the importance of one risk factor over
another.

This Draft Letter of Offer contains forward-looking statements that involve risks and uncertainties. The
Company’s actual results could differ materially from those anticipated in these forward-looking
statements as a result of certain factors, including the considerations described below and elsewhere
in this Draft Letter of Offer.

You are advised to read the following risk factors carefully before making an investment in the
Securities offered in this Issue. You must rely on your own examination of the Company and this
Issue, including the risks and uncertainties involved. The Equity Shares have not been recommended
or approved by SEBI nor does SEBI guarantee the accuracy or adequacy of this Draft Letter of Offer.

Materiality

The Risk factors have been determined on the basis of their materiality. The following factors have
been considered for determining the materiality.

• Some events may not be material individually but may be found material collectively.
• Some events may have material impact qualitatively instead of quantitatively.
• Some events may not be material at present but may be having material impact in future.

INTERNAL RISK FACTORS

1. We, and our Directors, are involved in certain legal and other proceedings that if
determined against us, or our Directors, could have a material adverse effect on our
financial condition and results of operations.

We, and our Directors, are currently involved in a number of legal and other proceedings in India.
These legal proceedings are pending at different levels of adjudication before various courts and
tribunals. If any new developments arise, for example a change in Indian law or rulings against us by
appellate courts or tribunals, we may face losses and may have to make provisions in our financial
statements, which could increase our expenses and our liabilities. Decisions in such proceedings
adverse to our interests may have a material adverse effect on us, our results of operations and
business prospects. A brief summary of the outstanding legal and other proceedings is provided
below:

Category Initiated By / Filed Against Amount Involved (Rs.)

A. Cases initiated against Our Company
1. Mr. R.K. Dhall & Others N.A.
Rs. 10,76,798 with interest on the
Civil 2. M/s. S. K. Trading Company sum of Rs. 3,37,995 at the rate of
Proceedings 24% p.a.
Rs.17,41,810 with interest on the
3. M/s. Dev Shah Corporation principal sum of Rs.5,94,597.99 at
the rate of 24% per annum.

viii
 4. Ganesh Laxman Khedekar N.A.
To quash and set aside the order
dated 21-12-2001 and Rs. 1,70,000
as rehabilitation money and
difference in compensation payable
5. Ashok D. Haldankar & Others
under 1995 VRS and 1993 VRS to
the Petitioners with interest at the rate
of 12% p.a. to each of the 503
Petitioners.
6. Prabhakar Anant Parab Rs.2,27,240 + 12% interest p.a.
7. Rashtriya Mill Mazdoor Sangh & Others N.A.
8. Rajaram Deepu Sonkar Rs. 1,70,000 + 12% interest p.a.
Rs.2500/- p.m. as subsistence
allowances from 1-06-2008 till 1-6-
Labour 9. Ganpatrao Gopala Mahangade
2011 and till the final disposal of W.
Matters
P. No 4513 of 1999.
Restore as permanent compounders
10. Shantaram Ganpat Labde & Others w.e.f Sept 1995. Full back wages
from 01.08.1996.
11. Chandrakant G Modi 50% back wages.
Small Causes
12. Shri. Amrish Rasiklal Shah N.A.
Court
13. M/s. Pranav Construction Systems Pvt.
Legal Notice NIL
Ltd.
14. Ministry of Corporate Affairs, Regional
NIL
Director, Western Region
15. Ministry of Corporate Affairs, Regional
Notice NIL
Director, Western Region
16. Ministry of Corporate Affairs, Regional
NIL
Director, Western Region
Show Cause 17. Assistance Commissioner of Customs
Rs. 6,98,500.00
Notice (import)
18. M/s. Kalpataru Constructions Overseas Rs. 1528.93 Crores along with
Arbitration Pvt. Ltd. interest.
Proceeding 19. M/s. Utility Premises Pvt. Ltd., Rs. 36.03 Crores
20. M/s. Cogent Ventures (India) Ltd., Rs. 26.00 Crores
Income Tax
21. Income Tax Officer N.A.
Matters
B. Cases initiated by Our Company
22. Rashtriya Mill Mazdoor NIL
Civil
Proceedings 23. The Court Receiver (Bombay High
NIL
Court)
24. Mr. Surendrakumar Ramprasad Shukla Rs.3040.00
25. Mr. Haji Noor Mohamed Gani Rs.3828.00
26. Mr. Rambilas Baijnath Gupta Rs.2880.00
27. Mr. Chhotalal Baijnath Gupta Rs.3993.00
Small Causes 28. Mr. Ramanuj Ramchandra Shukla Rs.3336.60
29. Mr. Sakharam Vithoo Rs.1438.40
30. Mr. Bankelal Baijnath Gupta Rs.2880.00
31. Mrs. Nirmala Ramesh Gundaria Rs.1755.40
32. Mr. Hiralal Joraji Porwal Jain Rs.5674.20

ix
 33. Mr. Arvind Chotalal Gupta Rs.3360.00
34. Mr. Bajirao Sampat Shewale Rs.3015.00
35. Commissioner of Customs (Imports),
Rs. 12,31,454.00
Mumbai
Customs & 36. Commissioner of Customs (Imports),
Excise Cases Rs. 17,04,954.00
Mumbai
37. Commissioner of Central Excise Rs. 3,39,250.00
38. Assessing Officer, Income Tax Rs. 10,60,944.00
Income Tax
39. Assessing Officer, Income Tax Rs. 87,618.00
Matters
40. Assessing Officer, Income Tax N.A.
Property Tax
41. Mumbai Municipal Corporation N.A.
Matters
C. Cases initiated against Our Directors
NIL
D. Cases initiated by Our Directors
Civil
42. The Collector, Mumbai City & Anr. NIL
Proceeding
E. Cases initiated against Subsidiaries
NIL
F. Cases initiated by Subsidiaries
NIL

For further details of these legal and other proceeding proceedings, please refer to the section titled
―Outstanding Litigation and Material Developments‖ on page 115 of this Draft Letter of Offer.

2. We have received a letter inquiring about various details regarding our Company and its
management from the Integrated Surveillance Department of SEBI under Section 11 of the
SEBI Act, 1992. The same has been replied to and no further correspondence has been
received from them.
nd
We have received a letter dated 2 September, 2010 from the Integrated Surveillance Department of
SEBI under section 11 of the SEBI Act, 1992, with regards to certain doubts raised by them based on
a compliant received from the ―Association of Minority Shareholders of Shree Ram Urban
Infrastructure Ltd.‖ with regards to various company matters. The same was supposed to be replied
th
within seven days. Pursuant to our letter dated 4 September, 2010 we sought extension to give our
st
reply and thereafter, on 21 September, 2010 we have filed our written submission stating that the
complaints mentioned by the ―Association of Minority Shareholders of Shree Ram Urban
Infrastructure Ltd.‖ are baseless and unfounded and have given detailed explanation to each such
query.

We have not yet received any further queries / letters since our reply to the said department till date.

3. Our Business Activities require various approvals, licenses, registrations, and

permissions from various government and other regulatory entities. Any delay in obtaining
or renewing or inability to obtain or renew the same could have a material adverse effect
on our financial results and business prospects.

Our current project – ―Palais Royale‖ at Mumbai, requires certain key approvals and/or documents
from various government entities at the Central and State Government levels. These include IOD,
Commencement Certificate, No Objection Certificate, Occupation Certificate, etc from various
authorities. Some of these approvals have been received but may be up for renewal soon, some are
applied for and are awaited and some others shall be applied for at a later stage as and when are
required. Also, our proposed projects which are in conceptualization stage currently shall require
various key approvals and registrations, once undertaken.

x
We cannot assure you that we will obtain these approvals, consents, permissions, etc. or enter into
these documents or enter into binding documentation on a timely basis, which means that all our
proposed projects are at risk of being delayed, derailed or not proceeding at all, any of which could
have a material adverse effect on our financial results and business prospects.

For further details regarding the current status of various Government and other key approvals see
―Government & other Key Approvals‖ on page 140 of this Draft Letter of Offer.

4. Our Company has in the past rescheduled its debt, been subject to rehabilitation schemes,
one time settlements and other such incidents. This track record, even though over six
years old, could hinder our future fund raising activities and hence adversely affect our
expansion plans and projections.

Our Company was declared a Sick Industrial Unit under the SICA (Sick Industrial Companies Act,
1985) in 1987, and thereafter has undergone restructuring as per the BIFR order in 1991 and the
AAIFR order in 1994. Some of these schemes included various one time settlements of dues to
Banks, Statutory Authorities and also various dues deferments to these institutions.

Even though the Company has been declared viable after all the restructuring schemes in 2004 and
the Company has a zero default and rescheduling track record since then, no assurances can be
given with respect to the fact that this track record will not affect our future fund raising activities and
our future plans and projections thereof.

For further details of our major financial restructuring activities please refer ―Major Events‖ in the
section titled ―History & Corporate Structure of the Company‖ on Page 35 of this Draft Letter of Offer.

5. Over 90% of the Company’s revenues come from the textile trading segment as opposed to
the Real Estate Development business, which is the segment for which the current issue is
proposed. We, and our Promoters, do not have any substantial experience or track record
in the real estate business and we may not be able to effectively manage and operate in
this new line of activity, and hence this may adversely affect our results of operations and
financial condition.

The Company has been in the business of textiles for more than 70 years. It was only in 2007, that
the Company entered into the business of residential real estate development and started its flagship
project ―Palais Royale‖ at Mumbai. Apart from this project, and a business service centre run at the
same premises, no other real estate development activity is currently operative or under development.
Since, this project is still under construction, no revenue is booked from the same till date, and hence
for the previous three fiscal years, none of the revenues have accrued from Real Estate activities
except for some minor income from the business service centre. The following table shows a segment
wise break-up of the revenues:

2007 2008 2009

Particulars Amount Amount Amount
(Rs. in % (Rs. in % (Rs. in %
Lacs) Lacs) Lacs)
Textile Trading 3428.19 89.34 3515.38 89.79 3705.72 93.27
Business Centre 409.02 10.66 399.78 10.21 267.59 6.73
Real Estate
- - - - - -
Development
Total 3837.22 100.00 3915.16 100.00 3973.32 100.00

The Company and its promoters have limited experience in the real estate development business.
Our short operating history means that we have not completed any projects till date. Hence we also
face the risk of not being able to effectively manage and operate in this new line of activity, which may
adversely affect our results of operations and financial condition.

xi
6. We anticipate that more than 25% of the Net Proceeds of the Offer will be deployed
towards general corporate purposes and we may not be able to make adequate
disclosures with regard to such utilisation.

We intend to utilize a portion of the Net Issue proceeds for general corporate purposes. We anticipate
that such monies which will be used for general corporate purposes will exceed 25% of the Net
Proceeds of the Issue. Further, our Board has not yet authorised any specific commitments or acts,
with respect to utilization of the portion of the Net Proceeds of the Issue which will be used for general
corporate purposes.

7. Rs. 253.89 lacs from the Rights Issue proceeds shall be utilised for the redemption of
preference shares held by the promoters and promoters group. Hence approximately 3% of
the issue proceeds shall be paid to promoters and promoters group.

There are 1,36,877 11% Redeemable Cumulative Preference Shares having face value of Rs. 100
each and 1,17,011 Zero Percent Redeemable Preference Shares having face value of Rs. 100 each
outstanding as on date.

Out of the above 1,28,416 11% Redeemable Cumulative Preference Shares and 1,10,779 Zero
Percent Redeemable Preference Shares are held by the promoters and promoter group entities.

The same shall be redeemed from the issue proceeds and hence approximately 3% of the issue
proceeds shall be paid to promoters and promoters group entities.

For further details regarding the date of issue and terms of these preference shares, please refer to
the section titled ―Objects of the Issue‖ on Page 17 of this Draft Letter of Offer.

8. Our business is heavily dependent on the performance of, and the prevailing conditions
affecting, the real estate market in the Mumbai Metropolitan Region.

Our real estate development activities are completely focused in the Mumbai Metropolitan Region. As
of today, our ongoing project and our complete land reserves are located in the Mumbai Metropolitan
Region. For details of our project and land reserves see section titled ―Summary of Our Business‖ on
page 1 of this Draft Letter of Offer. As a result, our business, financial condition and results of
operations have been and will continue to be heavily dependent on the performance of, and the
prevailing conditions affecting, the real estate market in the Mumbai Metropolitan Region. The real
estate market in the Mumbai Metropolitan Region may be affected by various factors outside our
control, including prevailing local and economic conditions, changes in the supply and demand for
properties comparable to those we develop, changes in the applicable governmental regulations,
economic conditions, demographic trends, employment and income levels and interest rates, among
other factors. These factors may contribute to fluctuations in real estate prices and the availability of
land in the Mumbai Metropolitan Region and may adversely affect our business, financial condition
and results of operations. These factors can also negatively affect the demand for and valuation of our
ongoing project at Lower Parel, Mumbai.

Further, real estate projects take a substantial amount of time to develop, and we could incur losses if
we purchase land and/or acquire development rights at high prices and we have to sell or lease our
developed projects at lower prices during weaker economic periods. The real estate market, both for
land and developed properties is relatively illiquid, which may limit our ability to respond promptly to
market events. In the event that market conditions deteriorate and cause a drop in real estate prices
in the Mumbai Metropolitan Region, our business, financial condition and results of operations could
be materially and adversely affected.
st
9. Our Company has reported negative operating cash flow for year ended 31 December,
st
2008 and 31 December, 2009. Continuation of negative cash flows in the future would
adversely affect our results of operations and financial conditions.

Our Company has reported a negative operating cash flow from operations of Rs. 1,454.12 Lacs for
st st
the year ended 31 December, 2008. Also, for the year ended 31 December, 2009 our Company
has reported a negative operating cash flow of Rs. 19,157.86 Lacs and Rs. 22,987.07 Lacs on a

xii
standalone and on a consolidated basis respectively. Sustained negative cash flows in the future
could affect our ability to service our debts and pay dividends. For further details regarding our
negative cash flows and reasons thereof please see sections titled ―Auditors Report‖ beginning on
page 57 of this Draft Letter of Offer respectively.

10. We have certain contingent liabilities not provided for which may adversely affect our
financial condition.

The following table sets forth our contingent liabilities, on a standalone basis, as of last audited
st
financial statement i.e. 31 December, 2009:

Sr. 31-Dec-2009 31-Dec-2008

Particulars
No. (Amt in Lacs) (Amt in Lacs)
a) Claims against the Company not acknowledged as debts 487.69 494.45
b) Bank guarantees 300.00 300.00
c) Outstanding letter of credit facility availed 48.25 Nil
Labour matter:
i. Pending in court in respect of claims for Retrenchment 4.87 4.87
compensation etc
d)
ii. Pending court cases – 5 (previous year – 5) in respect of claims for Black Wages, etc. filed
by ex-employees of the Company for which the amount of contingent liability is
unascertainable.
Income tax matters:
Nil 24.80
i. Income tax demand for Asst. year 2003-04
e)
ii. Income Tax demand for Asst. Year 2007-08 for which
43.59 Nil
appeal has been filed with CIT (Appeal)
i. Water tax dispute with BMC 27.48 Nil
f) ii. Sewerage tax dispute with BMC 16.49 Nil
iii. Property tax dispute with BMC 160.35 Nil
Excise Duty demand [Bank Guarantee
g) 3.39 3.39
provided for the same Rs.3,39,250/-]
Customs Duty demand [Bank Guarantee provided for the 6.98 6.98
h)
same Rs.6,98,500/-]
Pending court cases- 3 (Previous Year - 3) in respect of other matters against the Company
i)
which the amount of Contingent Liability is unascertainable.

In the event this liability gets materialized, our financial condition may be affected. For further
information see ―Note no. 4‖ of ―Schedule 19‖ of the Auditors Report on page 76 of this Draft Letter of
Offer.

11. We have not placed orders for the construction equipment proposed to be purchased from
the issue proceeds, and hence we face the risks pertaining to fluctuation in pricing and
availability of the same.

We intend to purchase capital equipment aggregating to Rs. 4503.82 Lacs from the issue proceeds.
We have not placed any orders for the same with the respective suppliers. Even though we have
apportioned for a contingency of 5% on the quotations received from the respective suppliers, there
can be no guarantee that we shall be able to obtain these equipments on a timely basis and on terms
acceptable to us as and when we actually place orders for their procurement. We hence face risks
pertaining to pricing and availability of these equipments.

xiii
 th
12. Trading of our Company’s equity shares was temporarily suspended from 19 May, 2004
th
to 26 December, 2005 by the BSE.
th
Trading of our Company‘s equity shares was suspended by BSE from 19 May, 2004 due to non-
nd
compliance with the Listing Agreement. BSE vide its Notice No. 20051222 – 7 dated 22 December,
th
2005 had revoked the suspension in trading of Equity Shares with effect from 27 December, 2005.

13. We have not paid any dividends in the past and any material adverse effect on our future
earnings, financial condition, cash flows will affect our ability to pay dividends in the
future.

The Company has never paid dividends to its equity shareholders in the past. Our ability to pay
dividends in the future will depend on the earnings, financial condition and capital requirements and
the same of our Subsidiaries and the dividends they distribute to us. Our business is capital intensive
and we may plan to make additional capital expenditure. Our ability to pay dividends is also restricted
under certain financing arrangements. We may be unable to pay dividends in the near or medium
term, and our future dividend policy will depend on our capital requirements and financing
arrangements in respect of our real estate projects, financial condition and results of operations.

14. We require substantial capital for our business operations, and the failure to obtain
additional financing in the form of debt or equity may adversely affect our ability to grow
and our future profitability.

Our business is highly capital intensive, requiring substantial capital to develop and market our
project. The actual amount and timing of our future capital requirements may also differ from
estimates as a result of, among other things, unforeseen delays or cost overruns in developing our
project, change in business plans due to prevailing economic conditions, unanticipated expenses,
regulatory changes, and engineering design changes. To the extent our planned expenditure
requirements exceed our available resources; we will be required to seek additional debt or equity
financing. Additional debt financing could increase our interest cost and require us to comply with
additional restrictive covenants in our financing agreements. Additional equity financing could dilute
our earnings per share and your interest in our Company and could adversely impact our share price.

In addition, the Indian regulations on foreign investment in housing, built-up infrastructure and
construction and development projects impose significant restrictions on us. Further, under current
Indian regulations except for certain limited purposes, external commercial borrowings cannot be
raised for investment in real estate, which may further restrict our ability to obtain necessary financing.

Our ability to obtain additional financing on favorable commercial terms, if at all, will depend on a
number of factors, including:

 our future financial condition, results of operations and cash flows

 the amount and terms of our existing indebtedness
 general market conditions and market conditions for financing activities by real estate
companies and
 economic, political and other conditions in the markets where we operate

We cannot assure you that we will be able to raise additional financing on acceptable terms in a timely
manner or at all. Our failure to renew existing funding or to obtain additional financing on acceptable
terms and in a timely manner could adversely impact our planned capital expenditure, business and
results of operations, including our growth prospects.

15. The uncertainty in our title to our real estate assets could have a material adverse impact
on our current and future revenue.

In India, property records do not provide a guarantee of title to the land. The title to land is often
fragmented and the land may, in many cases, have multiple owners and claimants and may be
subject to acquisition proceedings under the erstwhile Urban Land (Ceiling and Regulation) Act, 1971
and other applicable laws. Further, some of the land may have irregularities in title, such as non-

xiv
execution or non-registration or inadequate stamping of conveyance deeds and other acquisition
documents, or be subject to, or affected by, encumbrances of which we may not be aware. In some
instances, there can be no assurance that the persons with whom we have or may enter into joint
development arrangements have or will have clear title to such land. Further, property records in India
have not been fully computerized and are generally maintained manually through physical records of
all land related documents, which are also manually updated. This updating process can take a
significant amount of time and can result in inaccuracies or errors and increase the difficulty of
obtaining property records and/or materially impact our ability to rely on them. As a result, the title to
real property in which we have invested or may invest may not be clear or may be in doubt. Further,
there are areas where Marathi is the principal language used in drafting the sale deeds, agreements
to sell and other documentation and maintenance of land records. Therefore, we rely on local
expertise to undertake due diligence and documentation. As a result, some of the land may have
guaranteed title or title that has been independently verified.

In certain instances, there may be a discrepancy between the areas mentioned in the revenue
records, the area mentioned in the title deeds and/or the actual physical area of some of our land
reserves.

The failure to obtain good title to a particular plot of land may materially prejudice the success of a
development for which that plot is a critical part and may require us to write off expenditures in respect
of the development. We may not be able to assess or identify all risks and liabilities associated with
the land, such as faulty or disputed title, unregistered encumbrances, adverse possession rights or
other defects.

In addition, Indian law recognizes the concept of a Hindu undivided family, whereby all family
members jointly have interest in the land and at times transfer by the ‗karta‘ may be challenged by a
family member. Further, Indian law also recognizes the ability of persons to effectuate a mortgage by
physical delivery of original title documents to a lender without registration. Therefore, the uncertainty
of title to land makes the acquisition and development process more complicated, may impede the
transfer of title, expose us to legal disputes and adversely affect land valuations. Legal disputes in
respect of land title can take several years and considerable expense to resolve if they become the
subject of court proceedings and their outcome can be uncertain. If either we or the owner of the land
which is the subject of our development agreements are unable to resolve such disputes with these
claimants, we may lose our interest in the land.

16. We are not able to obtain title insurance guaranteeing title or land development rights.

Title insurance is not commercially available in India to guarantee title or development rights in
respect of land. The absence of title insurance, coupled with difficulties in verifying title to land, may
increase our exposure to third parties claiming title to the property. This could result in our Company
selling the property or even in a loss of our title to the property, thereby affecting valuations of the
property, or otherwise materially prejudice the development of the property. This could in turn have an
adverse effect on our business, financial condition or results of operations.

17. We face certain challenges because of our limited operating history in the highly
competitive real estate development market.

Businesses in their initial stages of development present substantial business and financial risks and
may present a much higher investment risk. We have started our real estate business in 2007 and as
a result of our short operating history, we have not completed any projects till date and consequently,
prospective investors or buyers will have limited information with which to evaluate the quality of our
projects and our current or future prospects on which to base their investment / purchase decisions.
We face significant competition from other more established real estate developers, many of whom
undertake similar projects within the same regional markets. Given the fragmented nature of the real
estate development industry in India, we often do not have complete information about the projects
our competitors are developing and accordingly we may underestimate supply in the market.
Increasing competition in our businesses could result in price and supply volatility, which could
adversely affect our results of operations. Competitors may, whether through consolidation or growth,
present more credible integrated and/or lower cost alternatives to our projects. We cannot assure you
that we may be able to complete our projects or compete effectively with our competitors in the future,

xv
and a failure to do so may have an adverse effect on our business, financial condition and results of
operations.

18. Our lenders have imposed certain restrictive conditions on us under the financing
agreements entered with them which would affect our business and finance operations.

Under our existing financing agreements, the lenders have the right to withdraw the facilities in the
event of any change in circumstances, including but not limited to, any material change in the
ownership or shareholding pattern or management of the Company, maintaining a Debt service
Reserve Account, etc. Further, certain of our financing arrangements impose restrictions on the
utilization of the loan for certain specified purposes only, such as for the purposes of meeting the
expenses of land acquisition and development and related activities. We are also required to obtain
the prior consent from some of our lenders for, among other matters amending our Articles of
Association, our capital structure and changing the composition of our management. There can be no
assurance that we will be able to comply with these financial or other covenants or that we will be able
to obtain lender consents necessary for our future operations and growth on time or at all. This may
limit our ability to pursue our business and limit our flexibility in planning for, or reacting to, changes in
our business or industry. For further information, see ―Details of Principal Terms of Loans and Assets
Charged‖ in the section titled ―General Information‖ on page 11 of this Draft Letter of Offer.

19. Any breach under our financing agreements could force us to sell assets or trigger a
cross-default under our financing agreements.

Any breach under our financing agreements could result in an acceleration of our loan repayments,
force us to sell our assets or trigger a cross-default under our other financing agreements. In some of
our financing agreements, the lender may, at its discretion, terminate or cancel the facility with
immediate effect if we default under any other material agreements with any other financing
institution. For further details, see ―Details of Principal Terms of Loans and Assets Charged‖ in the
section titled ―General Information‖ on page 11 of this Draft Letter of Offer.

20. Our Director, Mr. Vikas S. Kasliwal, has given a personal guarantee in relation to certain
debt facilities provided to us. Revocation of guarantees will have negative impact on our
business and financial condition.

Our Director, Mr. Vikas S. Kasliwal, has given a personal guarantee in relation to certain debt facilities
st
provided to us aggregating to Rs. 38,908.77 Lacs as of 31 December, 2009. In the event that he
withdraws or terminates the guarantees, the lenders for such facilities may ask for alternate
guarantees, repayment of amounts outstanding under such facilities, or terminate such facilities. We
may not be successful in procuring guarantees satisfactory to the lenders, and as a result may need
to repay outstanding amounts under such facilities or seek additional sources of capital, which could
affect our financial condition and cash flows.

21. Certain equity shares of our Promoters are pledged to various financial institutions and
other entities for raising debt financing for the Company and for themselves. Any default
under the financing documents could adversely impact the control exercised by our
Promoters and potentially impact the trading price of our Equity Shares.
th
As on 30 September, 2010 our Promoters and Promoter Group entities have pledged a total of
91,76,284 shares aggregating to a total of 44.47% of our outstanding issued equity to various financial
institutions and other entities for raising debt financing for the Company and for themselves. Any
default under the financing documents may result in the aforesaid lenders selling the equity shares
pledged to them in the open market, thereby diluting the shareholding of our Promoter Group. Any
such dilution could impede the control of our Promoter Group and management of the operations of
our Company. Further, the sale of such equity shares, or the perception that such sales may occur,
may result in the trading price of our equity shares being adversely affected.

For further details regarding the pledge, please refer to the section titled ―Capital Structure‖ on Page
13 of this Draft Letter of Offer.

xvi
22. Some of our Promoters & Promoters Group Entities have interests which are in businesses
similar to ours and this may result in potential conflicts of interests with us.

Some of our Promoters and Promoter Group Entities such as M/s. Akhilesh Developers Private
Limited and M/s. Hanumesh Realtors Private Limited have interests similar to that of our Company. A
conflict of interest may occur between our business and the business of our Promoter group
companies which could have an adverse affect on our operations. Conflicts of interest may also arise
out of common business objectives shared by us, our Promoters, Directors and their related entities.
Our Promoters, Directors and their related entities may compete with us and have no obligation to
direct any opportunities to us. There can be no assurance that these or other conflicts of interest will
be resolved in an impartial manner.

23. We have not entered into any definitive agreements to use any portion of the net proceeds
of the Issue, nor are the utilization of proceeds subject to monitoring from any
independent agency. We will have broad discretion in the application of proceeds from the
Issue.

We are raising money to improve our long term liquidity and financial condition, in line with the need to
maintain liquid capital before bidding or applying for various construction projects and land auctions.
No project has been materially identified till date, nor have we entered into any definitive agreements
for utilisation of any of our proceeds from this Issue. The utilisation of funds as described in ―Objects
of the Issue‖ on page 17 of this Draft Letter of Offer is at the discretion of our Board. We have not
hired any independent agency to monitor our utilisation of proceeds and there can be no assurance
that we will be able to identify suitable projects or enter into definitive agreements immediately or at
all, which means that we may have a significant amount of unallocated net proceeds. This means that
we would have broad discretion in allocating these net proceeds from the Issue without any action or
approval of our shareholders. Due to the number and variability of factors that we will analyze before
we determine how to use these net proceeds, we cannot determine now how we would allocate or
reallocate such proceeds. Accordingly, investors will not have the opportunity to evaluate the
economic, financial and other relevant information that will be considered by us in determining the
application of any such net proceeds.

24. We have entered into certain related party transactions and there is no assurance that we
may not continue to do so in future also. This could have an adverse effect on our financial
condition and results of operation.

Conflicts may arise in the ordinary course of decision making for our Company due to the related
party transactions entered into by our Company with our promoters / members of the promoter group.
Among other situations, conflicts may arise in connection with our negotiations and dealings with
members of the Promoter and Promoter Group.

We face risks pertaining to our promoters, key managerial persons, Directors being interested in our
Company for issues other than their normal remuneration, benefits and reimbursement of expenses
incurred. For more details of Related Party Transactions refer to ―Note no. 17‖ of ―Schedule 19‖ of the
‗Notes forming part of the Accounts‘ of the Auditor‘s Report on Page 81 of this Draft Letter of Offer.

25. We have unsecured loans outstanding to the tune of Rs. 1561.83 Lacs that are repayable
on demand. The demand for repayment of these loans will have bearing on our liquidity
there by imposing strain on our business and financial condition.
st
As per our limited review report as on 31 July, 2010, we have unsecured loans outstanding to an
amount aggregating to Rs. 1561.83 lacs from promoters and others which are repayable on demand.
These loans are interest free and can be recalled anytime by the said lenders. Any demand for
repayment of such unsecured loans, may adversely affect our cash flows and the business
operations. For further details on unsecured loan, please refer to the chapter titled ―Financial
Information‖ beginning on page 48 of this Draft Letter of Offer.

xvii
26. We may be unable to successfully identify and acquire suitable parcels of land for
development, which may impede our growth.

Our ability to identify suitable parcels of land for development is a vital element of our business and
involves certain risks, including identifying and acquiring appropriate land, appealing to the tastes of
residential customers and undertaking and responding to the requirements of commercial clients. We
have an internal assessment process for land selection and acquisition which includes a due diligence
exercise to assess the title of the land and its suitability for development, development potential and
marketability. Our internal assessment process is based on information that is available or accessible
to us. There can be no assurance that such information is accurate, complete or current. Any decision
based on inaccurate, incomplete or outdated information may result in certain risks and liabilities
associated with the acquisition of such land, which could adversely affect our business, financial
condition and results of operations.

In addition, our inability to acquire contiguous parcels of land may affect some of our existing and
future development activities. We could acquire parcels of land at various locations, which can be
subsequently consolidated to form a contiguous land area, upon which we can undertake
development. We may not be able to acquire such parcels of land in the future or may not be able to
acquire such parcels of land on terms that are acceptable to us, which may affect our ability to
consolidate parcels of land into a contiguous land area. We also may be required by applicable laws
or court orders to undertake activities, in addition to real estate development on certain portion of our
land reserves. Additionally, we may be asked to pay premium amounts for acquiring certain large
parcels of land, which we may not be willing to do. Accordingly, our inability to acquire parcels of land
may adversely affect our business prospects, financial condition and results of operations.

27. Our success depends in large part upon our senior management, Directors and key
personnel and our ability to retain them and attract new key personnel when necessary.

Our senior management team is integral to the success of our business and includes highly qualified
and experienced architects, civil engineers, doctorate holders etc. However, we cannot assure you
that we will be able to retain any or all of our management team. Any loss of our senior management
or key personnel or our inability to recruit further senior managers or other key personnel could
impede our growth by impairing our day-to-day operations and hindering our development of ongoing
and planned projects and our ability to develop, maintain and expand customer relationships.

28. Our business and growth plan could be adversely affected by the incidence and rate of
property taxes and stamp duties, service and other value added taxes.

As a property owning and development Company, we are subject to the property tax regime in the
Mumbai Metropolitan Region. We are also subject to stamp duty for the agreement entered into in
respect of the properties we buy and sell. These taxes could increase in the future, and new types of
property taxes, stamp duties and service and other value added taxes may be introduced which will
increase our overall costs. If these property taxes and stamp duties increase, the cost of buying and
selling properties may rise. Additionally, if stamp duties were to be levied on instruments evidencing
transactions which we believe are currently not subject to such duties, such as the grant or transfer of
development rights, our acquisition costs and sale values may be affected, resulting in a reduction of
our profitability. Any such changes in the incidence or rates of property taxes or stamp duties or
service and other value added taxes could have an adverse affect on our financial condition and
results of operations.

29. We have not registered “Palais Royale” as a brand or trademark under any applicable
local, state or national law. Our inability to protect our brand name and brand identity
could have an adverse effect on our business prospects.

We believe that one of the principal factors that differentiate us from our competitors in the real estate
industry is our brand name and brand identity. We believe that our customers associate our brand
―Palais Royale‖ with high quality design and construction. If we do not maintain our brand names and
identities and fail to provide high quality projects on a timely basis, we may not be able to maintain our
competitive edge. If we are unable to compete successfully, we could lose our customers, which
would negatively impact our financial performance and profitability.

xviii
We have not registered ―Palais Royale‖ as a brand or a trade mark under any applicable local, state
or national law. We are hence subject to duplicity of our brands and in case someone else registers
the same, we may be forced to change our branding and other sales and marketing material which
shall result in increased expenditure and loss of goodwill in the market. This could hence, materially
affect our results of operations.

30. We have incurred substantial indebtedness, and we may not have adequate resources to
finance our real estate developments.
st
We have incurred substantial indebtedness to finance development of our ongoing project. As of 31
July, 2010, our outstanding secured loans amounted to Rs. 44,336.07 Lacs. For details of our
outstanding loans, see ―Details of Principal Terms of Loans and Assets Charged‖ in the section titled
―General Information‖ on page 11 of this Draft Letter of Offer. We intend to pursue a strategy of
continued investment in additional real estate projects across our business segments for which we will
need additional financing. We expect to incur debt to fund portions of this expenditure, which could
result in increased overall indebtedness and higher leverage and therefore results in additional
borrowing costs. Our ability to borrow and the terms of our borrowings will depend on our financial
condition, the stability of our cash flows and our capacity to service debt. We may not be successful in
obtaining additional funds in a timely manner, on favorable terms or at all. If we do not have access to
these funds, we may be required to delay or abandon some or all of our planned projects or to reduce
planned expenditures, unable to extend advances to obtain land development rights and reduce the
scale of our operations.

31. Significant increases in prices of, or shortages of, or delay or disruption in supply of key
building materials could harm our results of operations and financial condition.

We procure building materials for our project, such as steel, cement, flooring products, hardware,
bitumen, sand and aggregates, doors and windows, bathroom fixtures and other interior fittings from
third party suppliers. The prices and supply of basic building materials and other raw materials
depend on factors outside our control, including general economic conditions, competition, production
levels, transportation costs and import duties.

Our ability to develop and construct the project profitably is dependent on our ability to obtain
adequate and timely supply of building materials. As we source our building materials from third
parties our supply chain may be interrupted by circumstances beyond our control, including work
stoppages and labor disputes affecting our suppliers, their distributors, or the transporters of our
supplies. Poor quality roads and other transportation related infrastructure problems, inclement
weather and road accidents may also disrupt the transportation of supplies. Prices of certain building
materials and in particular, cement and steel prices, are susceptible to rapid increases. During periods
of shortages in the supply of building materials or due to a delay or disruption in the supply of building
materials, we may not be able to complete projects according to our previously determined time
frames, at our previously estimated project cost, or at all, which may adversely affect our results of
operations and reputation.

32. We may be involved in legal and administrative proceedings arising from our operations
from time to time to which we may become a party which may have a negative impact on
our business.

We may be involved from time to time in disputes with various parties involved in the development
and sale of our properties, such as contractors, suppliers, constructors, joint venture or joint
development partners, occupants and claimants of title over land, and governmental authorities.
These disputes may result in legal and/or administrative proceedings, and may cause us to suffer
litigation costs and project delays. We may, for example, have disagreements over the application of
law with regulatory bodies or third parties in the ordinary course of our business, which may subject
us to administrative proceedings and unfavorable decisions, resulting in financial losses and the delay
of commencement or completion of our projects or parts thereof.

xix
33. We may suffer uninsured losses or experience losses exceeding our insurance limits.

Our real estate project could suffer physical damage from fire or other causes, resulting in losses,
which may not be fully compensated by insurance. In addition, there are certain types of losses, such
as those due to earthquakes, floods, other natural disasters, terrorism or acts of war, which may be
uninsurable or are not insurable at a reasonable premium. We may also be subject to claims resulting
from defects.

The proceeds of any insurance claim with respect to insurance that either we or our contractors have
taken may be insufficient to cover any expenses faced by us including higher rebuilding costs as a
result of inflation, changes in building regulations, environmental issues as well as other factors.
Should an uninsured loss or a loss in excess of insured limits occur, we may lose the capital invested
in and the anticipated revenue from the affected property. We could also remain liable for any debt or
other financial obligation related to that property. We cannot assure you that losses in excess of
insurance proceeds will not occur in the future. We may also face third party claims or torts liabilities
on account of accidents during construction or afterwards.

In addition, any payments we make to cover any uninsured loss may have a material adverse effect
on our business, financial condition and results of operations.

34. We may experience difficulties in expanding our business into additional geographical
markets in India.

While the Mumbai Metropolitan Region real estate market remains and is expected to remain our
primary strategic focus, we also evaluate attractive growth opportunities in other geographies on a
case to case basis. We may not be able to leverage our experience in the Mumbai Metropolitan
Region to expand our operations into other cities, should we decide to further expand our operations.
Factors such as competition, culture, regulatory regimes, business practices and customs, customer
tastes, behavior and preferences in other cities where we may plan to expand our operations may
differ from those in the Mumbai Metropolitan Region, and our experience in the Mumbai Metropolitan
Region may not be applicable to these cities. In addition, as we enter new markets and geographical
areas, we are likely to compete not only with national developers, but also local developers who have
an established local presence, are more familiar with local regulations, business practices and
customs, have stronger relationships with local contractors, suppliers, customers, relevant
government authorities, and who have access to existing land reserves or are in a stronger financial
position than us, all of which may give them a competitive advantage over us.

If we plan to expand our geographical footprint, our business will be exposed to various additional
challenges, including adjusting our construction methods to different terrains; obtaining necessary
governmental approvals and building permits under unfamiliar regulatory regimes; identifying and
collaborating with local business partners, construction contractors and suppliers with whom we may
have no previous working relationship; successfully gauging market conditions in local real estate
markets with which we have no previous familiarity; attracting potential customers in a market in which
we do not have significant experience or visibility; being susceptible to local taxation in additional
geographical areas of India; and adapting our marketing strategy and operations to different regions
of India in which other languages are spoken. Our inability to expand into areas outside the Mumbai
Metropolitan Region real estate market may adversely affect our business prospects, financial
conditions and results of operations.

35. Corrupt practices or improper conduct may delay the development of a project and affect
our results and operations.

The real estate development and construction industries are not immune to the risks of corrupt
practices. Large construction projects in all parts of the world provide opportunities for corruption.
Such corruption may include bribery, deliberate poor workmanship or the deliberate supply of low
quality materials. If we, or any other person involved in any of the projects is the victim of or involved
in any such corruption, our ability to complete the relevant projects as planned may be disrupted
thereby affecting our business, financial condition and results of operations.

xx
36. Improper handling of materials and machines used in the business of the Company can
result into accidents and the Company could face significant liabilities that would lower its
profits and adversely affect its financial condition.

Our business operations may be affected due to improper handling of materials and machines used
by our labourers which may further increase the liability of the Company and lower the profits. The
Company has been executing its current project ―Palais Royale‖ at Mumbai using modern techniques
and state-of-the-art plant & equipment, which have minimized the number of men, loss of materials
and requirement of number of machines. The Company makes it compulsory for all the site engineers
and laborers to wear safety gadgets to avoid accidents and probable liabilities, but no assurances can
be given that any unfortunate incident will not occur at our site, which may increase our financial
liabilities depending on the nature of accident.

37. Work stoppages and other labor problems could adversely affect our business.

We operate in a labor-intensive industry and we or our contractors may hire casual labor in relation to
our projects. If we or our contractors are unable to negotiate with the workmen or the sub-contractors,
it could result in work stoppages or increased operating costs as a result of higher than anticipated
wages or benefits. In addition, it may be difficult to procure the required labor for existing or future
projects. These factors could adversely affect our business, financial condition, results of operations
and cash flows.

38. We prepare our financial statements in accordance with Indian GAAP which differs in
certain material respects from other accounting principles.

Our financial statements are prepared in conformity with Indian GAAP. Indian GAAP differs in certain
significant respects from IFRS, U.S. GAAP and other accounting principles and standards. If we were
to prepare our financial statements in accordance with such other accounting principles, our results of
operations, cash flows and financial position may be substantially different. The significant accounting
policies applied in the preparation of our Indian GAAP financial statements are set forth in the notes to
our financial statements included in this Draft Letter of Offer. Prospective investors should review the
accounting policies applied in the preparation of our financial statements, and consult their own
professional advisors for the understanding of the differences between these accounting principles
and those with which they may be more familiar.

39. We have not obtained any third party appraisals for the objects of our Issue. The
deployment of funds towards the objects of the Issue is entirely at our discretion and as
per the details mentioned in the section titled “Objects of the Issue”. Any revision in the
estimates may require us to reschedule the deployment of funds and may have a bearing
on our expected revenues and earnings.

Our funding requirements and the deployment of the proceeds of the Issue are based on
management estimates and have not been appraised by any bank or financial institution. We may
have to revise our management estimates from time to time and consequently our funding
requirements may also change. In case of deviation of utilization of funds raised from the Issue, we
shall make an arrangement in accordance with the provisions of the equity listing agreement. Further,
the deployment of the funds towards the objects of the Issue is entirely at the discretion of our Board
of Directors and is not subject to monitoring by an external independent agency. However, the
deployment of funds is subject to monitoring by our Audit Committee.

EXTERNAL RISK FACTORS

40. Political instability or changes in the Government could adversely affect economic
conditions in India and consequently our business.

Our Company and our Subsidiaries are incorporated in India, derive their revenues in India and all of
their respective assets are located in India. Consequently, the Company‘s performance and the
market price and liquidity of the Equity Shares may be affected by changes in exchange rates and
controls, interest rates, Government policies, taxation, social and ethnic instability and other political
and economic developments affecting India.

xxi
The Government has traditionally exercised and continues to exercise a significant influence over
many aspects of the economy. Our business and the business of certain of our subsidiaries, and the
market price and liquidity of the Equity Shares may be affected by interest rates, changes in
Government policy, taxation, social and civil unrest and political, economic or other developments in
or affecting India.

Since 1991, successive governments have pursued policies of economic and financial sector
liberalization and deregulation and encouraged infrastructure projects. The previous coalition-led
Governments implemented policies and took initiatives that supported the economic liberalization
policies that had been pursued by prior governments. The new Government, which has come to
power in May 2009 has announced policies and taken initiatives that support the economic
liberalization program pursued by previous governments. The policies of the new Government may
change the rate of economic liberalization, the investment in real estate and infrastructure projects
and specific laws and policies affecting education, foreign investment and other matters affecting
investment in the Equity Shares. While the new Government is expected to continue the liberalization
of India‘s economic and financial sectors and deregulation policies, there can be no assurance that
such policies will be continued. A significant change in the Government‘s policies in the future, in
particular, those relating to the real estate sector in India, could affect business and economic
conditions in India, and could also adversely affect our and our subsidiaries‘ financial condition and
results of operations.

41. Terrorist attacks, civil unrest and other acts of violence or war involving India and other
countries could adversely affect the financial markets and our business.

Terrorist attacks such as the recent Mumbai terror attacks in November 2008 and other acts of
violence or war may negatively affect the Indian markets on which our Equity Shares trade and also
adversely affect the worldwide financial markets. These acts may also result in a loss of business
confidence, and adversely affect our business. In addition, any deterioration in relations between India
and its neighboring countries might result in investor concern about stability in the region, which could
adversely affect the price of our Equity Shares. India has also witnessed civil disturbances in recent
years and it is possible that future civil unrest as well as other adverse social, economic and political
events in India could have a negative effect on us. Such incidents could also create a greater
perception that investment in Indian companies involves a higher degree of risk and could have an
adverse affect on our business and the price of our Equity Shares.

42. Our customers obtain loans from banks / financial institutions in respect of residential
properties and avail of certain tax benefits which, if withdrawn, may adversely affect their
ability/willingness to purchase residential apartments & hence would also affect our
financial condition and results of operations.

There are various tax benefits under the I.T. Act which are available to the purchasers of residential
premises who avail loans from banks/financial institutions. Our customers may not be able to avail
these benefits if there is a change in law or change in interpretation of law resulting in the
discontinuation or withdrawal of these tax benefits. This could adversely affect our financial condition
and results of operations and the ability/willingness to purchase residential apartments. This could
adversely affect their ability/willingness of our customers to purchase residential apartments & hence
would also affect our financial condition and results of operations. For details regarding the tax
benefits available to our customers, see section titled ―Statement of Tax Benefits‖ on page 22 of this
Draft Letter of Offer.

43. The occurrence of natural or man-made disasters could adversely affect our results of
operations and financial condition.

The occurrence of natural disasters, including hurricanes, cyclones, floods, earthquakes, tornadoes,
fires, explosions, pandemic disease and man-made disasters, including acts of terrorism and military
actions, could adversely affect our results of operations or financial condition. The potential impact of
a natural disaster such as the H5N1 ―avian flu‖ virus, or H1N1, the swine flu virus on our results of
operations and financial position is highly speculative, and would depend on numerous factors. We

xxii
cannot assure prospective investors that such events will not occur in the future or that our results of
operations and financial condition will not be adversely affected.

44. Restrictions on FDI and external commercial borrowings in the real estate sector may
hamper our ability to raise additional capital.

While the Government has permitted FDI of up to 100% without prior regulatory approval in
townships, housing, built-up infrastructure and construction and development projects, it has issued a
notification and imposed certain restrictions on such investments pursuant to Press Notes and
circulars issued by the DIPP or the RBI from time to time. Further, under current external commercial
borrowing guidelines of the Reserve Bank of India, except for certain purposes external commercial
borrowings cannot be utilized for investment in real estate, including the development of integrated
townships. Our inability to raise additional capital as a result of these and other restrictions could
adversely affect our business and prospects. For more information on these restrictions, see section
titled ―Key Industrial Regulations and Policies‖ on page 29 of this Draft Letter of Offer.

45. Our business is subject to extensive government regulation, which may become more
stringent in the future.

The real estate sector in India is heavily regulated by the central, state and local governments. Real
estate developers are as a consequence, required to comply with a number of Indian laws and
regulations, including policies and procedures established and implemented by local authorities. For
example, we are subject to various land ceiling regulations, which regulate the amount of land that
can be held by a single entity.

Additionally, developers are required to obtain various approvals, permits and licenses from the
relevant administrative authorities at various stages of project development. Certain projects may also
have to comply with the necessary qualifications for inclusion in the ‗master plans‘ for the
development of a particular region. We may encounter problems in obtaining requisite approvals or
licenses, may experience delays in fulfilling the conditions precedent to any required approvals and
we may not be able to adapt ourselves to new laws, regulations or policies that may come into effect
from time to time with respect to the real estate sector. If we experience problems in obtaining or fail
to obtain the requisite governmental approvals, the schedule of development and sale or letting of our
projects could be substantially disrupted.

Although we believe that we are in material compliance with applicable laws and regulations,
regulatory authorities may allege non-compliance and may subject us to regulatory action in the future
including penalties, seizure of land and other civil or criminal proceedings. For more information, see
section titled ―Key Industrial Regulations and Policies‖ and ―Government & Other Key Approvals‖ on
pages 29 and 140, respectively.

46. The government may exercise rights of compulsory purchase or eminent domain in
respect of our lands.

Like other real estate development companies in India, we are subject to the risk that central or state
governments in India may exercise their rights of eminent domain, or compulsory purchase in respect
of our land reserves. The Land Acquisition Act, 1894 allows the central and state governments to
exercise rights of eminent domain or, compulsory purchase, which, if used in respect of our land,
could require us to relinquish land with minimal compensation. The likelihood of such actions may
increase as the central and state governments seek to acquire land for the development of
infrastructure projects such as roads, airports and railways. Any such action in respect of one or more
of our ongoing projects or planned projects could adversely affect our business.

47. A downgrade of India’s sovereign debt rating may adversely affect our ability to raise
additional debt financing.

India‘s sovereign debt rating could be downgraded due to various factors, including changes in tax or
fiscal policy, which are outside our control. Such downgrading could cause a change in interest rates
or other commercial terms and could adversely affect our ability to raise additional financing as well as
our capital expenditure plans, business and financial performance. A decline in this reserve could

xxiii
impact the valuation of the Indian rupee and could result in reduced liquidity and higher interest rates,
which could adversely affect the availability of financing to us for our future projects.

48. Future issuances or sales of the Equity Shares could significantly affect the trading price
of the Equity Shares.

The future issuance of Equity Shares by us or the disposal of Equity Shares by any of our major
shareholders or the perception that such issuance or sales may occur may significantly affect the
trading price of the Equity Shares.

There can be no assurance that we will not issue further Equity Shares or that the shareholders will
not dispose of, pledge or otherwise encumber their Equity Shares.

49. There is no guarantee that the Equity Shares issued pursuant to the Issue will be listed on
the BSE in a timely manner, or at all.

In accordance with Indian law and practice, permission for listing and trading of the Equity Shares
issued pursuant to the Issue will not be granted until after the Equity Shares have been issued and
allotted. Approval for listing and trading will require all relevant documents authorizing the issuing of
Equity Shares to be submitted. There could be a failure or delay in listing the Equity Shares on the
BSE. Any failure or delay in obtaining the approval would restrict your ability to dispose of your Equity
Shares.

50. Investors may be subject to Indian taxes arising out of capital gains on the sale of the
Equity Shares.

Under current Indian tax laws and regulations, capital gains arising from the sale of Equity Shares in
an Indian Company are generally taxable in India. Any gain realized on the sale of listed equity shares
on a stock exchange held for more than 12 months will not be subject to capital gains tax in India if
Securities Transaction Tax (―STT‖) has been paid on the transaction. STT will be levied on and
collected by a domestic stock exchange on which the Equity Shares are sold. Any gain realized on the
sale of equity shares held for more than 12 months to an Indian resident, which are sold other than on
a recognized stock exchange and on which no STT has been paid, will be subject to long term capital
gains tax in India. Further, any gain realized on the sale of listed equity shares held for a period of 12
months or less will be subject to short term capital gains tax in India. Capital gains arising from the
sale of the Equity Shares will be exempt from taxation in India in cases where the exemption from
taxation in India is provided under a treaty between India and the country of which the seller is
resident. Generally, Indian tax treaties do not limit India‘s ability to impose tax on capital gains. As a
result, residents of other countries may be liable for tax in India as well as in their own jurisdiction on a
gain upon the sale of the Equity Shares.

51. A third party could be prevented from acquiring control of us because of anti-takeover
provisions under Indian law.

There are provisions in Indian law that may delay, deter or prevent a future takeover or change in
control of the Company, even if a change in control would result in the purchase of your Shares at a
premium to the market price or would otherwise be beneficial to you. These provisions may
discourage or prevent certain types of transactions involving actual or threatened change in control of
us. Under the takeover regulations an acquirer has been defined as any person who, directly or
indirectly, acquires or agrees to acquire shares or voting rights or control over a Company, whether
individually or acting in concert with others. Although these provisions have been formulated to ensure
that interests of investors/shareholders are protected, these provisions may also discourage a third
party from attempting to take control of the Company. Consequently, even if a potential takeover of
the Company would result in the purchase of the Shares at a premium to their market price or would
otherwise be beneficial to its stakeholders, it is possible that such a takeover would not be attempted
or consummated because of Indian takeover regulations.

xxiv
52. Foreign investors are subject to foreign investment restrictions under Indian law that limits
our ability to attract foreign investors, which may adversely impact the market price of the
Equity Shares.

Under the foreign exchange regulations currently in force in India, transfers of shares between non-
residents and residents are freely permitted (subject to certain exceptions) if they comply with the
pricing guidelines and reporting requirements specified by the RBI. If the transfer of shares are not in
compliance with such pricing guidelines or reporting requirements or fall under any of the exceptions
referred to above, then the prior approval of the RBI will be required. Additionally, shareholders who
seek to convert the Rupee proceeds from a sale of shares in India into foreign currency and repatriate
that foreign currency from India will require a no objection or a tax clearance certificate from the
income tax authority. We cannot assure investors that any required approval from the RBI or any
other Government agency can be obtained on any particular terms or at all.

Prominent Notes

1. Our net worth was Rs. 3,664.78 Lacs, as per the audited financial statements of our Company
st
as at 31 December, 2009 disclosed in the section titled ―Auditors Report‖ beginning on page
57 of this Draft Letter of Offer.

2. Issue of [●] Equity Shares with a face value of Rs. 10/- each at a premium of Rs. [●] /- each
aggregating upto Rs. 7500 Lacs on a rights basis to the existing equity shareholders of the
Company in the ratio of [●] Equity Share for every [●] Equity Shares held by the equity
shareholders on the Record Date i.e. [●].

3. For details of transactions between our Company and our Group Entities in the last one year
preceding the date of this Draft Letter of Offer please refer to ―Related Party Transactions‖ as
described in ―Note no. 17‖ of ―Schedule 19‖ of the ‗Notes forming part of the Accounts‘ of the
Auditor‘s Report on Page 81 of this Draft Letter of Offer.

4. There are no financing arrangements whereby our Promoter Group, the Directors of
companies forming a part of our Promoters, our Directors and their relatives, (―Financier‖),
have financed the purchase by any other person of securities of our Company other than in
the normal course of the business of the Financier during the period of six months
immediately preceding the date of this Draft Letter of Offer.

xxv
 SECTION III: INTRODUCTION
SUMMARY OF OUR BUSINESS

In this section, unless the context requires otherwise, any reference to “we”, “our” and “us” refers to
our Company and our Subsidiaries on a consolidated basis.

OVERVIEW
th
Our Company was originally incorporated on 25 January 1935 under the Indian Companies‘ Act,
1913 as ―Shree Ram Mills Limited‖ and has its registered office at Shree Ram Mills Premises,
Ganpatrao Kadam Marg, Lower Parel, Mumbai – 400 013, making it an over 75 year old Company.
Subsequently, the name of our Company was changed to ―Shree Ram Urban Infrastructure Limited‖
th
on the 20 March, 2007 to reflect the change in objects of the company. The principle activities of our
Company can be broadly classified as under:

A. Real Estate Development and

B. Textiles Trading.

We are an emerging player in Mumbai‘s Real Estate Development Industry. We have commenced
development of a residential project called ―Palais Royale‖ at our Worli Estate. However, majority of
our revenues are still generated from the trading of textiles as the Real Estate Project is
underdevelopment and has not reached a stage where any revenue from the same can be
recognized.

Secondly, we also undertake trading of textile products by taking advantage of the historical strengths
achieved by our Company in the textile market. These strengths have been achieved by running one
of the largest textile mills in India over the years. The division is a source of steady business and
regular, albeit modest, profits. In light of this steadiness, and considering the historical background of
the Textile Mill, the Company intends to keep this division operational.

Our Company aims at becoming an established player in the real estate industry by creating
―technology infused sustainable property developments‖. We also aim to acquire further projects by
bidding for various other development rights. Therefore by the end of the completion of our flagship
project ―Palais Royale‖, we aim to acquire other projects as well.

BRIEF DETAILS OF OUR BUSINESS ACTIVITIES

A. Real Estate Development:

Our Company is a real estate development Company operating in Mumbai and is primarily focused on
premium property developments. Our Company plans to establish a strong brand in the real estate
industry by aiming to develop innovative projects through emphasis on contemporary architecture,
strong project execution and quality construction. The focus of our Company is completely on
residential projects which target the upper end of the respective income or market segment. We
believe that the Mumbai Metropolitan Region is one of the most attractive and profitable real estate
markets in India in terms of depth of demand for real estate developments across business segments
and price points.

Details of our Ongoing Project:

The project "Palais Royale" is a high rise Luxury Residential Apartment Project located at Shree Ram
Mills Premises, Ganpatrao Kadam Marg, Lower Parel in the locality of Worli in South Central Mumbai
on a land parcel admeasuring 28,410 sq. meters. The 74 storied tower will be 300 meters in height
with a grand entry to the main residential area.

1
Following are the salient features of this project:

 The tower is designed by the architect firm, Talati & Panthaky, in association with Sterling
Engineering Consultants and foreign consultants such as CBM Engineers, USA & RWDI,
Canada.

 The structure has been planned with earthquake control and fire prevention technology. Both
these features are based on US standards. These features as provided in the structure will act as
a competitive edge for the building as against its peers in the vicinity.

 The premise will have amenities like a cinema house, spa, health club, meditation room, satsang
(prayer) area, etc. It will have all kind of games including golf, basketball, tennis and other games.
It will have three swimming pools including one exclusively for kids. The Complex will have an in
house Clubhouse with swimming pool along with a large Garden and party area. The amenities
level floor will be with 56 feet height which would give a feel of almost open to sky outdoor
grounds.

B. Textiles Trading Division

The Company is carrying on regular business of trading in textile products, taking advantage of the
historical strengths in the textile market of the Company, having run one of the largest textile mills in
India. The division is a source of steady business and regular, albeit modest, profits. In light of this
steadiness, and considering the historical background of the Textile Mill, the Company intends to keep
this division operational.

2
 ISSUE DETAILS IN BRIEF

The following is a summary of the Issue. This summary should be read in conjunction with, and is
qualified in its entirety by, more detailed information in the section titled ―Terms of the Issue‖ on page
149 of this Draft Letter of Offer.

Equity Shares
offered by our [●] Equity Shares having Face Value of Rs. 10 each
Company
Equity Shareholders are entitled to [●] Equity Share for every [●] fully paid-up
Rights Entitlement
Equity Share held on the Record Date i.e., [●]
Record Date [●]
Issue Price per
Rs. [●] per Equity Share
Equity Share
Equity Shares
outstanding prior to 2,06,34,540 Equity Shares of Rs. 10 each.
the Issue

Equity Shares
outstanding after [●] Equity Shares having Face Value of Rs. 10 each.
the Issue
Use of Issue See section titled ―Objects of the Issue‖ on page 17 of this Draft Letter of
proceeds Offer.
See section titled ―Terms of the Issue‖ on page 149 of this Draft Letter of
Terms of the Issue
Offer.
See ―Risk Factors‖ for a discussion of factors you should consider before
Risk Factors
deciding whether to buy our Equity Shares.
Security Codes :
ISIN: INE164H01011
BSE Scrip Code: 503205

3
 SUMMARY OF OUR FINANCIAL INFORMATION

The following tables set forth summary financial information derived from our consolidated and
st
standalone financial statement as of and for the year ended 31 December, 2009. Our Audited
financial statements have been prepared in accordance with Indian GAAP and the SEBI (ICDR)
Regulations, 2009 and are presented in the section titled ―Financial Information‖ on page 48 of this
Draft Letter of Offer.
st
Summary of the Standalone Balance Sheet as at 31 December, 2009:

As at At as
st st
31 December 31 December
Particulars
2009 2008
(Rs. In Lacs) (Rs. In Lacs)
A SOURCES OF FUNDS
1 Shareholders‟ Funds
a) Share Capital 2317.34 2317.34
b) Convertible Equity Share Warrants 1575.00 -
c) Reserves & Surplus 308.37 1688.16
4200.71 4005.50
2 Loan Funds
a) Secured Loans 38943.24 19561.30
b) Unsecured Loans 7161.84 1026.15
46105.08 20587.45

3 Deferred Tax liability (Net) - 217.22

TOTAL 50305.80 24810.17

B APPLICATION OF FUNDS
1 Fixed Assets
a) Gross Block 19426.79 18295.69
b) Less: Depreciation, Amortisation & Impairment 2586.27 1658.59
c) Net Block 16840.52 16637.10
d) Capital Work in Progress (including Capital Advances) 369.33 273.19
17209.85 16910.29

2 Investments 100.00 -

3 Current Assets, Loans & Advances

a) Interest Accrued but not due 34.89 50.20
b) Inventories 39100.61 21140.40
c) Sundry Debtors 704.30 2451.36
d) Cash & Bank Balances 3255.56 1959.86
e) Loans & Advances 18878.90 9578.59
61974.26 35180.41

4 Less: Current Liabilities & Provisions

a) Current Liabilities 29490.12 28328.21
b) Provisions 24.12 24.18
29514.24 28352.39

Net Current Assets 32460.02 6828.02

Miscellaneous Expenditure (To the extent not written off /

5 535.93 1071.86
adjusted)

TOTAL 50305.80 24810.17

4
 st
Summary of the Standalone Profit & Loss Account for the year ended 31 December, 2009:

Year Ended on Year Ended on

st st
31 December, 31 December,
Particulars
2009 2008
(Rs. in Lacs) (Rs. in Lacs)
A INCOME
Sales & Services 3973.32 3915.16
Other Income 18.91 35.24
Increase / (Decrease) in Stocks - -
Total (A) 3992.23 3950.40

B EXPENDITURE
Traded Purchases 3969.22 3267.21
Cost of Construction (Real Estate Development) 38929.97 20795.11
Less: Cost of Construction carried to Inventories (38929.97) (20795.11)
Payments to & Provision for Employees 49.72 50.36
Administration & Other Expenses 1222.14 906.77
Finance Expenses 0.77 3.37
Depreciation & Amortization 113.02 129.18
Provision for Impairment Loss 232.47 316.37
Total (B) 5587.34 4673.26
Profit / (Loss) for the year (A - B) (1595.11) (722.86)
Less: Prior Period Adjustment (2.42) 2.15
Profit / (Loss) before Tax (PBT) (1592.69) (725.01)
Less: Tax Provision
Income Tax - -
Wealth Tax 0.20 0.49
Fringe Benefit Tax 4.82 11.90
Income Tax / Wealth Tax for earlier years 3.64 -
Fringe Benefit Tax for earlier years (1.51) -
Deferred Tax (217.22) 224.12
MAT Credit Entitlement (2.84) -
Profit / (Loss) after Tax (1379.78) (961.51)
Balance brought forward from Previous Year 1536.41 2497.92
Balance carried to Balance Sheet 156.63 1536.41

5
 st
Summary of the Consolidated Balance Sheet as at 31 December, 2009:

As at At as
st st
31 December 31 December
Particulars
2009 2009
(Rs. In Lacs) (Rs. In Lacs)
A SOURCES OF FUNDS
1 Shareholders‟ Funds
a) Share Capital 2,326.44
b) Convertible Equity Share Warrants 1,575.00
c) Reserves & Surplus 4,097.76 7,999.20

2 Loan Funds
a) Secured Loans 38,943.24
b) Unsecured Loans 7,161.84 46,105.09

3 Minority Interest 208.47

TOTAL 54,312.76

B APPLICATION OF FUNDS
1 Fixed Assets
a) Gross Block 19,426.79
b) Less: Depreciation, Amortization & Impairment (2,586.27)
c) Net Block 16,840.52
d) Capital Work in Progress (including Capital Advances) 369.33 17,209.85

2 Investments 99.00

3 Goodwill on Consolidation 0.16

4 Current Assets, Loans & Advances

a) Interest Accrued but not due 34.89
b) Inventories 41,083.29
c) Sundry Debtors 704.31
d) Cash & Bank Balances 3,258.57
e) Loans & Advances 21,023.56 66,104.62

Less: Current Liabilities & Provisions

a) Current Liabilities 29,612.68
b) Provisions 24.12 (29,636.80)

Net Current Assets 36,467.82

5 Miscellaneous Expenditure (To the extent not written off / 535.93

adjusted)

TOTAL 54,312.76

6
 st
Summary of the Consolidated Profit & Loss Account for the year ended 31 December, 2009:

Particulars Year Ended on Year Ended on

st st
31 December, 31 December,
2009 2009
A INCOME
Sales & Services 3,973.32
Other Income 21.30
Increase / (Decrease) in Stocks -
Total (A) 3,994.62

B EXPENDITURE
Traded Purchases 3,969.22
Cost of Construction (Real Estate Development) 38,929.97
Less: Cost of Construction carried to Inventories (38,929.97) -
Construction Work-In-Progress 1,982.68
Less: Construction W-I-P carried to Inventories (1,982.68) -
Payments to & Provision for Employees 49.72
Administration & Other Expenses 1,256.55
Finance Expenses 0.76
Depreciation & Amortization 113.02
Provision for Impairment Loss 232.47
Total (B) 5,621.74
Profit / (Loss) for the year (A - B) (1,627.12)
Less: Prior Period Adjustment (2.41)
Profit / (Loss) before Tax (PBT) (1,624.71)
Less: Tax Provision
Income Tax -
Wealth Tax 0.20
Fringe Benefit Tax 4.82
Income Tax / Wealth Tax for earlier years 3.64
Fringe Benefit Tax for earlier years (1.51)
Deferred Tax (217.22)
MAT Credit Entitlement (2.84)
Profit / (Loss) after Tax before Minority Interest (1,411.80)
Less: Minority‘s interest in loss of subsidiary 1.67
Profit / (Loss) for the year (1,410.13)
Balance brought forward from Previous Year 1,536.41
Balance carried to Balance Sheet 126.28

7
 GENERAL INFORMATION

Dear Shareholder(s),

Pursuant to the resolutions passed by our Board of Directors of our Company at the meeting held on
th
29 April, 2010, it has been decided to make the following offer to our Equity Shareholders of the
Company, with a right to renounce:

ISSUE OF [●] EQUITY SHARES OF RS. 10 EACH FOR CASH AT A PREMIUM OF RS. [●] PER
EQUITY SHARE AGGREGATING UPTO RS. 7500 LACS TO THE EQUITY SHAREHOLDERS ON
RIGHTS BASIS IN THE RATIO OF [●] EQUITY SHARES FOR EVERY [●] EQUITY SHARES HELD
ON THE RECORD DATE I.E. [●] (THE “ISSUE”). THE ISSUE PRICE OF EACH EQUITY SHARE IS
[●] TIMES THE FACE VALUE OF THE EQUITY SHARE.

The brief information for the Company is given below:

Name of the Company Shree Ram Urban Infrastructure Limited

Shree Ram Mills Premises, Ganpatrao Kadam Marg,
Lower Parel, Mumbai – 400 013.
Registered Office
Tel: +91 22 61404900; Fax: +91 22 24928617
Email: [email protected]
th
Date of Incorporation 25 January, 1935
Company Registration No 002241 of 1934/1935
Company Identification No L17110MH1935PLC002241
Registrar of Companies, Maharashtra
Address of the Registrar of Everest House,
Companies 100, Marine Drive,
Mumbai – 400 002.
Bombay Stock Exchange Limited,
Name of the Stock Exchange Floor 25, P. J. Towers,
(Designated Stock Exchange) Dalal Street,
Mumbai – 400 001.

Company Secretary & Compliance Officer:

Manju B. Batham,
Shree Ram Urban Infrastructure Limited,
Shree Ram Mills Premises,
Ganpatrao Kadam Marg, Lower Parel,
Mumbai – 400 013.
Tel: +91 22 61404900
Fax: +91 22 24928617
Email: [email protected]

Investors can contact the Compliance Officer in case of any Pre-Issue or Post-Issue related problems
such as non-receipt of letter of allotment or share certificates, credit of securities in depositories
beneficiary account or dispatch of refund orders etc.

Board of Directors of Shree Ram Urban Infrastructure Limited:

Sr.
Director Designation Category
No.
1 Mr. Shambhukumar S. Kasliwal Chairman Promoter, Non-Executive
2 Mr. Vikas S. Kasliwal Vice-Chairman & CEO Promoter, Executive
3 Mr. Ambuj A. Kasliwal Vice-Chairman Non-Executive

8
 4 Mr. Mukul S. Kasliwal Director Non-Executive
5 Mr. Subhkaran K. Luharuka Whole Time Director Executive
6 Mr. Vijay G. Kalantri Director Independent
7 Dr. Om Prakash Chawla Director Independent
8 Mr. Lalit Mohan Director Independent
9 Mr. Xerxes N. Talati Director Independent
10 Mr. Mohan M. Jayakar Director Independent
11 Dr. Poornima G. Advani Director Independent
12 Mr. Surendra Singh Bhandari Nominee Director Independent

For details of the Board of Directors of the Company, see section titled Our Management on page 42.

Lead Manager to the Issue:

Aryaman Financial Services Limited

60, Khatau Building,
Ground Floor,
Alkesh Dinesh Modi Marg,
Fort, Mumbai - 400 001.
Tel: +91 22 22618264 / +91 22 22618635
Fax: +91 22 22630434
E-mail: [email protected]
Website: www.afsl.co.in
Contact Person: Mr. Rajan Vora
SEBI registration number: INM000011344

Statement of responsibilities as the Lead Manager to the Issue

Aryaman Financial Services Limited is the sole Lead Manager to the Issue and all the responsibilities
relating to the co-ordination and other activities in relation to the Issue shall be performed by them.

Legal Advisor to the Issue:

M/s. Dave & Girish & Co.

1st Floor, Sethna Building,
55, Maharshi Karve Road,
Marine Lines, Mumbai - 400 002.
Tel: +91 22 22062132 / +91 22 22062192
Fax: +91 22 22085620
E-mail: [email protected]
Contact Person: Ms. Mona Bhide

Bankers to the Issue:

[●]

Self Certified Syndicate Banks:

The list of banks that have been notified by SEBI to act as SCSB for the ASBA Process are provided
on www.sebi.gov.in/pmd/scsb.pdf.

Registrar to the Issue:

M/s. Bigshare Services Pvt. Ltd.

E/2, Ansa Industrial Estate,
Sakivihar Road, Sakinaka,
Andheri (E), Mumbai – 400 072.

9
Tel: +91 22 40430200
Fax: +91 22 28475207
Website: www.bigshareonline.com
E-mail: [email protected]
Contact Person: Mr. Ashok Shetty
SEBI Registration Number: INR000001385

Note: Investors are advised to contact the Registrar to the Issue / Compliance Officer in case of any
pre-issue / post issue related problems such as non-receipt of Draft Letter of Offer / letter of allotment
/ demat credit / share certificate(s) / refund orders.

Credit Rating

This being a Rights issue of Equity Shares only, no Credit Rating is required.

Debenture Trustee

This being a Rights Issue of Equity Shares, appointment of Debenture trustee is not required.

Monitoring Agency

In terms of SEBI (ICDR) Regulations, 2009, Chapter II, Regulation 17, the appointment of a
monitoring agency is mandatory only if the issue size exceeds Rs.500.00 Crores. Since the present
issue size would not exceed Rs.500.00 Crores no Monitoring Agency has been appointed.

Appraising Entity

The objects of the present issue have not been appraised by any appraising agency.

Issue Schedule

Issue Opening Date [●]

Last date for receiving requests for SAFs [●]
Issue Closing Date [●]

Declaration by Board on creation of separate account

The Board of Directors declares that funds received against this Issue will be transferred to a separate
bank account other than the bank account referred to sub-section (3) of Section 73 of the Companies
Act.

Minimum Subscription

If our Company does not receive the minimum subscription of 90% of the Issue, our Company shall
forthwith refund the entire subscription amount received within 15 days from Issue Closing Date. If
there is a delay in the refund of subscription by more than eight days after the date from which our
Company becomes liable to pay the subscription amount (i.e. 15 days after the Issue Closing Date or
the date of refusal by the Stock Exchange, whichever is earlier) our Company shall pay interest for the
delayed period at the rates prescribed under Section 73 (2) and (2A) of the Companies Act.

Standby Underwriting Agreement / Subscription to the Issue by Promoter and Promoter Group

The present Rights Issue is not underwritten. However, the Promoters have confirmed vide their
th
Letter of Intent dated 7 October 2010 that they intend to subscribe to the full extent of their
entitlement in the Issue. Promoters intend to apply for additional Equity Shares in the Issue such that
at least 90% of the Issue size is subscribed. As a result of this subscription and consequent allotment,
the Promoters may acquire Equity Shares over and above their entitlement in the Issue, which may
result in their shareholding in the Company being above their current shareholding.

10
The Promoters and the members of the Promoter Group holding Equity Shares in our Company have
th
vide their letter dated 7 October 2010 undertaken to fully subscribe for their Rights Entitlement. They
reserve the right to subscribe for their Rights Entitlement either by themselves and/or through one or
more entities controlled by them, including by subscribing for Equity Shares pursuant to any
renunciation made by any member of the Promoter Group to another member of the Promoter Group.
They have also undertaken to apply for the Equity Shares in addition to their rights entitlement to the
extent of any undersubscribed portion of the Issue, subject to obtaining approvals required under
applicable law, if any. Such subscription for Equity Shares over and above their rights entitlement, if
allotted, may result in an increase in their percentage shareholding above their current percentage
shareholding. Further, such acquisition by them of additional Equity Shares with shall (i) not result in a
change of control of the management of our Company; and (ii) be exempt from the applicability of
Regulations 11 and 12 of the Takeover Code in terms of the provision to Regulation 3(1)(b)(ii) of the
Takeover Code. In connection with issued and allotted by our Company in the Issue, the Promoters
and members of the Promoter Group may apply for the issue of such Equity Shares as may arise from
the exercise of the issued and allotted to them in the Issue and such exercise shall (i) not result in a
change of control of the management of our Company; and (ii) be exempt from the applicability of
Regulations 11 and 12 of the Takeover Code in terms of the provision to Regulation 3(1) (b) (ii) of the
Takeover Code.

Details of Principal Terms of loans and assets charged are as follows:-

Amount
Amount
Sr. Outstanding as on
Name of Financial Institution / Bank Sanctioned (Rs. in
No. 31/07/2010
Lacs)
(Rs. in Lacs)
1. ICICI Bank Limited – I 17500.00 17500.00
2. ICICI Bank Limited – II 2500.00 0.00
3. Punjab National Bank 15000.00 14240.88
4. Bank of India 10000.00 9500.36
5. SREI Infrastructure Finance Limited 1275.00 31.47
6. SREI Infrastructure Finance Limited 1275.00 87.99
7. SREI Infrastructure Finance Limited 1275.00 16.22
8. SREI Infrastructure Finance Limited 1275.00 18.59
9. SREI Infrastructure Finance Limited 1275.00 74.33
10. SREI Infrastructure Finance Limited 1950.00 992.38
11. SREI Infrastructure Finance Limited 345.00 148.30
12. SREI Equipment Finance Limited 300.00 143.75
13. SREI Equipment Finance Limited 15.58 12.59
14. SREI Equipment Finance Limited 133.90 104.82
15. SREI Equipment Finance Limited 42.00 35.80
16. SREI Equipment Finance Limited 500.00 462.66
17. SREI Equipment Finance Limited 500.00 480.53
18. SREI Equipment Finance Limited 500.00 462.66
Total 55661.99 44313.34

Apart from the above mentioned secured loans, the company has availed vehicle loans from various
financial institutions and banks where the total sanction amount is Rs. 63.51 Lacs, where the amount
outstanding as on 31/07/2010 is Rs. 21.80 Lacs

Details of Assets charged as Security:

The term loans from Bank of India, Punjab National Bank and ICICI Bank, all interest thereon, costs,
charges, expenses and all other monies in respect thereof are be secured by:

11
- Pari passu charge with Lending Banks on mortgage of portion of the Property bearing plot No. 5B
& 6 together with all buildings and structures thereon, both present and future.
- Pari passu charge with Lending Banks on the Project receivables under the documents entered
into with the Customers by the Borrower, all insurance proceeds, both present and future.
- Pari passu charge with Lending Banks on mortgage and charge / assignment by way of security
of all rights, title, interest, claims; benefits, demands under the project documents, both present
and future.
- Pari passu charge with Lending Banks on the Escrow Account and DSR account.
- Personal Guarantee of Mr. Vikas Kasliwal.
- Corporate Guarantee of M/s. Akhilesh Developers Private Limited.
- Pari passu charge with Lending Banks on pledge of 44.47% shares of Shree Ram Urban
Infrastructure Limited subject to section 19(2), (3) of B. R. Act. In case of event of default, Security
Trustee would act on instructions of any or all of the Lenders to sell the pledged shares and share
the proceeds in proportion of the loan outstanding on the date of default.

Vehicles Loans and Loan from SREI Equipment Finance Pvt. Ltd. are secured against hypothecation
of assets financed.

12
 CAPITAL STRUCTURE

The capital structure of our Company and related information as on the date of this Draft Letter of
Offer is set forth below:

Aggregate Aggregate
Nominal Value at Issue
Particulars
Value Price
(Rs. in Lacs) (Rs. in Lacs)
Authorised Share Capital*
9,57,11,120 Equity Shares of Rs. 10 each 9,571.11 9,571.11
1,36,877 11% Redeemable Cumulative Preference Shares of Rs.
136.88 136.88
100 each
1,17,011 0% Redeemable Preference Shares of Rs. 100 each 117.01 117.01
17,50,000 Unclassified Shares of Rs. 10 each 175.00 175.00
10000.00 10000.00
Issued Subscribed and Paid up Capital
Equity Share Capital
(A) Issued Subscribed and Paid-up Equity Share Capital
2,06,34,540 Equity Shares of Rs. 10 each 2,063.45 2,063.45
Total (A) 2,063.45 2,063.45
(B) Issued Subscribed and Paid up Preference Share Capital
1,36,877 11% Redeemable Cumulative Preference Shares
st
having face value of Rs. 100 each are due for redemption on 31 136.88 136.88
October, 2018.
1,17,011 Zero Percent Redeemable Preference Shares having
th
face value of Rs. 100 each are due for redemption on 30 117.01 117.01
October, 2017.
Total (B) 253.89 253.89
Total (A+B) 2,317.34 2,317.34
Present Issue pursuant to this Draft Letter of Offer

[●] Equity Shares of Rs. 10 each at a premium of Rs. [●] i.e. at a

[●] [●]
price of Rs. [●]
Issued / Subscribed and Paid up Equity Share Capital post
the Issue
[●] Equity Shares of Rs. 10 each [●] [●]
Share Premium Account
Share Premium Account prior to the Issue - -
Share Premium Account post the Issue [●] [●]
* Authorised Share Capital of our Company was increased from Rs.2500 lacs to Rs.10,000 lacs in the
th
AGM held on 24 June, 2009.

Notes to Capital Structure:

1. The Company has 2,05,00,000 Convertible Equity Share warrants outstanding as on date of this
Draft Letter of Offer. Details of the same are, as under:


th
The Company has, pursuant to the approvals received from shareholders on 6 November,
th
2009 and 19 January, 2010, allotted 45,00,000 and 1,60,00,000 warrants respectively which

13
 are each Convertible into one Equity Share of Rs. 10/- each at a premium of Rs. 130/- per
share.

 In the event of these warrant holders exercising all their warrants, the Company shall issue
2,05,00,000 Equity Shares and consequently, the outstanding issued, subscribed and paid up
equity capital shall stand augmented by the additional shares issued and these Equity
Shareholders shall also be entitled to subscribe to the issue in case the allotment is
completed before the entitlement date.

 In case these warrants do not get converted and are outstanding as on the date of rights
entitlement, one right for each outstanding warrant shall be reserved and set aside. If these
warrants are converted within the stipulated time frame, they shall be entitled to apply for the
additional Equity Shares from this Rights Issue. For further details regarding rights entitlement
of outstanding warrant holders and terms of payment thereof please refer ―Terms of the
Issue‖ beginning on page 149 of this Draft Letter of Offer.

2. We have not issued any Equity Shares or granted any options under any employee stock option
scheme or employees stock purchase scheme.
th
3. Shareholding of our Promoter and Promoter Group in our Company as on 30 September 2010 :

Shares Pledged or otherwise

Total Shares Held
encumbered
Name of Shareholder As a % of As a % of As a % of
Number total Paid Number individual total paid
up capital holding up capital
(IV) = (III) /
(I) (II) (III) (V)
(I) * 100
Individuals
Shambhukumar Kasliwal 50,000 0.24 - - -
Vikas Kasliwal 4,48,000 2.17 - - -
Rajkumari Kasliwal 14,27,897 6.92 - - -
Anuradha Kasliwal 3,08,903 1.50 - - -
Corporate
Kartikeya Finvest Pvt Ltd 5,03,985 2.44 - - -
Vidhi Holdings Pvt Ltd 5,03,985 2.44 1,50,000 29.76 0.73
Akhilesh Developers Pvt Ltd 90,71,713 43.96 90,26,284 99.50 43.74
TOTAL 1,23,14,483 59.68 91,76,284 74.52 44.47

4. None of the Promoters or Promoter Group Entities of our Company have either purchased or sold
any Equity Shares, directly or indirectly, during the period of one year preceding the date on
which this Draft Letter of Offer is filed with SEBI.

5. The Promoters and the members of the Promoter Group holding Equity Shares in our Company
th
have vide their letter dated 7 October 2010 undertaken to fully subscribe for their Rights
Entitlement. The promoters reserve the right to subscribe for their Rights Entitlement either by
themselves and/or through one or more entities controlled by them, including by subscribing for
Equity Shares pursuant to any renunciation made by any member of the Promoter Group to
another member of the Promoter Group. They have also undertaken to apply for Equity Shares in
addition to their Rights Entitlement to the extent of any undersubscribed portion of the Issue,
subject to obtaining approvals required under applicable law, if any. Such subscription for Equity
Shares over and above their Rights Entitlement, if allotted, may result in an increase in their
percentage shareholding above their current percentage shareholding. Further, such acquisition
by them of additional Equity Shares shall (i) not result in a change of control of the management
of our Company; and (ii) be exempt from the applicability of Regulations 11 and 12 of the
Takeover Code in terms of the proviso to Regulation 3(1)(b)(ii) of the Takeover Code.

14
 The Promoters and Promoter Group shall subscribe to such unsubscribed portion as per the
relevant provisions of the law. Allotment to the Promoter and Promoter Group of any
unsubscribed portion, over and above their Rights Entitlement shall be done in compliance with
the Listing Agreement and other applicable laws prevailing at that time relating to continuous
listing requirements.

―The subscription by the Promoters and/or members of the Promoter Group for the Equity Shares
in the Issue and the allotment of the Equity Shares will be in continuous compliance with the
minimum public shareholding requirement specified under Clause 40A of the Listing Agreement
with the Stock Exchange (―Listing Agreement‖) and our Company will take such steps as may be
necessary to ensure such compliance with Clause 40A of the Listing Agreement.‖

In addition, our promoters and promoter group hold 1,60,84,678 convertible Equity Share
Warrants as on date. These warrants once exercised and converted, shall be entitled to one
additional equity share pursuant to this rights issue. In case they decide to convert these warrants
into equity shares and subsequently apply for their entitled additional equity shares pursuant to
this rights issue, such subscription or allotments pursuant to the reserved rights issue allotments
may result in an increase in their percentage shareholding above their current percentage
shareholding. Further, such acquisition by them of additional Equity Shares shall (i) not result in a
change of control of the management of our Company; and (ii) be exempt from the applicability of
Regulations 11 and 12 of the Takeover Code in terms of the proviso to Regulation 3(1)(b)(ii) of
the Takeover Code.
th
6. Shareholding Pattern of our Company as filed with the BSE as on 30 September, 2010:

Total
Shares pledged or
Shareholding as a
otherwise
% of total No. of
encumbered
Total No. of Shares
No. of
Total No. Shares held As a
Category of Shareholder Shareh
of Shares in Demat % of
olders As a % As a %
Form Number of Total
of of
shares No. of
(A+B) (A+B+C)
Shares
(7=6/2)
(1) (2) (3) (4) (5) (6) (7)
(A) Shareholding of
Promoter and Promoter
Group
(1) Indian
Individuals / Hindu
17 22,34,800 22,34,800 10.83 10.83 - -
Undivided Family
Bodies Corporate 3 1,00,79,683 1,00,79,683 48.85 48.85 91,76,284 91.04
Sub Total 20 1,23,14,483 1,23,14,483 59.68 59.68 91,76,284 74.52
(2) Foreign - - - - - - -
Total shareholding of
Promoter and Promoter 20 1,23,14,483 1,23,14,483 59.68 59.68 91,76,284 74.52
Group (A)
(B) Public Shareholding
(1) Institutions
Financial Institutions /
2 420 120 - - - -
Banks
Insurance Companies 2 1,29,000 1,29,000 0.63 0.63 - -
Foreign Institutional
4 17,75,050 17,75,050 8.60 8.60 - -
Investors

15
Sub Total 8 19,04,470 19,04,170 9.23 9.23 - -
(2) Non-Institutions
Bodies Corporate 243 30,41,425 30,40,525 14.74 14.74 - -
Individuals
Individual shareholders
holding nominal share 6,702 13,71,056 12,11,700 6.64 6.64 - -
capital up to Rs. 1 lakh
Individual shareholders
holding nominal share
34 16,51,786 14,95,426 8.00 8.00 - -
capital in excess of Rs.
1 lakh
Any Others (Specify) 86 3,51,320 3,51,320 1.70 1.70 - -
Clearing Members 33 3,22,289 3,22,289 1.56 1.56 - -
Non Resident Indians 52 28,831 28,831 0.14 0.14 - -
Trusts 1 200 200 - - - -
Sub Total 7,065 64,15,587 60,98,971 31.09 31.09 - -
Total Public shareholding
7,073 83,20,057 80,03,141 40.32 40.32 - -
(B)
Total (A)+(B) 7,093 2,06,34,540 2,03,15,031 100.00 100.00 91,76,284 44.47
(C) Shares held by
Custodians and against
- - - - - - -
which Depository Receipts
have been issued
Total (A)+(B)+(C) 7,093 2,06,34,540 2,03,15,031 100.00 100.00 91,76,284 44.47

7. The shareholding pattern of persons belonging to the category "Public" and holding more than 1%
of the total number of Equity Shares of our Company is set forth in the table below:

No. of Equity
Sr. No. Name of the Shareholder % of holding
Shares held
1. Rhodes Diversified 12,00,000 5.82
2. Turan Infratech Pvt Ltd 5,62,473 2.73
3. Girija Holding Pvt Ltd 5,03,985 2.44
4. Raj Infin Pvt Ltd 5,03,985 2.44
5. Moolsha Investment Pvt. Ltd. 5,03,985 2.44
6. Citi Group global Markets Mauritius Pvt Ltd 3,75,000 1.82
7. Roopchand Bhanshali 3,33,477 1.62
8. Dilip C Bagri 3,03,985 1.47
9. Ani-Abhi Investment Pvt Ltd 2,65,404 1.29
Total 45,52,294 22.06

8. None of the Equity Shares held by promoter and promoter group are locked-in.

9. The Equity Shares of our Company are fully paid up and there are no partly paid up Equity
Shares as on the date of this Draft Letter of Offer.

16
 SECTION IV: PARTICULARS OF THE ISSUE

OBJECTS OF THE ISSUE

The Objects of this Issue are to raise funds for:

i. Purchase of Capital Equipment

ii. Redemption of Preference Shares
iii. General Corporate Purposes

The details of the proceeds of the issue are summarized in the table below:

Particulars Amount (Rs. in Lacs)

Gross Issue Proceeds [●]
Less: Issue expenses [●]
Net proceeds of the Issue* [●]
*To be finalized upon completion of issue

The main object clauses of our Memorandum of Association enable us to undertake our existing
activities and the activities for which funds are being raised through this Issue.

The fund requirements and the intended use of the proceeds as described herein are based on
management estimates, current quotations from suppliers and our current business plan. The fund
requirements and intended use of proceeds have not been appraised by any bank or financial
institution. In view of the competitive and dynamic nature of the infrastructure development and
construction industry, we may have to revise our expenditure and fund requirements as a result of
variations including in the cost structure, changes in estimates, changes in quotations, exchange rate
fluctuations and external factors, which may not be within the control of our management. This may
entail rescheduling, revising or canceling the planned expenditure and fund requirement and
increasing or decreasing the expenditure for a particular purpose from its planned expenditure at the
discretion of our Board. In addition, current quotations from suppliers are only valid for limited periods
and there can be no assurance that we will be able to obtain new quotations from these or other
suppliers on the same terms.

In case of variations in the actual utilization of funds earmarked for the purposes set forth above,
increased fund requirements for a particular purpose may be financed by surplus funds, if any,
available in respect of the other purposes for which funds are being raised in this Issue. If surplus
funds are unavailable, the required financing will be through our internal accruals and debt.

Utilization of Net Proceeds:

Estimated Total Cost

Particulars
(Rs. in Lacs)
Purchase of Capital Equipment 4729.02
Redemption of Preference Shares 253.89
General Corporate Purposes [●]
Total [●]

Means of Finance:

Estimated Total Cost

Particulars
(Rs. in Lacs)
Net Issue Proceeds [●]
Total [●]

17
Since, all the objects of this Rights Issue are being financed by the Rights Issue proceeds there is no
requirement of confirming firm arrangements for any other means of finance.

Schedule of Implementation/Utilization of Issue Proceeds

The breakdown of the proposed utilization of the Net Proceeds and the deployment of the Issue
Proceeds, as currently estimated by the Company, during fiscals 2010, 2011 and 2012, and the
st
expenditure incurred as of 31 December, 2009, is set forth below.

Expenditure Schedule of Deployment of Funds as of

st
incurred as 31 December,
Particulars on date of
Draft Letter 2010 2011 2012
of Offer
Purchase of Capital Equipments - 1500.00 3229.02 -
Redemption of Preference
- - 253.89 -
Shares
General Corporate Purposes - - [●] -

i. Purchase of Capital Equipment

We need to purchase capital equipment on a recurring basis due to the nature of the industry we
operate in. We intend to use Rs. 4729.02 Lacs from the Issue Proceeds for the purchase of capital
equipment to meet the requirements of our Current Real Estate Project and our future requirements
as estimated by the management.

Total Total
Sr. Equipment
Capacity Brief Description Quantity Rate (Rs.) Amount
No. Type
(Tonnes) (Rs.)
1. Shuttering Lot Form Work System to 11,800 36,700 4,330.60
Equipment mould concrete to its
(M S Plate) desired size and
shape.
Vat 4% 173.22
Sub Total 4503.82
Add: Contingencies (5%) 225.20
Total 4729.02
th th
These cost estimates are based on quotations dated 19 June 2010 and 19 March 2010 have been
received from M/s. Krishna Trading Corporation and M/s. Ready Made Steel (India) Pvt. Ltd. for 5,900
tonnes of shuttering material each.

We intend to purchase the equipments set out above on a regular basis in the course of our business.
The prices for the equipment proposed to be purchased as set out above are as per current
quotations received from supplier. Current quotations from suppliers are only valid for limited periods
and there can be no assurance that we will be able to obtain new quotations from these or other
suppliers on the same terms.

The estimated expenditure plan has not been appraised by an independent organization. In addition,
the Company‘s capital expenditure plans are subject to a number of variables, including possible
changes in technology, changes in project design, construction delays or defects and changes in the
management‘s views of the desirability of current capital equipment, among others.

ii. Redemption of Preference Shares

a. 11% Redeemable cumulative preference shares

As per the AAIFR order dated 11th October, 1994, the Company has issued the 11% Redeemable
cumulative preference shares of Rs.100/- each in the year 1997 to its debenture holders towards the

18
outstanding interest on debentures outstanding as on 30th September, 1994 which were redeemable
with interest during the year 2001-2002 to 2002-2003. The Board of Directors at its meeting held on
31st July, 2003 extended the period of redemption of said Preference shares for a period of fifteen
years till 30th October, 2018. This extension permitted an early redemption in case the holders of
such instrument give a written consent for the same.

Pursuant to notice dated 5th June, 2010 sent to the holders of this instrument, we have received
affirmative written consents dated 5th July, 2010 from them for early redemption.

The redemption was approved by our Board of Directors on 19th July, 2010 at par and was proposed
to be funded from the proceeds of the rights issue.

Following is the list of current holders of these securities who shall be redeemed with the Issue
proceeds:

Amount to be
Sr.
Name of Shareholder No. of shares paid for
No.
redemption
(i) Promoters and Promoters Group
1 Mr. Vikas Kasliwal 182 18,200
2 Vidhi Holdings Pvt. Ltd. 93870 93,87,000
3 Akhilesh Developers Pvt. Ltd. 34364 34,36,400
(ii) Others
4 Mr. Virendra Popat 611 61,100
5 The Oriental Insurance Company Ltd. 7850 7,85,000

b. 0% Redeemable preference shares

The Company as per the AAIFR order dated 11th October, 1994, has issued 0% Redeemable
Preference Shares of Rs.100/- each in the year 1997 to its debenture holders towards the balance
interest portion comprising interest on overdue interest on the debentures outstanding as on 30th
September, 1994 redeemable during the year 2001-2002. Further the Board of Directors at its
meeting held on 31st July, 2003 extended the period of redemption of said Preference Shares for a
period of fifteen years till 30th October, 2017. This extension permitted an early redemption in case
the holders of such instrument give a written consent for the same.

Pursuant to notice dated 5th June, 2010 sent to the holders of this instrument, we have received
affirmative written consents dated 5th July, 2010 from them for early redemption.

The redemption was approved by our Board of Directors on 19th July, 2010 at par and was proposed
to be funded from the proceeds of the rights issue.

Following is the list of current holders of these securities who shall be redeemed with the Issue
proceeds:

Amount to be
Sr.
Name of Shareholder No. of shares paid for
No.
redemption
(i) Promoters and Promoters Group
1 Mr. Vikas Kasliwal 110 11,000
2 Vidhi Holdings Pvt. Ltd. 110669 1,10,66,900
(ii) Others
Mr. Virendra Popat 351 35,100
The Oriental Insurance Company Ltd. 5881 5,88,100

iii. General Corporate Purposes

We, in accordance with the policies set up by our Board, will have flexibility in applying the remaining
Net Proceeds of this Issue, for general corporate purposes including but not restricted towards

19
strategic initiatives and acquisitions, brand building exercises, repayment of liabilities, and the
strengthening of our marketing capabilities. Being a new company in the real estate segment, we
intend to bid / tender for or execute various construction projects from time to time. Depending on the
projects that may be awarded and the mode of funding required for those projects, we intend to invest
in those projects. We are also required to make security deposits, while we bid for construction
projects or development rights on any property. Since the amount required would be quite huge and
we may not have adequate funds / working capital available to place prompt bids at multifarious
locations / auctions, we intend to improve our liquidity position. In order to facilitate prompt bidding for
construction projects, development rights, contingencies with respect to new ventures that we may
take up from time to time, we have earmarked funds for General Corporate Purposes.

Appraisal

The funding requirements and means of finance as set out in the objects of the issue have not been
appraised by any independent agency and are based purely on management estimates.

Interim Use of Proceeds

The Company‘s management, in accordance with the policies established by the Board, will have
flexibility in deploying the Issue Proceeds. Pending utilization of the Issue Proceeds for the purposes
described above, the Company intends to temporarily invest the funds in high quality interest bearing
liquid instruments including money market mutual funds and deposits with banks, in accordance with
its investment policies as approved by the Board from time to time.

Issue Related Expenses*

The Issue related expenses include, among others, underwriting and selling commissions, printing
and distribution expenses, legal fees, advertisement expenses and registrar and depository fees. The
estimated Issue expenses are as follows:

Expense Expense
Sr. Expense
Particulars (% of Total (% of Issue
No. (Rs. in Lacs)
Expenses) Size)
1 Fees to Intermediaries [●] [●] [●]
2 Fees to SEBI and Stock Exchange [●] [●] [●]
Printing and Stationary (includes
3 [●] [●] [●]
Postage and Dispatch)
4 Advertisement [●] [●] [●]
5 Legal Expenses [●] [●] [●]
6 Miscellaneous Expenses [●] [●] [●]
Total [●] [●] [●]
*To be finalized before submitting the Letter of Offer to the Stock Exchange

Funds Deployed

No funds have been deployed till the date of this Draft Letter of Offer for these issue objects.

Interest of Promoters in the Objects of the Issue

The interest of the promoters is only upto the extent of redemption of Preference Shares held by them
amounting to Rs. 253.89 Lacs. The Promoters and Promoter Group entities hold 1,28,416 11%
Redeemable Cumulative Preference Shares and 1,10,779 Zero Percent Redeemable Preference
Shares are held by the promoters and promoter group entities.

The same shall be redeemed from the issue proceeds and hence approximately 3.37% of the issue
proceeds shall be paid to promoters and promoters group entities.

Apart from that, the promoters do not hold any interest in the Objects of the Issue.

20
Monitoring of Utilization of Funds

The Board will monitor the utilization of the Issue Proceeds. The Company will disclose the utilization
of the Issue Proceeds under a separate head in its balance sheet for such fiscal periods as required
under the ICDR Regulations and the listing agreements with the Stock Exchange, clearly specifying
the purposes for which such Net Proceeds have been utilized. The Company will also, in the
Company‘s balance sheet for such applicable fiscal periods, provide details, if any, in relation to all
such Issue Proceeds that have not been utilized thereby also indicating investments, if any, of such
unutilized Issue Proceeds.

Expect the repayment of Preference Shares, no part of the Issue Proceeds will be paid by the
Company as consideration to the Promoters, the Directors, the Company‘s key management
personnel or companies promoted by the Promoters.

21
 STATEMENT OF TAX BENEFITS

The Board of Directors

Shree Ram Urban Infrastructure Limited
Shree Ram Mills Premises,
Ganpatrao Kadam Marg,
Lower Parel,
Mumbai – 400 013.

Dear Sirs,

Statement of Possible Tax Benefits available to the Company and its shareholders

We hereby report that the enclosed annexure, prepared by the Company, states the possible tax
benefits available to Shree Ram Urban Infrastructure Ltd (hereinafter referred to as "The Company")
and its Shareholders under the current tax laws presently in force in India. Several of these benefits
are dependent on the Company or its Shareholders fulfilling the conditions prescribed under the
relevant provisions of the relevant tax laws. Hence, the ability of the Company or its Shareholders to
derive the tax benefits is dependent upon fulfilling such conditions, which are based on the business
imperatives the Company faces in the future, the Company may or may not choose to fulfill.

The benefits discussed in the enclosed are not exhaustive. This statement is only intended to provide
general information to the investors and is neither designed nor intended to be a substitute for
professional tax advice. In view of the individual nature of the tax consequences and the changing tax
laws, each investor is advised to consult their own tax consultant with respect to the specific tax
implications arising out of their participation in the issue.

We do not express any opinion or provide any assurance as to whether:

 The Company or its Shareholders will continue to obtain these benefits in future; or
 The conditions prescribed for availing the benefits, where applicable, have been / would be
met with;
 The revenue authorities / courts will concur with the views expressed herein.

Our views are based on the existing provisions of the law and its interpretation, which are subject to
change from time to time .We do not assume responsibility to up-date the views of such changes.

While all reasonable care has been taken in the preparation of this opinion, we accept no
responsibility for any errors or omission therein or for any loss sustained by any person who relies on
it.

The contents of this annexure are based on information, explanation and representation obtained
from the Company and on the basis of our understanding of the business activities and operations of
the Company and the interpretation of current tax laws.

This report is provided solely for the purpose of assisting the addressee Company in discharging its
responsibilities under the Securities and Exchange Board of India (issue of Capital and Disclosure
Requirements) Regulations, 2009 and is not to be used, referred to or distributed for any other
purpose without our prior written consent.

For and behalf of

HABIB & CO.
Chartered Accountants

(Dhiren P. Shroff)
Membership No: 045417

Place: Mumbai
th
Date: 19 July, 2010

22
 ANNEXURE TO STATEMENT OF POSSIBLE TAX BENEFITS

The tax benefits listed below are the possible benefits available under the current tax laws in India.
Several of these benefits are dependent on the Company or its Shareholders fulfilling the conditions
prescribed under the relevant tax laws. Hence the ability of the Company or its Shareholders to derive
the tax benefits is dependent upon fulfilling such conditions, which based on business imperatives it
faces in the future, it may not choose to fulfill.

1. SPECIAL TAX BENEFITS

There are no such special tax benefits available to Shree Ram Urban Infrastructure Ltd and its
Shareholders.

2. GENERAL TAX BENEFITS

As per the existing provisions of the I T Act and other laws, as applicable for the time being in force,
the following general tax benefits and deductions are and will, inter alia, be available to the Company
and its prospective shareholders. The below mentioned general tax benefits will be available to any
Company or its shareholders upon satisfaction of certain conditions under the relevant provisions of
the I T Act and other laws.

3. BENEFITS AVAILABLE UNDER THE INCOME TAX ACT, 1961

A. TO THE COMPANY:

i. Dividends exempt under Section 10(34)

Dividend income (whether interim or final), in the hands of the Company as distributed or paid by any
other Company, on or after April 1, 2003 is completely exempt from tax in the hands of the Company,
under section 10(34) of the IT Act.

ii. Income from units of Mutual Funds exempt under Section 10(35)

`The Company will be eligible for exemption of income received from units of mutual funds specified
under Section 10(23D) of the Act, income received in respect of units from the Administrator of
specified undertaking and income received in respect of units from the specified Company in
accordance with and subject to the provisions of Section 10(35) of the Act.

iii. Exemption of Long-Term Capital Gain under Section 10(38)

According to section 10(38) of the Act, long-term capital gains on sale of equity shares or units of an
equity-oriented fund where the transaction of sale is chargeable to Securities Transaction Tax (STT)
shall be exempt from tax. However, the aforesaid income shall be taken into account in computing the
Book profit and income tax payable under section 115JB.

iv. Preliminary Expenses under Section 35D

In accordance with and subject to the provisions of section 35D of the Income tax Act, the Company
will be entitled to amortize, over a period of five years, all expenditure in connection with the proposed
public issue subject to the overall limit specified in the said section.

v. Exemption of Long Term Capital Gain under Section 54EC

According to the provisions of section 54EC of the Act and subject to the conditions specified therein,
capital gains not exempt under section 10(38) and arising on transfer of a long term capital asset shall
not be chargeable to tax to the extent such capital gains are invested in certain notified bonds, subject
to a ceiling of Rs. 50 lakhs, within six months from the date of transfer.

However, if the said bonds are transferred or converted into money within a period of three years from
the date of their acquisition, the amount of capital gains exempted earlier would become chargeable

23
to tax as long term capital gains in the year in which the bonds are transferred or converted into
money.

vi. Lower Tax Rate under Section 111A on Short-Term Capital Gains

As per the provisions of section 111A of the Act, short-term capital gains on sale of equity shares or
units of an equity oriented fund where the transaction of sale is chargeable to Securities Transaction
tax ("STT") shall be subject to tax at a rate of 15 per cent (plus applicable surcharge and education
cess).

vii. Lower Tax Rate under Section 112 on Long-Term Capital Gains

As per the provisions of Section 112 of the Act, long-term gains that are not exempt under section
10(38) of the Act would be subject to tax at a rate of 20 percent (plus applicable surcharge and
education cess). However, as per the proviso to Section 112(1), if the tax on long term capital gains
resulting on transfer of listed securities or units, calculated at the rate of 20 percent 43 with indexation
benefit exceeds the tax on long term gains computed at the rate of 10 percent without indexation
benefit, then such gains are chargeable to tax at a concessional rate of 10 percent (plus applicable
surcharge and education cess).

viii. Benefits under Section 115JAA

Under Section 115JAA(1A) of the Act, tax credit shall be allowed of any tax paid (MAT) under Section
115JB of the Act. Credit eligible for carry forward is the difference between MAT paid and the tax
computed as per the normal provisions of the Act. Such MAT credit shall not be available for set-off
beyond 10 years succeeding the year in which the MAT becomes allowable.

ix. Minimum Alternate Tax (MAT) under Section 115JB

Under Section 115JB of the Act, in case of a Company, if the tax payable on the total income as
computed under the normal provision of Income-tax Act in respect of any previous year relevant to the
assessment year commencing on or after the April 1, 2001 is less than seven and one half per cent of
its book profit, such book profit shall be deemed to be the total income of the assessee and the tax
payable for the relevant previous year shall be seven and one-half per cent of such book profit. For
Assessment Year 2009-10, if the tax payable on the total income as computed under the Income-tax
Act is less than 15% of its book profit, such book profit shall be deemed to be the total income of the
assessee and the tax payable shall be fifteen percent of such book profit. However, with effect from
April 1, 2010 i.e., in relation to the Assessment Year 2010-11 and subsequent years, if the tax
payable on the total income as computed under the Income-tax Act in respect of any previous year
relevant to the assessment year commencing on or after the April 1, 2010 is less than 18% of its book
profit, such book profit shall be deemed to be the total income of the assessee and the tax payable for
the relevant previous year shall be ten per cent of such book profit.

B. BENEFITS AVAILABLE TO RESIDENT SHAREHOLDERS:

i. Exemption under Section 10 (34)

Dividend (whether interim or final) declared, distributed or paid by the Company is completely exempt
from tax in the hands of the shareholders of the Company as per the provisions of section 10(34) of
the IT Act.

ii. Exemption of Long-Term Capital Gain under Section 10 (38)

Under Section 10(38) of the Act, long term capital gain arising to the shareholder from transfer of a
long term capital asset being an equity share in the Company or unit of an equity oriented mutual fund
(i.e. capital asset held for the period of twelve months or more) entered into in a recognized stock
exchange in India and being such a transaction, which is chargeable to Securities Transaction Tax,
shall be exempt from tax.

24
iii. Exemption of Long Term Capital Gain under Section 54EC

According to the provisions of section 54EC of the Act and subject to the conditions specified therein,
capital gains not exempt under section 10(38) and arising on transfer of a long term capital asset shall
not be chargeable to tax to the extent such capital gains are invested in certain notified bonds, subject
to a ceiling of Rs. 50 lakhs, within six months from the date of transfer.

However, if the said bonds are transferred or converted into money within a period of three years from
the date of their acquisition, the amount of capital gains exempted earlier would become chargeable
to tax as long term capital gains in the year in which the bonds are transferred or converted into
money.

iv. Exemption of Long term Capital Gain under Section 54F

According to the provisions of section 54F of the Act and subject to the conditions specified therein, in
the case of an individual or a Hindu Undivided Family (`HUF"), gains arising on transfer of a long term
capital asset ((not covered by sections 10(38) and not being a residential house) are not chargeable
to tax if the entire net consideration received on such transfer is invested within the prescribed period
in a residential house. If only a part of such net consideration is invested within the prescribed period
in a residential house, the exemption shall be allowed proportionately. For this purpose, net
consideration means full value of the consideration received or accruing as a result of the transfer of
the capital asset as reduced by any expenditure incurred wholly and exclusively in connection with
such transfer.

v. Lower Tax Rate under Section 111A on Short-Term Capital Gains

As per the provisions of section 111A of the Act, short-term capital gains on sale of equity shares
where the transaction of sale is chargeable to Securities Transaction Tax shall be subject to tax at a
rate of 15% plus applicable surcharge and education cess).

vi. Lower Tax Rate under Section 112 on Long-Term Capital Gains

As per the provisions of Section 112 of the Act, long term gains that are not exempt under section
10(38) of the Act would be subject to tax at a rate of 20 percent (plus applicable surcharge and
education cess). However, as per the proviso to Section 112(1), if the tax on long term capital gains
resulting on transfer of listed securities or units or zero coupon bond, calculated at the rate of 20
percent with indexation benefit exceeds the tax on long term gains computed at the rate of 10 percent
without indexation benefit, then such gains are chargeable to tax at a concessional rate of 10 percent
(plus applicable surcharge and education cess).

C. BENEFITS AVAILABLE TO NON RESIDENTS/ NON-RESIDENT INDIAN

SHAREHOLDERS (OTHER THAN MUTUAL FUNDS, FIIS AND FOREIGN VENTURE
CAPITAL INVESTORS)

i. Exemption under Section 10(34)

Under Section 10(34) of the Act, income earned by way of dividend from domestic Company referred
to in Section 115-0 of the Act is exempt from income tax in the hands of the shareholders.

ii. Exemption under Section 10(38)

Under Section 10(38) of the Act, long term capital gains arising out of sale of equity shares or a unit of
equity oriented fund will be exempt from tax provided that the transaction of sale of such equity shares
or unit is chargeable to Securities Transaction Tax.

iii. Exemption of Long Term Capital Gain under Section 54EC

According to the provisions of section 54EC of the Act and subject to the conditions specified therein,
capital gains not exempt under section 10(38) and arising on transfer of a long term capital asset shall

25
not be chargeable to tax to the extent such capital gains are invested in certain notified bonds, subject
to a ceiling of Rs. 50 lakhs, within six months from the date of transfer.

However, if the said bonds are transferred or converted into money within a period of three years from
the date of their acquisition, the amount of capital gains exempted earlier would become chargeable
to tax as long term capital gains in the year in which the bonds are transferred or converted into
money.

iv. Exemption of Long Term Capital Gain under Section 54F

According to the provisions of section 54F of the Act and subject to the conditions specified therein, in
the case of an individual or a Hindu Undivided Family (`HUF'), gains arising on transfer of a long term
capital asset ((not covered by sections and 10(38)) and not being a residential house) are not
chargeable to tax if the entire net consideration received on such transfer is invested within the
prescribed period in a residential house. If only a part of such net consideration is invested within the
prescribed period in a residential house, the exemption shall be allowed proportionately. For this
purpose, net consideration means full value of the consideration received or accruing as a result of
the transfer of the capital asset as reduced by any expenditure incurred wholly and exclusively in
connection with such transfer.

v. Lower Tax Rate under Section 111A on Short-Term Capital Gains

Under section 111A of the Act and other relevant provisions of the Act, short-term capital gains (i.e., if
shares are held for a period not exceeding 12 months) arising on transfer of equity share in the
Company would be taxable at a rate of 15% (plus applicable surcharge and education cess) where
such transaction of sale is entered on a recognized stock exchange in India and is liable to securities
transaction tax. Short-term capital gains arising from transfer of shares in a Company, other than
those covered by section 111A of the Act, would be subject to tax as calculated under the normal
provisions of the Act.

vi. Lower Tax Rate under Section 112 on Long-Term Capital Gains

Under section 112 of the Act and other relevant provisions of the Act, long term capital gains, (other
than those exempt under section 10(38) of the Act) arising on transfer of shares in the Company,
would be subject to tax at a rate of 20 percent (plus applicable surcharge and education cess) after
indexation. The amount of such tax should however be limited to 10% (plus applicable surcharge and
education cess) without indexation, at the option of the shareholder, if the transfer is made after listing
of shares.

Where shares of the Company have been subscribed in convertible foreign exchange, Non- Resident
Indians (i.e. an individual being a citizen of India or person of Indian origin who is not a resident) have
the option of being governed by the provisions of Chapter XII-A of the Act, which inter alia entitles
them to the following benefits:

Under section 115E, where the total income of a non-resident Indian includes any income from
investment such income shall be taxed at a concessional rate of 20 per cent (plus applicable
surcharge and education cess). Also, where shares in the Company are subscribed for in convertible
foreign exchange by a Non-Resident Indian, long-term capital gains arising to the non-resident Indian
on transfer of these shares shall be taxed at a concessional rate of 10 percent (plus applicable
surcharge and education cess). The benefit of indexation of cost and the protection against risk of
foreign exchange fluctuation would not be available.

Under provisions of section 115F of the Act, long term capital gains (in cases not covered under
section 10(38) of the Act) arising to a non-resident Indian from the transfer of shares of the Company
subscribed to in convertible Foreign Exchange shall be exempt from Income tax, if the net
consideration is reinvested in specified assets or in any savings certificates referred to in section
10(4B), within six months of the date of transfer. If only part of the net consideration is so reinvested,
the exemption shall be proportionately reduced. The amount so exempted shall be chargeable to tax
subsequently, if the specified assets are transferred or converted into money within three years from
the date of their acquisition.

26
Under provisions of section 115G of the Act, it shall not be necessary for a Non- Resident Indian to
furnish his return of income under section 139(1) if his income chargeable under the Act consists of
only investment income or long term capital gains or both; arising out of assets acquired, purchased
or subscribed in convertible foreign exchange and tax deductible at source has been deducted there
from as per the provisions of Chapter XVII-B of the Act.

As per Section 90(2) of the Act, provisions of the Double Taxation Avoidance Agreement between
India and the country of residence of the Non-Resident/ Non- Resident India would prevail over the
provisions of the Act to the extent they are more beneficial to the Non-Resident/ Non-Resident Indian.

D. BENEFITS AVAILABLE TO FOREIGN INSTITUTIONAL INVESTORS (FIIs)

Income by way of dividend received on shares of the Company is exempt under section 10(34) of the
IT Act.

The long-term Capital gains accruing to the members of the Company on sale of the Company's
shares in a transaction entered into in a recognized stock exchange in India and on which STT is
paid, would be exempt from tax as per the provisions of Section 10(38).

Under section 115AD(1)(b)(iii) of the IT Act, Income by way of Long Term Capital Gain arising from
the transfer of securities (otherwise than as mentioned in 2 above) held in the Company will be
taxable @ 10% (plus applicable surcharge and education cess).

The short-term Capital gains accruing to the members of the Company on sale of the Company's
shares in a transaction entered into in a recognized stock exchange in India and on which STT is paid
would be chargeable to tax @, 15% [plus applicable surcharge and education cess] as per the
provisions of section 111A.

Under section 115AD(1)(b)(ii) of the IT Act, Income by way of Short Term Capital Gain arising from
the transfer of securities (otherwise than as mentioned in 4 above) held in the Company for a period
of less than 12 months will be taxable A 30% (plus applicable surcharge and education cess).

The foreign currency fluctuation protection and the benefits of indexation as provided in the first and
second provisos to section 48 of the IT Act are not available to Foreign Institutional Investors.

The FIIs are entitled to claim exemption in respect of tax on long term capital gains under sections
54EC of the IT Act, if the amount of capital gains is invested in certain specified bonds/securities
subject to the fulfillment of the conditions specified in those sections. As per the proviso to section
54EC (I). The investment in the specified bonds / securities should not exceed Rs. 50 lakhs during
any financial year.

Under the provisions of section 90(2) of the IT Act, if the provisions of the Double Taxation Avoidance
Agreement [DTAA] between India and the country of residence of the FII are more beneficial, then the
provisions of the DTAA shall be applicable.

E. BENEFITS AVAILABLE TO MUTUAL FUNDS

In accordance with section 10(23D), any income of:

 a Mutual Fund registered under the Securities and Exchange Board of India Act 1992 or
regulations made there under;

 such other Mutual Fund set up by a public sector bank or a public financial institution or
authorised by the Reserve Bank of India subject to such conditions as the Central Government
may, by notification in the Official Gazette, specify in this behalf, will be exempt from income-tax.

27
4. BENEFITS UNDER THE WEALTH TAX ACT, 1957

'Asset' as defined under section 2(ea) of the Wealth Tax Act, 1957, does not include shares in
Companies and hence, shares are not liable to wealth tax.

5. BENEFITS UNDER THE GIFT-TAX ACT, 1958

Gift tax is not leviable in respect of any gifts made on or after October 1, 1998. Therefore, any gift of
shares of the Company will not attract gift tax. However, in the hands of the Donee the same will be
treated as income unless the gift is from a relative as defined under Explanation to Section 56 (2) (vii)
on or after October 1 2009 of Income Tax Act, 1961.

28
 KEY INDUSTRIAL REGULATIONS & POLICIES

The following description is a summary of the relevant regulations and policies as prescribed by the
Government. The information detailed in this chapter has been obtained from the various legislations
that are available in the public domain as on the date of this Draft Letter of Offer. The regulations set
out below are not exhaustive, and are only intended to provide general information to the investors
and are neither designed nor intended to be a substitute for professional legal advice. In this section,
unless the context requires otherwise, any reference to Company refers to our Company. No action or
omission should be taken or contemplated based on the contents below without independent
verification with each prospective investors’ legal advisors, and any prospective investor who does
without such independent verification and based on the contents herein below would do so at
his/her/its sole risk and without recourse to our Company or the Lead Manager or any other person or
entity whatsoever.

The following is an overview of the important laws and regulations, which are relevant to our business
as Real Estate developers.

Central Laws

Laws relating to land acquisition

The Urban Land (Ceiling and Regulation) Act, 1976 prescribes the limits to urban areas that can be
acquired by a single entity. It has however been repealed in some states and union territories under
the Urban Land (Ceiling and Regulation) Repeal Act, 1999. Further, land holdings are subject to the
Land Acquisition Act, 1894 which provides for the compulsory acquisition of land by the central
government or appropriate state government for public purposes, including planned development and
town and rural planning. However, any person having an interest in such land has the right to object to
such compulsory acquisition and the right to compensation.

(B) Laws regulating transfer of property

Transfer of Property Act, 1882

The transfer of property, including immovable property, between living persons, as opposed to the
transfer of property by the operation of law, is governed by the Transfer of Property Act, 1882 (―T. P.
Act‖). The T. P. Act establishes the general principles relating to the transfer of property, including
among other things, identifying the categories of property that are capable of being transferred, the
persons competent to transfer property, the validity of restrictions and conditions imposed on the
transfer and the creation of contingent and vested interest in the property.

Registration Act, 1908

The Registration Act, 1908 (―Registration Act‖) has been enacted with the object of providing public
notice of the execution of documents affecting transfer of interest in immoveable property. The
purpose of the Registration Act is the conservation of evidence, assurances, title, and prevention of
fraud. It details the formalities for registering an instrument. Section 17 of the Registration Act
identifies documents for which registration is compulsory and includes, among other things, any non-
testamentary instrument which purports or operates to create, declare, assign, limit or extinguish,
whether in present or in future, any right, title or interest, whether vested or contingent, in immovable
property of the value of one hundred rupees or more, and a lease of immovable property for any term
exceeding one year or reserving a yearly rent. A document will not affect the property comprised in it,
nor be treated as evidence of any transaction affecting such property (except as evidence of a
contract in a suit for specific performance or as evidence of part performance under the T.P. Act or as
collateral), unless it has been registered.

The Indian Stamp Act, 1899 (“Stamp Act”)

Stamp duty needs to be paid on all documents specified under the Stamp Act and at the rates
specified in the Schedules thereunder. The rate of stamp duty varies from state to state. The stamp

29
duty is payable on instruments at the rates specified in Schedule I of the Stamp Act. The applicable
rates for stamp duty on these instruments, including those relating to conveyance, are prescribed by
state legislation. Instruments chargeable to duty under the Stamp Act which are not duly stamped are
incapable of being admitted in court as evidence of the transaction contained therein. The Stamp Act
also provides for impounding of instruments which are not sufficiently stamped or not stamped at all.

The Indian Easements Act, 1882

The law relating to easements is governed by the Indian Easements Act, 1882 (―Easements Act‖).
The right of easement is derived from the ownership of property and has been defined under the
Indian Easements Act to mean a right which the owner or occupier of land possesses for the
beneficial enjoyment of that land and which permits him to do or to prevent something from being
done in respect of certain other land not his own. Under this law an easement may be acquired by the
owner of immovable property, i.e. the dominant owner, or on his behalf by the person in possession of
the property. Such a right may also arise out of necessity or by virtue of a local custom.

Property Tax

Property tax is levied as a percentage of the Rateable Value (RV) of the property. The calculation of
RV and the tax rate payable varies between states. The property tax payable also varies depending
on whether the property is owner occupied or leased out. The RV is calculated on the basis of actual
rental if the property is leased. If the property is owner occupied, the RV is calculated on the basis of
the comparable rental that the property can achieve.

Laws relating to employment

The employment of construction workers is regulated by a wide variety of generally applicable labour
laws, including the Contract Labour (Regulation and Abolition) Act, 1970, the Minimum Wages Act,
1948, the Payment of Bonus Act, 1965, the Building and Other Construction Workers (Regulation of
Employment and Conditions of Service) Act, 1996, the Employees Provident Funds and
Miscellaneous Provisions Act, 1952 , the Payment of Gratuity Act 1972, the Workmen‘s
Compensation Act, 1923 and the Payment of Wages Act, 1936.

Laws for Classification of Land User

Usually, land is broadly classified under one or more categories, such as agricultural or non –
agricultural (residential, commercial and industrial). Land classified under a specified category is
permitted to be used only for such specified purpose. Where the land is originally classified as
agricultural land, in order to use the land for any other purpose, it is required to be converted into
residential, commercial or industrial purpose, by making an application to the relevant municipal or
town and country planning authorities.

In addition, some State governments in India have imposed various restrictions, which vary from State
to State, on the transfer of property within such States.

Development of Agricultural Land

The acquisition of land is regulated by State land reform laws which prescribe limits up to which an
entity may acquire agricultural land. Any transfer of land which results in the aggregate land holdings
of the acquirer in the State to exceed this ceiling is void, and the surplus land is deemed, from the
date of the transfer, to have been vested in the State government free of all encumbrances. While
granting licenses for development of townships, the authorities generally levy proportional
development charges for the provision of services such as laying down of main lines, drainage,
sewerage, water supply and electricity, where the authority is carrying out the same. Such licenses
require approvals of layout plans for development and building plans for construction activities.

Land Use Planning

Land use planning and its regulation including the formulation of regulations for building construction,
form a vital part of the urban planning process. There are several authorities having jurisdiction to

30
regulate land use planning and real estate development activities in each Indian State. Various
enactments, rules and regulations have been made by the Government, concerned State
governments and other authorized agencies and bodies such as the Ministry of Urban Development,
State Land Development and/or Planning Boards, local municipal or village authorities, which deal
with the acquisition, ownership, possession, development, zoning, planning of land and real estate. All
relevant applicable laws, rules and regulations have to be taken into consideration by any person or
entity proposing to enter into any real estate development or construction activity in this sector in
India.

Building Consents

Each State and city has its own set of laws which govern planned development and rules for
construction (such as floor area ratio ―FAR‖ or floor space index ―FSI‖ limits). The various authorities
that govern building activities in States are the Town and Country Planning Department (―TCPD‖),
municipal corporations and the Urban Arts Commission. Any application for undertaking any
construction or development activity has to be made to the TCPD, which is a State level department
engaged in the physical planning of urban centers and rural areas in the State. The municipal
authorities regulate building development and construction norms. For example, building plans are
required to be approved by the relevant municipal authority. The Urban Arts Commission advises the
relevant State Government in the matter of preserving, developing and maintaining the aesthetic
quality of urban and environmental design in some States and also provides advice and guidance to
any local body with respect to building or engineering operations or any development proposal which
affects or is likely to affect the skyline or the aesthetic quality of the surroundings or any public
amenity provided therein. Under certain State laws, the local body, before it accords its approval for
building operations, engineering operations or development proposals, is obliged to refer all such
operations to the Urban Arts Commission and seek its approval for the project. Besides the above,
certain approvals and consents may also be required from various other departments, such as the
Fire Department, the Airport Authority of India and the Archaeological Survey of India.

Environment Laws

Environmental Regulation

The three major statutes in India which seek to regulate and protect the environment against pollution
and related activities in India are the Water (Prevention and Control of Pollution) Act 1974, the Air
(Prevention and Control of Pollution) Act, 1981 and the Environment Protection Act, 1986. The basic
purpose of these statutes is to control, abate and prevent pollution. In order to achieve these
objectives, Pollution Control Boards (―PCB‖) which are vested with diverse powers to deal with water
and air pollution, have been set up in each state. The PCBs are responsible for setting the standards
for maintenance of clean air and water, directing the installation of pollution control devices in
industries and undertaking investigations to ensure that industries are functioning in compliance with
the standards prescribed. These authorities also have the power of search, seizure, and investigation
if the authorities are aware of or suspect pollution. In addition, the Ministry of Environment and
Forests looks into Environment Impact Assessment. The Ministry receives proposals for expansion,
modernization and setting up of projects and the impact which such projects would have on the
environment is assessed by the Ministry before granting clearances for the proposed projects.

Laws specific to the state of Maharashtra:

The Maharashtra Ownership of Flats (Regulation of the Promotion of Construction, Sale,

Management and Transfer) Act, 1963

The Maharashtra Ownership of Flats (Regulation of the Promotion of Construction, Sale,

Management and Transfer) Act, 1963 (―MOF Act‖) applies throughout the State of Maharashtra. The
provisions of the MOF Act apply to promoters / developers who intend to construct a block or building
of flats on ownership basis. The MOF Act prescribes general liabilities of promoters and developers.
Under the rules framed under the MOF Act, a model form of agreement to be entered into between
promoters / developers and purchasers of flats has been prescribed. Under the MOF Act, the
promoter / developer is required to enter into a written Agreement for sale of flat with each purchaser
and the agreement contains prescribed particulars with relevant copies of documents and these

31
agreements are compulsorily required to be registered. Pursuant to an amendment dated May 12,
2008 to the MOF Act, the flats are eligible to be sold on the basis of carpet area only. The said carpet
area includes the area of balcony of such flat. However, the promoters are allowed to separately
charge for the common areas and facilities in proportion to the carpet area of the flat.

Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971

The Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971 (―MSA Act‖)
provides for and governs the making of better provisions for improvement and clearance of slum
areas in the State and their redevelopment and for the protection of occupiers from eviction and
distress warrants.

Maharashtra Rent Control Act, 1999

The Maharashtra Rent Control Act, 1999 (―MRC Act‖) has been enacted to unify, consolidate and
amend the law relating to control of rent and repairs of certain premises and of eviction in
Maharashtra and for encouraging the construction of new houses by assuring a fair return on the
investment by landlords and to provide for the matters connected with the purposes aforesaid.

Maharashtra Tax on Buildings (with Larger Residential Premises) Act, 1979

The Maharashtra Tax on Buildings (with Larger Residential Premises) Act, 1979 has been enacted to
provide for levy of tax on buildings in corporation areas in the State of Maharashtra, which contain
larger residential premises.

The Bombay Stamp Act, 1958

As stated above, the applicable rates for stamp duty on various instruments, including those relating
to conveyance, are prescribed by state legislation. The stamp duty rates as applicable in Maharashtra
have been prescribed by the Bombay Stamp Act, 1958 (―BSA‖).

The Maharashtra Value Added Tax Act, 2002

The Maharashtra Value Added Tax Act, 2002 prescribes certain requirements in relation to the
payment of value added tax in Maharashtra.

The Maharashtra Cooperative Societies Act, 1960

The Maharashtra Cooperative Societies Act, 1960 has been enacted with a view to provide for the
orderly development of cooperative movement in the State of Maharashtra in accordance with the
relevant Directive Principles of State Policy enunciated in the Constitution of India.

The Mumbai Municipal Corporation Act, 1888

The Mumbai Municipal Corporation Act, 1888 has been enacted to regulate the municipal
administration of the city of Bombay (now Mumbai) and to secure the due administration of municipal
funds.

The Maharashtra Housing and Area Development Act, 1976

The Maharashtra Housing and Area Development Act, 1976 has been enacted for giving effect to the
policy of the State towards securing the principle specified in the Constitution of India and the
execution of the proposals, plans or projects therefore and acquisition therefore of the lands and
buildings and transferring the lands, buildings or tenements therein to the needy persons and
cooperative societies of occupiers of such lands or buildings.

The Maharashtra Apartment Ownership Act, 1970

The Maharashtra Apartment Ownership Act, 1970 has been enacted to provide for ownership of an
individual apartment in a building and to make such apartment heritable and transferable property.

32
The Maharashtra Regional and Town Planning Act, 1966

The Maharashtra Regional and Town Planning Act, 1966 (the ―Town Planning Act‖) has been enacted
with the object of establishing local development authorities in Maharashtra to ensure efficient town
planning and development of lands within their jurisdiction. It provides for the creation of new towns
and compulsory acquisition of land required for public purposes. The Collector and the Town Planning
Department as appointed and established under the Town Planning Act, grant approvals for real
estate projects situated in areas falling within their jurisdiction. Change in the use or development of
any land which is part of a notified area or site for a new town requires the permission of the planning
authority and it may revoke or modify the permission granted if it appears inconsistent with the
development plan. The Town Planning Act also empowers the Planning Authority to levy development
charge on use, change of use or development of land for which permission is required at specified
rates.

The Bombay Tenancy and Agricultural Lands Act, 1948

The Bombay Tenancy and Agricultural Lands Act, 1948 (the ―Tenancy Act‖) was passed in
furtherance to give effect to agrarian reform and improve the economic and social conditions of
peasants and ensure the full and efficient use of land for agriculture. It confers on the protected tenant
a right to purchase their holdings from their landlords. Section 32 of the Tenancy Act, provides that a
st
tenant notified as the protected tenant as on 1 April, 1957 (known as the ―Tillers Day‖) was deemed
to have purchased such land occupied by him from the landlord free of all encumbrances (subject to
the other provisions of the Tenancy Act). The title of the landlord passes immediately to the tenant on
the Tiller‘s day. Pursuant to Section 32(G) (iv) if a tenant is willing to purchase the land, upon payment
of the complete purchase price, the Tribunal issues a certificate under section 32(M), which is the
conclusive evidence of the purchase. On account of failure to pay the purchase price, the sale is
declared ineffective and as provided under Section 32(P), the tenant is summarily evicted.
Subsequently, the Tribunal may direct that the land be either restored to the former landlord or
disposed of by sale to various persons/entities as provided in Section 32(P). Section 43 of the
Tenancy Act, imposes restrictions on the transfer of agricultural land purchased under Section 32(G)
to any person without the prior permission of the Collector. Notwithstanding permissions to purchase
land bought under Section 32(G), the Tenancy Act imposes generic restrictions on the transfer of
agricultural land to non-agriculturists. The Collector may grant permission under Section 63 for
transfer of land if the land is required for agricultural purpose by industrial or commercial undertaking
in connection with any industrial or commercial operations carried on by such undertaking or if the
land is being sold bona fide for any non agricultural purpose.

Slum Rehabilitation Scheme of the Government of Maharashtra

The Government of Maharashtra (―GoM‖) launched the Slum Rehabilitation Scheme in 1995
(―Scheme‖) by introducing amendments to the Development Control Regulations for Greater Bombay,
th
1991 (―DCR‖). The Scheme was made effective from 25 December, 1995. The provisions of the
Scheme are contained in Regulation 33(10) and Appendix IV of the DCR. Under the Maharashtra
Regional and Town Planning Act, 1966 (―MRTPA‖) the SRA, appointed under section 3A of the
Maharashtra Slum Areas (Improvement and Redevelopment) Act, 1971, serves as a planning
authority for all slum areas in Greater Mumbai except those located in the Maharashtra Industrial
Development Corporation (―MIDC‖) area and to facilitate the slum rehabilitation scheme. The powers,
duties and functions of the SRA are to survey and formulate schemes of rehabilitation of slum areas
and to ensure their implementation.

Development Control Regulations for Greater Mumbai, 1991 (Development Control

Regulations)

The Development Control Regulations for Greater Mumbai, 1991 (Development Control Regulations)
(―Development Control Regulations‖) were formulated under the Maharashtra Regional Town
Planning Act, 1966. The Development Control Regulations apply to building activity and development
work in areas under the entire jurisdiction of the Municipal Corporation of Greater Mumbai. The
Development Control Regulations provide for an alternative to acquisition under the Land Acquisition
Act by way of Transfer of Development Rights (TDRs). The permissible floor space index (FSI)

33
defines the development rights of every parcel of land in Mumbai. If a particular parcel of land is
designated for a public purpose, the land owner has an option of accepting monetary compensation
under the Land Acquisition Act, 1894 or accept TDRs which can be sold in the market for use
elsewhere in Mumbai. Regulation 34 of the Development Control Regulations states that in certain
circumstances, the development potential of a plot of land may be separated from the land itself and
may be made available to the owner of the land in the form of TDRs. Regulation 33 (10) of the
Development Regulations provides that additional floor space index will be allowed to
owners/developers of land on which slums are located where such owners/developers are prepared
to provide 269 square feet dwelling units free of cost to the slum dwellers. The remainder of total
development rights can be used as TDR. The Development Control Regulations also set out
standards for building design and construction, provision of services like water supply, sewerage site
drainage, access roads, elevators, fire fighting etc.

Development Control Regulations for Mumbai Metropolitan Region, 1999

The Development Control Regulations for Mumbai Metropolitan Region, 1999 (―Development Control
Regulations for MMR‖) apply to the development of any land situated within the Mumbai Metropolitan
Region as defined in the Mumbai Metropolitan Region Development Authority Act, 1974. Under the
Development Control Regulations for MMR, no person can carry out any development (except those
stated in proviso to section 43 of the Maharashtra Regional Town Planning Act, 1966) without
obtaining permission from the Planning Authority and other relevant authorities including Zilla
Parishads and the Pollution Control Board. The Development Control Regulations for MMR have
demarcated the region into various zones for development purposes including urbanisable zones,
industrial zone, recreation and tourism development zone, green zones and forest zone. Development
Control Regulations for MMR also provide that development of land in these zones (other land in
specified urbanisable zone and industrial zone) shall not be permitted unless the owner undertakes to
provide at his own cost physical and social infrastructural facilities including roads, water supply,
sewage waste disposal systems, electricity, play grounds etc. as well as any other facilities that the
Planning Authority will determine. Further the Development Control Regulations for MMR also provide
that all developments which are existing prior to the Development Control Regulations for MMR,
which are authorised under the Maharashtra Regional Town Planning Act, 1966 and Maharashtra
Land Revenue Code, 1966 but which are not in conformity with the use provisions of the Regional
Plan or these Regulation will continue as though they are in the conforming zone and will be allowed
reasonable expansion within existing land area and within FSI limits prescribed by these Regulations.

Urban Development Laws

State legislations provide for the planned development of urban areas and the establishment of
regional and local development authorities charged with the responsibility of planning and
development of urban areas within their jurisdiction. Real estate projects have to be planned and
developed in conformity with the norms established in these laws and regulations made thereunder
and require sanctions from the government departments and developmental authorities at various
stages. Where projects are undertaken on lands that form part of the approved layout plans and/or fall
within municipal limits of a town, generally the building plans of the projects have to be approved from
concerned municipal or developmental authority.

Building plans are required to be approved for each building within the project area. Clearances with
respect to other aspects of development such as fire, civil aviation and pollution control are required
from appropriate authorities, depending on the nature, size and height of the projects.

34
 SECTION V: ABOUT THE ISSUER COMPANY

HISTORY & CORPORATE STRUCTURE OF THE COMPANY

The Company was originally incorporated as ―Shree Ram Mills Limited‖ evidenced by the Certificate
th
of Incorporation bearing No. 2241 of 1934/1935 on 25 January, 1935 under the Indian Companies
Act, 1913. The name of the Company was changed to ―Shree Ram Urban Infrastructure Limited‖ and
th
a fresh Certificate of Incorporation consequent to change in name was obtained on 20 March, 2007
from the Registrar of Companies under the Companies Act, 1956. The aforesaid changes were made
in the name to reflect the nature of the business or the constitution of the Company and/or to clearly
reflect the nature of business.

Main Objects of the Company

The object clauses of our Company enable us to undertake the activities for which the funds are being
raised in the Issue as also the activities which our Company has been carrying on till date.

Our main objects as contained in our Memorandum of Association are as under:

 To Purchase or otherwise acquire lands, houses, buildings, sheds and other fixtures and let
them on lease, rent, contract or any agreement or arrangement as may be deemed fit and to
acquire, improve, manage, develop all rights in real estate and sale dispose of, turn to
account and otherwise deal with property all kind and to carry on trade or business of dealing
in agent for lands, buildings, factories, houses, flats and other residential and commercial,
agricultural and mining property and construct, maintain and alter residential and commercial
and industrial plots and properties. To carry on the business of builders, civil contractors,
engineers, designers, ownership flat, sellers, building experts, advisers”.

 To construct, execute, carry out equipments, improve, alter, develop, decorate, maintain,
furnish, administrator, manage or control public and private works and convenience of all
kinds including railways, ropeways, roads, bridges, tramways cocks, harbors, piers wharves,
canals, reservoirs, embankments, tanks aqua ducts, marine -works, powerhouses, irrigations,
reclamations, improvement, sewage, drainage, sanitary, water, gas, electric, lights, telephonic
and power supply works, hotels, warehouses, markets, bazaars, places of amusement,
pleasure grounds, parks gardens, swimming pools, water sewage, water proofing, effluent
treatment of plants, shops, offices, flats, houses, dairies, furnaces, sawmill, crushing works,
hydraulic works, tanneries, factories, mills, industrial structures, and all other works of
convenience or other public or public utility.

 To Purchase and acquire any ginning, pressing, spinning, weaving, manufacturing factory,
press, mill business or concern.

 To carry on the business of manufacturing of cotton, silk, artificial silk, staple and synthetic
fibre, wool, flax, hemp, and jute and similar fibres and of merchants, importers and growers of
and dealers of cotton, silk, staple and synthetic fibre, wool, flax, hemp, and all products
thereof, and the business of cotton spinners and doublers, silk, staple and synthetic fibre,
wool, flax, hemp and jute spinners, combers and weavers and or dyers, bleachers, cleaners
and finishers, printers, embossers and manufacturing of and dealers in dyeing and bleaching
and finishing materials, and manufacturing and general chemist and druggist and to comb,
spin, wind, weave, scour, clean, prepare, render marketable and buy, sell or deal in cotton,
silk, staple and synthetic fibre, flax, hemp, jute, wool, and other like substances, and to
manufacture, work up, buy, sell, and deal in linen, cloth, silk, stain, satinette, plush velvet,
velveteen, yarn, thread and other goods and fabrics and to carry on the business of ginning
and pressing and to supply power.

35
Registered Office:

Shree Ram Urban Infrastructure Limited has its registered office at Shree Ram Mills Premises,
Ganpatrao Kadam Marg, Lower Parel, Mumbai – 400 013. There has been no change in the
registered office of the Company since its incorporation.

Amendments to the Memorandum of Association

Dates on which some of the main clauses of the Memorandum of Association of the Company have
been changed citing the details of amendment as under:

Date Nature of Amendment

th
12 October, 1968 Increased in Authorised Capital from Rs.1,00,00,000 to Rs.3,00,00,000
th New clause 38A added in MOA regarding to make donations either in cash or
4 July, 1969
otherwise to the persons or institutions but not of a political nature.
rd
23 August, 1971 New clause 29A added in MOA regarding to provide guarantee to banks,
financial Institutions and persons in respect of financial assistance.
Increased in aggregate Authorised Capital from Rs.3,00,00,000 to
Rs.13,00,00,000.
nd
22 June, 1992 (Equity of Rs. 9,00,00,000, Unclassified of Rs. 1,00,00,000, 11% Redeemable
Preference Shares of Rs. 2,00,00,000 & 0% Redeemable Preference Shares
of Rs. 1,00,00,000)
th Re-classification in Authorised Capital of Equity Share of Rs.9,00,00,000.
9 November, 1993
(by sub division of face value from Rs.100 each to Rs.10 each)
th Commencement of New Business as mentioned in the clause 26 and 36 of
9 November, 1993
MOA
Re-classification in Authorised Capital of Rs.13,00,00,000
th
11 November, 1997 (Equity of Rs. 7,60,00,000, 11% Redeemable Preference Shares of Rs.
2,70,00,000 & 0% Redeemable Preference Shares of Rs. 2,70,00,000)
Increased in Authorised Capital from Rs. 13,00,00,000 to Rs.25,00,00,000
th (Equity of Rs. 19,25,00,000, Unclassified of Rs.3,00,00,000, 11%
4 April, 2000
Redeemable Preference Shares of Rs.1,50,00,000 & 0% Redeemable
Preference Shares of Rs. 1,25,00,000)
Re-classification in Authorised Capital of Rs.25,00,00,000
th (Equity of Rs.20,71,11,200, Unclassified of Rs.1,75,00,000, 11% Redeemable
9 March, 2006
Preference Shares of Rs. 1,36,87,700 & 0% Redeemable Preference Shares
of Rs. 1,17,01,100)
Change of name of the Company from Shree Ram Mills Ltd. to Shree Ram
th
20 March, 2007 Urban Infrastructure Limited along with a change in the Object Clause of the
Company.
th
24 June, 2009 Increased in Authorised Capital from Rs.25,00,00,000 to Rs.100,00,00,000.

Major Events in the History of the Company

Date Details
th
Our Company was incorporated as Shree Ram Mills Limited on 25 January, 1935 vide
1935
Registration No. 002241
The Company acquired and took over the spinning and weaving mills formerly belonging to
Crescent Mills Limited in 1935 along with all land & buildings along with the machinery and
1935
decided to carry on the business of manufacturing or dealings in cotton silk, art silk, etc
along with the purchase & sale of yarn, etc.
The Company came out with its Initial Public Issue of 62,750 shares having Face Value of
1968 th
Rs. 100 per share at par on 16 December, 1968

36
Date Details
th
Shree Ram Mills Limited was taken over by the management of the S. Kumar Group on 9
1978
October, 1978.
There was an indefinite strike by an unrecognized union viz. Maharashtra Girni Kamgar
Union. The workers of all the textile mills in Bombay went on an illegal, indefinite strike with
th
1982 effect from 18 January 1982. As a result the operations at the mills have almost totally
suspended for a major period of a year, an event unprecedented in the history of textile
industry.
The Company was declared as sick unit under SICA (Sick Industrial Companies Act,
1987
1985).
st
The BIFR sanctioned a scheme for revival of the Company vide is order dated 31 October
1991
1991.
The Company subdivided its Shares from the existing One Share Rs. 100/- each to Ten
th
1993 Shares of Rs.10/- each on 9 November 1993. This was done by passing a resolution in
the Share Holders General Meeting (Extra ordinary General Meeting)
The BIFR declared that the scheme sanctioned in 1991 had failed and issued a show
1994 th
cause notice to wind-up the Company vide its order dated 13 January 1994.
On appeal against the above order, the AAIFR sanctioned a scheme for the revival of the
1994 th
Company again vide its letter dated 11 October 1994.
th
The AAIFR scheme was modified on 11 February 2000 which involved a One-Time
2000
Settlement of dues of all Financial Institutions and banks.
The Company filed an application to the AAIFR seeking deregistration from the purview of
st
2000 the SICA on the grounds that its net worth had turned positive with effect from 31
December 2000.
th
Following an order from the AAIFR dated 12 October 2004, Shree Ram Mills Limited was
2004 no longer classified as a sick industrial Company and was deregistered from the purview of
the Sick Industrial Companies (Special Provision) Act, 1985.
The name of the Company was changed from Shree Ram Mills Limited to Shree Ram
th
Urban Infrastructure Limited from the 20 of March 2007 in order to reflect the additional
2007 business activity of real estate development as per clause 1 and 1 A of Memorandum &
Articles of Association of the Company and later started the construction activities of its
flagship project – ‗Palais Royale‘.

37
Subsidiaries of the Company:

The Company has the following Subsidiary as on the date of this Letter of Offer. The details of the
same are as follows:

1. SRM Sites Private Limited (SRM)

th
SRM Sites Private Limited (SRM) was incorporated on 27 May 2009, under the Companies Act. The
registered office of SRM Sites Private Limited is at Shree Ram Mills Premises, G. K. Marg, Lower
Parel, Mumbai – 400 013.

The Main Objects of the Company are as follows:

1. To construct, execute, carry out equipments, improve, alter, develop, decorate, maintain, furnish,
administer, manage or control public and private works and convenience of all kinds including
railways, ropeways, roads, bridges, tramways cocks, harbours, piers, wharves, reservoirs,
embankments, tanks aqua ducts, marine–works, powerhouses, irrigations, reclamations,
improvement, sewage, drainage, sanitary, water, gas, electric, lights, telephonic and power supply
works, hotels, warehouse, markets, bazaars, places of amusement, pleasure grounds, parks
gardens, swimming pools, water sewage, water proofing, effluent treatment of plants, shops,
offices, flats, houses, dairies, furnaces, sawmill, crushing works, tanneries, factories, mills,
industrial structures.

Board of Directors

Name Designation
Mr. S. K. Luharuka Director
Mr. Lalit Mohan Director
Mr. Rajiv Maheshwari Director

Shareholding pattern:

The shareholding pattern of SRM Sites Private Limited is as follows:

A. Shareholding Pattern (Equity Shares)

% of Total
Name of Equity Shareholders No. of Shares
Capital
Mr. S. K. Luharuka (Nominee of SRUIL) 10 0.095
Mr. N. K. Modani (Nominee of SRUIL) 10 0.095
Shree Ram Urban Infrastructure Ltd. 9980 94.60
IIRF India Realty XII Limited 535 5.07
IL&FS Trust Company Limited 15 0.14
Total 10550

B. Shareholding Pattern (Preference Shares)

% of Total
Name of Preference Shareholders No. of Shares
Capital
IIRF India Realty XII Limited 243025 97.21
IL&FS Trust Company Limited 6975 2.79
Total 250000

38
Capital Structure:

Total Paid Up Capital No. of Shares

Equity Shares 10,550
Preference Shares 2,50,000

Financial Performance

The summary audited financial statements are as follows:

For the Year ended on

Particulars st
31 December 2009
Total Income 2,38,358
Profit / (Loss) After Tax (PAT) (32,17,965)
Equity Share Capital
1,05,500
(Face value Rs. 10- per Share)
Preference Share Capital 9,10,000
Reserves & Surplus
40,29,82,500
(excluding Revaluation Reserve)
Earnings per Share (Basic) (527.71)
Earnings per Share (Diluted) (31.69)
th st
As this is the first financial year of the company, these figures are for a period 27 May, 2009 to 31
December, 2009.

2. Raghuveer Suburban Infrastructure Private Limited (RSIPL)

th
Raghuveer Suburban Infrastructure Private Limited was incorporated on 30 July 2009, under the
Companies Act. The registered office of Raghuveer Suburban Infrastructure Private Limited is at
Shree Ram Mills Premises, G. K. Marg, Lower Parel, Mumbai - 400 013.

The Main Objects of the Company are as follows:

1. To Purchase or otherwise acquire lands, houses, buildings, sheds and other fixtures and let them
on lease, rent, contract or any agreement or arrangement as may be deemed fit and to acquire,
improve, manage, develop all rights in real estate and sale dispose of, turn to account and
otherwise deal with property of all kinds and to carry on business of dealing in agent for lands,
buildings, factories, houses, flats and other residential and commercial and construct, maintain
and alter residential, commercial and industrial plots and properties. To carry on the business of
builders, civil contractors, engineers, designers, ownership flat, sellers, building experts, advisers.

2. To construct, execute, improve, alter, develop, decorate, maintain, furnish, administer, manage or
control pubic and private works and convenience of all kinds including railways, ropeways,
roads, bridges, tramways cocks, harbours, piers, wharves, reservoirs, embankments, tanks aqua
ducts, marine–works, powerhouses, irrigations, reclamations, improvement, sewage, drainage,
sanitary, water, gas, electric, lights, telephonic and power supply works, hotels, warehouse,
markets, bazaars, places of amusement, pleasure grounds, parks gardens, swimming pools,
water sewage, water proofing, effluent treatment of plants, shops, offices, flats, houses, dairies,
furnaces, sawmill, crushing works, tanneries, factories, mills, industrial structures.

39
Board of Directors

The board of Directors of RSIPL consists of:

Name Designation
Mr. S. K. Luharuka Director
Mr. N. K. Modani Director

Capital Structure:

No. of Shares
Authorised Capital 10,000 Equity shares of Rs.10 each
Issued, subscribed & paid-up capital 10,000 Equity shares of Rs.10 each

Shareholding pattern

The shareholding pattern of Raghuveer Suburban Infrastructure Private Limited is as follows:

Shareholder's Category No. of Shares % of Total Capital

Mr. S. K. Luharuka (Nominee of SRUIL) 1 0.01
Shree Ram Urban Infrastructure Ltd. 9999 99.99
Total Paid Up Capital 10000 100.00

Financial Performance

The company has not completed one full audited financial year.

3. Shree Ram Realinfra Ventures Private Limited (SRRVPL)

st
Shree Ram Realinfra Ventures Private Limited was incorporated on 31 July 2009, under the
Companies Act. The registered office of Shree Ram Realinfra Ventures Private Limited is at Shree
Ram Mills Premises, G. K. Marg, Lower Parel, Mumbai - 400 013.

The Main Objects of the Company are as follows:

1. To Purchase or otherwise acquire lands, houses, buildings, sheds and other fixtures and let them
on lease, rent, contract or any agreement or arrangement as may be deemed fit and to acquire,
improve, manage, develop all rights in real estate and sale dispose of, turn to account and
otherwise deal with property of all kinds and to carry on trade or business of dealing in agent for
lands, buildings, factories, houses, flats and other residential and commercial and construct,
maintain and alter residential, commercial and industrial plots and properties. To carry on the
business of builders, civil contractors, engineers, designers, ownership flat, sellers, building
experts, advisers.

2. To construct, execute, carry out equipments, improve, alter, develop, decorate, maintain, furnish,
administer, manage or control public and private works and convenience of all kinds including
railways, ropeways, roads, bridges, tramways cocks, harbours, piers, wharves, reservoirs,
embankments, tanks, aqua ducts, marine–works, powerhouses, irrigations, reclamations,
improvement, sewage, drainage, sanitary, water, gas, electric, lights, telephonic and power supply
works, hotels, warehouse, markets, bazaars, places of amusement, pleasure grounds, parks
gardens, swimming pools, water sewage, water proofing, effluent treatment of plants, shops,
offices, flats, houses, dairies, furnaces, sawmill, crushing works, tanneries, factories, mills,
industrial structures.

40
Board of Directors

The board of Directors of SRRVPL consists of:

Name Designation
Mr. S. K. Luharuka Director
Mr. N. K. Modani Director

Capital Structure:

No. of shares
Authorised Capital 10,000 Equity shares of Rs.10 each
Issued, subscribed & paid-up capital 10,000 Equity shares of Rs.10 each

Shareholding pattern

The shareholding pattern of Shree Ram Realinfra Ventures Private Limited is as follows:

Shareholder's Category No. of Shares % of Total Capital

Mr. S. K. Luharuka (Nominee of SRUIL) 1 0.01
Shree Ram Urban Infrastructure Ltd. 9999 99.99
Total Paid Up Capital 10000 100.00

Financial Performance

The company has not completed one full audited financial year.

41
 OUR MANAGEMENT

Under our Articles of Association, our Company is required to have not less than 3 (three) Directors
and not more than 12 (twelve) Directors, subject to Section 252 and 259 of the Companies Act, 1956.
As on the date of this Offer Document, our Company has 12 (Twelve) Directors on its Board, of which
2 (two) are executive, 3 (three) are non-executive non-independent and 7 (seven) are independent.

1. The following table sets forth the details of the Current Board of Directors:

Status of Occupation,
Director in Nationality,
Name, Address & Age Other Directorships
our DIN &
Company Qualification
1. Ajit Holdng Pvt. Ltd.
Mr. Shambhukumar S. Kasliwal Chairman Industrialist
2. Ani-Abhi Investment Pvt. Ltd.
3. Aniruddh Arnav Agriculture
17/1, Padam, 4B, Pedder Road, Promoter & Indian
Development Co. Pvt. Ltd.
Mumbai – 400 026. Non-
4. Girija Holdings Pvt. Ltd.
Executive DIN: 00555161
5. K. U. Enterprises Ltd.
Age: 79 years
6. Kartikeya Finvest Pvt. Ltd.
Matriculation
7. S. Kumars & Co. (Trades) Ltd.
8. S. Kumars Enterprises
(Synfabs) Ltd.
9. S. Kumars Ltd.
10. Shantivijay Jewels Limited
11. Surajamal & Sons Pvt. Ltd.

1. S. Kumars Enterprises
Mr. Vikas S. Kasliwal Vice Industrialist
(Synfabs) Ltd.
Chairman &
2. Vidhi Holdings Pvt. Ltd.
Padam 1, Flat 17, 4B, G CEO Indian
Deshmukh Marg, Mumbai- 400
026. Promoter & DIN: 00046876
Executive
Age: 53 Years MBA
1. Ani-Abhi Investment Pvt. Ltd.
Mr. Ambuj A. Kasliwal Vice Business
2. Chamundeshwari Trading &
Chairman
Finance Pvt. Ltd.
Padam 2, Flat 2, 4B, G. Indian
3. S. G. Jewelcraft Ltd.
Deshmukh Marg, Mumbai 400 026 Non-
4. Kartikeya Finvest Pvt. Ltd.
Executive DIN: 00679286
5. Modak Rubber & Textile
Age: 59 years
Industries Ltd.
PMD graduate
6. Moolsha Investment Pvt. Ltd.
7. S. Kumars & Co. (Trades) Pvt.
Ltd.
8. S. Kumars Enterprises
(Synfabs) Ltd.
9. S. Maart (India) Pvt. Ltd.
10. Shree Ram Textiles Mills Ltd.
11. Surajmal & Sons Pvt. Ltd.

42
 Status of Occupation,
Director in Nationality,
Name, Address & Age Other Directorships
our DIN &
Company Qualification
1. Cable Corporation of India Ltd.
Mr. Mukul S. Kasliwal Director Business
2. Dasna Developers Pvt. Ltd.
3. Dhvani Terefabs Exports Pvt.
Padam, 4B, G. Deshmukh Marg, Non- Indian
Ltd.
Mumbai- 400 026. Executive
4. Entegra Limited
DIN: 0058577
5. Essar Power Ltd.
Age: 45 Years
6. K. U. Enterprises Pvt. Ltd.
MBA & DBA
7. Klopman India Pvt. Ltd.
Honoris Causa
8. MW Corp. Pvt. Ltd.
9. MW Infra Developers Pvt. Ltd.
10. Nevaa Solar Power Company
Pvt. Ltd.
11. Raj Infin Pvt. Ltd.
12. S. Kumars & Co (Trades) Pvt.
Ltd.
13. S. Kumars (Investments) Ltd.
14. S. Kumars Ltd.
15. S. Kumars Unitexx Ltd.
16. Shree Maheshwar Hydel Power
Corporation Limited
17. SKM Fabrics (Amana) Ltd.
18. Unitex Designs Ltd.
1. SRM Sites Pvt. Ltd.
Mr. Subhkaran K. Luharuka Whole Time Service
2. Raghuveer Suburban
Director
Infrastructure Pvt. Ltd.
Flat No. 304, 3rd Floor, Mars – B Indian
3. Shree Ram Realinfra Ventures
Wing, Vasant Galaxy, Bangur Executive
Pvt. Ltd.
Nagar, Goregaon (W), Mumbai - DIN: 01068251
4. S. Kumars Ltd.
400 090
Bachelor of
Age: 68 Years Arts

1. Balaji Infra Project Limited

Mr. Vijay G. Kalantri Director Industrialist &
2. Courier Publications Pvt. Ltd.
Business
3. Dighi Port Ltd.
2, Wahedna Apartment, Ground Independent
4. Dighi Project Development Co.
Floor, 75, Hill Road, Bandra West, Indian
Ltd.
Mumbai, 400 050.
5. Dighi Rail Infrastructure Ltd.
DIN: 00019510
6. Gannon Dunkerley & Co. Ltd.
Age: 60 Years
7. Goenka Diamond & Jewels Ltd.
GCD & Textile
8. Hindustan Housing Finance &
diploma
Development Corporation Ltd.
9. Man Industries (India) Ltd.
10. S. Kumars Nationwide Ltd.
11. SAB Industries Ltd.
12. Sovereign Diamond Ltd.
13. VIP Industries Ltd.
14. Vindyachal Hydro Power Ltd.
15. Zicom Electronic Security
Systems Ltd.

43
 Status of Occupation,
Director in Nationality,
Name, Address & Age Other Directorships
our DIN &
Company Qualification
1. PNB Gilts Ltd.
Dr. Om Prakash Chawla Director Retired

B 204, Natasha Enclave, Independent Indian

Kondhwa Road, Pune – 411048
DIN: 00026712
Age: 76 Years
M. Com, PhD

1. SRM Sites Pvt. Ltd.

Mr. Lalit Mohan Director Retired

A-1, Konark Estates, 10, Bund Independent Indian

Garden Road, Pune – 411001
DIN: 00625540
Age: 71 Years
M. A.

1. Talati & Panthakey Associated

Mr. Xerxes N. Talati Director Architect
Pvt. Ltd.
2. Kamran Constructions Pvt. Ltd.
96 D, Villa Modern, Ground Floor, Independent Indian
3. Talati IPR Pvt. Ltd.
Worli Sea Face, Worli, Mumbai-
4. Sai Ganesha Developers Pvt.
400018 DIN: 00586199
Ltd.
5. Talati & Talati Design
Age: 30 Years Master of
Developers Pvt. Ltd.
Architecture
6. Talati Enterprises Pvt. Ltd.
7. Blue Angel Constructions Pvt.
Ltd.
8. Silver Pearl Reality Pvt. Ltd.
9. Ekashwa Constructions Pvt. Ltd.
1. Photoquip (India) Limited
Mr. Mohan M. Jayakar Director Advocate
2. Everest Kanto Cylinder Limited
3. Satyagiri Shipping Company
12, Makani Manor, Pedder Road, Independent Indian
Limited
Mumbai-400026
4. Birla Cotsyn (I) Limited
DIN: 00925962
5. Macrocosm Infrastructure Pvt.
Age: 58 Years
Ltd.
L.L.B.
6. Macrocosm Industries Pvt. Ltd.
7. Mysore Pertochemicals Ltd.
8. Vericom Global Pvt. Ltd.
NIL
Dr. Poornima G. Advani Director Advocate

73/63, Mehrdad, Cuffe Parade, Independent Indian

Mumbai- 400005
DIN: 02626450
Age: 49 Years
B.Sc., L.L.M.,
Ph D (Law)

44
 Status of Occupation,
Director in Nationality,
Name, Address & Age Other Directorships
our DIN &
Company Qualification
NIL
Mr. Surendra Singh Bhandari Nominee Service
Director
Flat no. C-2, R.D.Appartment, (Punjab Indian
Sector No. 6, Plot No. 20, Dwarka, National
New Delhi – 75. Bank) DIN: 01647645

Age: 59 Years Independent MA

(Economics),
CAIIB

Brief Details of the Board of Directors of Shree Ram Urban Infrastructure Limited:

The Board of Directors consists of total twelve Directors, out of which 2 are promoter Director, 3 are
non-independent non-executive Directors and others are Independent Directors. The brief details of
Directors on the Board are as detailed below:

a. Mr. Shambhukumar S. Kasliwal

Mr. Shambhukumar Kasliwal, s/o of Shri Late Shankarlal Surajmal Kasliwal, aged about 79 years, is
the Chairman & Promoter of the Company. He is also the founder of the S. Kumars Group. Mr.
Kasliwal is actively involved in Group's business, mainly in Textiles for over 50 years. He is an active
Rotarian and has also been the President of the Rotary Club of South Mumbai. Mr. Kasliwal is also
actively involved with various charitable trusts, and Religious and Educational Institutions

b. Mr. Vikas S. Kasliwal

Mr. Vikas Kasliwal, s/o of Shri Shambhukumar Kasliwal, aged about 53 years, is the Vice-Chairman &
C.E.O of the Company. He is also the Promoter of Shree Ram Urban Infrastructure Limited. He holds
a Master‘s Degree in Business Administration from Harvard Business School, USA and has decades
of vast experience in various sectors and with the S. Kumars group. He is well versed with the nitty-
gritty of real estate sector, and spearheads the day-to-day business operations involved with the
project ―Palais Royale‖ since its inception. Having served as the Chairman of Madhya Pradesh
Textiles Mills Association and as the Chairman of Textiles Committee of Government of India, he has
developed substantial network with the Who‘s Who of the Indian business fraternity.

c. Mr. Ambuj A. Kasliwal

Mr. Ambuj Kasliwal, s/o of Shri Late Abhayakumar Shankarlal Kasliwal, aged about 59 years, is the
Vice-Chairman of the Company. He holds a degree in Program for Management Development (PMD)
from Harvard business School, USA. He has over 35 years of experience in the textile industry.

d. Mr. Mukul S. Kasliwal

Mr. Mukul S. Kasliwal, s/o of Shri Shambhukumar Shankarlal Kasliwal, aged about 45 years, is Non-
Executive Director of the Company. He has successfully completed his Bachelor‘s Degree in
Commerce from Sydenham College, Master‘s Degree in Business Administration from the University
of Rochester, USA as well as Doctor of Business Administration (DBA) Honoris Cause from
Greenwich University. He has more than 22 years of diversified business experience in Textiles,
Energy and Finance. He is involved in promoting the role of the Private Sector in the area of Hydro
Power, Renewable Energy Infrastructure Industry. He has been involved in various Private Power
projects. He serves on several boards and is the youngest member of National Manufacturing
Competitiveness Council (NMMCC).

45
e. Mr. Subhkaran K. Luharuka

Mr. Subhkaran Luharuka, s/o of Shri Late Kamalaprasad Luharuka, aged about 68 years, is the
Whole-Time Director of the Company. He is an Arts Graduate from Mumbai University. He has been
associated with Shree Ram Urban Infrastructure Limited (formerly known as Shree Ram Mills Limited)
and S. Kumars Group of Companies since last 22 years and that has helped him gain considerable
amount of experience of working for various senior positions. He was also as a Director in Indian
Bank, a Public Sector bank for a period of 5 years.

f. Mr. Vijay G. Kalantri

Mr. Vijay Kalantri, s/o of Shri Govardhandas Dwarkadas Kalantri, aged about 60 years, is a Non-
Executive & Independent Director of the Company. He holds a G.C.D. (Government Commercial
Diploma) and Diploma Holder in Textiles from SASMIRA (The Synthetic & Art Silk Mills' Research
Association). He is an Industrialist and businessman by profession. Mr. Kalantri ventured from the
Textiles Industry to Leasing Finance to Infrastructure Development. He presently associated with
developing a Port/SEZ in Maharashtra. Mr. Kalantri is also the Vice-Chairman of the World Trade
Centre and Member of the World Trade Centre Association Board, New York. He is also the President
of All India Association of Industries, and represents various Advisory Boards & Committees of the
State / Central Government as well as the Reserve Bank of India. He has also served as a Director
on several nationalized banks. He has been honoured with various prestigious awards by Institutions
and Organizations representing Industry, Government Bodies and Socio - Economic Institutions. He is
also the recipient of "Commander Cross Of The Order Of Merit" –The highest civilian award by the
Government of Poland.

g. Dr. Om Prakash Chawla

Dr. Om Prakash Chawla, s/o of Shri Amarnath Chawla, aged about 76 years, is a Non-Executive &
Independent Director of the Company. He has done his Master‘s in Commerce as well as his Ph.D. in
Personal Taxation from University of Rajasthan. He started his career as a university lecturer in 1955.
He was a consultant to United Nations Management Institute, East Africa for a period of 2 years from
1979 to 1980. He joined National Institute of Bank Management in 1975 and retired as its Director in
1994. He has authored / co-authored various books and numerous articles and papers on Financial
Markets, Treasury Management, Credit Management, Bank Balance Sheet Management and
Accounting and Taxation, etc., during his academic career. Currently he is a consultant in Banking
and Finance.

h. Mr. Lalit Mohan

Mr. Lalit Mohan, s/o of Shri E. W. Franklin, aged about 71 years, is a Non-Executive & Independent
Director of the Company. He has successfully completed his Masters in Arts from the University of
Delhi. He was formerly with the Indian Revenue Services and has 36 years of experience in the
Income-Tax Department.

i. Mr. Xerxes N. Talati

Mr. Xerxes Talati, s/o of Shri Noshir Darabshaw Talati, aged about 30 years, is a Non-Executive &
Independent Director of the Company. He holds a Masters Degree in Architecture from Columbia
University, New York, USA. He is currently practicing as an Architect and is a director of Talati and
Panthky Associates Pvt. Ltd.

j. Mr. Mohan M. Jayakar

Mr. Mohan Jayakar, s/o Shri Motiram Jayakar, aged about 58 years, is a Non-Executive &
Independent Director of the Company. He has completed his Bachelor of Laws (L.L.B.) and has been
a professional advocate for the past 35 years. He has been attending to various matters including
ones dealing with Indirect Taxation, Company Law and Commercial Arbitrations both domestic and
international. He is also associated with various Religious Trusts and is a member of the various
committees of the Indian Merchant's Chamber such as Indo American Society and also its Managing
Committee.

46
k. Dr. Poornima Advani

Dr. Poornima Advani, d/o Shri Govind Radhakrishna Advani, aged about 50 years, is a Non-Executive
& Independent Director of the Company. She has completed Bachelors in Science, Master of Laws
(L.L.M.) and also a Ph.D. (Law). She is presently an Advocate of Bombay High Court and on the
Special Panel Counsel for Government of India.

l. Mr. Surendra Singh Bhandari

Mr. Surendra Singh Bhandari, s/o of Dev Singh Bhandari, is a Nominee Director of the Company. He
is a Masters in Arts (Economics) and a CAIIB (Certified Associate of Indian Institute of Bankers). He
has 38 years of experience in the field of Commercial Banking.

Details of Appointment of the Directors

Name of the Director Date of Appointment Term

th
Mr. S. S. Kasliwal 9 October, 1978 Liable to retire by rotation
th
Mr. Vikas S. Kasliwal 30 October, 2002 Not liable to retire by rotation
th
Mr. Ambuj A. Kasliwal 26 February, 1980 Liable to retire by rotation
th
Mr. Mukul S. Kasliwal 28 April, 2003 Liable to retire by rotation
th
Mr. Subhkaran K. Luharuka 26 June, 1996 Not liable to retire by rotation
th
Mr. Vijay G. Kalantri 25 August, 2005 Liable to retire by rotation
th
Dr. Om Prakash Chawla 25 August, 2005 Liable to retire by rotation
th
Mr. Lalit Mohan 25 August, 2005 Liable to retire by rotation
th
Mr. Xerxes N. Talati 29 January, 2008 Liable to retire by rotation
th
Mr. Mohan Jayakar 18 March, 2009 Liable to retire by rotation
th
Dr. Poornima Advani 18 March, 2009 Liable to retire by rotation
th
Mr. S. S. Bhandari 18 September, 2009 Liable to retire by rotation

Relationship between Directors:

Except for those mentioned below none of the Directors of the Company are related to each other

Name of the Director Relationship with Relation

Mr. Vikas S. Kasliwal Father
Mr. Shambhukumar S. Kasliwal
Mr. Mukul S. Kasliwal Father
Mr. Shambhukumar. S. Kasliwal Son
Mr. Vikas S. Kasliwal
Mr. Mukul S. Kasliwal Brother
Mr. Shambhukumar. S. Kasliwal Son
Mr. Mukul S. Kasliwal
Mr. Vikas S. Kasliwal Brother

2. Except Mr. S. S. Bhandari, who is appointed as a Nominee Director of Punjab National Bank,
none of our Directors have entered into any arrangement or understanding with major
shareholders, customers, suppliers or other parties, pursuant to which they have been appointed
as the Director of our Company.

3. There is no service contracts entered into by any of the Directors with our Company.

47
 SECTION VI: FINANCIAL INFORMATION

Particulars Page
Limited Review Report – Standalone Financial Statements 49
Limited Review Report – Consolidated Financial Statements 51
Auditors Report – Standalone Financial Statements 57
Auditors Report – Consolidated Financial Statements 86

48
 LIMITED REVIEW REPORT – STANDALONE FINANCIAL STATEMENTS

To,
The Board of Directors,
Shree Ram Urban Infrastructure Limited,
(Formerly known as Shree Ram Mills Limited)

1. We have reviewed the accompanying unaudited condensed Standalone Financial Statements of

M/s. Shree Ram Urban Infrastructure Limited (Formerly known as Shree Ram Mills Limited) (‗the
st
Company‘) for the seven months period ended 31 July, 2010 except for the disclosures
regarding ‗Public Shareholding‘ and ‗Promoter and Promoter Group Shareholding‘ which have
been traced from disclosures made by the management and have not been audited by us, for the
purposes of it‘s inclusion in the offer document prepared by the Company in connection with its
proposed Right Issue of the equity shares of the Company. These condensed financial
statements are the responsibility of the Company‘s Management and have been approved by the
Board of Directors of the Company at the meeting held on 30th October, 2010. Our responsibility
is to issue a report on these condensed financial statements based on our review.

2. We conducted our review in accordance with the Standard on Review Engagement (SRE) 2400,
―Engagements to Review Financial Statements‖, issued by the Institute of Chartered Accountants
of India. This standard requires that we plan and perform the review to obtain moderate
assurance as to whether the condensed financial statements are free of material misstatement. A
review is limited primarily to inquiries of Company personnel and analytical procedures applied to
financial data and thus provide less assurance than an audit. We have not performed an audit
and accordingly, we do not express an audit opinion.

3. Based on our review conducted as above nothing has come to our attention that causes us to
believe that the accompanying unaudited condensed standalone financial statements prepared in
accordance with applicable accounting standards and other recognized accounting practices and
policies has not disclosed the information required to be disclosed in terms of Securities and
Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009
including the manner in which it is to be disclosed, or that it contains any material misstatement.

4. This report is intended solely for inclusion in the Offer Document in connection with the proposed
Rights Issue of the equity shares of the Company and is not to be used, referred to or distributed
for any other purpose without our prior written consent.

For KHANDELWAL JAIN & Co. For HABIB & Co.

Chartered Accountants, Chartered Accountants,
Firm‘s Regn No. 105049W Firm‘s Regn No. 103479W

(NARENDRA JAIN) (D. P. SHROFF)

PARTNER PARTNER
Membership No. 048725 Membership No. 045417

Place : Mumbai
th
Date : 30 October, 2010

49
Limited Review Standalone Balance Sheet as at 31st July 2010

As at As at
Particulars 31.07.2010 31.12.2009
Unaudited Audited
SOURCES OF FUNDS
Shareholders' Funds
a) Share Capital 2,317.34 2,317.34
b) Convertible Equity Share Warrants 7,175.00 1,575.00
c) Reserves & Surplus 1.74 308.37
9,494.08 4,200.71
Loan Funds
a) Secured Loans 44,336.08 38,943.24
b) Unsecured Loans 1,561.83 7,161.84
45,897.91 46,105.09
TOTAL 55,391.99 50,305.80

APPLICATION OF FUNDS
Fixed Assets
Gross Block 21,773.22 19,426.79
Less: Depreciation, Amortisation and Impairment 3,707.51 2,586.27
Net Block 18,065.71 16,840.52
Capital Work in Progress (including capital advances) 269.79 369.33
18,335.50 17,209.85

Investments 102.00 100.00

Current Assets, Loans & Advances :

a) Interest Accrued but not due 91.39 34.89
b) Inventories 47,907.28 39,100.61
c) Sundry Debtors 1,066.53 704.30
d) Cash & Bank Balances 4,313.20 3,255.56
e) Loans & Advances 22,076.68 18,878.90
75,455.08 61,974.26

Less: Current Liabilities & Provisions:

a) Current Liabilities 39,486.92 29,490.12
b) Provisions 35.26 24.12
39,522.18 29,514.24

Net Current Assets 35,932.90 32,460.02

Miscellaneous Expenditure (To the extent not written off / adjusted) - 535.93

Profit & Loss Account 1,021.59 -

TOTAL 55,391.99 50,305.80

50
 LIMITED REVIEW REPORT – CONSOLIDATED FINANCIAL STATEMENTS

To,
The Board of Directors
Shree Ram Urban Infrastructure Limited
(Formerly known as Shree Ram Mills Limited)

1. We have reviewed the accompanying unaudited Condensed Consolidated Financial Statements

of M/s. Shree Ram Urban Infrastructure Limited (Formerly known as Shree Ram Mills Limited)
(‗the Company‘) and its subsidiary companies for the seven months period ended 31st July 2010,
except for the disclosures regarding ‗Public Shareholding‘ and ‗Promoter and Promoter Group
Shareholding‘ which have been traced from disclosures made by the management and have not
been audited by us, for the purposes of its inclusion in the offer document prepared by the
Company in connection with its proposed Right Issue of the equity shares of the Company. These
condensed Financial Statements are the responsibility of the Company‘s Management and have
been approved by the Board of Directors of the Company at the meeting held on 30th October,
2010. Our responsibility is to issue a report on these condensed financial statements based on
our review.

2. We did not review the condensed financial statements of three Subsidiaries included in the
condensed consolidated financial results, whose condensed financial statements reflect Total
Assets of Rs.10931.47 lakhs as at 31st July, 2010 and Total Revenue of Rs.8.69 lakhs for the
seven months period ended on that date. These condensed financial statements have been
reviewed by other auditors whose review reports have been furnished to us and our opinion in so
far as it relates to the amount included in respect of these entities, is solely on the review reports
of those auditors.

3. We conducted our review in accordance with the Standard on Review Engagement (SRE) 2400,
―Engagements to Review Financial Statements‖, issued by the Institute of Chartered Accountants
of India. This standard requires that we plan and perform the review to obtain moderate
assurance as to whether the condensed consolidated financial statements are free of material
misstatement. A review is limited primarily to inquiries of Company personnel and analytical
procedures applied to financial data and thus provide less assurance than an audit. We have not
performed an audit and accordingly, we do not express an audit opinion.

4. Based on our review conducted as above and on the consideration of separate review reports on
individual reviewed condensed financial statements of the Company and its subsidiaries, nothing
has come to our attention that causes us to believe that the accompanying unaudited condensed
consolidated financial statements prepared in accordance with applicable accounting standards
and other recognized accounting practices and policies has not disclosed the information required
to be disclosed in terms of Securities and Exchange Board of India (Issue of Capital and
Disclosure Requirements) Regulations, 2009 including the manner in which it is to be disclosed,
or that it contains any material misstatement.

5. This report is intended solely for inclusion in the Offer Document in connection with the proposed
Rights Issue of the equity shares of the Company and is not to be used, referred to or distributed
for any other purpose without our prior written consent.

For KHANDELWAL JAIN & Co. For HABIB & Co.

Chartered Accountants, Chartered Accountants,
Firm‘s Regn No. 105049W Firm‘s Regn No. 103479W

(NARENDRA JAIN) (D. P. SHROFF)

PARTNER PARTNER
Membership No. 048725 Membership No. 045417
Place : Mumbai
Date : 30th October, 2010

51
Limited Review Consolidated Balance Sheet as at 31st July 2010

As at As at
Particulars 31.07.2010 31.12.2009
Unaudited Audited
SOURCES OF FUNDS
Shareholders' Funds
a) Share Capital 2,342.34 2,326.44
b) Convertible Equity Share Warrants 7,175.00 1,575.00
c) Reserves & Surplus 10,404.54 4,097.76
19,921.88 7,999.20
Loan Funds
a) Secured Loans 44,336.07 38,943.24
b) Unsecured Loans 1,561.83 7,161.85
45,897.90 46,105.09

Minority Interest 566.92 208.47

TOTAL 66,386.70 54,312.76

APPLICATION OF FUNDS
Fixed Assets
Gross Block 21,773.22 19,426.79
Less: Depreciation, Amortisation and Impairment 3,707.51 2,586.27
Net Block 18,065.71 16,840.52
Capital Work in Progress (including capital advances) 269.79 369.33
18,335.50 17,209.85

Goodwill on Consolidation 0.35 0.16

Investments 99.00 99.00

Current Assets, Loans & Advances :

a) Interest Accrued but not due 91.39 34.89
b) Inventories 57,994.07 41,083.29
c) Sundry Debtors 1,066.53 704.30
d) Cash & Bank Balances 4,338.61 3,258.57
e) Loans & Advances 22,895.95 21,023.56
86,386.55 66,104.62
Less: Current Liabilities & Provisions:
a) Current Liabilities 39,517.40 29,612.68
b) Provisions 35.26 24.12
39,552.67 29,636.80

Net Current Assets 46,833.88 36,467.82

Miscellaneous Expenditure (To the extent not written off / adjusted) - 535.93

Profit & Loss Account 1,117.97 -

TOTAL 66,386.70 54,312.76

52
 Limited Review Standalone as well as Consolidated Profit and Loss Accounts

Standalone Consolidated
Seven Previous Seven Previous
Months Accounting Months Accountin
Period Year Ended Period g
Particulars
Ended 31.12.2009 Ended Year
31.07.2010 31.07.2010 Ended
31.12.2009
Unaudited Audited Unaudited Audited
Net Sales / Income from Operations 2,099.29 3,973.32 2099.29 3,973.32
Other Operating Income 4.94 8.56 4.94 8.56
Total Income 2,104.23 3,981.88 2,104.23 3,981.88
Expenditure
(Increase)/decrease in Stock in trade and work in - - - -
progress
Consumption of Raw Materials - - - -
Purchase of traded goods 1,895.26 3,969.22 1,895.26 3,969.22
Employee Cost 31.28 49.72 31.28 49.72
Depreciation 54.74 113.02 54.74 113.02
Provision for Impairment loss 570.55 232.47 570.55 232.47
Miscellaneous expenditure written off 535.93 588.43 577.70 588.43
Other Expenditure 353.87 631.30 390.44 665.70
Total 3,441.63 5,584.16 3,519.96 5,618.56
Profit / (Loss) from operations before other (1,337.39) (1,602.28) (1,415.72) (1,636.68)
income Interest and exceptional items
Other Income 10.04 10.35 18.73 12.74
Profit / (Loss) before Interest and exceptional (1,327.36) (1,591.94) (1,396.99) (1,623.94)
items
Interest 0.45 0.77 0.45 0.77
Profit / (Loss ) from ordinary activities before (1,327.80) (1,592.70) (1,397.44) (1,624.71)
tax
Less: Tax expenses
Current Tax - - - -
Wealth Tax 0.05 0.20 0.05 0.20
Deferred Tax - (217.22) - (217.22)
Fringe Benefit Tax - 4.82 - 4.82
Mat Credit Entitlement - (2.84) - (2.84)
Taxes for earlier years 0.37 2.13 0.37 2.13

Add / (Less): Minority Interest - - (3.62) 1.67

Net Profit (Loss) from ordinary activities after (1,328.22) (1,379.80) (1,394.23) (1,410.13)
tax
Extra ordinary items ( net of tax expenses ) - - - -
Net Profit (Loss) for the period (1,328.22) (1,379.80) (1,394.23) (1,410.13)

Paid up equity share Capital (Face value Rs 10/- 2,063.45 2,063.45 2,063.45 2,063.45
per share)

Reserves excluding Revaluation Reserve as per 308.37 4,097.76

Balance Sheet of previous accounting year

Earning Per Share (EPS)

a) Basic and Diluted EPS before Extraordinary
items for the period, and for the previous year (in
Rs.)
- Basic EPS (6.44) (6.69) (6.76) (6.83)
- Diluted EPS (6.44) (6.69) (6.76) (6.83)

53
 Standalone Consolidated
Seven Previous Seven Previous
Months Accounting Months Accountin
Period Year Ended Period g
Particulars
Ended 31.12.2009 Ended Year
31.07.2010 31.07.2010 Ended
31.12.2009
Unaudited Audited Unaudited Audited

b) Basic and Diluted EPS after Extraordinary items

for the period, and for the previous year (in Rs.)
- Basic EPS (6.44) (6.69) (6.76) (6.83)
- Diluted EPS (6.44) (6.69) (6.76) (6.83)

Public Shareholding
Number of Equity Shares 8,320,057 8,320,057 8,320,057 8,320,057
Percentage of Equity Shareholding 40.32% 40.32% 40.32% 40.32%

Promoters and Promoter Group Shareholding 59.68% 59.68% 59.68% 59.68%

Pledged / Encumbered Number of Shares 9,176,284 9,176,284 9,176,284 9,176,284

Percentage of Shares (as a % of the total 74.52% 74.52% 74.52% 74.52%

Shareholding of Promoter and Promoter Group)

Percentage of Shares (as a % of the total Share 44.47% 44.47% 44.47% 44.47%
capital of the Company)

Non Encumbered Number of Shares 3,138,199 3,138,199 3,138,199 3,138,199

Percentage of Shares (as a % of the total 25.48% 25.48% 25.48% 25.48%

Shareholding of Promoter and Promoter Group)

Percentage of Shares (as a % of the total Share 15.21% 15.21% 15.21% 15.21%
capital of the Company)

Notes:

1. During the period, 'Raghuveer Suburban Infrastructure Private Limited' (a Company incorporated
in India) and 'Shree Ram Realinfra Ventures Private Limited' (a Company incorporated in India)
have become wholly owned subsidiary companies with effect from 14th January, 2010 and 24th
February, 2010 respectively and accordingly the financial statements of these subsidiaries have
been included in Consolidated Financial Statements.

2. The Consolidated financial results have been prepared in line with the requirements of Accounting
Standard (AS) 21 'Consolidated Financial Statements'.

54
 3. Segment Disclosure:
a. Segment wise Revenue, Results and Capital employed for the seven months ended 31st July,
2010 are as follows:

STANDALONE CONSOLIDATED
Seven Seven
months Previous months Previous
Particulars Period Year Ended Period Year Ended
Ended 31.12.2009 Ended 31.12.2009
31.07.2010 31.07.2010
Unaudited Audited Unaudited Audited
1. Segment Revenue
(a) Textile 1,972.89 3,709.63 1,972.89 3,709.63
(b) Real Estate 131.34 272.25 131.34 272.25
Total 2,104.23 3,981.88 2,104.23 3,981.88

Less: Inter Segment Revenue - - - -

Net Sales / Income from Operations 2,104.23 3,981.88 2,104.23 3,981.88

2. Segment Results
[Profit (+) / Loss (-) before tax and Interest from each
segment]
(a) Textile (542.97) (595.20) (542.97) (595.20)
(b) Real Estate 66.36 126.04 66.36 126.04
Total (476.61) (469.16) (476.61) (469.16)

Less: i. Interest Expense (0.45) (0.77) (0.45) (0.77)

ii. Interest Income 4.10 18.91 12.79 21.30
iii. Other unallocable income net off (854.85) (1,141.69) (933.17) (1,176.08)
unallocable (expenditure) / income
iv. Exceptional items - - - -
Total Profit Before Tax (1,327.80) (1,592.70) (1,397.44) (1,624.71)

3. Capital Employed
(Segment Assets - Segment Liabilities)
[Based on estimates in terms of available data]
(a) Textile 623.10 722.94 623.10 722.94
(b) Real Estate 52,982.78 38,045.45 63,858.83 42,061.53
(c) Unallocable 764.52 11,001.48 219.88 10,783.89
Total 54,370.40 49,769.87 64,701.81 53,568.36

b. Company‘s reporting segments have been identified in accordance with the Accounting Standard
(AS) 17 "Segment Reporting", considering activities / products, risks and reward, organization
structure and internal reporting systems.

c. Segment revenue and expense includes amounts, which can be directly attributed to the segment
and are allocable on a reasonable basis. Unallocable items and interest income / expenses are
disclosed separately.

d. Segment assets and liabilities are operating assets / liabilities by the segments which are directly
attributable to the segment. The components of capital employed that cannot be directly identified
are shown as unallocable capital employed.

e. Real Estate segment includes income from Business Centre.

55
4. During the period, the Company had issued and allotted on preferential / private placement basis,
1,60,00,000 equity warrants carrying an option to subscribe to equivalent number of equity shares
of Rs.10/- each on a future date, to the Promoters / Promoters Group and Others. The said equity
warrants have been allotted to the Promoters / Promoters Group and others at its Board meeting
held on 30th March, 2010. The issue price per convertible warrant is Rs.140/-, of which Rs.35/-
per convertible warrant aggregating Rs.5600 lakhs has been received by the Company.

5. During the period one of the subsidiary has issued 79,500 Compulsorily Convertible Preference
Shares (CCPS) on 8th January, 2010 and 79,500 Compulsorily Convertible Preference Shares
(CCPS) on 31st March, 2010, of Rs.10/- each at a premium of Rs.4,368/- per share. Thus the
subsidiary has received Rs.15.90 lakhs towards preference share capital and Rs.6945.12 lakhs
towards share premium. The above 1,59,000 CCPS along with 91,000 CCPS issued on 28th
October, 2009 are due for conversion into equity shares in the three equal installment of 83,333
each after the end of 24, 30 & 36 months from 28th October, 2009.

6. As at 31st July, 2010, the Company has 2,05,00,000 equity warrants. As there is a loss during the
period, these warrants are anti-dilutive, the same have are not included in calculating Diluted
Earning Per Share and therefore, the basic and diluted earning per share for the period ended
st
31 July, 2010 are same.

7. Number of investors complaints received during the period ended 31st July, 2010:
Opening: Nil, Received: 5, Disposed off: 5, Pending: Nil.
(A group of investors have filed a Company Petition No.45/397-398/CLB/MB/2009 with CLB which
is pending.)

8. The Previous year's figures have been regrouped / rearranged wherever necessary.

9. The Company's name change process from 'Shree Ram Mills Limited' to 'Shree Ram Urban
Infrastructure Limited' is underway at the Bombay Stock Exchange Limited.

For KHANDELWAL JAIN & Co. For HABIB & Co.

Chartered Accountants, Chartered Accountants,
Firm‘s Regn No. 105049W Firm‘s Regn No. 103479W

(NARENDRA JAIN) (D. P. SHROFF)

PARTNER PARTNER
Membership No. 048725 Membership No. 045417

Place : Mumbai
th
Date : 30 October, 2010

56
 AUDITORS‟ REPORT

Auditors‟ Report - Standalone Financial Statements

To
The Members Of
Shree Ram Urban Infrastructure Limited,
Mumbai.

1. We have audited the attached Balance Sheet of SHREE RAM URBAN INFRASTRUCTURE
st
LIMITED as at 31 December 2009 and also the Profit & Loss Account and the Cash Flow
Statement of the Company 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.

2. 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 from material misstatements. 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 estimates made by management, as well as evaluating the overall financial
statements presentation. We believe that our audit provides a reasonable basis for our
opinion.

3. As required by the Companies (Auditor‘s Report) Order, 2003, and read with the amendments
made by the Companies (Auditor‘s Report) (Amendment) Order 2004, issued by the Central
Government of India in terms of sub section (4A) of section 227 of the Companies Act, 1956,
and on the basis of such checks of books and records of the Company as we considered
appropriate and according to the information and explanation given to us we give in the
Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order to the
extent they are applicable to the Company.

4. Further to our comments in the Annexure referred to in Paragraph 3 above, we report that :

(a) We have obtained all the information and explanations, which to the best of our
knowledge and belief were necessary for the purposes of our audit;

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

(c) The Balance Sheet, the Profit & Loss Account and the Cash Flow Statement dealt with by
this report are in agreement with the books of account;

(d) In our opinion, the Balance Sheet, the Profit & Loss Account and the Cash Flow
Statement dealt with by this report comply with the Accounting Standards referred to in
Sub-section (3C) of Section 211 of the Companies Act, 1956.
st
(e) On the basis of the written representations received from the Directors as on 31
December, 2009 and taken on record by the Board of Directors, we report that none of
st
the Directors is disqualified as on 31 December, 2009 from being appointed as a
Director in terms of Clause (g) of Sub-section (1) of Section 274 of the Companies Act,
1956;

(f) In our opinion and to the best of our information and according to the explanations given
to us, the said accounts read together with significant accounting policies and notes
thereon, give the information required by the Companies Act, 1956, in the manner so
required and give a true and fair view in conformity with the accounting principles
generally accepted in India:

57
 (i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st
December, 2009;

(ii) in the case of the Profit and Loss Account, of the Loss of the Company for the
year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the
year ended on that date.

For KHANDELWAL JAIN & Co. For HABIB & Co.

Chartered Accountants, Chartered Accountants,
Firm‘s Registration No. 105049W Firm‘s Registration No. 103479W

(NARENDRA JAIN) (D. P. SHROFF)

PARTNER PARTNER
Membership No. 048725 Membership No. 045417

Place : Mumbai Place : Mumbai

th th
Date : 25 May 2010 Date : 25 May 2010

58
 ANNEXURE TO THE AUDITORS‟ REPORT

(REFERRED TO IN PARAGRAPH (3) OF OUR REPORT OF EVEN DATE TO THE MEMBERS OF

st
SHREE RAM URBAN INFRASTRUCTURE LIMITED FOR THE YEAR ENDED 31 DECEMBER,
2009)

i)
a. The Company has generally maintained proper records showing particulars including
quantitative details and location of fixed assets.

b. The Company has physically verified the fixed assets in accordance with a programme of
verification which in our opinion provides for physical verification of all fixed assets at
reasonable intervals. No material discrepancies were noticed on such verification.

c. During the year, the Company has not disposed off any substantial part of fixed assets.

ii)
a. The management has conducted physical verification of the inventory at reasonable intervals.
In our opinion, the frequency of physical verification is reasonable.

b. In our opinion and according to the information and explanations given to us, 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. In our opinion and according to the information and explanations given to us, the Company
has maintained proper records of the inventory and no material discrepancies were noticed
on physical verification of inventory as compared to the book records.

iii)
a. The Company has not granted loans to companies, firms or other parties covered in the
register maintained under Section 301 of the Act. Accordingly, the provisions of sub-clause
(b) to (d) of clause (iii) of the paragraph 4 of the order are not applicable.

b. The Company has taken unsecured loan from six companies covered in the register
maintained under section 301 of the companies Act, 1956. The maximum amount involved
during the year was Rs.82,74,16,893/- and the year end balance of loans taken from such
companies was Rs.63,76,16,893/-.

c. In our opinion and according to the information and explanation given to us, the loans taken
are interest free and the other terms and conditions on which these loans have been taken
are not prima facie prejudicial to the interest of the Company.

d. Since there is no repayment schedule in respect of aforesaid loans, the question of

repayment being regular does not arise.

iv) In our opinion, and according to the information and explanations given to us, there are adequate
internal control system commensurate with the size of the Company and the nature of its
business, with regard to the purchase of inventory, fixed assets and for sale of goods. During the
course of our audit, we have not observed any continuing failure to correct major weaknesses in
internal control system.

v)
a. On the basis of the audit procedures performed by us, and according to the information,
explanation and representations made to us, we are of the opinion that, the transactions in
which the Directors were interested as contemplated under section 297 and section 299 of
the Companies Act, 1956 and which were required to be entered in the register maintained in
section 301 of the said Act, have been so entered.

59
 b. In our opinion and according to the information and explanation given to us, the transactions
made in pursuance of contracts or arrangements entered in the register maintained under
Section 301 of the Companies Act, 1956 and exceeding value of Rupees five Lacs in respect
of any party during the year, have been made at prices which are reasonable having regard to
prevailing market prices at the relevant time.

vi) The Company has not accepted any deposits during the year from the public within the meaning
of the provisions of Section 58A, 58AA or any other relevant provisions of the Companies Act,
1956 and the rules made thereunder.

vii) In our opinion, the Company has an internal audit system commensurate with the size and nature
of its business.

viii) According to the information and explanations given to us, the Central Government has not
prescribed for the maintenance of Cost Records under Section 209(1)(d) of the Companies Act,
1956 in respect of the products of the Company.

a. According to the information and explanations given to us, and the records examined by us,
generally the Company is regular in depositing with appropriate authorities undisputed
statutory dues including provident fund, employee‘s state insurance, income-tax, wealth tax,
service tax, sales tax, custom duty, Tax deducted at source, works contract tax, cess and
other statutory dues except that there have been delays in some cases, in depositing
statutory dues in respect of ‗Tax deducted at source‘, ‗TDS on works contract tax under
MVAT Act‘ and wealth tax with the appropriate authorities during the year. According to the
information and explanations given to us, there were no other undisputed statutory dues
st
which have remained outstanding as at 31 December, 2009 for the period of more than six
months from the date they became payable except for wealth tax amounting to Rs.91,285/-
which has since been paid.

b. According to the information and explanations given to us, and the records examined by us,
dues in respect of Income tax, water tax, sewerage tax, property tax, excise duty and custom
st
duty as at 31 December, 2009 that have not been deposited with the appropriate authority
on account of any disputes and the forum where the dispute is pending are as under:

Sr. Name of the Nature of Period to Amount Forum where

No. Statute the Dues which the (Rs.) dispute is
amount pending
relates
1 Income Tax Act, Income Tax Asst. year 10,60,944 CIT (Appeal)
1961 2007-08 (since then paid
Rs.5,31,000/- on
th
18 Feb, 2010)
2 Brihanmumbai Water Tax April 2009 to 27,48,330 B. M. C.
Mahanagar Palika Dec 2009
(B. M. C.)
3 Brihanmumbai Sewerage Tax April 2009 to 16,48,998 B. M. C.
Mahanagar Palika Dec 2009
(B. M. C.)
4 Brihanmumbai Property Tax April 2008 to 1,60,35,383 B. M. C.
Mahanagar Palika Dec 2009
(B. M. C.)
5 Central Excise Act, Excise Duty Oct 2000 3,39,250 Superintendant of
1944 Central Excise
6 Customs Act, 1962 Custom Duty July 2008 6,98,250 Deputy
Commissionner
of Customs

60
ix) The Company has no accumulated losses as at the end of the financial year. The Company has
incurred cash losses during the financial year covered by our audit. However it had not incurred
cash losses in the immediately preceding financial year.

x) Based on the examination of the books of account and related records and according to the
information and explanations given to us, 7 instances of delays were noted in payment of interest
on loans to a bank ranging from 5 days to 126 days with amounts varying from Rs.2,02,07,333/-
to Rs. 2,27,74,384/-.

xi) Based on the information and explanations given to us, the Company has not granted any loans
and / or advances on the basis of security by way of pledge of shares, debentures and other
securities.

xii) The Company is not a Chit Fund Company or nidhi / mutual benefit fund / society. Accordingly,
the provisions of clause 4 (xiii) of the Companies (Auditor‘s Report) Order, 2003 are not
applicable to the Company.

xiii) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and
other investments. Accordingly, the provisions of clause 4 (xiv) of the Companies (Auditor‘s
Report) Order, 2003 are not applicable to the Company.

xiv) According to the information and explanations given to us, the Company has not given any
guarantee for loans taken by others from bank or financial institutions.

xv) In our opinion, the term loans raised during the year have been applied for the purpose for which
they were raised.

xvi) According to the information and explanations given to us and on an examination of the Balance
Sheet of the Company, we report that, on an overall basis, funds raised on short-term basis have,
prima facie, not been used during the year for long-term investment.

xvii) During the year, the Company has made preferential allotment of 45,00,000 convertible equity
share warrants at a price of Rs.140/- each, carrying an option to subscribe to equivalent number
of equity shares of Rs.10 each, to three companies covered in register maintained under Section
301 of the Companies Act, 1956. In our opinion and according to the information and explanation
given to us, the price at which the said convertible equity share warrants have been issued is not
prejudicial to the interest of the Company.

xviii) In our opinion and according to the information and explanations given to us, the Company has
not issued any secured debentures during the year covered by our report.

xix) During the year covered by our Audit Report the Company has not raised any money by public
issues.

xx) To the best of our knowledge and belief and according to the information and explanations given
to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For KHANDELWAL JAIN & Co. For HABIB & Co.

Chartered Accountants, Chartered Accountants,
Firm‟s Registration No. 105049W Firm‟s Registration No. 103479W

(NARENDRA JAIN) (D. P. SHROFF)

PARTNER PARTNER
Membership No. 048725 Membership No. 045417

Place : Mumbai Place : Mumbai

th th
Date : 25 May 2010 Date : 25 May 2010

61
 ST
BALANCE SHEET AS AT 31 DECEMBER 2009

As at At as
st st
Schedule 31 December 31 December
Particulars
No. 2009 2008
(Rs. In Lacs) (Rs. In Lacs)
SOURCES OF FUNDS
Shareholders‟ Funds
a) Share Capital 1 2317.34 2317.34
b) Convertible Equity Share Warrants 2 1575.00 -
c) Reserves & Surplus 3 308.37 1688.15
4200.71 4005.49
Loan Funds
a) Secured Loans 4 38943.24 19561.30
b) Unsecured Loans 5 7161.84 1026.15
46105.08 20587.45

Deferred Tax liability (Net) - 217.22

TOTAL 50305.80 24810.17

APPLICATION OF FUNDS
Fixed Assets 6
a) Gross Block 19426.79 18295.69
b) Less: Depreciation, Amortisation & Impairment 2586.27 1658.59
c) Net Block 16840.52 16637.10
d) Capital Work in Progress (including Capital
369.33 273.19
Advances)
17209.85 16910.30

Investments 7 100.00 -

Current Assets, Loans & Advances 8

a) Interest Accrued but not due 34.89 50.20
b) Inventories 39100.61 21140.40
c) Sundry Debtors 704.30 2451.36
d) Cash & Bank Balances 3255.56 1959.86
e) Loans & Advances 18878.90 9578.59
61974.26 35180.41

Less: Current Liabilities & Provisions 9

a) Current Liabilities 29490.12 28328.21
b) Provisions 24.12 24.18
29514.24 28352.39

Net Current Assets 32460.02 6828.02

Miscellaneous Expenditure (To the extent not 10

535.93 1071.86
written off / adjusted)

TOTAL 50305.80 24810.17

Significant Accounting Policies 18

Note forming part of the Accounts 19

62
 PROFIT AND LOSS ACCOUNT
ST
FOR THE YEAR ENDED 31 DECEMBER, 2009

Year Ended on Year Ended on

st st
Schedule 31 December, 31 December,
Particulars
No. 2009 2008
(Rs. in Lacs) (Rs. in Lacs)
INCOME
Sales & Services 11 3973.32 3915.16
Other Income 12 18.91 35.24
Increase / (Decrease) in Stocks - -
Total (A) 3992.23 3950.40

Expenditure
Traded Purchases 13 3969.22 3267.21
Cost of Construction (Real Estate Development) 14 38929.97 20795.11
Less: Cost of Construction carried to Inventories (38929.97) (20795.11)
Payments to & Provision for Employees 15 49.72 50.35
Administration & Other Expenses 16 1222.14 906.77
Finance Expenses 17 0.77 3.37
Depreciation & Amortization 6 113.02 129.18
Provision for Impairment Loss 6 232.47 316.37
Total (B) 5587.34 4673.26
Profit / (Loss) for the year (A - B) (1595.11) (722.86)
Less: Prior Period Adjustment (2.42) 2.15
Profit / (Loss) before Tax (PBT) (1592.69) (725.01)
Less: Tax Provision
Income Tax - -
Wealth Tax 0.20 0.49
Fringe Benefit Tax 4.82 11.90
Income Tax / Wealth Tax for earlier years 3.64 -
Fringe Benefit Tax for earlier years (1.51) -
Deferred Tax (217.22) 224.12
MAT Credit Entitlement (2.84) -
Profit / (Loss) after Tax (1379.78) (961.51)
Balance brought forward from Previous Year 1536.41 2497.92
Balance carried to Balance Sheet 156.63 1536.41

Earnings Per Share EPS

Basic Earnings Per Share (6.69) (4.66)
Diluted Earnings Per Share (6.69) (4.66)

Significant Accounting Policies 18

Note forming part of the Accounts 19

63
 CASH FLOW STATEMENT
ST
FOR THE YEAR ENDED 31 DECEMBER 2009

Particulars Year Ended on Year Ended on

st st
31 December, 31 December,
2009 2008
(Rs. in Lacs) (Rs. in Lacs)
CASH FLOW FROM OPERATING ACTIVITIES
Net Profit Before Tax and prior period adjustment (1595.10) (722.86)
Adjustment for:
Depreciation 113.02 129.18
Provision for Impairment 232.47 316.37
Miscellaneous Expenditure written off 535.93 535.93
Provision for Doubtful Debts 34.42 -
Bad Debts - 2.59
Interest Expense 0.77 3.37
Interest Received (7.73) (12.53)
Loss on sale of assets 6.24 3.96
Sundry Balance written off 3.35 4.96
Sundry Balances written back (4.66) (7.91)
Operating profit before Working Capital Changes (681.30) 253.07
Adjustment for:
Trade and other Receivable (7611.02) 5171.84
Inventories (12054.14) (8221.35)
Trade Payables 1169.87 1383.68
Cash Generated from Operations (19176.58) (1412.76)
Direct Taxes (Paid) / Refunded (Net of Refund / Paid) 16.31 (39.21)
Cash Flow before prior period adjustment (19160.27) (1451.97)
Prior Period Adjustment (income / loss) 2.42 (2.15)
NET CASH FROM OPERATING ACTIVITIES (TOTAL A) (19157.86) (1454.12)
CASH FLOW FROM INVESTMENT ACTIVITIES
Purchase of Fixed Assets
(1247.18) (1765.34)
(including capital work-in-progress)
Sale of Fixed Assets 5.56 5.05
Sale of Investment 1.00 -
Purchase of Investment (101.00) -
Interest Received 113.98 73.53
NET CASH FROM / (USED IN) INVESTMENT ACTIVITIES
(1227.64) (1686.75)
(TOTAL B)
CASH FLOW FROM FINANCING ACTIVITIES
Proceed from issue of convertible Equity Share Warrants 1575.00 -
Proceed from Secured Loans (Net of Repayment) 19381.95 5908.38
Proceed / (Repayment) from Unsecured Loans (Net) 6135.69 (140.88)
Interest Paid (5411.44) (2311.18)
NET CASH FROM FINANCING ACTIVITIES (TOTAL C) 21681.19 3456.31
Net Increase in Cash & Cash Equivalents Total (A + B + C) 1295.70 315.44
Cash & Cash Equivalents – Opening Balance 1959.86 1644.42
Cash & Cash Equivalents – Closing Balance 3255.56 1959.86

64
SCHEDULES „1‟ TO „19‟ ANNEXED TO AND FORMING PART OF THE BALANCE SHEET AS AT
ST
31 DECEMBER, 2009 AND THE PROFIT & LOSS ACCOUNT OF THE YEAR ENDED AT THAT
DATE:

Schedule 1 – Share Capital

st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
Authorised
9,57,11,120 Equity Shares of Rs.10/- each 9,571.11 2071.11
1,36,877 11% Redeemable Cumulative Preference Shares 136.88 136.88
of Rs.100/- each
1,17,011 0% Redeemable Preference Shares of Rs.100/- 117.01 117.01
each
17,50,000 Unclassified Shares of Rs.10/- each 175.00 175.00
Total Authorised Capital 10,000.00 2500.00
Issued, Subscribed & Paid-Up
2,06,34,540 Equity Shares of Rs.10/- each 2,063.45 2,063.45
1,36,877 11% Redeemable Cumulative Preference Shares 136.88 136.88
of Rs.100/- each
1,17,011 0% Redeemable Preference Shares of Rs.100/- 117.01 117.01
each
Total Issued, Subscribed & Paid-Up Capital 2,317.34 2317.34

Schedule 2 – Convertible Equity Share Warrants

st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
45,00,000 Equity Warrants at Rs. 140/- each Rs. 35/- paid on
1575.00 -
application

Schedule 3 – Reserves & Surplus

st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
Capital Reserve 1.50 1.50
General Reserve 150.00 150.00
Workers‘ Welfare & Benevolent Reserve 0.25 0.25
Profit & Loss Account 156.63 1536.41
Total 308.38 1688.16

Schedule 4 – Secured Loans

st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
A) From Banks
Term Loan 36520.11 16940.00
Vehicle Loan 34.47 27.77
B) From Others 2388.66 2593.52
Total 38943.24 19561.29

Schedule 5 – Unsecured Loans

st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
Loan from Corporate 7161.84 1026.15

65
 Schedule 6 – Fixed Assets

Gross Block Depreciation / Amortization Impairment Net Block

Particulars As at Additions Deduction As at As at For Deductio As at As at For As at As at As at
31-12-08 / s/ 31-12-09 31-12-08 the ns / 31-12- 31-12- the 31-12- 31-12- 31-12-
Adjustme Adjustme Year Adjustme 09 08 Year 09 09 08
nts nts during nts
during the year during
the year the year

Textile Division
Land - Leasehold 0.06 - - 0.06 0.02 0.00 - 0.02 - - - 0.03 0.03
Land - Freehold 10820.69 - - 10820.69 - - - - - - - 10820.69 10820.69
Buildings – Residential 106.00 - - 106.00 14.54 3.49 - 18.02 - - - 87.98 91.46
Buildings Leasehold Land 4.46 - - 4.46 2.70 0.07 - 2.77 - - - 1.69 1.76
Roads 2.42 - - 2.42 0.10 0.04 - 0.14 - - - 2.28 2.32
Fire Fighting Equipments 2.12 - - 2.12 2.04 0.01 - 2.06 - - - 0.06 0.07
Computers & Peripherals 4.95 - - 4.95 2.42 0.80 - 3.21 - - - 1.74 2.54
Office Equipments 1.08 - - 1.08 0.19 0.05 - 0.24 - - - 0.85 0.90
Motor Cars 55.28 13.48 19.94 48.81 23.05 5.22 6.06 22.22 - - - 26.60 32.22
Air Conditioners 4.28 - - 4.27 0.47 0.20 - 0.67 - - - 3.60 3.81
Plant & Machinery 2341.34 - - 2341.34 870.01 95.86 - 965.87 293.97 216.01 509.98 865.49 1177.36
Air Conditioners for 151.07 - - 151.07 54.77 6.26 - 61.04 19.26 14.15 33.42 56.62 77.04
Plant & Machinery
Factory Equipments 24.67 - - 24.67 8.99 1.02 - 10.01 3.14 2.31 5.44 9.22 12.55
Total (A) 13518.42 13.48 19.94 13511.96 979.30 113.02 6.06 1086.27 316.37 232.47 548.84 11876.85 12222.75
Previous Year (A) 13489.83 41.06 12.47 13518.42 853.58 129.18 3.46 979.30 - 316.37 316.37 12222.75 -

Real Estate Dev. Division

Computers & Printers 34.46 1.93 - 36.39 6.68 5.79 - 12.47 - - - 23.93 27.78
Intangible Assets (Software) 5.82 1.79 - 7.61 2.54 2.20 - 4.74 - - - 2.87 3.28
Air Conditioners 14.34 1.19 - 15.53 0.88 0.72 - 1.60 - - - 13.93 13.46
Plant & Machinery 1524.32 216.42 - 1740.75 82.11 74.03 - 156.15 - - - 1584.60 1442.21
Heavy Earth Moving 94.52 - - 94.52 10.81 10.69 - 21.50 - - - 73.02 83.72
Machinery
Motor Buses & Lorries 6.65 - - 6.66 0.52 0.75 - 1.27 - - - 5.38 6.13
Office Equipment 57.41 7.46 - 64.86 8.81 3.32 - 12.12 - - - 52.74 48.60
Temporary Structures 64.14 - - 64.14 5.00 4.06 - 9.06 - - - 55.08 59.14
Furniture & Fixtures 130.35 1.71 - 132.06 17.49 8.28 - 25.77 - - - 106.29 112.86
Office Building 92.93 - - 92.93 1.56 1.51 - 3.08 - - - 89.85 91.37
Motor Cars 44.40 31.48 13.48 62.40 4.31 5.00 2.09 7.21 - - - 55.18 40.09
Electrical Fittings 43.82 - - 43.82 1.80 2.08 - 3.88 - - - 39.94 42.02
Shuttering & Scaffolding 2664.11 889.06 - 3553.16 220.41 471.90 - 692.31 - - - 2860.86 2443.69
Total (B) 4777.27 1151.04 13.48 5914.83 362.92 590.33 2.09 951.16 - - - 4963.67 4414.35
Previous Year (B) 1393.21 3384.06 - 4777.27 25.30 337.62 - 362.92 - - - 4414.35 -

TOTAL (A + B) 18295.69 1164.52 33.42 19426.79 1342.22 703.35 8.15 2037.43 316.37 232.47 548.84 16840.52 16637.10
Previous Year (A + B) 14883.04 3425.12 12.47 18295.69 878.88 466.80 3.46 1342.22 - 316.37 316.37 16637.10 -

Capital Work-In-Progress 369.33 273.19

(Including Capital Adv.)

Schedule 7 – Investments
st st st st
Particulars 31 Dec 31 Dec 31 Dec 31 Dec
2009 2009 2008 2008
(Rs. in (Rs. in (Rs. in (Rs. in
Lacs) Lacs) Lacs) Lacs)
“A” Government Securities - Quoted
3% Government Loan 1986 0.04 0.04
5% Loan 2000 0.01 0.01
Less: Provision for diminution in Value 0.05 - 0.05 -

“B” Trade – Shares

(Quoted Equity Shares: Fully Paid)
1704 Equity Shares of Rs.100/- each of 1.73 1.73
Mafatlal Engineering Industries Ltd.
Less: Provision for diminution in Value 1.73 - 1.73 -

Unquoted Equity Shares (Fully Paid)

Equity Shares in Subsidiary Company

66
10,000 Equity Shares of Rs.10/- each of 1.00
SRM Sites Pvt. Ltd.

Other Investment
10 Equity Shares of Rs.1000/- each of 0.10 0.10
Engineering Raw Material Consumers
Corporation Ltd.
Less: Provision for diminution in Value 0.10 - 0.10 -

9,90,000 Equity Shares of Rs.10 each of 99.00

Raghuveer Urban Infrastructure Pvt. Ltd.

―C‖ Contribution towards Proposed East 0.04 0.04

India Cotton Association Society in an
earlier year
Less: Provision for diminution in Value 0.04 - 0.04 -
100.00 -

Aggregate Book Value - Quoted

- Unquoted 100.00
Aggregate Market Value - Quoted

Schedule 8 – Current Assets, Loans & Advances

st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
(a) Interest Accrued but no due 34.89 50.20

(b) Inventories
i. Materials for Real Estate Activity 109.97 277.85
ii. Stores & Spares 60.68 64.43
iii. Loose Tools - 3.01
iv. Cost of Construction (Real Estate Development) 38929.97 20795.11
39100.61 21140.40

(c) Sundry Debtors

Debts outstanding for a period exceeding Six Months:
Unsecured, Considered Good 55.48 1858.69
Unsecured, Considered Doubtful 34.42 -
Others, Unsecure Considered Good 648.83 592.67
Less: Provision for Doubtful Debts (34.42) -
704.30 2451.36

(d) Cash & Bank Balances

Cash on Hand 422.25 582.95
Bank Balances with Scheduled Banks
In Current Accounts 403.12 347.58
In Fixed Deposit Accounts 2430.19 1029.32
3255.56 1959.86

(e) Loans & Advances

(Unsecured, Considered Good)
Advances to subsidiary Company 10.16 -
Advances recoverable in cash or kind or for value to be received 18600.21 9291.96
Less: Provision for Doubtful Advances (8.70) (8.70)
Advances/Loan to Staff 12.88 18.53
Deposits 80.50 79.95

67
Prepaid Expenses 26.13 19.41
Tax Deducted at Source / Advance Taxes (Net of provisions and
154.89 177.72
including refund receivable)
MAT Credit Entitlement 2.84 -
18878.90 9578.59

Schedule 9 – Current Liabilities & Provisions

st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
A. Current Liabilities
Sundry Creditors For Goods & Expenses
Amount Outstanding to Micro, Small & Medium Enterprises - -
Others 1443.88 1765.44
Interest Accrued but not due on Loans 132.30 136.30
Advances against sale of flats 23406.80 21771.05
Deposits 1443.67 1527.39
Other Liabilities 3063.47 3128.04
29490.12 28328.21

B. Provisions
i. Provision for Gratuity 13.01 13.50
ii. Provision for Leave Entitlement 9.18 9.21
iii. Provision for Bonus 0.82 0.98
iv. Provision for Wealth Tax 1.12 0.49
24.12 24.18

Schedule 10 – Miscellaneous Expenditure

st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
Miscellaneous Expenditure
(To the extent not written off / adjusted)
Voluntary Termination Benefit
Balance Brought Forward 1071.86 1607.79
Less: Written off during the year (535.93) (535.93)
535.93 1071.86

Schedule 11 – Sales & Services

st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
Sales (Textiles) 3705.72 3515.38
Income from Business Centre 267.60 399.78
3973.32 3915.16

Schedule 12 – Other Income

st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
Interest Received 98.68 97.89
Rent Income 8.56 7.74
Sundry Credit Balance Written Back (Net) 1.30 2.95
Scrap Sales 16.65 12.03
Miscellaneous Income 1.32 1.00

68
 126.51 121.60
Less: Transferred to Cost of Construction (Real Estate 107.59 86.36
Development) (Schedule 14)
18.92 35.24

Schedule 13 – Purchases – Fabric & Other (Trading)

st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
Stocks at Commencement - -
Purchases 3969.22 3267.21
Stock at Close - -
3969.22 3267.21

Schedule 14 – Cost of Construction (Real Estate Development)

st st st st
Particulars 31 Dec 31 Dec 31 Dec 31 Dec
2009 2009 2008 2008
(Rs. in (Rs. in (Rs. in (Rs. in
Lacs) Lacs) Lacs) Lacs)
Opening Balance as per Last year 20795.11 9849.72

Add :
Material Consumed
Opening stock of Materials 277.85 396.16
Purchase of materials 4465.89 2425.55
Less : Closing Stock of Materials 109.97 277.85
4633.78 2543.86

Stores & Spares Consumed

Opening Stock of Stores & Spares, Tools
67.44 58.57
/Electrical Item
Purchase of Stores & Spares, Tools /
121.77 212.96
Transfer from CWIP to stores
Less : Closing Stock of Stores & Spares,
60.68 67.44
Tools/Electrical Items
128.53 204.09

Labour Charges - 3777.79

Contract, Sub-contract with material and
6038.26 89.92
other charges
Payment to and provision for employees 78.64 115.14
Administration and Other expenses 633.00 1331.47
Finance Expenses 6139.91 2631.85
Depreciation 590.33 337.62
18242.45 11031.75

39037.56 20881.47
Less: Tender Fees - 1.00
Interest on FDR (Schedule 12) 90.94 85.36
Scrap Sales 16.65 -
107.59 86.36
38929.97 20795.11
Less: Transferred to Cost of Construction
38929.97 20795.11
(Real Estate Development) (Sch. 8)
- -

69
Schedule 15 – Payment to & provision for Employees
st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
Salaries, Wages and other allowances 109.70 143.14
Contribution to Provident Fund 9.28 10.95
Contribution to Other Fund 0.17 0.46
Gratuity 0.65 3.32
Staff Welfare Expenses 8.57 7.63
128.36 165.50
Less : Transferred to Cost of Construction (78.64) (115.14)
(Real Estate Development) (Schedule 14)
49.72 50.36

Schedule 16 – Administration & Other Expenses

st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
Insurance 69.89 53.45
Rent 7.36 6.77
Rates & Taxes 54.87 48.97
Directors Sitting Fees / Other Fees 1.90 4.12
Printing & Stationery 16.63 14.61
Refreshment Charges 0.28 0.05
Advertisement and Publicity 0.56 ----
Miscellaneous Expenses 83.32 68.06
Office Expenses 1.87 3.48
Custodial / Revocation / Listing Fees 0.73 0.44
Legal & Professional Fees 528.16 692.66
Diwali Expenses ---- 2.63
Security Charges 29.74 30.76
Conveyance Charges & Travelling Expenses 89.76 137.08
Motor Car Expenses 6.82 5.66
B.M.C. Expenses 1.10 122.87
Power and Fuel 268.10 405.74
Architects Fees ---- 6.43
Telephone Expenses 6.98 7.31
Transportation & Octroi Charges ---- 0.01
Donations 2.50 8.66
Repairs & Maintenance - Building 0.41 5.26
Repairs & Maintenance - Machinery 1.18 0.81
Repairs & Maintenance - Others 7.28 38.51
Share Issue / Transfer expenses 52.81 0.50
Interest & Penalty Charges ---- 0.02
Miscellaneous Expenses Written off 535.93 535.93
Loss on sale on Motor Car 6.24 3.96
Provision for Doubtful Debts 34.42 ----
Bad Debts ---- 2.59
Membership & Subscription 1.05 1.62
Auditors Remuneration 14.42 3.89
Water Charges 30.82 25.40
1855.14 2238.24
Less : Transferred to Cost of Construction
(633.00) (1331.47)
(Real Estate Development) (Schedule 14)
1222.14 906.77

70
Schedule 17 – Finance Expenses
st st
Particulars 31 Dec 2009 31 Dec 2008
(Rs. in Lacs) (Rs. in Lacs)
Interest Expenses
Term Loans 3586.10 2107.76
Others 1820.59 254.57
Finance Charges 733.99 272.89
6140.67 2635.22
Less : Transferred to Cost of Construction
6139.91 2631.85
(Real Estate Development) (Sch. 14)
0.77 3.37

st
Schedule 18 - Significant Accounting Policies for the Year Ended 31 December, 2009

BASIS OF ACCOUNTING:

The Financial statements are prepared under historical cost convention, on accrual basis, in
accordance with the Generally Accepted Accounting Principles in India and comply with Accounting
Standards prescribed by the Companies (Accounting Standards) Rules, 2006 to the extent applicable
and in accordance with provisions of the Companies Act,1956.

USE OF ESTIMATES:

The preparation of financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and contingent liabilities at the date of the financial
statements and the reported accounts of revenues and expenses for the years presented. Although
these estimates are based upon management's knowledge of current event and actions, actual results
could differ from those estimates and revisions, if any, are recognized in the current and future periods.

REVENUE RECOGNITION:

(i) Policy in respect of Real Estate Sales

The Company follows Accounting Standard AS-9 'Revenue Recognition' read alongwith the Guidance
Note on 'Recognition of Revenue by the Real Estate Developers' issued by the Institute of Chartered
Accountants of India. Revenue in respect of real estate sales is recognized when the Company has
transferred to the buyer all significant risks and rewards of ownership, i.e., when the buyer has entered
into a legally enforceable agreement for sale and according to the which the buyer has a legal right to
sell or transfer his interest in the property, without any material condition. However in case where the
Company is obliged to perform the substantial acts after the transfer of all significant risk and rewards
of ownership, the revenue is recognized on proportionate basis as the acts are performed, by applying
percentage of completion method in the manner explained in Accounting Standard AS-7 'Construction
Contracts' issued by Institute of Chartered Accountants of India. Further, Revenue is recognized, in
relation to the sold areas only, on the basis of percentage of actual cost incurred thereon including cost
of land as against the total estimated cost of the project under execution subject to such actual costs
being 30% or more of the total estimated cost. Estimated project cost includes cost of land /
development rights, borrowing costs, overheads, estimated construction and development cost of such
properties. The estimates of the saleable area and costs are reviewed periodically and effect of any
changes in such estimates is recognized in the period in which such changes are determined.
However, when the total project cost is estimated to exceed total revenues from the project, loss is
recognized immediately.

(ii) Others

Interest income is recognized on accrual basis on a time proportion basis.

71
Dividend income is recognized when the Company's right to receive dividend is established.

FIXED ASSETS:

All fixed assets are stated at cost of acquisition, less accumulated depreciation except leasehold land,
and intangible assets which are stated at cost less amounts amortized. Cost includes purchase price
and all other attributable costs of bringing the assets to its working condition for intended use.
Financing costs relating to borrowed funds attributable to acquisition, which takes substantial period of
time to get ready for its intended use are also included, for the period till such asset is put to use.

DEPRECIATION / AMORTISATION:

a) Depreciation on fixed assets (other than Fire Fighting Equipment at Avadh Division) is provided on
Line Method (SLM) at the rates and in the manner specified in Schedule XIV to the Companies A
except for depreciation on Shuttering & Scaffolding which are being depreciated on SLM at 16.6
based on useful life determined by the Management.

b) Depreciation on Fire Fighting Equipment at Avadh Division is provided on written down value
method at the rates and in the manner specified in Schedule XIV to the Companies Act, 1956.

c) The depreciation has not been charged on Fixed Assets whose written down value had reached
below 5% of its cost.

d) Asset costing Rs.5000 or less individually is fully depreciated in the year of purchase.

e) Leasehold land is amortized over the period of the lease.

f) Softwares are being amortized over the estimated useful life of 3 years.

g) In case of impairment loss, if any, depreciation on it is provided on the revised carrying amount
remaining useful life.

IMPAIRMENT OF ASSETS:

The Company assesses at each balance sheet date whether there is any indication that an asset may
be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset.
If recoverable of such asset is less than the carrying amount, then the carrying amount is reduced to its
recoverable am the difference arising therefrom is treated as impairment loss and is charged to profit &
loss account.

After impairment, depreciation is provided on the revised carrying amount of the asset over its
remaining useful life.

BORROWING COST:

Borrowing costs that are directly attributable to the acquisition or construction of a qualifying asset are
considered as part of the cost of that asset upto the date the assets are ready/put to use. Other
Borrowing costs are recognized as an expense in the year in which they are incurred.

INVESTMENTS:

Long term Investments are stated at cost. However, provision is made for diminution in value, other
than to on individual basis.

INVENTORIES:

Materials, Stores and Spares, tools and consumables are valued at cost or net realizable value,
whichever on the basis of 'First in First Out' (FIFO) method.

72
Work-in-progress is valued at lower of cost or net realizable value. Cost of construction includes cost
materials, services, depreciation, interest on borrowing and other incidental cost incurred in relation to
project.

COST OF CONSTRUCTION (Real Estate Development):

Cost of construction includes cost of land, materials, services, depreciation, interest on borrowing, and
incidental cost incurred in relation to project.

EMPLOYEE BENEFITS:

a) Defined Contribution Plan

Company‘s contribution to Provident Fund is deposited with the employees Provident Fund
Organization (EPFO). The Company‘s monthly contribution towards Provident Fund is accounted for
on accrual basis.

b) Defined Benefit Plan

Liability on account of ‗Gratuity‘ is accounted for on the basis of Actuarial Valuation at the end of each
year.

c) Other Long Term

Liability account of ‗Leave encashment‘ is made on the basis if Actuarial Valuation at the end of each of
the year.

d) Other Short Term

Other short term Employees Benefits are charged to revenue in the year in which the related services
are rendered.

MISCELLANEOUS EXPENDITURE:

Expenditure in the nature of miscellaneous expenditure represented by Voluntary Termination Benefits

is amortized in accordance with Accounting Standard 15 (Revised) 'Employee Benefits' issued by the
Institute of Chartered Accountants of India.

TAXATION:

a) Current tax is measured at the amount expected to be paid to the taxation authorities, using the
applicable tax rates and tax laws.

b) Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been
announced up to the balance sheet date. Deferred tax assets and liabilities are recognized for the
future tax consequences attributable to timing differences between the taxable income and
accounting income. The effect of tax rate change is considered in the profit and loss account of the
respective year of change.

c) Deferred tax assets arising mainly on account of brought forward losses and unabsorbed
depreciation under tax laws are recognized only if there is a virtual certainty of its realization
supported by convincing evidence. Deferred tax assets on account of other timing differences are
recognized only to the extent there is reasonable certainty of its realization.

FOREIGN CURRENCY TRANSACTIONS:

a) The transactions in foreign currency are recorded at the exchange rates prevailing on the date of
the transaction.

b) Current Assets and Current Liabilities in Foreign currency outstanding at the Balance Sheet date
are translated at the exchange rates prevailing on the date of Balance Sheet.

The resulting Exchange Difference, if any, is charged to the Profit & Loss Account.

73
EARNINGS PER SHARE (`EPS'):

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to
equity shareholders by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period
attributable to equity shareholders and the weighted average number of shares outstanding during the
period are adjusted for the effects of all dilutive potential equity shares.

PROVISIONS:

Provision is recognized when an enterprise has a present obligation as a result of past events and it is
probable that an outflow of resources will be required to settle the obligation and in respect of which a
reliable estimate can be made. Provisions are determined based on management estimates required
to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and
adjusted to reflect the current management estimate.

LEASES:

Lease arrangements where the risk and rewards incident to ownership of asset substantially vest with
the lessor are recognized as operating lease. Lease rent under operating leases are charged to the
Profit and Loss account on straight line basis over the lease term.

Assets given under operating leases are included in fixed assets. Lease income is recognized in the
profit and lo account on as straight line basis over the lease term. Costs, including depreciation are
recognized as expense in the profit and loss account.

SEGMENT POLICIES:

Company's reporting segments are identified based on activities / products, risks and reward,
organization structure and internal reporting systems.

Segment revenue and expense includes amounts, which can be directly attributed to the segment and
are allocable on a reasonable basis. Unallocable items and interest income / expenses are disclosed
separately.

Segment assets and liabilities are operating assets / liabilities by the segments which are directly
attributable to the segment. The components of capital employed that cannot be directly identified are
shown' as unallocable capital employed.

CONTINGENT LIABILITIES:

The Company makes a provision when there is present obligation as a result of past event where the
outflow of economic resources is probable and a reliable estimate of the amount of the obligation can
be made.

A disclosure is made for a contingent liability when there is:

a) 'Possible obligation, the existence of which will be confirmed by the occurrence / non-
occurrence of one or more uncertain events, not fully within the control of the Company;

b) Present obligation, where it is not probable that an outflow of resources embodying economic
benefits will be required to settle the obligation.

c) Present obligation, where a reliable estimate cannot be made.

OTHER ACCOUNTING POLICIES:

These are consistent with the generally accepted accounting practices.

74
 st
Schedule 19 - Notes forming part of the accounts for the year ended 31 December, 2009

1. Preference shares includes 1,17,011 - 0 % Redeemable Preference Shares of face value of

Rs.100/- each and 1,36,877 – 11% Redeemable Cumulative Preference Shares which are due for
th st
redemption on 30 October, 2017 and 31 October, 2018 respectively.

2. Issue of convertible warrants:

During the year, the Company had issued on preferential / private placement basis, 1,60,00,000 equity
warrants carrying an option to subscribe to equivalent number of equity shares of Rs 10/- each on a
future date, to the Promoters / Promoters Group and Others. Out of above, the Company has allotted
th
45,00,000 equity warrants the Promoters / Promoters Group at its Board meeting held on 16
December, 2009. The other terms and conditions of the convertible warrants issued are as follows:

a) An amount of 25% of the price of equity warrants, as prescribed as per applicable SEBI regulations
relating to preferential allotment as amended from time to time, is payable on or before allotment of
equity warrants.

b) The Warrants holders shall have the option of applying for and being allotted equity shares of the
Company of face value of Rs.10/- each by paying the balance subscription price after adjusting the
upfront payment made on the date of allotment of warrants, at any time prior to expiry of 18 months
from the date of allotment of the Warrants by the allottees.

c) The relevant dates for the preferential issue of equity warrants, as prescribed as per applicable
SEBI regulations relating to preferential allotment as amended upto date, for determination of
th
applicable price for the issue of above mentioned equity warrants was 7 October, 2009 i.e. 30
(thirty) days prior to the date of declaration of the postal ballot result.

d) In the event the equity warrants holder(s) doesn't exercise the option given under the equity
warrants within 18 months from the date of allotment of the equity warrants, the equity warrants
shall lapse and the amount paid as deposit shall stand forfeited by the Company.

e) The equity shares to be issued and allotted by the Company as a consequence of the conversion /
exchange of the equity warrants in the manner aforesaid shall be subject to the Memorandum and
Articles of Association of the Company and shall rank pari passu in all respect with the existing
equity shares of the Company.

f) The equity warrants and the equity shares allotted pursuant to exercise of such equity warrants
shall be subject to the lock-in period and restrictions in transferability as specified as per applicable
SEBI Regulations relating to preferential allotment.

g) The aforesaid warrants by itself shall not give the holder thereof any rights of the shareholder of the
Company.

The details of the amount received during the year are as under:

Number of Warrants Issue price of the warrant Total Amount

issued allotted Received
(Amt in Lacs)
Rs.140/-
45,00,000 (Rs.35/- i.e. 25% of Rs.140/- received on allotment of 1575.00
equity warrants)

75
Utilization of funds raised from preferential issue of equity warrants: The details of the amount utilized
are as under:

Sr.No. Particular Amount

Utilized (Amt
in Lacs)
1 Implementation of the ongoing project at Worli Premises 1575.00
Total 1575.00

3. Capital Commitments:
Amt. in Rupees
Particulars Current year Previous year
(Amt in Lacs) (Amt in Lacs)
Estimated amount of contracts remaining to be executed on capital
18.03 146.33
account and not provided for:

4. Contingent Liabilities in respect of:

Sr. Current year Previous year

Particulars
No. (Amt in Lacs) (Amt in Lacs)
a) Claims against the Company not acknowledged as debts 487.69 494.45
b) Bank guarantees 300.00 300.00
c) Outstanding letter of credit facility availed 48.25 Nil
d) Labour matter: 4.84 4.87
i. Pending in court in respect of claims for Retrenchment
compensation etc
ii. Pending court cases – 5 (previous year – 5) in respect of claims for Black Wages etc. filed
by ex-employees of the Company for which the amount of contingent liability us uncertain
able.
e) Income tax matters : Nil 24.80
i. Income tax demand for Asst. year 2003-04
ii. Income Tax demand for Asst. Year 2007-08 for which 43.59 Nil
appeal has been filed with CIT (Appeal)
f) i. Water tax dispute with BMC 27.48 Nil
ii. Sewerage tax dispute with BMC 16.49 Nil
iii. Property tax dispute with BMC 160.35 Nil
g) Excise Duty demand [Bank Guarantee 3.39 3.39
provided for the same Rs.3,39,250/-
(Previous Year Rs.3,39,250/-) not included above]
h) Customs Duty demand [Bank Guarantee provided for the 6.98 6.98
same Rs.6,98,500/- (Previous Year Rs.6,98,500/-) not
included above]
i) Pending court cases- 3 (Previous Year - 3) in respect of other matters against the Company
which the amount of Contingent Liability is unascertainable.

5.
a) Arbitration proceedings are underway which have been filed by Kalpataru Properties (Pvt) Ltd
[formerly known as Kalpataru Construction (Overseas) Pvt Ltd] in respect of development
rights of Plot 5A admeasuring 20,955.4 sq. mtrs of the Company's Worli Estate for which it has
received Rs.30 crores. The Bombay High Court had passed a status quo order on about
23,500 sq. mtrs of the said Estate. Recently, Kalpataru Properties (Pvt) Ltd have filed a claim
of compensation for Rs.1,528.93 crores alongwith interest as alternative to their original claim
for specific performance. The Company has received legal advice from its lawyers that the said
claim for compensation is not tenable, and the chances of it being held against the Company
are highly remote. The Company has since filed papers for a counter-claim for Rs.2,677.32
crores from the said Kalpataru Properties (Pvt) Ltd.

76
 b) Arbitration proceedings filed by Utility Premises Pvt Ltd and Cogent Ventures (India) Ltd
[formerly known as Bhupendra Capital & Finance Ltd] in respect of Plot 2 admeasuring 4,848.5
sq. mtrs. of the Company's Worli Estate are underway. The said claimants have filed a claim
for compensation of Rs.36.03 crores alongwith interest as an alternate to specific performance.
The Company has given a Bank Guarantee of Rs.3 crores in favour of the Arbitration Tribunal
towards the pending arbitration proceedings. The Company has received legal advice from its
lawyers that the said claim for compensation is not tenable, and the chances of it being held
against the Company are highly remote.

6. In the opinion of the Management, no item of current assets has a value on realization in the
ordinary course of business, which is less than the amount of value at which it is stated in the
Balance Sheet. The provision for all known and determined liability is adequate and not in the
excess of the amount reasonably required.

7. Shares held as investment by the Company have been classified as Long term Investment.
Provision for the diminution in the value of investment has been made in the accounts where the
management is of the view that such diminution is of permanent nature.

8. The Company assesses at each balance sheet date whether there is any indication that an asset
may be impaired. If any such indication exists, the Company estimates the recoverable amount of
the asset. If recoverable amount of such asset is less than the carrying amount, then the carrying
amount is reduced to its recoverable amount and such difference between recoverable amount
and carrying amount is treated as impairment loss and is charged to profit & loss account. For the
st
current year ended 31 December 2009 impairment loss charged to Profit and Loss account is
Rs.2,32,46,755/- (Previous Year Rs.3,16,36,990/-).
st
9. Operating future minimum Rent Payable / Receivable as at 31 December, 2009.

Amount (Rs.) Amount (Rs.)

Particulars
(Rs. in Lacs) (Rs. in Lacs)
a) Rent payable As on As on
31.12.2009 31.12.2008
i) Not later than one year 1.00 4.00
ii) Later than one year and not later than five year Nil Nil
iii) Later than five year Nil Nil
b) Rent Receivable As on As on
31.12.2009 31.12.2008
i) Not later than one year 97.77 95.05
ii) Later than one year and not later than five year 15.08 4.63
iii) Later than five year Nil Nil

10. As at 31st December, 2009 the percentage of completion with respect to actual cost incurred for
including cost of land as against the total estimated cost of the project under execution, is less than
the total estimated cost. Accordingly no revenue has been recognized in relation to the sold areas.
The management is of the view that the total estimated project cost is within the total estimated
revenue the project.

11. No significant events which could affect the financial position as on 31st December, 2009, to a
material have been occurred, after the balance sheet date till the signing of report.

12. Managerial Remuneration comprises of the following:

Current year Previous year

Particulars
(Amt in Lacs) (Amt in Lacs)
Salary 24.55 22.80
Contribution to Provident Fund 2.94 2.67
Ex-Gratia 0.90 0.90
Others 2.72 4.17

77
 Total 31.11 30.54
Less: Transferred to cost of construction 17.33 14.93
Debited to Profit & Loss Account 13.78 15.61

13. Audit fees include payment to auditors:

Particulars Current year Previous year

(Amt in Lacs) (Amt in Lacs)
For Statutory Audit 13.23 3.00
For Tax Audit 0.66 0.45
For Vat Audit 0.25 0.28
For Other Matters 0.28 0.16
Total 14.42 3.89

14. The Company has recognized the Deferred Tax Liability / Assets as at 31st December, 2009 as
per Accounting Standard — 22 "Accounting for Taxes on Income" issued by the Institute of
Chartered Accountants of India detailed under:

Particulars Current year Previous year

(Amt in Lacs) (Amt in Lacs)
Deferred Tax Liability
Depreciation on Fixed Assets & Others 44.78 115.55
Misc. Expenditure 178.02 364.32
Total Deferred Tax Liability 222.80 479.87
Deferred tax Assets
Provision for Gratuity / Leave Encashment 4.34 -
Unabsorbed Depreciation / Fiscal Losses 218.46 262.65
Total Deferred Tax Assets 222.80 262.65
Deferred Tax Liabilities / (Assets) - Net Nil 217.22

The Company has loss and unabsorbed depreciation. However, on a prudent basis, as per Accounting
Standard 22 (Accounting for Taxes on Income), Deferred Tax Asset is recognized only to the extent of
deferred tax liability.

15. Segment Reporting:

The Company has recognized the Textile & Real Estate Segments as at 31st Dec, 2009 as per
Accounting Standard — 17 "Segment Reporting" issued by the Institute of Chartered Accountants of
India as detailed under:

Accounting Standard 17 „Segment Reporting‟

(a) Business Segment:

Particulars Textile Real estate Total

31.12.2009 31.12.2008 31.12.2009 31.12.2008 31.12.2009 31.12.2008
REVENUE
External revenue 3709.63 3520.54 272.25 40236 3981.88 3922.90
Inter-segment revenue - - - - - -
Total revenue 3709.63 3520.54 272.25 40236 3981.88 3922.90
RESULT

Segment result (595.20) (181.20) 126.04 140.89 (469.16) (40.32)

Less: unallocable expenditure net of 1144.09 714.40
unallocable income
Less: interest expenses 0.77 3.37
Add: interest income 18.91 35.24
Profit before prior period adjustment (1595.11) (722.86)

78
Less/(Add): prior period adjustment (2.42) 2.15
Profit before taxation & exceptional (1592.69) (725.00)
item
Less: tax provision
Income tax - -
Wealth tax 0.20 0.49
Fringe benefit tax 4.82 11.90
Income/wealth tax for earlier years 3.64 -
Fringe benefit tax for earlier years (1.51) -
MAT credit entitlement (2.84) -
Deferred tax (217.22) 224.12
Profit after taxation (1379.78) (961.51)

OTHER INFORMATION
Segment assets 1605.72 2339.14 66486.01 39387.11 68091.73 41726.25
Unallocable assets 11192.38 10364.45
Total assets 79284.11 52090.70
Segment liabilities 882.78 897.98 28440.56 27204.58 29323.35 28102.57
Unallocable liabilities 190.89 467.05
Total liabilities 29514.24 28569.62
Capital Expenditure
Segment capital expenditure 13.48 - 1247.18 1765.34 1260.66 1765.34
Unallocable capital expenditure - -
Total capital expenditure 1260.66 1765.34
Depreciation/Amortization/Impairment
Segment Depreciation / Amortization / 335.61 434.54 593.94 341.22 929.54 775.76
Impairment
Unallocable Depreciation / Amortization / - - 6.28 7.41
Impairment
Total Depreciation / Amortization / 935.82 783.18
Impairment

* Includes depreciation of Rs.5,90,33,451/- (Previous Year Rs.3,37,62,362/-) relating to real estate

division which has been debited to Cost of Construction (Real Estate Development) (Refer Schedule
14)

Note: Real Estate segment includes income from Business Centre.

(b) Secondary Segment Reporting (Geographical Segments):

Not applicable

16. Employee Benefits:

Disclosure under Accounting Standard 15 "Employee Benefits" (Revised 2005) issued by the Institute
of Chartered Accountants of India:

Defined Contribution Plan

The Company's contribution to Provident Fund is deposited with the Employees Provident Fund
Organization (EPF During the year the Company has recognized Rs.9,27,519/- (Previous year
Rs.10,94,893/-) towards provident fu

Defined Benefit Plan

79
Gratuity

The Gratuity liability arises on retirement, premature withdrawal, resignation and death of an employee.
The gratuity liability is calculated on the basis of actuarial valuation as per projected unit credit method.

Other Long Term Benefit

Leave Encashment Plan

The earned leave liability arises as and when services are performed by an employee. The said liability
is calculated on the basis of actuarial valuation as per projected unit credit method.

I) Changes in Defined Benefit Obligation.

Leave Leave
Gratuity Gratuity
Encashment Encashment
Particulars as on as on
as on as on
31.12.2009 31.12.2008
31.12.2009 31.12.2008
Liability at the beginning of the year 13.50 10.17 9.21 7.16
Current Service Cost. 3.50 2.53 2.18 1.34
Interest Cost 1.07 1.02 0.66 0.58
Benefits paid (1.14) - (2.35) (2.40)
Actuarial Gain/ Loss on obligation (3.92) (0.22) (0.54) 2.54
Liability at the end of the year 13.01 13.50 9.18 9.21

II) The fair value of plan assets is Nil since retirement benefit plans are wholly unfunded.

III) Amount recognized in Balance Sheet

Leave Leave
Gratuity Gratuity
Encashment Encashment
Particulars as on as on
as on as on
31.12.2009 31.12.2008
31.12.2009 31.12.2008
Liability at the end of the year 13.01 13.50 9.18 9.21
Amount recognized in balance sheet 13.01 13.50 9.18 9.21

IV) Expenses recognized in Profit & Loss Account & Transferred to Cost of Constructions

Leave Leave
Gratuity Gratuity
Encashment Encashment
Particulars as on as on
as on as on
31.12.2009 31.12.2008
31.12.2009 31.12.2008
Current service cost 3.50 2.53 2.18 1.33
Interest cost 1.07 1.02 0.66 0.58
Adjustment for increase in opening - - - -
provision
Expense transfer to reserve - - - -
Actuarial (Gain)/Loss (3.92) (0.22) (0.54) 2.54
Total expenses 0.65 3.32 2.31 4.46
Expenses charged to profit & Loss
account 1.23 1.88 1.46 1.80
Expenses charged to Construction costs
Expenses charged to Construction cost (0.58) 1.44 0.86 2.65
Total expenses 0.65 3.32 2.31 4.46

80
V) Balance Sheet Reconciliation:

Leave Leave
Gratuity Gratuity
Encashment Encashment
Particulars as on as on
as on as on
31.12.2009 31.12.2008
31.12.2009 31.12.2008
Opening net liability 13.50 10.17 9.21 7.16
Expense as above 0.64 3.32 2.31 4.46
Adjustment for increase in opening - - - -
provision for retirement benefits
Benefits paid (1.14) - (2.35) (2.40)
Amount recognition in the balance sheet 13.01 13.50 9.18 9.21

VI) Principal Actuarial Assumptions

Leave Leave
Gratuity Gratuity
Encashment Encashment
Particulars as on as on
as on as on
31.12.2009 31.12.2008
31.12.2009 31.12.2008
Discount rate 8.00% 6.50% 8.00% 6.50%
Future salary increase 5.00% 5.00% 5.00% 5.00%

The discount rate is based upon the bench mark rate available on Government Securities having
maturity equal to the tenure of benefits.

The estimate of salary growth rate considered in actuarial valuation takes into account inflation,
seniority and other relevant factors on long term basis.

17. Related Party Discussion

In compliance with Accounting Standard 18 — 'Related Party Disclosures' issued by the Institute of
Chart Accountants of India, the required disclosures are given in the table below:

a) Name of the Related Party and Nature of Related Party Relationship

Name of the related Party Nature of Related Party Relationship

a) SRM Sites Pvt. Ltd. Subsidiary
b) Raghuveer Urban Infrastructure Pvt. Ltd.
(from 18-03-2009 to 24-09-2009)
a) Akhilesh Developers Pvt. Ltd. Enterprise that directly, or indirectly through one
or more intermediaries, control, or are controlled
by, or are under common control with, the
reporting enterprise
a) Landmark Leisure Corporation Limited Enterprises over which key management
b) S. Kumars Online limited personnel & their Relatives exercise significant
c) Vidhi Holdings Pvt. Ltd. influence where the Company has entered into
d) Akhilesh Developers Pvt. Ltd. transactions during the year
e) Hanumesh Realtors Pvt. Ltd.
f) Mandakini Hospitality Pvt. Ltd.
g) Yashaswini Leisure Pvt. Ltd.
h) SKM Fabrics (Andheri) Ltd
a) Mr. Vikas S. Kasliwal — Vice Chairman & CEO Key Management Personnel
b) Mr. S. K. Luharuka — Whole Time Director

b) Details of transactions between the Company & related parties & the status of outstanding balances
as 31st December, 2009.

81
 Nature of transaction Current year Previous year
(Amt in Lacs) (Amt in Lacs)
Contact, Sub-Contact charges
Raghuveer Urban Infrastructure Pvt. Ltd 3726.80 89.92
Total 3726.80 89.92
Consultancy charges paid/(reversed)
Landmark Leisure Corporation Ltd (0.22) 29.47
Total (0.22) 29.47
Rent received
S. Kumars Online Ltd. 2.71 -
Total 2.71 -
Interest paid
A.S. Parivar — 3.90
Total — 3.90
Preliminary & other expenses incurred on behalf of
subsidiary (recoverable from subsidiary)
SRM Sites Private Limited 28.54 —
Total 28.54 —
Expenses incurred on behalf – recoverable
Raghuveer Urban Infrastructure Pvt. Ltd — 0.18
Total — 0.18
Investment in equity shares
Raghuveer Urban Infrastructure Pvt. Ltd 99.00 —
Total 99.00 —
Loans taken
Vidhi Holdings Pvt. Ltd. 1650.26 -
Akhilesh Developers Pvt. Ltd. 5005.00 -
Hanumesh Realtors Pvt. Ltd. 1044.90 -
Mandakini Hospitality Pvt. Ltd. 1099.00 -
Yashaswini Leisure Pvt. Ltd. 990.10 -
SKM Fabrics (Andheri) Ltd. 460.00 -
A. S. Parivar - 250.00
Total 10249.26 250.00
Loans taken repaid
Vidhi Holdings Pvt. Ltd. 600.26 -
Akhilesh Developers Pvt. Ltd. 1480.00 -
SKM Fabrics (Andheri) Ltd. 460.00 -
A. S. Parivar - 250.00
Total 2540.26 250.00
Allotment of Equity Share Warrants
(Amount adjusted from loan taken)
Hanumesh Realtors Pvt. Ltd. 525.00 -
Mandakini Hospitality Pvt. Ltd. 525.00 -
Yashaswini Leisure Pvt. Ltd. 525.00 -

Total 1575.00 -
Advances received
Raghuveer Urban Infrastructure Pvt. Ltd. 175.00 -
Vidhi Holdings Pvt. Ltd. - 365.00
Total 175.00 365.00
Payments towards advances Received
Raghuveer Urban Infrastructure Pvt. Ltd. 75.00 -
Vidhi Holdings Pvt. Ltd. - 365.00
Total 75.00 365.00
Deposit Received
S Kumars Online Ltd - 150.00
Total - 150.00
Deposit Repaid

82
S Kumars Online Ltd 77.00 -
Landmarc Leisure Corporation Limited 3.50 56.21

Total 80.50 56.21

Advances given
Raghuveer Urban Infrastructure Pvt. Ltd. 520.75 -
Total 520.75 -
Receipts against advances given
Raghuveer Urban Infrastructure Pvt. Ltd. 520.75 -
First Row Lifestyle Private Limited - 0.17
Total 520.75 0.17
Key Management Personnel
Managerial Remuneration -
- Mr. Vikas S. Kasliwal - Vice Chairman & CEO 17.34 14.94
- Mr. S. K. Luharuka - Whole Time Director 13.77 15.61
Total 31.11 30.54
Purchase of Equity Shares of SRM Sites Pvt. Ltd.
- Mr. Vikas S. Kasliwal - Vice Chairman & CEO 0.5 -
- Mr. S. K. Luharuka - Whole Time Director 0.5 -
Total 1.00 -
st
Outstanding Balance as on 31 December, 2009
Debtors
S Kumars Online Ltd. 3.15 0.44
Total 3.15 0.44
Amount recoverable towards Preliminary & other Expenses
incurred on behalf of subsidiary
SRM Sites Pvt. Ltd. 10.16 -
Total 10.16 -
Investments held
SRM Sites Pvt. Ltd. 1.00 -
Total 1.00 -
Loans taken
Vidhi Holdings Pvt. Ltd. 1050.00 -
Akhilesh Developers Pvt. Ltd. 3525.00 -
Hanumesh Realtors Pvt. Ltd. 519.90 -
Mandakini Hospitality Pvt. Ltd. Y 574.00 -
Yashaswini Leisure Pvt. Ltd. 465.10 -
Total 6134.00 -
Advance received
Akhilesh Developers Pvt. Ltd. 900.00 900.00
Hanumesh Realtors Pvt. Ltd. 900.00 900.00
Mandakini Hospitality Pvt. Ltd. 900.00 900.00
Yashaswini Leisure Pvt. Ltd. 900.00 900.00
Total 3600.00 3600.00
Deposits Received
Landmarc Leisure Corporation Limited 1370.67 1374.39
S Kumars Online Ltd 73.00 150.00
Total 1443.67 1524.39

18. Computation of Earning per share (EPS)

Current year Previous year

Particulars (Amt in Lacs) (Amt in Lacs)
Profit/(loss) After Taxation (Rs.) (1379.78) (961.51)
Weighted Average number of Equity Shares (Quantity) 2,06,34,540 2,06,34,540
Face value per equity shares(Rs.) 10 10

83
 Basic Earnings per share (EPS) Rs. (6.69) (4.66)
Diluted Earnings per Share (EPS) Rs. (6.69) (4.66)

The Company has issued 45,00,000 equity warrants at issue price of Rs.140/- per warrant. The issue
price being more than the fair value calculated in terms of Accounting Standard 20 'Earning per Share'
issued by ICAI, is anti-dilutive. Therefore, the above equity warrants have not been taken into
consideration while calculating the Dilutive EPS.

19. There are no Micro, Small & Medium Enterprises, to whom the Company owes dues on account of
principal amount together with interest as at the Balance sheet date. This has been determined to
the extent such parties have been identified on the basis of information available with the
Company.

20. `Sundry Credit balances written back' (Net) amounting to Rs.1,30,120/- (Previous Year
Rs.2,94,633/-) are net of sundry debit 'balances written off amounting to Rs.3,35,489/- (Previous
Year Rs.4,96,449/-).

21. The Company has maintained the 'Debt Service Reserve Account' (DSR) with the banks from
whom the Company has borrowed the money for the real estate project. An amount equal to three
months interest on each disbursement under the rupee term loan is being transferred directly by
the lender to the DSR Account out of the proceeds of such disbursement. The Company is
required to maintain and operate this account during the entire tenure of the facility. As at 31st
December, 2009, the outstanding balance in DSR Account is Rs.12,67,00,420/- (Previous Year
Rs.5,62,78,000/-) and is included in the balances lying in Fixed Deposit Accounts.

22. The Company is a real estate developer Company and not a manufacturing Company hence in
respect of activities of real estate division, quantitative and other disclosures as required by
paragraph 3 (ii) (a), (b) and paragraph 4C of Part II of Schedule VI to the Companies Act, 1956 are
not applicable to the Company.

23. Additional information pursuant to the Provision of Paragraph 3, 4C and 4D of Part II of Schedule
VI to the Companies Act, 1956 in respect of trading division of the Company.

A: Licensed and Installed capacity and Production

a) Licensed Capacity Not applicable

b) Installed Capacity Not applicable
c) Production Current Year Previous Year
Cloth (in Mtrs.) - -

B. Stock and Turnover:

Opening stock Closing stock Turnover

01-01-2009 01-01-2008 31-12-2009 31-12-2008 31-12-2009 31-12-2008
Cloths (Mtrs.) - - - - 31.95 22.62
Rs. - - - - 3705.72 3515.38
Total (Rs.) - - - - 3705.72 3515.38

24. C.I.F. Value of imports, Expenditures and earning in Foreign Currencies

Particulars Current year Previous year

(Amt in Lacs) (Amt in Lacs)

a) C.I.F.: i) capital goods 69.73 452.85

ii) material 1.01 103.87
b) advance received in foreign currencies 333.75 1995.92
c) earning of foreign currencies Nil Nil
d) expenditure/remittance in foreign currencies
i) foreign traveling 30.19 64.94

84
 ii) consultancy charges paid 15.68 38.99

25. Previous year's figures are regrouped wherever necessary in order to bring them in conformity with
current year classification.

For KHANDELWAL JAIN & Co. For HABIB & Co.

Chartered Accountants, Chartered Accountants,
Firm‘s Registration No. 105049W Firm‘s Registration No. 103479W

(NARENDRA JAIN) (D. P. SHROFF)

PARTNER PARTNER
Membership No. 048725 Membership No. 045417

Place : Mumbai Place : Mumbai

th th
Date : 25 May 2010 Date : 25 May 2010

85
 Auditors Report – Consolidated Financial Statements

To
The Members Of
Shree Ram Urban Infrastructure Limited,
Mumbai.

1. We have examined the attached Consolidated Balance Sheet of SHREE RAM URBAN
st
INFRASTRUCTURE LIMITED (‗the Company‘) and its subsidiary as at 31 December, 2009
and also the Consolidated Profit & Loss Account and the Consolidated Cash Flow Statement
for the year ended on that date annexed thereto. These Consolidated financial statements are
the responsibility of the Company‘s Management and have been prepared by them on the
basis of separate financial statements and other financial information regarding components.
Our responsibility is to express an opinion on these consolidated financial statements based
on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India.
These Standards require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are prepared, in all material respects, in accordance
with the identified financial framework and are free of material misstatements. 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 estimates made by management, as well as evaluating the overall consolidated
financial statements presentation. We believe that our audit provides a reasonable basis for
our opinion.

3. We did not audit financial statements of subsidiary whose financial statements reflect total
st
assets of Rs.40,07,80,035/- as at 31 December, 2009, total revenue of Rs.2,38,358/- and
net cash flow amounting to Rs.3,01,526/- for the year then ended. These financial statements
have been audited by other auditor whose report has been furnished to us and our opinion, in
so far as it relates to the amounts included in respect of these entities, is based solely on the
report of other auditor.

4. We report that the consolidated financial statements have been prepared by the Company in
accordance with the requirements of the Accounting Standards (AS) 21 on ―Consolidated
Financial Statements‖ issued by the Institute of Chartered Accountants of India and on the
basis of the separate audited financial statements of the Company and its subsidiary included
in the consolidated financial statements.

5. On the basis of the information and explanations given to us and on the consideration of the
separate audit report on individual audited financial statements of the Company and its
subsidiary, we are of the opinion that the attached consolidated financial statements read with
the other notes and the significant accounting policies thereon, give a true and fair view in
conformity with the accounting principles generally accepted in India:

(i) in the case of the Consolidated Balance Sheet, of the state of affairs of the
st
Company and its subsidiary as at 31 December, 2009;

(ii) in the case of the Consolidated Profit and Loss Account, of the Consolidated Loss
of the Company and its subsidiary for the year ended on that date; and

(iii) in the case of the Consolidated Cash Flow Statement, of the cash flows of the
Company and its subsidiary for the year ended on that date.

For KHANDELWAL JAIN & Co. For HABIB & Co.

Chartered Accountants, Chartered Accountants,
Firm‘s Registration No. 105049W Firm‘s Registration No. 103479W

86
(NARENDRA JAIN) (D. P. SHROFF)
PARTNER PARTNER
Membership No. 048725 Membership No. 045417

Place : Mumbai Place : Mumbai

th th
Date : 25 May 2010 Date : 25 May 2010

87
 CONSOLIDATED BALANCE SHEET
ST
AS AT 31 DECEMBER, 2009
st
Particulars Schedule As at 31 As at 31st
No. December December
2009 2009
(Rs. in Lacs) (Rs. in Lacs)
SOURCES OF FUNDS
Shareholder's Funds
a) Share Capital 1 2326.44
b) Convertible Equity Share Warrants 2 1575.00
c) Reserves & Surplus 3 4097.76 7999.20

Loan Funds
a) Secured Loans 4 38943.24
b) Unsecured Loans 5 7161.84 46105.09

Minority Interest 208.47

TOTAL 54312.76

Application of Funds
Fixed Assets 6
a) Gross Block 19426.79
b) Less: Depreciation, Amortization and Impairment 2586.27
c) Net Block 16840.52
d) Capital Work in Progress (including Capital
369.33 17209.85
Advances)

Investment 7 99.00

Goodwill on Consolidation 0.16

Current Assets, Loans & Advances 8

a) Interest Accrued but not due 34.89
b) Inventories 41083.29
c) Sundry Debtors 704.31
d) Cash & Bank Balance 3258.57
e) Loans & Advances 21023.56
66104.62

Less: Current Liabilities & Provisions 9

Current Liabilities 29612.68
Provision 24.12
(29636.80)
Net Current Assets 36467.82
Miscellaneous Expenditure (To the extent not 10
535.93
written off/adjusted)
TOTAL 54312.76
Significant Accounting Policies 19
Notes forming part of the Accounts 20

88
 PROFIT & LOSS ACCOUNT
ST
FOR THE YEAR ENDED 31 DECEMBER, 2009

Particulars Schedule Year Ended on Year Ended on

st st
No. 31 December, 31 December,
2009 2009
(Rs. in Lacs) (Rs. in Lacs)
INCOME
Sales & Services 11 3973.32
Other Income 12 21.30
Increase / (Decrease) in Stocks -
Total (A) 3994.62

EXPENDITURE
Traded Purchases 13 3969.22
Cost of Construction (Real Estate Development) 14 38929.97
Less: Cost of Construction carried to Inventories 38929.97 -
Construction work in progress 15 1982.68
Less: Construction Work in Progress Carried to
1982.68 -
Inventories
Payments to Provision for Employees 16 49.72
Administration & Other Expenses 17 1256.55
Finance Expenses 18 0.77
Depreciation & Amortisation 6 113.03
Provision for Impairment Loss 6 232.47
Total (B) 5621.74
Profit / (Loss) for the year (A – B) (1627.12)
Less: Prior Period adjustments (2.41)
Profit / (Loss) before Tax (1624.71)
Less: Tax Provision
Income Tax ----
Wealth Tax 0.20
Fringe Benefit Tax 4.82
Income / Wealth Tax for earlier years 3.64
Fringe Benefit Tax for earlier years (1.51)
Deferred Tax (217.22)
MAT Credit Entitlement (2.84)
Profit / (Loss) after Tax before Minority Interest (1411.80)
Less: Minority interest in loss of subsidiary (1.67)
Profit / (Loss) for the year (1410.13)
Balance brought forward from Previous Year 1536.41
Balance carried to Balance Sheet 126.28

Earnings Per Share EPS

Basic Earnings Per Share (6.83)
Diluted Earnings Per Share (6.83)
Significant Accounting Policies 19
Notes forming part of the Accounts 20

89
 CASH FLOW STATEMENT
ST
FOR THE YEAR ENDED 31 DECEMBER 2009

Particulars Year Ended on

st
31 December,
2009
(Rs. in Lacs)
CASH FLOW FROM OPERATING ACTIVITIES
Net Profit Before Tax, Minority Interest and prior period adjustment (1627.13)

Adjustment for:
Depreciation 113.02
Provision for Impairment 232.47
Miscellaneous Expenditure written off 535.93
Provision for Doubtful Debts 34.42
Interest Expense 0.77
Interest Received (10.12)
Loss on sale of assets 6.24
Sundry Balance written off 3.35
Sundry Balances written back (4.66)
Operating profit before Working Capital Changes (715.70)

Adjustment for:
Trade and other Receivable (9755.60)
Inventories (14036.82)
Trade Payables 1502.57
Cash Generated from Operations (23005.55)
Direct Taxes (Paid) / Refunded (Net of Refund / Paid) 16.07
Cash Flow before prior period adjustment (22989.48)
Prior Period Adjustment (income / loss) 2.42
NET CASH FROM OPERATING ACTIVITIES (TOTAL A) (22987.07)

CASH FLOW FROM INVESTMENT ACTIVITIES

Purchase of Fixed Assets
(1247.18)
(including capital work-in-progress)
Sale of Fixed Assets 5.56
Sale of Investment 1.00
Purchase of Investment (100.00)
Interest Received 116.37
NET CASH FROM / (USED IN) INVESTMENT ACTIVITIES (TOTAL B) (1224.25)

CASH FLOW FROM FINANCING ACTIVITIES

Proceeds from Issue of Convertible Equity Share Warrants 1575.00
Proceeds from Issue of Compulsorily Convertible Preference (CCP) Shares 9.10
Proceeds from Securities Premium 3819.74
Proceeds from Secured Loans (Net of Repayment) 19381.95
Proceeds / (Repayment) from Unsecured Loans (Net) 6135.69
Interest Paid (5411.44)
NET CASH FROM FINANCING ACTIVITIES (TOTAL C) 25510.03

Net Increase in Cash & Cash Equivalents Total (A + B + C) 1298.71

Cash & Cash Equivalents – Opening Balance 1959.86
Cash & Cash Equivalents – Closing Balance 3258.57

90
SCHEDULE '1' TO '20' ANNEXED TO AND FORMING PART OF THE CONSOLIDATED BALANCE
ST
SHEET AS AT 31 DECEMBER, 2009 AND THE CONSOLIDATED PROFIT AND LOSS
ACCOUNT OF THE YEAR ENDED AT THAT DATE:

Schedule 1 – Share Capital

st
Particulars 31 Dec 2009
(Rs. in Lacs)
Authorised
9,57,11,120 Equity Shares of Rs.10/- each 9,571.11
1,36,877 11% Redeemable Cumulative Preference Shares of Rs.100/- each 136.88
1,17,011 0% Redeemable Preference Shares of Rs.100/- each 117.01
2,50,000 Compulsorily Convertible Preference (CCP) Shares of Rs. 10/- each 25.00
17,50,000 Unclassified Shares of Rs.10/- each 175.00
Total Authorised Capital 10,025.00
Issued, Subscribed & Paid-Up
2,06,34,540 Equity Shares of Rs.10/- each 2,063.45
1,36,877 11% Redeemable Cumulative Preference Shares of Rs.100/- each 136.88
91,000 Compulsorily Convertible Preference (CCP) Shares of Rs. 10/- each 9.10
1,17,011 0% Redeemable Preference Shares of Rs.100/- each 117.01
Total Issued, Subscribed & Paid-Up Capital 2,326.44

Note:
34,39,090 Equity Shares of Rs. 10/- each were allotted in 2006 as full paid bonus shares in the ratio
of 1:5 by way of capitalisation of Rs. 3,43,90,900/- from General Reserve.

Schedule 2 – Convertible Equity Share Warrants

st
Particulars 31 Dec 2009
(Rs. in Lacs)
45,00,000 Equity Warrants at Rs. 140/- each Rs. 35/- paid on application 1575.00

Schedule 3 – Reserves & Surplus

st
Particulars 31 Dec 2009
(Rs. in Lacs)
Capital Reserve 1.50
Securities Premium Account 3819.74
General Reserve 150.00
Workers' Welfare and Benevolent Reserve 0.25
Profit and Loss Account 126.28
Total 4097.76

Schedule 4 – Secured Loans

st
Particulars 31 Dec 2009
(Rs. in Lacs)
A) From Banks
Term Loan 36520.11
Vehicle Loan 34.47
B) From Others 2388.66
Total 38943.24

91
 Schedule 5 – Unsecured Loans
st
Particulars 31 Dec 2009
(Rs. in Lacs)
Loan from Corporates 7161.84

Schedule 6 – Fixed Assets

Gross Block Depreciation / Amortization Impairment Net Block

Particulars As at 31-12- Additions Deduction As at 31- As at 31- For Deductio As at As at For As at As at As at
08 / s/ 12-09 12-08 the ns / 31-12- 31-12- the 31-12- 31-12- 31-12-
Adjustme Adjustme Year Adjustme 09 08 Year 09 09 08
nts nts during nts
during the year during
the year the year

Textile Division
Land - Leasehold 0.06 - - 0.06 0.02 0.00 - 0.02 - - - 0.03 0.03
Land - Freehold 10820.69 - - 10820.69 - - - - - - - 10820.69 10820.69
Buildings – Residential 106.00 - - 106.00 14.54 3.49 - 18.02 - - - 87.98 91.46
Buildings Leasehold Land 4.46 - - 4.46 2.70 0.07 - 2.77 - - - 1.69 1.76
Roads 2.42 - - 2.42 0.10 0.04 - 0.14 - - - 2.28 2.32
Fire Fighting Equipments 2.12 - - 2.12 2.04 0.01 - 2.06 - - - 0.06 0.07
Computers & Peripherals 4.95 - - 4.95 2.42 0.80 - 3.21 - - - 1.74 2.54
Office Equipments 1.08 - - 1.08 0.19 0.05 - 0.24 - - - 0.85 0.90
Motor Cars 55.28 13.48 19.94 48.81 23.05 5.22 6.06 22.22 - - - 26.60 32.22
Air Conditioners 4.28 - - 4.27 0.47 0.20 - 0.67 - - - 3.60 3.81
Plant & Machinery 2341.34 - - 2341.34 870.01 95.86 - 965.87 293.97 216.01 509.98 865.49 1177.36
Air Conditioners for 151.07 - - 151.07 54.77 6.26 - 61.04 19.26 14.15 33.42 56.62 77.04
Plant & Machinery
Factory Equipments 24.67 - - 24.67 8.99 1.02 - 10.01 3.14 2.31 5.44 9.22 12.55
Total (A) 13518.42 13.48 19.94 13511.96 979.30 113.02 6.06 1086.27 316.37 232.47 548.84 11876.85 12222.75

Real Estate Dev. Division

Computers & Printers 34.46 1.93 - 36.39 6.68 5.79 - 12.47 - - - 23.93 27.78
Intangible Assets (Software) 5.82 1.79 - 7.61 2.54 2.20 - 4.74 - - - 2.87 3.28
Air Conditioners 14.34 1.19 - 15.53 0.88 0.72 - 1.60 - - - 13.93 13.46
Plant & Machinery 1524.32 216.42 - 1740.75 82.11 74.03 - 156.15 - - - 1584.60 1442.21
Heavy Earth Moving
94.52 - - 94.52 10.81 10.69 - 21.50 - - - 73.02 83.72
Machinery
Motor Buses & Lorries 6.65 - - 6.66 0.52 0.75 - 1.27 - - - 5.38 6.13
Office Equipment 57.41 7.46 - 64.86 8.81 3.32 - 12.12 - - - 52.74 48.60
Temporary Structures 64.14 - - 64.14 5.00 4.06 - 9.06 - - - 55.08 59.14
Furniture & Fixtures 130.35 1.71 - 132.06 17.49 8.28 - 25.77 - - - 106.29 112.86
Office Building 92.93 - - 92.93 1.56 1.51 - 3.08 - - - 89.85 91.37
Motor Cars 44.40 31.48 13.48 62.40 4.31 5.00 2.09 7.21 - - - 55.18 40.09
Electrical Fittings 43.82 - - 43.82 1.80 2.08 - 3.88 - - - 39.94 42.02
Shuttering & Scaffolding 2664.11 889.06 - 3553.16 220.41 471.90 - 692.31 - - - 2860.86 2443.69
Total (B) 4777.27 1151.04 13.48 5914.83 362.92 590.33 2.09 951.16 - - - 4963.67 4414.35

TOTAL (A + B) 18295.69 1164.52 33.42 19426.79 1342.22 703.35 8.15 2037.43 316.37 232.47 548.84 16840.52 16637.10

Capital Work-In-Progress 369.33 273.19

(Including Capital Adv.)

Schedule 7 – Investments
st st
Particulars 31 Dec 2009 31 Dec 2009
(Rs. in Lacs) (Rs. in Lacs)
“A” Government Securities - Quoted
3% Government Loan 1986 0.04
5% Loan 2000 0.01
Less: Provision for diminution in Value 0.05 -

“B” Trade – Shares

(Quoted Equity Shares: Fully Paid)
1704 Equity Shares of Rs.100/- each of Mafatlal Engineering 1.73
Industries Ltd.
Less: Provision for diminution in Value 1.73 -

92
Unquoted Equity Shares (Fully Paid)
10 Equity Shares of Rs.1000/- each of Engineering Raw Material 0.10
Consumers Corporation Ltd.
Less: Provision for diminution in Value 0.10 -

9,90,000 Equity Shares of Rs.10 each of Raghuveer Urban 99.00

Infrastructure Pvt. Ltd.

―C‖ Contribution towards Proposed East India Cotton Association 0.04

Society in an earlier year
Less: Provision for diminution in Value 0.04 -
99.00

Schedule 8 – Current Assets, Loans & Advances

st
Particulars 31 Dec 2009
(Rs. in Lacs)
(a) Interest Accrued but no due 34.89

(b) Inventories
i. Materials for Real Estate Activity 109.96
ii. Stores & Spares 60.68
iii. Cost of Construction (Real Estate Development) 38929.97
iv. Construction Work – In – Progress 1982.68
41083.29

(c) Sundry Debtors

Debts outstanding for a period exceeding Six Months:
Unsecured, Considered Good 55.48
Unsecured, Considered Doubtful 34.42
Others, Unsecure Considered Good 648.82
Less: Provision for Doubtful Debts (34.42)
704.30

(d) Cash & Bank Balances

Cash on Hand 422.24
Bank Balances with Scheduled Banks:
In Current Accounts 406.14
In Fixed Deposit Accounts 2430.19
3258.57

(e) Loans & Advances

(Unsecured, Considered Good)
Advances recoverable in cash or kind or for value to be received 20618.86
Less: Provision for Doubtful Advances (8.70)
Advances/Loan to Staff 12.88
Deposits 80.50
Prepaid Expenses 26.30
Tax Deducted at Source / Advance Taxes (Net of provisions and including refund
155.13
receivable)
Service Tax Recoverable 81.78
Value Added Tax Recoverable 53.97
MAT Credit Entitlement 2.84
21023.56

93
Schedule 8 – Current Liabilities & Provisions
st
Particulars 31 Dec 2009
(Rs. in Lacs)
A. Current Liabilities
Sundry Creditors For Goods & Expenses
Amount Outstanding to Micro, Small & Medium Enterprises -
Others 1566.43
Interest Accrued but not due on Loans 132.30
Advances against sale of flats 23406.81
Deposits 1443.67
Other Liabilities 3063.47
29612.68

B. Provisions
i. Provision for Gratuity 13.01
ii. Provision for Leave Entitlement 9.18
iii. Provision for Bonus 0.82
iv. Provision for Wealth Tax 1.11
24.12

Schedule 10 – Miscellaneous Expenditure

st
Particulars 31 Dec 2009
(Rs. in Lacs)
Miscellaneous Expenditure
(To the extent not written off / adjusted)
Voluntary Termination Benefit:
Balance Brought Forward 1071.86
Less: Written off during the year (535.93)
535.93

Schedule 11 – Sales & Services

st
Particulars 31 Dec 2009
(Rs. in Lacs)
Sales (Textiles) 3705.72
Income from Business Centre 267.60
3973.32

Schedule 12 – Other Income

st
Particulars 31 Dec 2009
(Rs. in Lacs)
Interest Received 101.06
Rent Income 8.56
Sundry Credit Balance Written Back (Net) 1.30
Scrap Sales 16.65
Miscellaneous Income 1.32
128.89
Less: Transferred to Cost of Construction (Real Estate Development) (Schedule 14) 107.59
21.30

94
Schedule 13 – Purchases – Fabric & Other (Trading)
st
Particulars 31 Dec 2009
(Rs. in Lacs)
Stocks at Commencement -
Purchases 3969.22
Stock at Close -
3969.22

Schedule 14 – Cost of Construction (Real Estate Development)

st st
Particulars 31 Dec 2009 31 Dec 2009
(Rs. in Lacs) (Rs. in Lacs)
Opening Balance as per Last year 20795.11

Add :
Material Consumed
Opening stock of Materials 277.85
Purchase of materials 4465.89
Less : Closing Stock of Materials 109.96
4633.78

Stores & Spares Consumed

Opening Stock of Stores & Spares, Tools /Electrical Item 67.44
Purchase of Stores & Spares, Tools / Transfer from CWIP to
121.77
stores
Less : Closing Stock of Stores & Spares, Tools/Electrical Items 60.68
128.53

Contract, Sub-contract with material and other charges 6038.26

Payment to and provision for employees 78.64
Administration and Other expenses 633.00
Finance Expenses 6139.91
Depreciation 590.34
18242.45

39037.56
Less: Interest on FDR (Schedule 12) 90.94
Scrap Sales 16.65
(107.59)
38929.97
Less: Transferred to Cost of Construction (Real Estate
38929.97
Development) (Sch. 8)
-

Schedule 15 – Construction Work in Progress

st
Particulars 31 Dec 2009
(Rs. in Lacs)
Contract Charges with Material and Labour 1982.27
Administration and Other Expenses 0.41
1982.68
Less: Transferred to Construction Work in Progress (Schedule 8) 1982.68
-

95
Schedule 16 – Payment to & Provision for Employees
st
Particulars 31 Dec 2009
(Rs. in Lacs)
Salaries, Wages and Other Allowances 109.70
Contribution to Provident Fund 9.27
Contribution to Other Fund 0.17
Gratuity 0.65
Staff Welfare Expenses 8.57
128.36
Less : Transferred to Cost of Construction (78.64)
(Real Estate Development) (Schedule 14)
49.72

Schedule 17 – Administration & Other Expenses

st
Particulars 31 Dec 2009
(Rs. in Lacs)
Insurance 69.89
Rent 7.36
Rates & Taxes 54.87
Directors Sitting Fees / Other Fees 1.90
Printing & Stationery 16.63
Refreshment Charges 0.28
Advertisement and Publicity 0.56
Miscellaneous Expenses 83.32
Office Expenses 3.32
Custodial / Revocation / Listing Fees 0.73
Legal & Professional Fees 528.34
Security Charges 29.74
Conveyance Charges & Travelling Expenses 89.76
Motor Car Expenses 6.82
B.M.C. Expenses 1.10
Power and Fuel 268.10
Telephone Expenses 6.98
Donations 2.50
Repairs & Maintenance - Building 0.41
Repairs & Maintenance - Machinery 1.18
Repairs & Maintenance - Others 7.28
Share Issue / Transfer expenses 52.81
Miscellaneous Expenses Written off 535.93
Loss on sale on Motor Car 6.24
Provision for Doubtful Debts 34.42
Membership & Subscription 1.05
Auditors Remuneration 15.86
Water Charges 30.82
1889.96
Less : Transferred to Cost of Construction
(633.00)
(Real Estate Development) (Schedule 14)
Less: Transferred to Construction Work in Progress (Schedule 15) (0.41)
1256.55

96
Schedule 18 – Finance Expenses
st
Particulars 31 Dec 2009
(Rs. in Lacs)
Interest Expenses
Term Loans 3586.10
Others 1820.59
Finance Charges 733.99
6140.68
Less : Transferred to Cost of Construction
6139.91
(Real Estate Development) (Sch. 14)
0.77

Schedule 19 - Significant Accounting Policies to the Consolidated Financial Statements for the
Year Ended 31st December, 2009

Basis of Consolidation

The consolidated financial statements relates to Shree Ram Urban Infrastructure Limited ('the
Company' or 'the parent Company'), its subsidiary Company 'collectively referred to as the group'.

a) Basis of Accounting

The consolidated financial statements of the Company and its subsidiary are prepared under the
historical cost convention and in accordance with the requirements of the Companies Act, 1956 and
Accounting Standard 21 'Consolidated Financial Statements (CFS)‘ issued by the Institute Chartered
Accountants of India.

b) Principles of Consolidation

The Consolidated Financial Statements have been prepared on the following basis:

i. The financial statements of the Company and its subsidiary Company have been consolidated on
a line-by-line basis by adding together the book values of like items of assets, liabilities, income
and expenses, after fully eliminating intra-group balances and transactions resulting in unrealized
profits or losses.

ii. The CFS have been prepared using uniform accounting policies for like transactions and other
events in similar circumstances and are presented in the same manner as the Company's
separate financial statements.

iii. The excess of the cost to the Company of its investment in subsidiary Company over the
Company's portion of equity of the subsidiary as at the date, on which investment in subsidiary is
made, is recognized in the financial statement as Goodwill. The excess of Company's share of
equity and reserve of the subsidiary Company over the cost of acquisition is treated as Capital
Reserve.

iv. Minority's Interest in the CFS is identified and recognized after taking into consideration:

- The amount of equity attributable to minority's at the date on which investments in a

subsidiary is made.

- The minority's share of movements in equity since the date parent subsidiary relationships
came into existence.

c) The particulars of subsidiary Company and the percentage of ownership interest therein of the
Company as on 31st December, 2009 are as under:

97
 Name of w.e.f. Country of Percentage of Reporting Date
st
Company Incorporation holding as at 31
Dec, 2009
th st
SRM Sites Private 24 August, 2009 India 94.79% 31 December,
Limited 2009

BASIS OF ACCOUNTING:

The Financial statements are prepared under historical cost convention, on accrual basis, in
accordance with the Generally Accepted Accounting Principles in India and comply with Accounting
Standards prescribed by the Companies (Accounting Standards) Rules, 2006 to the extent applicable
and in accordance with provisions of the Companies Act,1956.

USE OF ESTIMATES:

The preparation of financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and contingent liabilities at the date of the financial
statements and the reported accounts of revenues and expenses for the years presented. Although
these estimates are based upon management's knowledge of current event and actions, actual
results could differ from those estimates and revisions, if any, are recognized in the current and future
periods.

REVENUE RECOGNITION:

i. Policy in respect of Real Estate Sales

The Company follows Accounting Standard AS-9 'Revenue Recognition' read alongwith the Guidance
Note on `Recognition of Revenue by the Real Estate Developers' issued by the Institute of Chartered
Accountants of India. Revenue in respect of real estate sales is recognized when the Company has
transferred to the buyer all significant risks and rewards of ownership, i.e., when the buyer has
entered into a legally enforceable agreement for sale and according to the which the buyer has a legal
right to sell or transfer his interest in the property, without any material condition. However in case
where the Company is obliged to perform the substantial acts after the transfer of all significant risk
and rewards of ownership, the revenue is recognized on proportionate' basis as the acts are
performed, by applying percentage of completion method in the manner explained in Accounting
Standard AS-7 'Construction Contracts' issued by Institute of Chartered Accountants of India. Further,
Revenue is recognized, in relation to the sold areas only, on the basis of percentage of actual cost
incurred thereon including cost of land as against the total estimated cost of the project under
execution subject to such actual costs being 30% or more of the total estimated cost. Estimated
project cost includes cost of land / development rights, borrowing costs, overheads, estimated
construction and development cost of such properties. The estimates of the saleable area and costs
are reviewed periodically and effect of any changes in such estimates is recognized in the period in
which such changes are determined. However, when the total project cost is estimated to exceed total
revenues from the project, loss is recognized immediately.

ii. Policy in respect of Construction Contracts

Contract revenue is recognized by adding the aggregate cost and proportionate margin using the
percentage completion method. Percentage of completion method is determined as a proportion of
cost incurred to date to the total estimated cost.

iii. Others

Interest income is recognized on accrual basis on a time proportion basis.

Dividend income is recognized when the Company's right to receive dividend is established.

98
FIXED ASSETS:

All fixed assets are stated at cost of acquisition, less accumulated depreciation except leasehold land,
and intangible assets which are stated at cost less amounts amortized. Cost includes purchase price
and all other attributable costs of bringing the assets to its working condition for intended use.
Financing costs relating to borrowed funds attributable to acquisition, which takes substantial period of
time to get ready for its intended use are also included, for the period till such asset is put to use.

DEPRECIATION / AMORTISATION:

a) Depreciation on fixed assets (other than Fire Fighting Equipment at Avadh Division) is provided
on Straight Line Method (SLM) at the rates and in the manner specified in Schedule XIV to the
Companies Act, 1956 except for depreciation on Shuttering & Scaffolding which are being
depreciated on SLM at 16.67% p.a. based on useful life determined by the Management.

b) Depreciation on Fire Fighting Equipment at Avadh Division is provided on written down value
method at the rates and in the manner specified in Schedule XIV to the Companies Act, 1956,

c) The depreciation has not been charged on Fixed Assets whose written down value had reached
below 5% of its cost.

d) Asset costing Rs.5000 or less individually is fully depreciated in the year of purchase.

e) Leasehold land is amortized over the period of the lease.

f) Software is being amortized over the estimated useful life of 3 years.

g) In case of impairment loss, if any, depreciation on it is provided on the revised carrying amount for
their remaining useful life.

IMPAIRMENT OF ASSETS:

The Company assesses at each balance sheet date whether there is any indication that an asset may
be impaired. If any such indication exists, the Company estimates the recoverable amount of the
asset. If recoverable amount of such asset is less than the carrying amount, then the carrying amount
is reduced to its recoverable amount and the difference arising there from is treated as impairment
loss and is charged to profit & loss account.

After impairment, depreciation is provided on the revised carrying amount of the asset over its
remaining useful life.

BORROWING COST:

Borrowing costs that are directly attributable to the acquisition or construction of a qualifying asset are
considered as part of the cost of that asset up to the date the assets are ready / put to use. Other
Borrowing costs are recognized as an expense in the year in which they are incurred.

INVESTMENTS:

Long term Investments are stated at cost. However, provision is made for diminution in value, other
than temporary, on individual basis.

INVENTORIES:

Materials, Stores and Spares, tools and consumables are valued at cost or net realizable value;
whichever is lower on the basis of 'First In First Out' (FIFO) method.

99
Work-in-Progress is valued at lower of cost or net realizable value. Cost of construction includes cost
of land, materials, services, depreciation, interest on borrowing and other incidental cost incurred in
relation to project.

COST OF CONSTRUCTION (Real Estate Development):

Cost of construction includes cost of land, materials, services, depreciation, interest on borrowing, and
other incidental cost incurred in relation to project.

CONSTRUCTION WORK IN PROGRESS:

The construction work in progress pertaining to the development project is carried at the lower of cost
or net realizable value, where the cost includes all expenditure necessary to bring the assets to its
working condition.

EMPLOYEE BENEFITS:

a) Defined Contribution Plan

Company's contribution to Provident Fund is deposited with the Employees Provident Fund
Organization (EPFO). The Company's monthly contribution towards Provident Fund is accounted for
on accrual basis.

b) Defined Benefit Plan

Liability on account of 'Gratuity' is accounted for on the basis of Actuarial Valuation at the end of each
year.

c) Other Long term

Liability on account of 'Leave Encashment' is made on the basis of Actuarial Valuation at the end of
the year.

d) Other Short Term

Other Short term Employee Benefits are charged to revenue in the year in which the related services
are rendered.

MISCELLANEOUS EXPENDITURE:

Expenditure in the nature of miscellaneous expenditure represented by Voluntary Termination

Benefits is amortized n accordance with Accounting Standard 15 (Revised) 'Employee Benefits'
issued by the Institute of Chartered Accountants of India.

TAXATION:

a) Current tax is measured at the amount expected to be paid to the taxation authorities, using the
applicable tax rates and tax laws.

b) Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been
announced up to the balance sheet date. Deferred tax assets and liabilities are recognized for the
future tax consequences attributable to timing differences between the taxable income and
accounting income. The effect of tax rate change is considered in the profit and loss account of
the respective year of change.

c) Deferred tax assets arising mainly on account of brought forward losses and unabsorbed
depreciation under tax laws are recognized only if there is a virtual certainty of its realization
supported by convincing evidence. Deferred tax assets on account of other timing differences are
recognized only to the extent there is reasonable certainty of its realization.

100
FOREIGN CURRENCY TRANSACTIONS:

a) The transactions in foreign currency are recorded at the exchange rates prevailing on the date of
the transaction,

b) Current Assets and Current Liabilities in foreign currency outstanding at the Balance Sheet date
are translated at the exchange rates prevailing on the date of Balance Sheet.

The resulting Exchange Difference, if any, is charged to the Profit & Loss Account.

EARNINGS PER SHARE (EPS):

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to
equity shareholders by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period
attributable to equity shareholders and the weighted average number of shares outstanding during the
period are adjusted for the effects of all dilutive potential equity shares.

PROVISIONS:

Provision is recognized when an enterprise has a present obligation as a result of past events and it is
probable that an outflow of resources will be required to settle the obligation and in respect of which a
reliable estimate can be made. Provisions are determined based on management estimates required
to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and
adjusted to reflect the current management estimate.

LEASES:

Lease arrangements where the risk and rewards incident to ownership of asset substantially vest with
the lessor are recognized as operating lease. Lease rent under operating leases are charged to the
Profit and Loss account on a straight line basis over the lease term.

Assets given under operating leases are included in fixed assets. Lease income is recognized in the
profit and loss account on as straight line basis over the lease term. Costs, including depreciation are
recognized as expense in the profit and loss account.

SEGMENT POLICIES:

Company's reporting segments are identified based on activities/ products, risks and reward,
organization structure and internal reporting systems.

Segment revenue and expense includes amounts, which can be directly attributed to the segment and
are allocable on a reasonable basis. Unallocable items and interest income / expenses are disclosed
separately.

Segment assets and liabilities are operating assets / liabilities by the segments which are directly
attributable to the segment. The components of capital employed that cannot be directly identified are
shown as unallocable capital employed.

CONTINGENT LIABILITIES:

The Company makes a provision when there is present obligation as a result of past event where the
outflow of economic resources is probable and a reliable estimate of the amount of the obligation can
be made.

A disclosure is made for a contingent liability when there is a:

i. Possible obligation, the existence of which will be confirmed by the occurrence / non-occurrence
of one or more uncertain events, not fully within the control of the Company;

101
ii. Present obligation, where it is not probable that an outflow of resources embodying economic
benefits will be required to settle the obligation.

iii. Present obligation, where a reliable estimate cannot be made.

OTHER ACCOUNTING POLICIES:

These are consistent with the generally accepted accounting practices.

Schedule 20 - Notes forming part of Consolidated Financial Statements for the Year Ended
31st December, 2009

1.
a) Preference shares includes 1,17,011 - 0 % Redeemable Preference Shares of face value of
Rs.100/- each and 1,36,877 - 11% Redeemable Cumulative Preference Shares which are due for
th st
redemption on 30 October, 2017 and 31 October, 2018 respectively

b) During the period the Subsidiary has issued 91,000 Compulsorily Convertible Preference Shares
(CCPS) of Rs.10/- each at a premium of Rs. 4,368/- per share. The above CCPS are due for
th
conversion into equity shares after 24 months from 28 October 2009 i.e. date of issue of CCPS.

2. Issue of convertible warrants:

During the year, the Company had issued on preferential / private placement basis, 1,60,00,000
equity warrants carrying an option to subscribe to equivalent number of equity shares of Rs 10/- each
on a future date, to the Promoters / Promoters Group and Others. Out of above, the Company has
allotted 45,00,000 equity warrants to the Promoters / Promoters Group at its Board meeting held on
16th December, 2009. The other terms and conditions of the convertible warrants issued are as
follows:

a) An amount of 25% of the price of equity warrants, as prescribed as per applicable SERI
regulations relating to preferential allotment as amended from time to time, is payable on or
before allotment of equity warrants.

b) The Warrants holders shall have the option of applying for and being allotted equity shares of the
Company of face value of Rs.10/- each by paying the balance subscription price after adjusting
the upfront payment made on the date of allotment of warrants, at any time prior to expiry of 18
months from the date of allotment of the Warrants by the allottees.

c) The relevant dates for the preferential issue of equity warrants, as prescribed as per applicable
SEBI regulations relating to preferential allotment as amended upto date, for determination of
th
applicable price for the issue of above mentioned equity warrants was 7 October, 2009 i.e. 30
(thirty) days prior to the date of declaration of the postal ballot result.

d) In the event the equity warrants holder(s) doesn't exercise the option given under the equity
warrants within 18 months from the date of allotment of the equity warrants, the equity warrants
shall lapse and the amount paid as deposit shall stand forfeited by the Company.

e) The equity shares to be issued and allotted by the Company as a consequence of the conversion
/ exchange of the equity warrants in the manner aforesaid shall be subject to the Memorandum
and Articles of Association of the Company and shall rank pari passu in all respect with the
existing equity shares of the Company.

f) The equity warrants and the equity shares allotted pursuant to exercise of such equity warrants
shall be subject to the lock-in period and restrictions in transferability as specified as per
applicable SEBI Regulations relating to preferential allotment.

102
g) The aforesaid warrants by itself shall not give the holder thereof any rights of the shareholder of
the Company.

The details of the amount received during the year are as under:

Total Amount
Number of Warrants
Issue price of the warrant Received
issued allotted
(Amt in Lacs)
Rs.140/-
45,00,000 (Rs.35/- i.e. 25% of Rs.140/- received on allotment of 1575.00
equity warrants)

Utilization of funds raised from preferential issue of equity warrants:

The details of the amount utilized are as under

Sr. No. Particular Amount

Utilized
(Amt in Lacs)
1 Implementation of the ongoing project at Worli Premises 1575.00
Total 1575.00

3. Capital Commitments

Particulars Current year

(Amt in Lacs)
Estimated amount of contracts remaining to be executed on capital account and not
18.03
provided for:

4. Contingent Liabilities in respect of:

Sr. Current year

Particulars
No. (Amt in Lacs)
a) Claims against the Company not acknowledged as debts 487.69
b) Bank guarantees 300.00
c) Outstanding letter of credit facility availed 48.25
d) Labour matter: 4.87
i. Pending in court in respect of claims for Retrenchment compensation etc
ii. Pending court cases – 5 (previous year – 5) in respect of claims for Black Wages etc. filed
by ex-employees of the Company for which the amount of contingent liability us uncertain
able.
e) Income tax matters : Nil
i. Income tax demand for Asst. year 2003-04
ii. Income Tax demand for Asst. Year 2007-08 for which appeal has been 43.59
filed with CIT (Appeal)
f) i. Water tax dispute with BMC 27.48
ii. Sewerage tax dispute with BMC 16.49
iii. Property tax dispute with BMC 160.35
g) Excise Duty demand [Bank Guarantee 3.39
provided for the same Rs.3,39,250/-
(Previous Year Rs.3,39,250/-) not included above]
h) Customs Duty demand [Bank Guarantee provided for the same Rs.6,98,500/- 6.98
(Previous Year Rs.6,98,500/-) not included above]
i) Pending court cases - 3 (Previous Year - 3) in respect of other matters against the Company
which the amount of Contingent Liability is unascertainable.

103
5.
a) Arbitration proceedings are underway which have been filed by Kalpataru Properties (Pvt) Ltd
[formerly known as Kalpataru Construction (Overseas) Pvt Ltd] in respect of development
rights of Plot 5A admeasuring 20,955.4 sq. mtrs of the Company's Worli Estate for which it has
received Rs.30 Crores. The Bombay High Court had passed a status quo order on about
23,500 sq. mtrs of the said Estate. Recently, Kalpataru Properties (Pvt) Ltd have filed a claim
of compensation for Rs.1,528.93 Crores along with interest as alternative to their original
claim for specific performance. The Company has received legal advice from its lawyers that
the said claim for compensation is not tenable, and the chances of it being held against the
Company are highly remote. The Company has since filed papers for a counter-claim for
Rs.2,677.32 Crores from the said Kalpataru Properties (Pvt) Ltd.

b) Arbitration proceedings filed by Utility Premises Pvt Ltd and Cogent Ventures (India) Ltd
[formerly known as Bhupendra Capital & Finance Ltd] in respect of Plot 2 admeasuring 4,848.5
sq. mtrs. of the Company's Worli Estate are underway. The said claimants have filed a claim
for compensation of Rs.36.03 Crores along with interest as an alternate to specific
performance. The Company has given a Bank Guarantee of Rs.3 Crores in favour of the
Arbitration Tribunal towards the pending arbitration proceedings. The Company has received
legal advice from its lawyers that the said claim for compensation is not tenable, and the
chances of it being held against the Company are highly remote.

6. In the opinion of the Management, no item of current assets has a value on realization in the
ordinary course of business, which is less than the amount of value at which it is stated in the
Balance Sheet. The provision for all known and determined liability is adequate and not in the
excess of the amount reasonably required.

7. Shares held as investment by the Company have been classified as Long term Investment.
Provision for the diminution in the value of investment has been made in the accounts where the
management is of the view that such diminution is of permanent nature.

8. The Company assesses at each balance sheet date whether there is any indication that an asset
may be impaired. If any such indication exists, the Company estimates the recoverable amount of
the asset. If recoverable amount of such asset is less than the carrying amount, then the carrying
amount is reduced to its recoverable amount and such difference between recoverable amount
and carrying amount is treated as impairment loss and is charged to Profit & Loss Account. For
the current year ended 31st December 2009 impairment loss charged to Profit and Loss account
is Rs.2,32,46,755/-.

9. Operating future minimum Rent Payable / Receivable as at 31st December, 2009:

Particulars Amount (Rs.)

a) Rent Payable As at 31.12.2009
i) Not later than one year 1,00,000
ii) Later than one year and not later than five year Nil
iii) Later than five year Nil
b) Rent Receivable As at 31.12.2009
i) Not later than one year 97,76,600
ii) Later than one year and not later than five year 15,08,300
iii) Later than five year Nil

10. As at 31st December, 2009 the percentage of completion with respect to actual cost incurred for
the project including cost of land as against the total estimated cost of the project under
execution, is less than 30% of the total estimated cost. Accordingly no revenue has been
recognized in relation to the sold areas. Further the management is of the view that the total
estimated project cost is within the total estimated revenues from the project.

11. No significant events which could affect the financial position as on 31st December, 2009, to a
material extent have been occurred, after the balance sheet date till the signing of report.

104
12. Managerial Remuneration comprises of the following:

Current year
Particulars
(Amt in Lacs)
Salary 24.55
Contribution to Provident Fund 2.94
Ex-Gratia 0.90
Others 2.72
Total 31.11
Less: Transferred to cost of construction 17.33
Debited to Profit & Loss Account 13.78

13. Audit fees include payment to auditors:

Particulars Current year

(Amt in Lacs)
For Statutory Audit 14.62
For Tax Audit 0.66
For Vat Audit 0.25
For Other Matters 0.33
Total 15.86

14. The Company has recognized the Deferred Tax Liability / Assets as at 31st Dec, 2009 as per
Accounting Standard —22 "Accounting for Taxes on Income" issued by the Institute of Chartered
Accountants of India as detailed under:

Particulars Current year

(Amt in
Lacs)
Deferred Tax Liability
Depreciation on Fixed Assets & Others 44.78
Misc. Expenditure 178.02
Total Deferred Tax Liability 222.80
Deferred tax Assets
Provision for Gratuity / Leave Encashment 4.34
Unabsorbed Depreciation / Fiscal Losses 218.46
Total Deferred Tax Assets 222.80
Deferred Tax Liabilities / (Assets) - Net Nil

The Company has loss and unabsorbed depreciation. However, on a prudent basis, as per
Accounting Standard 22 (Accounting for Taxes on Income), Deferred Tax Asset is recognized
only to the extent of deferred tax liability.

15. Segment Reporting

The Company has recognized the Textile & Real Estate Segments as at 31st Dec, 2009 as per
Accounting Standard – 17 "Segment Reporting" issued by the Institute of Chartered Accountants
of India as detailed under

(a) Business Segments:

Particulars Textile Real estate Total

31.12.2009 31.12.2009 31.12.2009
REVENUE
External revenue 3709.63 272.25 3981.88
Inter-segment revenue — --

105
Total Revenue 3709.63 272.25 3981.88
RESULT
Segment Result (595.20) 126.04 (469.16)
Less: unallocable expenditure net of unallocable
1178.50
income
Less: interest expenses 0.77
Add: interest income 21.30
Profit Before Prior Period Adjustment (1627.13)
Less / (Add): prior period adjustment (2.42)
Profit Before Taxation & Exceptional Item (1624.71)
Less: Tax Provision
Income Tax -
Wealth Tax 0.20
Fringe Benefit Tax 4.82
Income/Wealth Tax For Earlier Years 3.64
Fringe Benefit Tax For Earlier Years (1.51)
MAT Credit Entitlement (2.84)
Deferred Tax (217.22)
Profit After Tax before Minority Interest (1411.80)
Less: Minority‘s interest in loss of subsidiary (1.67)
Profit / (Loss) for the year 1410.13

OTHER INFORMATION
Segment assets 1605.72 70487.52 72093.24
Unallocable assets 11320.39
Total assets 83413.63
Segment liabilities 882.78 28561.74 29444.52
Unallocable liabilities 400.75
Total liabilities 29845.27
Capital Expenditure
Segment capital expenditure 13.48 1247.18 1260.66
Unallocable capital expenditure -
Total capital expenditure 1260.66
Depreciation / Amortization / Impairment
Segment Depreciation / Amortization /
335.61 593.94* 929.54
Impairment
Unallocable Depreciation / Amortization /
6.28
Impairment
Total Depreciation / Amortization /
935.82
Impairment
* Includes depreciation of Rs.5,90,33,451/- relating to real estate division which has been debited
to Cost of Construction (Real Estate Development). (Refer Schedule 14)

Note: Real Estate segment includes income from Business Centre and income from Construction
activities.

(b) Secondary Segment Reporting (Geographical Segments):

Not Applicable

16. During the year, Raghuveer Urban Infrastructure Private Limited (a Company incorporated in
th
India) has become a subsidiary with effect from 18 March, 2009 however the said Company
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ceases to be a subsidiary with effect from 25 September, 2009. Accordingly, the financial
statements of Raghuveer Urban Infrastructure Private Limited have not been included in
preparation of Consolidated Financial Statements as the control was temporary in nature.

106
17. Related Party Disclosures:

In compliance with Accounting Standard 18 --`Related Party Disclosures' issued by the Institute of
Chartered Accountants of India, the required disclosures are given in the table below:

a) Name of the Related Party and Nature of Related Party Relationship

Name of the related Party Nature of Related Party Relationship

a) Raghuveer Urban Infrastructure Pvt. Ltd. Subsidiary
(from 18-03-2009 to 24-09-2009)
a) Akhilesh Developers Pvt. Ltd. Enterprise that directly, or indirectly through one
or more intermediaries, control, or are controlled
by, or are under common control with, the
reporting enterprise
a) Landmark Leisure Corporation Limited Enterprises over which key management
b) S. Kumars Online limited personnel & their Relatives exercise significant
c) Vidhi Holdings Pvt. Ltd. influence where the Company has entered into
d) Akhilesh Developers Pvt. Ltd. transactions during the year
e) Hanumesh Realtors Pvt. Ltd.
f) Mandakini Hospitality Pvt. Ltd.
g) Yashaswini Leisure Pvt. Ltd.
h) SKM Fabrics (Andheri) Ltd
a) Mr. Vikas S. Kasliwal — Vice Chairman & CEO Key Management Personnel
b) Mr. S. K. Luharuka — Whole Time Director

b) Details of transactions between the Company & related parties & the status of outstanding
balances as on 31st December, 2009.
Amount in Lacs
Nature of transaction Current year
Contact, Sub-Contact charges
Raghuveer Urban Infrastructure Pvt. Ltd 3726.80
Total 3726.80
Consultancy charges paid / (reversed)
Landmark Leisure Corporation Ltd (0.22)
Total (0.22)
Rent received
S. Kumars Online Ltd. 2.71
Total 2.71
Investment in equity shares
Raghuveer Urban Infrastructure Pvt. Ltd 99.00
Total 99.00
Loans taken
Vidhi Holdings Pvt. Ltd. 1650.26
Akhilesh Developers Pvt. Ltd. 5005.00
Hanumesh Realtors Pvt. Ltd. 1044.90
Mandakini Hospitality Pvt. Ltd. 1099.00
Yashaswini Leisure Pvt. Ltd. 990.10
SKM Fabrics (Andheri) Ltd 460.00
Total 10249.26
Loans taken repaid
Vidhi Holdings Pvt. Ltd. 600.26
Akhilesh Developers Pvt. Ltd. 1480.00
SKM Fabrics (Andheri) Ltd. 460.00
Total 2540.26
Allotment of Equity Share Warrants
(Amount adjusted from loan taken)
Hanumesh Realtors Pvt. Ltd. 525.00
Mandakini Hospitality Pvt. Ltd. 525.00

107
Yashaswini Leisure Pvt. Ltd. 525.00
Total 1575.00
Advances received
Raghuveer Urban Infrastructure Pvt. Ltd. 175.00
Vidhi Holdings Pvt. Ltd. -
Total 175.00
Payments towards advances received
Raghuveer Urban Infrastructure Pvt. Ltd. 75.00
Total 75.00
Deposit Repaid
S Kumars Online Ltd 77.00
Landmarc Leisure Corporation Limited 3.50
Total 80.50
Advances given
Raghuveer Urban Infrastructure Pvt. Ltd. 520.76
Total 520.76
Receipts against advances given
Raghuveer Urban Infrastructure Pvt. Ltd. 520.76
First Row Lifestyle Private Limited -
Total 520.76
Key Management Personnel
Managerial Remuneration
- Mr. Vikas S. Kasliwal - Vice Chairman & CEO 17.34
- Mr. S. K. Luharuka - Whole Time Director 13.78
Total 31.11
Purchase of Equity Shares of SRM Sites Pvt. Ltd.
- Mr. Vikas S. Kasliwal - Vice Chairman & CEO 0.50
- Mr. S. K. Luharuka - Whole Time Director 0.50
Total 1.00
st
Outstanding balance as on 31 December, 2009
Debtors
S Kumars Online Ltd. 3.15
Total 3.15
Loans taken
Vidhi Holdings Pvt. Ltd. 1050.00
Akhilesh Developers Pvt. Ltd. 3525.00
Hanumesh Realtors Pvt. Ltd. 519.90
Mandakini Hospitality Pvt. Ltd. 574.00
Yashaswini Leisure Pvt. Ltd. 465.10
Total 6134.00
Advance received
Akhilesh Developers Pvt. Ltd. 900.00
Hanumesh Realtors Pvt. Ltd. 900.00
Mandakini Hospitality Pvt. Ltd. 900.00
Yashaswini Leisure Pvt. Ltd. 900.00
Total 3600.00
Deposits Received
Landmarc Leisure Corporation Limited 1370.67
S Kumars Online Ltd 73.00
Total 1443.67

18. Computation of Earning per Share (EPS)

Current year
Particulars (Amt in Lacs)

Profit/(loss) after taxation (Rs.) (1410.13)

Weighted average number of equity shares 206.35
Face value per equity shares (Rs.) 10

108
 Basic Earnings per share (EPS) Rs. (6.83)
Diluted Earnings per Share (EPS) Rs. (6.83)

The Company has issued 45,00,000 equity warrants at issue price of Rs.140/- per warrant. The
issue pr being more than the fair value calculated in terms of Accounting Standard 20 'Earning per
Share' issue by ICAI, is anti-dilutive. Therefore, the above equity warrants have not been taken
into consideration while calculating the Dilutive EPS.

19. There are no Micro, Small & Medium Enterprises, to whom the Company owes dues on account
principal amount together with interest as at the Balance sheet date. This has been determined to
tri extent such parties have been identified on the basis of information available with the
Company.

20. 'Sundry Credit balances written back' (Net) amounting to Rs.1,30,120/- are net of sundry debit
balance written off amounting to Rs.3,35,489/-.

21. The Company has maintained the 'Debt Service Reserve Account' (DSR) with the banks from
whom the Company has borrowed the money for the real estate project. An amount equal to three
months interest on each disbursement under the rupee term loan is being transferred directly by
the lender to the DS Account out of the proceeds of such disbursement. The Company is required
to maintain and operate the account during the entire tenure of the facility. As at 31st December,
2009, the outstanding balance in DSI Account is Rs.12,67,00,420/- and is included in the
balances lying in Fixed Deposit Accounts.

22. Movement in Minority Interest during the year

Particular Amount
(Rs. in Lacs)
Equity Share Capital held by minority in subsidiary acquired during the year 0.05
Add. Minority Share in the share premium 210.08
Less: Minority Share in loss of subsidiary (1.66)
Minority Interest Balance as at 31.12.09 208.47

23. Employee Benefits

Disclosure under Accounting Standard 15 "Employee Benefits" (Revised 2005) issued by the
Institute of Chartered Accountants of India:

Defined Contribution Plan:

The Company's contribution to Provident Fund is deposited with the Employees Provident Fund
Organization (EPFO). During the year the Company has recognized Rs.9,27,519/- towards
provident fund

Defined Benefit Plan:

Gratuity

The Gratuity liability arises on retirement, premature withdrawal, resignation and death of an
employee. The gratuity liability is calculated on the basis of actuarial valuation as per projected
unit credit method.

Other Long Term Benefit:

Leave Encashment Plan

The earned leave liability arises as and when services are performed by an employee. The said
liability is calculated on the basis of actuarial valuation as per projected unit credit method.

109
I) Changes in Defined Benefit Obligation.

Leave
Gratuity
Encashment
Particulars as on
as on
31.12.2009
31.12.2009
Liability at the beginning of the year 13.50 9.21
Current Service Cost. 3.50 2.18
Interest Cost 1.07 0.66
Benefits paid (1.14) (2.35)
Actuarial Gain/ Loss on obligation (3.92) (0.54)
Liability at the end of the year 13.01 9.18

II) The fair value of plan assets is Nil since retirement benefit plans are wholly unfunded.

III) Amount recognized in Balance Sheet

Leave
Gratuity
Encashment
Particulars as on
as on
31.12.2009
31.12.2009
Liability at the end of the year 13.01 9.18
Amount recognized in balance sheet 13.01 9.18

IV) Expenses recognized in Profit & Loss Account & transferred to Cost of Constructions.

Leave
Gratuity
Encashment
Particulars as on
as on
31.12.2009
31.12.2009
Current service cost 3.50 2.18
Interest cost 1.07 0.66
Adjustment for increase in opening provision - -
Expense transfer to reserve - -
Actuarial (Gain) / Loss (3.92) (0.54)
Total Expenses 0.65 2.31
Expenses charged to profit & Loss Account 1.23 1.46
Expenses charged to Construction Costs (0.58) 0.86
Total Expenses 0.65 2.31

V) Balance Sheet Reconciliation:

Leave
Gratuity
Encashment
Particulars as on
as on
31.12.2009
31.12.2009
Opening net liability 13.50 9.21
Expense as above 0.64 2.31
Adjustment for increase in opening provision for retirement - -
benefits
Benefits paid (1.14) (2.35)
Amount Recognition in the Balance Sheet 13.01 9.18

110
VI) Principal Actuarial assumption

Leave
Gratuity
Encashment
Particulars as on
as on
31.12.2009
31.12.2009
Discount rate 8.00% 8.00%
Future salary increase 5.00% 5.00%

The discount rate is based upon the bench mark rate available on Government Securities having
maturity equal to the tenure of benefits.

The estimate of salary growth rate considered in actuarial valuation takes into account inflation,
seniority and other relevant factors on long term basis.
th
24. During the year, the Company has acquired a subsidiary on 24 August, 2009. As there was no
subsidiary in previous year and the consolidated financial statements are being prepared for the
first time, corresponding figures for the previous year are not applicable.

For KHANDELWAL JAIN & Co. For HABIB & Co.

Chartered Accountants, Chartered Accountants,
Firm‘s Registration No. 105049W Firm‘s Registration No. 103479W

(NARENDRA JAIN) (D. P. SHROFF)

PARTNER PARTNER
Membership No. 048725 Membership No. 045417

Place : Mumbai Place : Mumbai

th th
Date : 25 May 2010 Date : 25 May 2010

111
 ACCOUNTING RATIOS & CAPITALIZATION STATEMENT

ACCOUNTING RATIOS

Stand-Alone Consolidated
Particulars
31-12-2009 31-12-2008 31-12-2009 31-12-2008
Earnings Per Share (6.69) (4.66) (6.83) N.A.
Return on Networth NA NA N.A. N.A.
Net Asset Value Per Share 8.89 12.98 8.97 N.A.

CAPITALIZATION STATEMENT

Pre-Issue as at
31-07-2010 As adjusted for the
Particulars
Stand Alone Issue
(Rs. in Lacs)
Short-Term Debt 1,561.83 1,561.83
Long-Term Debt 44,336.07 44,336.07
Shareholders‟ Funds
Share Capital 2,317.34 [●]
Convertible Equity Share Warrants 7,175.00 7,175.00
Reserves 1.75 [●]
Total Shareholders‘ Funds 9,494.09 [●]
Long Term Debt/Equity 19.13 [●]

Notes:

1. Short term debts are considered as debt having original repayment term not exceeding 12
months.

2. Long term debt is considered as debt other than short term debt as defined above.
st
3. The figures disclosed above are based on the Limited Review Report of the Company as at 31
July, 2010.

4. The above statement should be read with the Significant Accounting Policies and Summary of
Selected Notes to Accounts, as appearing in Annexure to this report.

112
 CERTAIN OTHER FINANCIAL INFORMATION

UNAUDITED WORKING RESULTS FOR THE NINE MONTHS ENDING SEPTEMBER 30, 2010

Information as required by Government of India, Ministry of Finance Circular No. F2/5/SE/76 dated
February 5, 1977 as amended vide Circular of even no dated March 8, 1977.

Particulars Amount
(Rs. in Lacs)
Net Sales / Income 2674.47
Other Income 8.83
Total Income 2683.30
Expenditure 3370.28
Gross Profit (excluding depreciation & taxes) (686.98)
Interest 0.83
Depreciation 637.04
Profit before Tax (1324.86)
Tax -
Profit after tax (1324.86)

NOTES:

The Issue price has been arrived at in consultation between the issuer and the Lead Manager.

Except for the convertible warrants issue, as disclosed in the section titled ―Capital Structure‖ on page
13 in the Draft Letter of Offer, and ‗M/s. Raghuveer Suburban Infrastructure Private Limited‘ and
‗Shree Ram Real Infra Ventures Private Limited‘ becoming our wholly owned subsidiaries with effect
th th
from 14 January, 2010 and 24 February, 2010 respectively, there are no other material changes
and commitments, which are likely to affect the financial position of our Company after December 31,
2009 (i.e. the last date up to which audited information is incorporated in this Draft Letter of Offer).

Week end price of Equity Shares of the Company for the last four weeks on the BSE are as below:

Week ended on Closing Price BSE(Rs.)

th
8 October, 2010 242.45
th
15 October, 2010 237.70
nd
22 October, 2010 230.25
th
29 October, 2010 233.65
*Source BSE based on calendar week ends

Highest and lowest price of the Equity Shares of the Company on BSE for the last four weeks

Date Highest Date Lowest

th th
6 October, 2010 249.80 27 October, 2010 228.10
*Source BSE based on calendar week ends

113
 STOCK MARKET DATA FOR EQUITY SHARES OF THE COMPANY

The equity shares of the Company are listed on The Bombay Stock Exchange Ltd. (BSE). The tables
set forth below are for the periods indicate the high and low of our Equity Shares and also volume of
trading activity.

A. The high, low and average market price of our Equity Shares during the preceding 3 years.

BSE
Volume Volume
Closing on Date Closing on Date
Average
Date High of High Date Low of Low
(Rs.)
Year Ending as (Rs.) (No. of (Rs.) (No. of
on December 31 Shares) Shares)
2009 28/07/2009 180.90 2,488 09/03/2009 39.50 821 105.43
2008 07/01/2008 453.30 47,727 03/11/2008 56.85 4,450 159.62
2007 06/02/2007 553.20 4,59,459 04/04/2007 230.40 14,551 359.17
* In the event the high and low price of the Equity Shares are the same on more than one day, the day
on which there has been higher volume of trading has been considered for the purposes of this
section.
* Source: www.bseindia.com

B. Monthly high and low prices of our Equity Share for the six months preceding the date of
this Draft Letter of Offer.

BSE
Volume Volume
on Date Closing on Date
Closing Average
Date of High Date Low of Low
High (Rs.) (Rs.)
Month (Last 6 (No. of (Rs.) (No. of
Months) Shares) Shares)
October 2010 06/10/2010 249.80 9,808 27/10/2010 228.10 6,032 238.31
September
2010 02/09/2010 266.30 10,507 23/09/2010 236.70 1,620 252.24
August 2010 23/08/2010 283.55 81,487 03/08/2010 192.15 3,974 232.64
July 2010 13/07/2010 223.70 9,895 30/07/2010 191.15 13,204 209.83
June 2010 10/06/2010 247.95 14,037 04/06/2010 204.10 13,625 220.82
May 2010 03/05/2010 265.20 31,828 25/05/2010 198.20 6,604 224.55
* In the event the high and low price of the Equity Shares are the same on more than one day, the day
on which there has been higher volume of trading has been considered for the purposes of this
section.
* Source: www.bseindia.com

C. Volume of business transacted during the last six months on the Bombay Stock Exchange
(BSE)

Volume Turnover
Month (Last 6 Months)
(No. of Shares) (Amount in Rs.)
October 2010 2,14,951 5,22,03,284
September 2010 5,63,055 14,07,55,894
August 2010 10,13,412 26,13,61,555
July 2010 1,40,008 2,95,96,618
June 2010 2,52,188 5,79,17,986
May 2010 6,16,259 14,06,44,549
* Source: www.bseindia.com
th
The closing market price was Rs. 252.95 on BSE on 28 April, 2010, the trading day immediately
following the day on which Board meeting was held to approve the Issue.

114
 SECTION VII: LEGAL AND OTHER INFORMATION
OUTSTANDING LITIGATIONS AND MATERIAL DEVELOPMENTS

Except as described below, there are no outstanding litigations, suits or criminal or civil prosecutions,
proceedings or tax liabilities against the Company, its Directors and Promoters and the Promoter
group companies that would have a material adverse effect on the business of the Company and
there are no defaults, nonpayment or overdue of statutory dues, institutional / bank dues and dues
payable to holders of debentures, bonds and fixed deposits that would have a material adverse effect
on the Company‘s business other than unclaimed liabilities against the Company or its Directors or
Promoters or Promoter group as of the date of this Draft Letter of Offer.

LITIGATIONS INVOLVING SHREE RAM URBAN INFRASTRUCTURE LIMITED

st
A. Contingent Liabilities not provided as of 31 December, 2009

The Contingent liabilities / claims not acknowledged as debt as of 31st December, 2009 are as
follows:

Sr. Current year (Amt

Particulars
No. in Lacs)
a) Claims against the company not acknowledged as debts 487.69
b) Bank guarantees 300.00
c) Outstanding letter of credit facility availed 48.25
d) Labour matter:
i. Pending in court in respect of claims for Retrenchment
compensation etc. 4.87
ii. Pending court cases – 5 (2 Matters disposed off in 2010) in respect of claims for Wages
etc. filed by ex-employees of the company for which the amount is unascertainable, the
case summaries are given below.
e) Income tax matters :
i. Income Tax demand for Assessment Year 2007-08 for which appeal
has been filed with CIT (Appeal) 43.59
f) Water tax dispute with BMC 27.48
Sewerage tax dispute with BMC 16.49
Property tax dispute with BMC 160.35
g) Excise Duty demand [Bank Guarantee 3.39
provided for the same Rs.3,39,250/- not included above]
h) Customs Duty demand [Bank Guarantee provided for the same 6.98
Rs.6,98,500/- not included above]
i) Pending court cases- 3 in respect of other matters against the Company the amount is
unascertainable; the case summaries are given below.

B. Outstanding Litigations:

Following is a summary of various litigations involving our Company:

Category Initiated By / Filed Against Amount Involved (Rs.)

A. Cases initiated against Our Company
1. Mr. R.K. Dhall & Others N.A.
Rs. 10,76,798 with interest on the
2. M/s. S. K. Trading Company sum of Rs. 3,37,995 at the rate of
Civil 24% p.a.
Proceedings Rs.17,41,810 with interest on the
3. M/s. Dev Shah Corporation principal sum of Rs.5,94,597.99 at
the rate of 24% per annum.
4. Ganesh Laxman Khedekar N.A.

115
 To quash and set aside the order
dated 21-12-2001 and Rs. 1,70,000
as rehabilitation money and
difference in compensation payable
5. Ashok D. Haldankar & Others
under 1995 VRS and 1993 VRS to
the Petitioners with interest at the rate
of 12% p.a. to each of the 503
Petitioners.
6. Prabhakar Anant Parab Rs.2,27,240 + 12% interest p.a.
7. Rashtriya Mill Mazdoor Sangh & Others N.A.
8. Rajaram Deepu Sonkar Rs. 1,70,000 + 12% interest p.a.
Rs.2500/- p.m. as subsistence
allowances from 1-06-2008 till 1-6-
Labour 9. Ganpatrao Gopala Mahangade
2011 and till the final disposal of W.
Matters
P. No 4513 of 1999.
Restore as permanent compounders
10. Shantaram Ganpat Labde & Others w.e.f Sept 1995. Full back wages
from 01.08.1996.
11. Chandrakant G Modi 50% back wages.
Small Causes
12. Shri. Amrish Rasiklal Shah N.A.
Court
13. M/s. Pranav Construction Systems Pvt.
Legal Notice NIL
Ltd.
14. Ministry of Corporate Affairs, Regional
NIL
Director, Western Region
15. Ministry of Corporate Affairs, Regional
Notice NIL
Director, Western Region
16. Ministry of Corporate Affairs, Regional
NIL
Director, Western Region
Show Cause 17. Assistance Commissioner of Customs
Rs. 6,98,500.00
Notice (import)
18. M/s. Kalpataru Constructions Overseas Rs. 1528.93 Crores along with
Arbitration Pvt. Ltd. interest.
Proceeding 19. M/s. Utility Premises Pvt. Ltd., Rs. 36.03 Crores
20. M/s. Cogent Ventures (India) Ltd., Rs. 26.00 Crores
Income Tax
21. Income Tax Officer N.A.
Matters
B. Cases initiated by Our Company
22. Rashtriya Mill Mazdoor NIL
Civil
Proceedings 23. The Court Receiver (Bombay High
NIL
Court)
24. Mr. Surendrakumar Ramprasad Shukla Rs.3040.00
25. Mr. Haji Noor Mohamed Gani Rs.3828.00
26. Mr. Rambilas Baijnath Gupta Rs.2880.00
27. Mr. Chhotalal Baijnath Gupta Rs.3993.00
28. Mr. Ramanuj Ramchandra Shukla Rs.3336.60
Small Causes 29. Mr. Sakharam Vithoo Rs.1438.40
30. Mr. Bankelal Baijnath Gupta Rs.2880.00
31. Mrs. Nirmala Ramesh Gundaria Rs.1755.40
32. Mr. Hiralal Joraji Porwal Jain Rs.5674.20
33. Mr. Arvind Chotalal Gupta Rs.3360.00
34. Mr. Bajirao Sampat Shewale Rs.3015.00

116
 35. Commissioner of Customs (Imports),
Rs. 12,31,454.00
Mumbai
Customs & 36. Commissioner of Customs (Imports),
Excise Cases Rs. 17,04,954.00
Mumbai
37. Commissioner of Central Excise Rs. 3,39,250.00
38. Assessing Officer, Income Tax Rs. 10,60,944.00
Income Tax
39. Assessing Officer, Income Tax Rs. 87,618.00
Matters
40. Assessing Officer, Income Tax N.A.
Property Tax
41. Mumbai Municipal Corporation N.A.
Matters
C. Cases initiated against Our Directors
NIL
D. Cases initiated by Our Directors
Civil
42. The Collector, Mumbai City & Anr. NIL
Proceeding
E. Cases initiated against Subsidiaries
NIL
F. Cases initiated by Subsidiaries
NIL

Details of various outstanding litigations:

A. Cases initiated against Our Company

i. Civil Proceedings:

Court /
Sr. Quantum/Reli Current
Jurisdiction & Initiated By Brief Particulars
No. ef‟s (Rs.) Status
Case Number
1. Before the Mr. R.K. Dhall Shri. R.K. Dhall (hereinafter N.A. The matter is
Hon‘ble referred to as ―Petitioner‖) has filed pending for
Company Law (―Petitioner‖) a Petition against Shri Ram Urban hearing.
Board, Infrastructure Limited and 14
Principal others (hereinafter referred to as
Bench, Mumbai the ―Respondents‖). The
Company Respondent No. 1 is a Company
Petition No.45 which is engaged in the business
of 2009 of real estate. It is alleged by the
Petitioner that the Respondents
In the matter of are mismanaging the affairs of the
the Companies Respondent No. 1 Company. The
Act, 1956, Petitioner and other consenting
Section 397, members‘ hold 2,46,667 equity
398 of 399 shares of Rs. 10/- each in the
Respondent No. 1 Company. The
Read with Petitioner in the said Petition has
Section 402, prayed to declare the AGM held on
403 and 406 of 25-6-2008 as illegal, null and void
the Companies and issue directions for appointing
Act, 1956. independent Directors for
Respondent No. 1 Company,
direct the removal of auditors viz.
Habib & Company and appoint
fresh Auditors, restrain the present
Board of Directors from dealing
with the flats of the Project ―Palais

117
 Court /
Sr. Quantum/Reli Current
Jurisdiction & Initiated By Brief Particulars
No. ef‟s (Rs.) Status
Case Number
Royale‖ with any person, restrain
the Board of Directors of the
Company from dealing with the
assets of the Respondent No.1
Company, direct the Board to
make full disclosure of the assets
of the Company, direct
investigations in to the affairs of
the Company under Section 234
by the Central Government or any
other person deems fit.
2. In the High M/s. S. K. M/s S. K. Trading Company Rs. 10,76,798 The suit is
Court of Trading (hereinafter referred to as the together with pending and
Judicature At Company ―Plaintiff‖) has filed a Summary interest on the Company is
Bombay Suit in March 2003 against M/s. sum of Rs. yet to file its
(―Plaintiff‖) Shree Ram Mills Ltd (hereinafter 3,37,995 at written
Ordinary referred to as the ―Defendant‖) for the rate of statement.
Original Civil recovery of Rs. 10,76,798 together 24% p.a.
Jurisdiction with interest on the sum of Rs.
3,37,995 at the rate of 24% p.a.
Summary Suit being the price of goods as
No 152 of 2003 supplied by the Plaintiff to the
Defendant.
3. In the High M/s Dev Shah M/s. Dev Shah Corporation Rs.17,41,810/- The
Court of Corporation (hereinafter referred to as the together with Company
Judicature At ―Plaintiff‖) has filed a Summary further interest has filed its
Bombay (―Plaintiff‖) Suit in August 2001 against M/s. on the written
Shree Ram Mills Ltd (hereinafter principal sum statement
Ordinary referred to as the ―Defendant‖) for of Rs. and the suit
Original Civil recovery of Rs. 17,41,810 together 5,94,597.99 at is pending for
Jurisdiction with further interest on the principal the rate of hearing.
sum of Rs. 5,94,597.99 at the rate 24% per
Summary Suit of 24% per annum from the date of annum from
No 3164 of the suit till payment and costs of the date of the
2001 the suit for the materials supplied Suit till
by the Plaintiff to the Defendant. payment.
4. In the High Ganesh Shri. Ganesh Laxman Khedekar To quash and The matter
Court of Laxman (hereinafter referred to as the set aside the has been
Judicature At Khedekar ―Petitioner‖) has filed a writ petition order dated admitted.
Bombay on 23rd April, 2010 against M/s 20.03.2009.
(―Petitioner‖) Shri Ram Mills Limited & Others
Ordinary (hereinafter referred to as the
Original Civil ―Respondents‖) under Articles 226
Jurisdiction & 227 of the Constitution of India,
challenging Judgment and order
Writ Petition No dated 20-03-2009 passed by the
1209 of 2010 learned Member, Industrial Court,
Mumbai in Complaint (ULP) No.
501 of 2005 wherein the Complaint
filed by the Petitioner was
dismissed without cost. Being
aggrieved by the order dated 20-
03-2009, the Petitioner has
preferred this Writ Petition.
5. In the High Ashok D. Shri. Ashok D. Haldankar & 502 To quash and The matter is
Court of Haldankar & other Petitioners (hereinafter set aside the kept for

118
 Court /
Sr. Quantum/Reli Current
Jurisdiction & Initiated By Brief Particulars
No. ef‟s (Rs.) Status
Case Number
Judicature At Others referred to as the ―Petitioners‖) order dated hearing.
Bombay have filed a writ petition on 14th 21-12-2001
(―Petitioners‖) March, 2002 against M/s Shree and Rs.
In Its‘ Appellate Ram Mills Limited & Others 1,70,000 as
Civil (hereinafter referred to as the rehabilitation
Jurisdiction ―Respondents‖) under Articles 226 money and
& 227 of the Constitution of India, difference in
Writ Petition No challenging the common Judgment compensation
2064 of 2002 and order dated 21st December, payable under
2001 passed by the learned 1995 VRS and
Member, Industrial Court, Mumbai 1993 VRS to
in Complaint (ULP) Nos. 1387 of the Petitioners
1996, 211 of 1997, 846 of 1998 with interest at
and 1063 of 1998 to 1227 of 1998 the rate of
wherein the Complaint‘s filed by 12% p.a. to
the Petitioners were dismissed each of the
without cost. Being aggrieved by 503
the order dated 21-12-2001, the Petitioners.
Petitioners have preferred this Writ
Petition. The Petitioners have also
prayed that the Respondent No 1
be directed to pay the benefits
namely Rs.1,70,000 as
rehabilitation money and difference
in compensation payable under
1995 VRS and 1993 VRS to the
Petitioners with interest at the rate
of 12% p.a.

ii. Labour Matters:

Court /
Sr. Quantum/Re Current
Jurisdiction & Initiated By Brief Particulars
No. lief‟s (Rs.) Status
Case Number
6. In the 11th Shri Prabhakar Shri. Prabhakar Anant Parab, The Applicant The matter is
Labour Court, Anant Parab (hereinafter referred to as the claim for kept for
at Bombay ―the Applicant‖) has filed a Rs.2,27,240/- evidence of
Application (―Applicant‖) case against the Company by way of the Applicant.
(BIR) no. 17 of M/s. Shree Ram Mills Ltd, closure
2007 (hereinafter referred to as ―the compensatio
Opponent‖)under section 79 n along with
read with Section 78, and interest at the
42(4) of the BIR Act, 1946 and rate of 12%.
in the matter of payment of
closure compensation to the
Applicant. The Applicant is
entitled to receive Rs.
2,27,240 by way of closure
compensation from the
Opponent along with interest
at the rate of 12%.
7. In the Labour Rashtriya Mill The Complainant No.1 is an Restrain the The matter is
Court, at Mazdoor approved and Representative Respondent kept for
Mumbai Sangh & Union representing the from evidence.
Complaint Others Complainant Nos. 2 to 26 who terminating
(ULP) No.149 are members of the the services

119
 Court /
Sr. Quantum/Re Current
Jurisdiction & Initiated By Brief Particulars
No. lief‟s (Rs.) Status
Case Number
Of 2000 (―Complainants Complainant No.1 (hereinafter of the
‖) referred to as the Complainant
―Complainants‖) who have No. 2 to 26
filed a complaint against the and to
Shree Ram Mills Ltd. comply with
(hereinafter referred to as the the order
―Respondents‖) for Unfair dated 23-12-
Labour Practices under 1999 of the
section 28 item 1(a), (b) and High Court.
(d) of Schedule IV of the
Maharashtra Recognition of
Trade Unions and Preventions
of Unfair Labour Practices Act,
1971 apart from Unfair Labour
Practices on the part of the
Respondents the
Complainants are entitled for
consequential reliefs of
restraining the Respondent
from terminating the services
of the Complainant Nos.2 to
26 under the guise of
retrenchment or by any other
means and to comply to the
order of the division bench in
Appeal No 325 of 1999 dated
23-12-1999 of the High Court.
8. In the Industrial Shri Rajaram Shri. Rajaram Deepu Sonkar The The matter is
Court, at Deepu Sonkar (hereinafter referred to as ―the Complainant kept for cross
Mumbai Complainant‖) has filed a claim for Rs. examination
Complaint (―Complainant‖) complaint against (1) Shree 1,70,000/- of the
[ULP] No.102 Ram Urban Infrastructure Ltd and interest Respondent
Of 2008 (2) Ambuj Abhaykumar at the rate of witness Mr.
Kasliwal (3) Shri Vikas 12%p.a. Ravi Singh.
Kasliwal, (hereinafter referred
to as ―the Respondents‖)
under Section 28 read with
item 5 & 9 of Schedule IV of
Maharashtra Recognition of
Trade Unions and Preventions
of Unfair Labour Practices Act,
1971. And to hold and declare
that the Respondents have
indulged in unfair Labour
practices and direct the
Respondent to pay to the
Complainant the benefits
under the VRS Scheme, ex-
gratia payment amounting Rs.
1,70,000/- and interest at the
rate of 12%p.a.
9. In the Industrial Shri Ganpatrao Shri Ganpatrao G. Mahangade The The
Court, at Gopala (hereinafter referred to as the Complainant Company
Mumbai Mahangade ―Complainant‖) has filed a claimed for has informed
Complaint complaint against Shree Ram Rs.2500 p.m. us that the
[ULP] No.153 (―Complainant‖) Mills Ltd. (hereinafter referred as outcome of

120
 Court /
Sr. Quantum/Re Current
Jurisdiction & Initiated By Brief Particulars
No. lief‟s (Rs.) Status
Case Number
Of 2008 to as the ―Respondent‖) for subsistence the matter is
Unfair Labour Practices under allowances on hold till
Section 28 items 1, 5 and 9 of from 1-06- any order is
Schedule IV of the 2008 till 1-6- passed by
Maharashtra Recognition of 2011 and till the Hon‘ble
Trade Unions and Preventions the final Bombay High
of Unfair Labour Practices Act, disposal of Court in Writ
1971 as the services of the W. P. No Petition No.
Complainant were orally 4513 of 1999. 4513 of 1999.
terminated w.e.f. 1-6-2008.
And that the Respondent be
ceased from committing Unfair
Labour Practices and be
restrained from terminating the
services of the Complainant
even after he completes 63
years of age and pay
subsistence allowances of
Rs.2500 p.m. till 1-6-2011 and
till the final disposal of Writ
Petition No 4513 of 1999.
10. Before the High Shri. (1) Shri. Shantaram Ganpat To be The Petition
Court of Shantaram Labde (2) Shri. Pandurang restored as is admitted
Judicature at Ganpat Labde Mallaya Wasal, and (3) Shri. permanent and is kept
Bombay & Others Narayan B Gentyal compounders for hearing.
Civil Appellate (hereinafter referred to as the w.e.f. Sept.
Jurisdiction (―Petitioners‖) Petitioners), have filed writ 1995 and pay
Writ Petition petition against the full back
No. 1180 of Respondents M/s. Shree Ram wages with
2008 Mills Ltd. and the Industrial continuity of
Court (hereinafter referred to services.
as ―the Respondents‖) in the
matter of Article 226 of the
Constitution of India and in the
matter of Maharashtra
Recognition of Trade Unions
and Preventions of Unfair
Labour Practices Act, 1971
and in the matter of judgment
and order dated 20/09/2006 in
Complaint (ULP) No. 93 of
2000. The Petitioner Nos.1, 2
and 3 are entitled that the
order dated 20/09/2006 be
quashed and set aside and
that they be made permanent
compounders with
retrospective effect from
September, 1995 till the
petition is heard with full back
wages and continuity of
services. And the Respondent
to absorb the Petitioner Nos.1,
2 and 3 with immediate and/or
pay to the Petitioners as per
order passed in letters patent
appeal No. 325 of 1999 in Writ

121
 Court /
Sr. Quantum/Re Current
Jurisdiction & Initiated By Brief Particulars
No. lief‟s (Rs.) Status
Case Number
Petition No. 4513 of 1999.
11. Before the High Chandrakant G Mr. Chandrakant G Modi The The Petition
Court of Modi (hereinafter referred to as ―the Complainant is admitted
Judicature at Petitioner‖) has filed this Writ claim for 50% and is kept
Bombay (―Petitioner‖) Petition against M/s. Shree back wages for hearing.
Ordinary Ram Mills Limited, (hereinafter as awarded
Original Civil referred to as ―the by the Labour
Jurisdiction Respondent‖) under Article Court vide its
226 of the Constitution of India order dated
Writ Petition and in the matter of Section 78 31-1-2003.
No. 719 of and 79 of the Bombay
2007 Industrial Relations Act, 1946
and in the matter of Judgment
and order dated 31-1-2003
passed by Labour Court,
Mumbai in Application (BIR)
No. 177 of 1993 and in the
matter of Judgment and Order
dated 15-11-2006 passed by
Industrial Court, Maharashtra
at Mumbai in Appeal (IC) No.
80 of 2003. For quashing and
setting aside the Judgement
and order dated 31-1-2003
and 15-11-2006 passed by the
Labour Court and the
Industrial Court respectively
and to direct the Respondent
to pay to the Petitioner 50%
back wages as awarded by the
Labour Court vide its order
dated 31-1-2003 and for other
reliefs.

iii. Small Causes Court:

Sr. Court / Initiated By Brief Particulars Quantum/Re Current

No. Jurisdiction & lief‟s (Rs.) Status
Case Number
12. In the Court of Amrish Rasiklal Shri Amrish Rasiklal Shah, To hand over The matter is
Small Cases, Shah (hereinafter referred to as the vacant and adjourned for
At Mumbai Plaintiff) has filed a case peaceful issues.
R.A.E. Suit (―Plaintiff‖) against M/s Shree Ram Mills possession of
No.461/719 Of Ltd, ―the Defendant‖ in 2007 to the suit
2007 hand over the vacant and premises.
peaceful possession of the
―suit premises‖ namely
godown No 1, Ground Floor,
Shree Laxmi Bhuvan, situated
at 76/86, Old Hanuaman Lane,
Kalbadevi Road, Mumbai -
400 002 to the Plaintiff.

122
 iv. Legal Notice:

Sr. Court / Initiated By Brief Particulars Quantum/Re Current

No. Jurisdiction & lief‟s (Rs.) Status
Case Number
13. Legal Notice M/s Pranav MEVA Schalungs Systeme N.A. No legal
Construction GmbH and M/s. Shree Ram proceeding
Systems Pvt. Urban Infrastructure Limited has been
Ltd. (hereinafter referred to as the filed so far.
―Company‘s‖) has received a
notice dated 26-3-2010 from
the advocate of M/s. Pranav
Construction Systems Pvt. Ltd.
(hereinafter referred to as
―Pranav‖) who are engaged in
manufacturing of shuttering
materials and supplying to
various customers. Pranav is
claiming an amount of
Rs.86,26,246 from the
Company‘s and cost of
Rs.5000 for the professional
charges. The Company
through its advocates have
given a reply to Pranav vide its
notice dated 21-4-2010
denying all the allegations
made in the notice. Pranav
have replied vide its notice
dated 23rd June, 2010 calling
upon the MEVA Schalungs.
Systems GmbH to pay a sum
of Rs.86,26,246 with interest
@ 24% p.a.

v. Notice

Court /
Sr. Quantum/Re Current
Jurisdiction & Initiated By Brief Particulars
No. lief‟s (Rs.) Status
Case Number
14. Notice for Ministry of The Company has received a N.A. No legal
inspection u/s Corporate notice from Mr. J. K. Jolly, proceeding
209 A of the Affairs, Joint Director, Ministry of has been
th
Companies Regional Corporate Affairs dated 26 filed so far.
Act, 1956 director, July, 2010 wherein after the
Western inspection of the books of
Region accounts & papers of the
Company u/s 209 (A) of the
Companies Act, 1956, the
Ministry of Corporate Affairs
have received complaints from
certain persons making
allegation regarding the affairs
of the Company and violations
of the Companies Act and
other acts. The Company was
requested to furnish reply
/explanation/ documents/
clarifications along with

123
 documentary evidence with
regard to each of the
allegations made by the
complainants in Annexure A,
B, C and D with seven days
from the date of receipt of this
notice. In case of default, the
Company is liable to be
proceeded against u/s 209A
(8) and (9) of the Companies
Act, 1956.

The allegations are as follows:

(a) Mismanagement &

Financial Irregularities being
committed by the Company
and its promoter Directors.

(b) Oppression of minority

shareholders, mismanagement
of the company, violation of
corporate governance
practices and insider trading
by promoters/directors.

(c) Irregularities and breach of

regulations in the preparation
of accounts and working of the
Company. There is a demand
that the accounts, audited
report and Directors‘ report
under consideration cannot
and should not be adopted.

(d) To investigate in the affairs

of S. Kumar group including S.
Kumar nationwide limited and
illegalities committed by this
group and by their Directors,
promoters/ executors.

The Company vide its letter

th
dated 9 August, 2010 has
replied to the joint Directors‘
Ministry of Corporate Affairs‘
th
notice dated 26 July, 2010.
The Company stated that the
allegations are baseless, false
and unfounded, made with an
intention to malign the image
of the Company.

15. Notice for Ministry of The Company has received a N.A. No legal
inspection u/s Corporate notice from Mr. J. K. Jolly, proceeding
209 A of the Affairs, Joint Director, Ministry of has been
th
Companies Regional Corporate Affairs dated 26 filed so far.
Act, 1956 director, July, 2010 wherein it is
Western informed the Company that
Region during the course of inspection

124
 u/s 209 A of the Companies
Act, 1956 which was
undertaken on 4.6.2010 at the
Companies registered office,
irregularities and
contraventions of the
Companies Act were
observed. And further certain
information was not available.
They have informed the
Company to reply, clarify and
explanations with documentary
evidence within ten days from
the date of this letter. The
Company vide its letter dated
th
16 August, 2010 has replied
th
to the letter dated 26 July,
2010 along with all the
clarifications, explanation,
documents on the issues
raised by the Authorities.

16. Notice for Ministry of The Company has received a N.A. No legal
inspection u/s Corporate notice from Mr. J. K. Jolly, proceeding
209 A (8) and Affairs, Joint Director, Ministry of has been
th
(9) of the Regional Corporate Affairs dated 26 filed so far.
Companies director, July, 2010 wherein it is
Act, 1956 Western informed the Company that the
Region Company have entered into
certain agreements/ MOUs/
cancellations/ Court/
CLB/Tribunal Cases. The
Company was requested to
produce the documents and
papers for inspection and to
explain the financial
implication and synopsis of
Court. In case of default, the
Company are liable to be
proceeded against u/s 209 A
(8) and (9) of the Companies
Act, 1956. The Company vide
th
its letter dated 16 August,
2010 has replied to the notice
th
dated 26 July, 2010 wherein
they have mentioned the
synopsis of the agreements
referred therein and also
inform them that the
original/copies of the
documents mentioned are
available for the verification.

125
 vi. Show Cause Notice

Sr. Court / Initiated By Brief Particulars Quantum/Re Current

No. Jurisdiction & lief‟s (Rs.) Status
Case Number
17. Show Cause Assistance The Company has informed us Rs.6,98,500/- The Current
Notice dated Commissioner that the Company has status is not
12/2008 of Customs received a notice from the provided by
received by us (import) Assistance Commissioner of the
on 30/12/2008 Customs (import) calling upon Company.
bearing the Company to pay the
reference no. differential duty of
F.No.S/5-PD- Rs.6,98,500/- (Six Lakh Ninety
11/2008 VA Eight Thousand Five Hundred
S/26-Misc- only) on account of import of
112/2008 VA goods from M/s Meva
Schalungs – Systeme. The
Assistance Commissioner has
held that the goods has been
wrongly classified under CTH
84806000 whereas the same
should have been classified
under CTH 76109030.

vii. Arbitration Proceeding

Court /
Sr. Quantum/Reli Current
Jurisdiction & Initiated By Brief Particulars
No. ef‟s (Rs.) Status
Case Number
18. Before the Kalpataru Kalpataru Constructions The Claimant The matter is
Learned Constructions (Overseas) Pvt. Ltd. claim for kept for
Arbitrators Overseas Pvt. (hereinafter referred to as the compensation cross-
The Hon‘ble Limited Claimant) has filed arbitration is Rs. 1528.93 examination
Mr. Justice proceedings against the Shree Crores along of
Variava (―Claimant‖) Ram Mills Limited and others with interest Respondents
(hereinafter referred to as the and the witnesses.
The Hon‘ble Respondents) in respect to the Respondent
Mr. Justice development right of Plot 5A No. 1‘s
Khare admeasuring 20,955.40 sq. counter claim
mtrs. for the Company‘s Worli is for Rs.
And estate. The Claimant has filed 2,677.32
a claim for compensation of Crores.
Mr. R. A Dada, Rs. 1528.93 Crores along with
Senior interest as alternative to the
Advocate, original claim for specific
Bombay High performance. The Respondent
Court No 1 has filed written
statement – cum - counter
claim on 11th January, 2008
wherein the Respondent No 1
has made his counter claim for
Rs. 1500 Crores. Further the
Respondent No 1 had filed an
application for amendment of
its written statement – cum -
counterclaim wherein the claim
amount of Rs. 1500 Crores is
substituted with the figure of

126
 Court /
Sr. Quantum/Reli Current
Jurisdiction & Initiated By Brief Particulars
No. ef‟s (Rs.) Status
Case Number
Rs. 2,677.32 Crores.
19. Before the M/s. Utility M/s. Utility Premises Pvt. Ltd. The Claimant The matter is
Learned Premises Pvt. (hereinafter referred to as the claim is for Rs. kept for
Arbitrators Limited Claimant) and Shree Ram 36.03 Crores. Cross-
The Hon‘ble Mills Limited, (hereinafter examination
Mrs. Justice (―Claimant‖) referred to as the Respondent) of Claimant‘s
Sujata entered into an agreement witnesses
Manohar (Retd) dated April 27, 1994, whereby
it was agreed between the
The Hon‘ble parties that the Claimant shall
Mr. Prakash S. develop a residential building
Shah (Retd) on the portion of land
admeasuring to 4848.1 sq.
And mtrs at Worli. The Claimant
has prayed to the Hon‘ble
The Hon‘ble Arbitral Tribunal that the
Mr. Justice Respondent be directed to
A.C. Agrawal provide balance portion of the
(Retd) land in its mill compound so as
to enable the Claimant to
develop the balance Municipal
FSI. The Claimants claims a
sum of Rs. 4,04,18,279/-
together with interest @ 18%
p.a. w.e.f. May 31, 1995 till its
actual payment. The
Respondent be directed to
execute the conveyance deed
in respect of the said Property.
The Claimants claims a sum of
Rs. 25,00,00,000/- on account
of compensation on account of
loss of goodwill and delay
caused by the Respondent in
not performing his obligations.
The Claimants claims a sum of
Rs.1,00,00,000/- cost of
litigation incurred by the
Claimant.

On 23rd October, 2010 an

arbitration meeting was held
wherein the learned Arbitrator
Mrs (Justice) Sujata Manohar
has held that since the
Respondents are not willing to
bear the Claimants‘ share of
amount required to be
deposited and/or paid, the
arbitration proceedings are
suspended till 30th November,
2010. If all amounts as
directed by the Learned

127
 Court /
Sr. Quantum/Reli Current
Jurisdiction & Initiated By Brief Particulars
No. ef‟s (Rs.) Status
Case Number
Arbitrator below are not
deposited by the Claimant by
30th November, 2010, the
arbitration proceedings will
stand terminated.

(1) The Claimant is directed to

pay fees of the Arbitrator.

(2)The Claimant shall pay to

the Respondent all expenses
for holding today‘s meeting
amounting to Rs.7500/- as well
as the cost which are fixed at
Rs.50,000/-

(3)The Claimant are also

directed to ascertain whether
the six cheques totaling to Rs.
3,75,000/- which are paid to
Justice P. S. Shah has been
paid to him or credited to his
account and should send
proper of account.
20. Before the M/s. Cogent M/s. Cogent Venture (India) The Claimant The Claimant
Learned Ventures Limited (hereinafter referred to claim is for Rs. witnesses are
Arbitrators (India) Limited as the Claimant) has filed an 26.00 crores. yet to be
The Hon‘ble Arbitration Petition against cross
Mrs. Justice (―Claimant‖) M/s. Shree Ram Mills Limited examined.
(Retd) Sujata and M/s. Utility Premises Pvt.
Manohar Limited (hereinafter referred to
as the Respondents). The
The Hon‘ble Respondent No 1 was
Mr. Justice declared as sick by BIFR,
(Retd) Prakash thereafter a scheme of
S. Shah rehabilitation was sanctioned
wherein the Respondent No 1
And was to sell 1,20,000 sq. ft. of
land in order to revive the
The Hon‘ble Company which would fetch
Mr. Justice the Respondent No 1‘s 21
(Retd) A.C. Crores to discharge its
Agrawal obligations to various
creditors. Thereafter there was
an arrangement between the
Respondent No 1 and 2 and
the claimant to develop the
said property jointly, wherein
the claimant paid a sum of Rs.
21.60 Crores to the
Respondent No 1 to clear its
outstanding dues, with an
understanding that the
claimant would be allowed to
develop the Property. The
Defendants No 1 failed to pay

128
 Court /
Sr. Quantum/Reli Current
Jurisdiction & Initiated By Brief Particulars
No. ef‟s (Rs.) Status
Case Number
the claimant the said amount
of Rs. 21.60 Crores. The
Claimant has prayed to the
Arbitral Tribunal that the
Respondent No 1 be provided
the balance portion of the land
to develop the same and to
direct the Respondent No 1 to
execute a deed of conveyance
in favour of the claimant, to
pay compensation of Rs. 25
Crores to the claimant for loss
of goodwill and Rs. 1 Crores
on account of litigation
incurred by the Claimant.

On 23rd October, 2010 an

arbitration meeting was held
wherein the learned Arbitrator
Mrs (Justice) Sujata Manohar
has held that since the
Respondents are not willing to
bear the Claimants‘ share of
amount required to be
deposited and/or paid, the
arbitration proceedings are
suspended till 30th November,
2010. If all amounts as
directed by the Learned
Arbitrator below are not
deposited by the Claimant by
30th November, 2010, the
arbitration proceedings will
stand terminated.

(1) The Claimant is directed to

pay fees of the Arbitrator.

(2) The Claimant shall pay to

the Respondent all expenses
for holding today‘s meeting
amounting to Rs.7500/- as well
as the cost which are fixed at
Rs.50,000/-

(3)The Claimant are also

directed to ascertain whether
the six cheques totaling to Rs.
3,75,000/- which are paid to
Justice P. S. Shah has been
paid to him or credited to his
account and should send
proper of account.

129
 viii. Income Tax Matters

Court /
Sr. Quantum/Reli Current
Jurisdiction & Initiated By Brief Particulars
No. ef‟s (Rs.) Status
Case Number
21. ITAT No. Income Tax The Income Tax Officer had N.A. The said
4650/M/09 Dt. Officer filed an appeal against the appeal is
25/02/2010 order passed by the CIT (A). admitted and
the same is
pending for
final hearing

B. Cases initiated by Our Company

i. Civil Proceedings:

Court /
Sr. Quantum/Re Current
Jurisdiction & Filed Against Brief Particulars
No. lief‟s (Rs.) Status
Case Number
22. In the High Rashtriya Mill M/s. Shree Ram Mills Limited To quash and The matter is
Court of Mazdoor (hereinafter referred to as the set aside the pending and
Judicature At ―Petitioners‖) has filed a Writ impugned listed for final
Bombay (―Respondent‖) Petition on 9th August 1999 order dated hearing.
against Rashtriya Mill Mazdoor 2.07.1999.
Appellate Civil (hereinafter referred to as
Jurisdiction ―Respondent‖). The
Respondent had filed a
Writ Petition No complaint before the Industrial
4513 of 1999 Court under section 28 of item
5 of Schedule II and item 6
and 9 of Schedule IV of
M.R.T.U & ULP Act, 1971
challenging the removal of 27
clerks by the Company. The
Industrial Court by its order
dated 2nd July, 1999 order the
Company to enter the names
of the concerned employees
on the muster roll and provide
benefits till the end of their
service. Being aggrieved by
the said order, the Company
preferred this Writ Petition.
The Respondent had also filed
a Letters Patent Appeal No
325 of 1999 in this Writ
Petition. The Court had
passed an order dated 23rd
December, 1999 wherein the
Petitioner was directed to pay
Rs.2500/- p.m. to each of all
27 workmen or to make a lump
sum payment of Rs.30,000 for
a period of 12 months with
effect from 15th September,
1999 till the disposal of this
Writ Petition.

130
 Court /
Sr. Quantum/Re Current
Jurisdiction & Filed Against Brief Particulars
No. lief‟s (Rs.) Status
Case Number
23. In the Supreme The Court The Petitioner has filed N.A. The matter is
Court of India Receiver Special Leave Petition in the now listed as
Civil Appellate (Bombay High Supreme Court against the a fresh
th
Jurisdiction Court) judgment dated 16 matter and
Respondents September, 2010 passed by the interim
S.L.P. No Justice Bhatia in Civil Revision order passed
30298 of 2010 Application No 452 of 2009. by the High
The Petitioner is a Company Court in CRA
In and is a tenant in respect of No.452 of
th
Flat No.6-C, situated on the 2009 on 16
Civil Revision 6th Floor of the building known September,
Application as ―Dev Ashish‖ situated at 2010 will
No.452 of 2009 Plot No.1, bearing continue.
C.T.S.No.755 at Padam Takri,
In Peddar Road, Bombay 400
026, (hereinafter referred to as
Appeal no.837 the ―Suit Premises‖). Since
of 2003 there was a dispute and hence
a court receiver was appointed
In in respect of the Suit
Premises. The Petitioner has
T.E.&.R. Suit been paying rent to the Court
no.60/63 of Receiver from time to time.
2002 The Court Receiver issued a
notice for eviction of the suit
premises or else calling upon
the Petitioner to pay
compensation of Rs.1,75,000/-
per month from 1-4-2000. No
separate suit is filed by the
Court Receiver for Mesne
Profit. Being aggrieved and
dissatisfied by the Judgment
dated 12-6-2009 passed in
Appeal No.837 of 2003
thereby confirming judgment
and decree dated 20-10-2003
passed in TE&R Suit No.60/63
of 2003. The Petitioner had
preferred the civil revision
application No.452 of 2009
which was dismissed by the
judgment dated 16.09.2010.
Further it was also ordered
that the decree shall not be
executed for a period of six
weeks from the date of the
judgment, subject to condition
that the Petitioner shall not
create any third party interest
in the property. Being
aggrieved by the order dated
16.09.10 the
Applicant/Petitioners have
preferred this present Special
Leave Petition.

131
 ii. Small Causes Court:

Sr. Court / Filed Against Brief Particulars Quantum/Re Current

No. Jurisdiction & lief‟s (Rs.) Status
Case Number
24. In the Court of Shri. M/s. Shree Ram Mills Ltd ―the Rs. 3040.00 The matter is
Small Cases, at Surendrakumar Plaintiff‖ is the owner of kept for steps
Bombay Ramprasad premises being Shop No.7, /order.
Stamp No. Shukla Shree Ram Mills Chawl, Site
2972 of 2005 No.9, V.L. Tenancy, Globe
(―Defendant‖) Mills Passage, Opp Gopal
R.A.E. & R. Nagar, P. B. Marg, Worli,
Suit No. 25/38 Mumbai - 400 013, hereinafter
of 2006. referred to as ―the suit
premises‖, has filed a case
against Shri Surendrakumar
Ramprasad Shukla ―the
Defendant‖ to hand over the
vacant and peaceful
possession of the Suit
premises to the Plaintiff. And
to pay the arrears of rent from
1-4-1997 to 31-8-2003 at the
rate of Rs. 40/- per month
aggregating to Rs.3040/- to
the Plaintiff.
25. In the Court of Mr. Haji Noor M/s. Shree Ram Mills Ltd the Rs. 3828.00 The matter is
Small Causes Mohamed Gani Plaintiff, who is the owner of a adjourned for
Court, at & Anr. building known as Shree Ram issues.
Bombay Mills Chawl, being Shop No.2,
Stamp No. (―Defendants‖) situated at site No.9, V.L.
2120 of 2005 Tenancy, Globe Mills, Opp.
Gopal Nagar, P. B. Marg,
R.A.E. & R. Worli, Mumbai - 400 013,
Suit No. hereinafter referred to as ―the
927/1459 of suit Premises‖, has filed a
2005. case against Mr. Haji Noor
Mohamed Gani & Anr. ―the
Defendants‖, to hand over the
vacant and peaceful
possession of the suit
premises to the Plaintiff, and
also for recovery from the
Defendant No.1 the arrears of
rent from 1-1-1994 to 31-8-
2003 at the rate of Rs.33/- per
month aggregating to
Rs.3,828/- due to the Plaintiff.
26. In the Court of Mr. Rambilas M/s. Shree Ram Mills Ltd, the Rs. 2880.00 The matter is
Small Causes Baijnath Gupta Plaintiff, is the owner of a adjourned for
Court, at building known as Shree Ram steps.
Bombay (―Defendant‖) Mills Chawl, being Shop No.4,
Stamp No. situated at site No.9, V.L.
2122 of 2005 Tenancy, Globe Mills, Opp.
Gopal Nagar, P. B. Marg,
R.A.E. & R. Worli, Mumbai - 400 013 ―the
Suit No. suit Premises‖, has filed a
929/1461 Of case against Mr. Rambilas

132
Sr. Court / Filed Against Brief Particulars Quantum/Re Current
No. Jurisdiction & lief‟s (Rs.) Status
Case Number
2005. Baijnath Gupta, ―the
Defendants‖ to hand over the
vacant and peaceful
possession of the suit
premises to the Plaintiff, and
also for recovery from the
Defendant the arrears of rent
from 1-1-1997 to 31-8-2003 at
the rate of Rs.36/- per month
aggregating to Rs.2880/- due
to the Plaintiff.
27. In the Court of Mr. Chhotalal M/s. Shree Ram Mills Ltd, ―the Rs. 3993.00 Matter is
Small Causes Baijnath Gupta Plaintiff‖, is the owner of a adjourned for
Court, at building known as Shree Ram steps / for
Bombay (―Defendant‖) Mills Chawl, being Shop No.6, filing fresh
Stamp No. situated at site No.9, V.L. application.
2124 of 2005 Tenancy, Globe Mills, Opp.
Gopal Nagar, P. B. Marg,
R.A.E. & R. Worli, Mumbai - 400 013
Suit No. hereinafter referred to as ―the
931/1463 Of suit Premises‖, has filed a
2005. case against Mr. Chhotalal
Baijnath Gupta ―the
Defendant‖ to hand over the
vacant and peaceful
possession of the suit
premises to the Plaintiff, and
also for recovery from the
Defendant the arrears of rent
from 1-8-1993 to 31-8-2003 at
the rate of Rs.33/- per month
aggregating to Rs.3993/- due
to the Plaintiff.
28. In the Court of Mr. Ramanuj M/s. Shree Ram Mills Ltd, ―the Rs. 3336.60 The Plaintiff
Small Causes Ramchandra Plaintiff‖, is the owner of a has to take
Court, at Shukla building known as Shree Ram service steps
Bombay Mills Chawl, being Shop or else order
Stamp No. (―Defendant‖) No.11, situated at site No.9, V. will be
2128 Of 2005 L. Tenancy, Globe Mills, Opp. passed.
Gopal Nagar, P.B. Marg,
R.A.E. & R. Worli, Mumbai - 400 013
Suit No. hereinafter referred to as ―the
935/1467 Of suit Premises‖, has filed a
2005. case against Mr. Ramanuj
Ramchandra Shukla ―the
Defendant‖ to hand over the
vacant and peaceful
possession of the suit
premises to the Plaintiff, and
also for recovery from the
Defendant the arrears of rent
from 1-2-1998 to 31-8-2003 at
the rate of Rs.49.80 per month
aggregating to Rs.3336.60/-
due to the Plaintiff.
29. In the Court of (1) Mr. M/s. Shree Ram Mills Ltd, ―the Rs.1438.40 The Plaintiff

133
Sr. Court / Filed Against Brief Particulars Quantum/Re Current
No. Jurisdiction & lief‟s (Rs.) Status
Case Number
Small Causes Sakharam Plaintiff‖, is the owner of a has to take
Court, at Vithoo (2) building known as Shree Ram service steps
Bombay Subhash Mills Chawl, being Shop No.9, against the
Stamp Mangalaprasad situated at site No.9, V. L. Defendant
No.2126/2005 Mishra & (3) Tenancy, Globe Mills, Opp. No.2 or else
Shri. Gopal Nagar, P. B. Marg, order will be
R.A.E. & R. Ghanashyam Worli, Mumbai - 400 013 passed.
Suit No. Mangalaprasad hereinafter referred to as ―the
933/1465 of Mishra suit Premises‖, has filed a
2005. (―Defendants‖) case against (1) Mr. Sakharam
Vithoo (2) Subhash
Mangalaprasad Mishra & (3)
Shri. Ghanashyam
Mangalaprasad Mishra ―the
Defendants‖ to hand over the
vacant and peaceful
possession of the suit
premises to the Plaintiff, and
also for recovery from the
Defendants arrears of rent
from 1-1-1994 to 31-8-2003 at
the rate of Rs.12.40 per month
aggregating to Rs.1438.40 due
to the Plaintiff.
30. In the Court of Shri Bankelal M/s. Shree Ram Mills Ltd, ―the Rs.2880/- The matter is
Small Cases, Baijnath Gupta Plaintiff‖, is the owner of a kept for filing
At Bombay building known as Shree Ram fresh
Stamp No. (―Defendant‖) Mills Chawl, being Shop No.3, Application.
2121 of 2005 situated at site No.9, V. L.
Tenancy, Globe Mills, Opp.
R.A.E. & R. Gopal Nagar, P. B. Marg,
Suit No. Worli, Mumbai - 400 013
928/1460 of hereinafter referred to as ―the
2005. suit Premises‖, has filed a
case against Shri Bankelal
Baijnath Gupta ―the
Defendant‖ to hand over the
vacant and peaceful
possession of the suit
premises to the Plaintiff, and
also for recovery from the
Defendant the arrears of rent
of from 1-1-1997 to 31-8-2003
at the rate of Rs.36/- per
month aggregating to
Rs.2880/- due to the Plaintiff.
31. In the Court of Mrs. Nirmala M/s. Shree Ram Mills Ltd, ―the Rs.1755.40 The matter is
Small Causes Ramesh Plaintiff‖, is the owner of a adjourned for
Court, at Gundaria & building known as Shree Ram Issues.
Bombay Anr. Mills Chawl, being Shop No.12
Stamp No. situated at site No.9, V. L.
2129 of 2005 (―Defendants‖) Tenancy, Globe Mills, Opp.
Gopal Nagar, P. B. Marg,
R.A.E. & R. Worli, Mumbai - 400013
Suit No. hereinafter referred to as ―the
936/1468 of suit Premises‖, has filed a

134
Sr. Court / Filed Against Brief Particulars Quantum/Re Current
No. Jurisdiction & lief‟s (Rs.) Status
Case Number
2005. case against Mrs. Nirmala
Ramesh Gundaria & Anr. ―the
Defendants‖ to hand over the
vacant and peaceful
possession of the suit
premises to the Plaintiff, and
also for recovery from the
Defendant No.1 the arrears of
rent from 1-2-1998 to 31-8-
2003 at the rate of Rs. 26.20
per month aggregating to Rs.
1755.40 due to the Plaintiff.
32. In the Court of Mr. Hiralal M/s. Shree Ram Mills Ltd, ―the Rs.5674.20 The matter is
Small Causes Joraji Porwal Plaintiff‖, is the owner of a adjourned for
Court, at Jain and Anr. building known as Shree Ram Issues.
Bombay Mills Chawl, being Shop
Stamp No. (―Defendants‖) No.10, situated at site No.9, V.
2127 Of 2005 L. Tenancy, Globe Mills, Opp.
Gopal Nagar, P. B. Marg,
R.A.E. & R. Worli, Mumbai - 400 013
Suit No. hereinafter referred to as ―the
934/1466 Of suit Premises‖, has filed a
2005. case against Mr. Hiralal Joraji
Porwal Jain and Anr. ― the
Defendants‖ to hand over the
vacant and peaceful
possession of the suit
premises to the Plaintiff, and
also for recovery from the
Defendant No.1 the arrears of
rent from 1-1-1997 to 31-8-
2003 at the rate of Rs.70.95
per month aggregating to Rs.
5674.20 due to the Plaintiff.
33. In the Court of Shri. Arvind M/s. Shree Ram Mills Ltd, ―the Rs.3360/- The matter is
Small Cases, at Chotalal Gupta Plaintiff‖, is the owner of a adjourned for
Bombay building known as Shree Ram dismissal
Stamp No. (―Defendant‖) Mills Chawl, being Shop No.8, order since
2125 Of 2005 situated at site No.9, V.L. Plaintiff failed
Tenancy, Globe Mills, Opp. to file
R.A.E. & R. Gopal Nagar, P.B. Marg, examination
Suit No. Worli, Mumbai - 400 013 in chief.
932/1464 Of hereinafter referred to as ―the
2005. suit Premises‖, has filed a
case against Shri Arvind
Chotalal Gupta ―the
Defendants‖ to hand over the
vacant and peaceful
possession of the suit
premises to the Plaintiff, and
also for recovery from the
Defendant the arrears of rent
from 1-9-1996 to 31-8-2003 at
the rate of Rs.40/- per month
aggregating to Rs.3360/- due
to the Plaintiff.

135
Sr. Court / Filed Against Brief Particulars Quantum/Re Current
No. Jurisdiction & lief‟s (Rs.) Status
Case Number
34. In the Court of Shri. Bajirao M/s. Shree Ram Mills Ltd, ―the Rs.3015/- The Plaintiff
Small Cases, at Sampat Plaintiff‖, is the owner of a has to take
Bombay Shewale & Anr. building known as Shree Ram service steps
Stamp No. Mills Chawl, being Shop No.1, against the
2119 Of 2005 (―Defendant‖) situated at site No.9, V. L. Defendant or
Tenancy, Globe Mills, Opp. else order will
R.A.E. & R. Gopal Nagar, P. B. Marg, be passed.
Suit No. Worli, Mumbai - 400 013
926/1458 Of hereinafter referred to as ―the
2005. suit Premises‖, has filed a
case against Shri Bajirao
Sampat Shewale & Anr. ―The
Defendants‖ to hand over the
vacant and peaceful
possession of the suit
premises to the Plaintiff. And
also for recovery from the
Defendant No.1 the arrears of
rent from 1-2-1998 to 31-8-
2003 at the rate of Rs. 45/- per
month aggregating to Rs.
3015/- due to the Plaintiff.

iii. Customs & Excise Matters

Sr. Court / Filed Against Brief Particulars Quantum/Re Current

No. Jurisdiction & lief‟s (Rs.) Status
Case Number
35. In the Customs, Commissioner The Appeal is been filed by Rs.12,31,454 The Appeal
Excise And of Customs Shree Ram Urban has been
Service Tax (Imports), Infrastructure Ltd. against admitted and
Appellate order dated 17th February
Mumbai. the matter is
Tribunal 2009 passed by the
West Zonal Commissioner of Customs pending for
Bench At (Imports), Mumbai wherein the final disposal.
Mumbai duty of Rs.12,31,454/- (Twelve
Court No. II Lakh Thirty One Thousand
C/S/430/09 In Four Hundred and Fifty Four
Appeal No. only) was ordered to be paid
C/244/09 on the goods i.e. MD-Panel
w.GM-sheet and MD-primary
beam classified under CTH
76109090.
36. In the Customs, Commissioner The Appeal is been filed by Rs.17,04,954 The Appeal
Excise And of Customs Shree Ram Urban has been
Service Tax (Imports), Infrastructure Ltd. against admitted and
Appellate
Mumbai. order dated 30th September the matter is
Tribunal
West Zonal 2008 passed by the pending for
Bench At Commissioner of Customs final disposal.
Mumbai (Imports), Mumbai wherein the
duty of Rs.17,04,954/-
Court No.1 (Seventeen Lakhs Four
Thousand Nine Hundred and
C/S/1778/08 In Fifty Four only) was ordered to
Appeal be paid on the goods imported

136
Sr. Court / Filed Against Brief Particulars Quantum/Re Current
No. Jurisdiction & lief‟s (Rs.) Status
Case Number
No.C/1183/08 vide B/E
No.799813/18.10.2004,
797341/08.10.2007 and
807496/23.11.2007 classified
under CTH 76109030.

37. In the Customs, Commissioner The Appeal is been filed Rs.3,39,250/- The Appeal
Excise And of Central against the order dated 1st has been
Service Tax Excise January 2002 passed by the admitted and
Appellate
Commissioner of Central the matter is
Tribunal
(W.Z.B.) Excise wherein it has been pending for
Stay/ Misc. held that the Company is liable final disposal.
Appn. No. in to pay the Excise duty of
Appeal No. Rs.3,39,250/- (Rupees Three
E/814/02-MUM Lakh Thirty Nine Thousand
Arising out of Two Hundred Fifty only) on
O-In-A No.
textile fabric admeasuring
27/VPS-
12/01/M- 37,777.75 L. Mtrs valued at
III/dtd.01/01/20 Rs.13,57,000/- (Thirteen Lakh
02 passed by Fifty Seven Thousand only).
CCE Mumbai - Against the said order appeal
III has been filed by Shree Ram
Urban Infrastructure Ltd.

iv. Income Tax Matters

Court /
Sr. Quantum/Re Current
Jurisdiction & Filed Against Brief Particulars
No. lief‟s (Rs.) Status
Case Number
38. CIT (A) No. Income Tax Assessment Year 2007-08 Rs.10,60,944 The said
171/2008-09 of Officer, Range appeal is
Mumbai Dt. – 7 (2) (3), The Company had filed an admitted and
25/01/2010 appeal against the order
Mumbai the same is
passed by the Assessing pending for
Officer demanding tax of final hearing.
Rs.10,60,944/- (Rupees Ten The case is
Lakh Sixty Thousand Nine reopened u/s
Hundred Forty Four only 147 / 148 and
scrutiny
assessment
is pending.

39. CIT (A) No. Income Tax Assessment Year 2006-07 Rs.87,618/- The said
380/2009-10 of Officer, Range (Balance appeal is
Mumbai Dt. – 7 (2) (2), The Company had filed an amount) admitted and
10/01/2009 appeal against the order
Mumbai the same is
passed by the Assessing pending for
Officer matters as specified in final hearing.
Grounds of Appeal. The The case is

137
 Court /
Sr. Quantum/Re Current
Jurisdiction & Filed Against Brief Particulars
No. lief‟s (Rs.) Status
Case Number
computation U/s 143(3) reopened u/s
ordered refund of Rs. 147 / 148 and
41,46,728/- (Forty One Lakh scrutiny
Forty Six Thousand Seven assessment
Hundred Twenty Eight only) is pending.
against which we have
received the amount of Rs.
40,59,110/- (Rupees Forty
Lakh Fifty Nine Thousand One
Hundred Ten only).

40. CIT (A) No. Asst. Assessment Year 2004-05 N.A. The said
2934/M/2009 of Commissioner appeal is
Mumbai Dt. of Income Tax, The Company had filed an admitted and
15/01/2010 appeal against the order
Range – 7 (2), the same is
Mumbai passed by the Assessing pending for
Officer matters as specified in final hearing.
Grounds of Appeal.

v. Property Tax Matters

Court /
Sr. Quantum/Re Current
Jurisdiction & Filed Against Brief Particulars
No. lief‟s (Rs.) Status
Case Number
41 Before the Mumbai The complaint is filed by Shree Not The
Assistant Mahanagar Ram Urban Infrastructure Ltd. quantifiable complaint
Assessor And Palika challenging the revised has been
Collector,
rateable value assessed by heard and is
Mumbai
Mahanagar the Assistant Assessor And reserved for
Palika, Collector at Rs.56,37,600/- Orders
G-south ward (Rupees Fifty Six Lakhs Thirty
office, N.M. Seven Thousand Six Hundred
Joshi Marg, only) NPA w.e.f 1st April 2009
Mumbai in respect of the property of
the Company situated at Worli.

C. Cases initiated against Our Directors

NIL

D. Cases initiated by Our Directors

Court /
Sr. Quantum Current
Jurisdiction & Filed Against Brief Particulars
No. (Rs.) Status
Case Number
42. Before the The Collector, Mr. Vikas Kasliwal (hereinafter N. A. The
Hon‘ble Mumbai City & referred to as the ―Appellant‖) Commissioner
Divisional Anr. has filed an Appeal against (1) has directed to
Commissioner the Collector & (2) Vijay issue notice to

138
 Court /
Sr. Quantum Current
Jurisdiction & Filed Against Brief Particulars
No. (Rs.) Status
Case Number
Konkan Division (―Respondents‖ Infrastructure Technologies the Collector
) Pvt. Ltd. (hereinafter referred of Bombay.
Appeal no.160 to as the ―Respondents‖)
of 2007 challenging the notice of
nd
demand dated 22 November,
(Under Section 2007 under Section 267 of the
274 of the Maharashtra Land Revenue
Maharashtra Code issued to the Appellant
Land Revenue who was an Ex-director of the
Code) Respondent No. 2 and who
resigned on 26-1-2001. The
Respondent No.2 and another
Company Shree Ram Mills
Ltd. had entered into an
agreement dated 27-6-1996
for development of properties.
The owners submitted Form
37-1 as required under the
Income - Tax Act. Thereafter
the Dy. Collector passed an
order dated 27-9-1997 that
stamp duty of 2.86 Crores was
due and payable by
Respondent No.2 on the
agreement. The Appellant was
only an Ex - Director of the
Company and hence he
cannot be liable personally for
the stamp duty payable by the
Respondent No. 2. Hence the
Appellant has filed this appeal
to quash & set aside the order
dated 22-11-2007.

E. Cases initiated against Our Subsidiaries

NIL

F. Cases initiated by Our Subsidiaries

NIL

Letter from Securities and Exchange Board of India to the Company

The Company has received a letter bearing No. ISD/SR/AS/ASR/18407/2010 from Securities and
nd
Exchange Board of India (hereinafter referred to as ―SEBI‖) on 2 September, 2010 wherein SEBI
has requested the Company to provide information which are sought under Section 11 of SEBI Act,
st
1992. The Company vide its letter dated 21 September, 2010 has given a suitable reply to the
Securities and Exchange Board of India. The Company has not received any response until the date
of this Draft Letter of Offer.

139
 GOVERNMENT AND OTHER KEY APPROVALS

We have received the necessary consents, licenses, permissions and approvals from the Government
of India, relevant state governments and various governmental agencies required for our present
business and except as mentioned below in the Draft Letter of Offer, no further approvals are required
for carrying on our present business.

It must be distinctly understood that, in granting these approvals, the Government of India does not
take any responsibility of our financial soundness or for the correctness of any of the statements
made or opinions expressed in this behalf.

In view of the approvals listed below, we can undertake this Issue and our current business activities
and no further major approvals from any governmental or regulatory authority or any other entities are
required to undertake the Issue or continue our business activities. Unless otherwise stated, these
approvals are all valid as of the date of this Draft Letter of Offer.

Incorporation Details

Certificate of Incorporation No. 2241 of 1934/35 dated 25th January, 1935 is issued to Shree Ram
Urban Infrastructure Limited by the Registrar of Companies, Maharashtra. The Company Identification
Number is L17110MH1935PLC002241.

Consequent to the change of name, Shree Ram Urban Infrastructure Limited was issued certificate of
change of name on 20th March, 2007 by the Registrar of Companies, Maharashtra, pursuant to
resolution passed by our company on 22nd November, 2006 in terms of Section 21 of the Companies
Act, 1956.

Approvals for the Issue

Corporate Approvals

The Issue is authorised pursuant to the resolution passed in the meeting of the Board of Directors of
th
Shree Ram Urban Infrastructure Limited held on 29 April, 2010.

Approvals from the Stock Exchange

We have received in-principle approvals from BSE for the listing of the Equity Shares issued through
this Rights Issue pursuant to letter dated [●]

Approvals to carry on our Business

Described below are the various approvals obtained by us:

Tax Approvals

Name of Registration Number

Permanent Account Number (―PAN‖) AACCS0454P
Tax Deduction Account Number (―TAN‖) MUMS37641C
Central Sales Tax Number (―CST‖) 27720044754C
Tax Payer Identification Numbers (―TIN‖) 27720044754V
Service Tax Number AACCSO454PST001
Registration Number under Maharashtra Value Added Tax Act, 2002 MH01 V 670602
Certificate under Maharashtra State Tax on Professions, Trades, 11002708301588P
Callings and Employment Act, 1976

140
Other Approvals

Details of the Approval Reference No.

Registration Number under Bombay Shops And Establishments Act, 760033242
1948
Certificate of Registration under the Contract Labour (Regulation and CL/CLA/Regn/Pvt/139/G
Abolition) Act, 1970
Registration of Employees under the Employees State Insurance Act, Employer Code No. 31-
1948. 1011-11
Importer – Exporter Code (IEC) 0307046460

Approvals for our Project:

We require various approvals to carry on our construction and development activities as mentioned
below:

 Building plan approval.

 Intimation of Disapproval (“IOD”) - This is given for each individual building on any plot. This
gives approval to a detailed plan for that building thereby finalizing all the detail parameters of that
particular building.

 Commencement Certificate (“CC”) - This gives permission to commence the work on site.

 Further Commencement Certificate - This is issued after completion of the plinth of any building or
Stilt slab where the building comprises Stilt and upper floors. This permits commencement of
work on the upper floors to the terrace of the building unless specified otherwise.

 No Objection Certificate (“NOC”) granted by the Chief Fire Officer. This NOC is granted in
respect of buildings which would exceed 24 metres of height.

 Occupation Certificate (“OC”) - This is issued after the entire construction work on site is
completed and the structure is fit for occupation by complying with all the conditions.

 Non- Agricultural Order (“NA Order”) / Change of Land Use Permission / Conversion order
(nomenclature changes in accordance with the city in which the project is based).

 Environmental clearance from State Environment Impact Assessment Authority constituted by

Government of India is required for projects with built-up area of 20,000 Sq. Mtrs. or more (but
less than 1,50,000 Sq. Mtrs.).

We are still in the process of developing the project, which falls in the category of Residential Project.
Our projects are being developed on the land owned by us (subject to the conditions mentioned in the
approvals that we have received) and charged to ICICI Bank as security towards a Rupee Term Loan
Facility availed by us.

In relation to the projects undertaken, we have obtained and in some cases are in the process of
obtaining the following government approvals:

Approvals Received by the Company for its Residential Project: “Palais Royale”

Sr. Description Reference Issuing Date of Issue Date of Expiry

No. Number Authority
1. CC for EEBPC / 987 / Municipal Issued on The CC is valid
Construction GS / A Corporation of 24/02/2005 and for a period of
Greater Mumbai re-endorsed on one year from
24/01/2008 and the date of issue
06/07/2010 and/or re-
endorsement

141
2. IOD EB / 987 / GS / A Municipal 24/01/2005 23/01/2006
Corporation of
Greater Mumbai
3. Approval of EB / 987 / GS / A Municipal 12/07/2005 Not provided for
Amended Plan Corporation of
Greater Mumbai
4. Approval of EB / 987 / GS / A Municipal 07/11/2007 Not Provided for
Amended Plan Corporation of
Greater Mumbai
5. Approval of EB / 987 / GS / A Municipal 02/02/2009 Not provided for
Amended Plan Corporation of
Greater Mumbai
6. No Objection FBM / 506 / 469 Chief Fire 30/12/2006 N.A.
Certificate from Officer, Mumbai
Chief Fire Officer Fire Brigade
7. No Objection Ch. E / HRB-82 / Municipal 16/01/2009 N.A.
Certificate for DPWS Corporation of
Development of Greater Mumbai
High Rise
Building
8. Environment 21–112 / 2006 – The Ministry of 31/08/2006 N.A.
Clearance I A.III Environment
and Forests
9. Environment ROM / CC / O-575 The 12/06/2009 N.A.
Clearance Maharashtra
(Unit I) Pollution Control
Board
10. Environment ROM / CC / AW / The 04/08/2008 N.A.
Clearance 382 Maharashtra
(Unit II) Pollution Control
Board
11. Environment DYCHE / 1296 / Environment 04/11/2011 N.A.
Clearance for ENV Section of
ready mix Municipal
concrete plant Corporation of
Greater Mumbai
12. License in USR-046 / WRLO- Joint Wireless 12/11/2009 30/09/2010
respect of Fixed / 08 / 1-07 Advisor, WPC
Land / Land
Mobile / Station
1-10 sets
13. No Objection TPB 4304 / 2686 / Secretary to the 21/06/2005 N.A.
Certificate for CR-22 / 05 / UD- Government of
closure of the mill 11 Maharashtra
and
redevelopment of
land
14. Factory License - Assistant 01/04/2009 31/03/2011
Commissioner,
GS Ward,
Municipal
Corporation of
Greater Mumbai
15. License u/s 394 - Municipal 27/12/2009 26/12/2010
of Mumbai Corporation of
Municipal Greater Mumbai
Corporation Act

142
Pending Approvals:

Sr. Description Issuing

No Authority
.
1. The consent order (No.: ROM / CC / AW / 382) issued by Maharashtra The
Pollution Control Board dated 4th August 2008, whereby consent was Maharashtra
granted under Section 26 of the Water (Prevention and Control of Pollution) Pollution
Act, 1974, under Section 21 of the Air (Prevention and Control of Pollution) Control Board
Act, 1981 and Authorization / Renewal of Authorization under Rule 5 of the
Hazardous Wastes (Management and Handling) Rules, 1989, and as
amended up to year 2003 framed under the Environmental (Protection) Act,
1986, authorizing us to operate facilities and to manufacture the products as
mentioned in the consent order subject to the terms and conditions stipulated
therein, was valid upto 31st July 2010. We still have to renew the same.
2. We have submitted forms for allotment of National Social Security Number Regional P. F.
(NSSN) to Employees‘ Provident Fund Organisation in respect of 12 Commissioner
employees, via letter dated 3rd January 2008 addressed to the Regional P F
Commissioner. The NSSN numbers are still to be allotted.
3. We have applied to the Registrar of Trade Marks for registration of our logo Registrar of
under Class 36. The logo has been advertised before acceptance as per Trade Marks
Section 20(1) of the Trademarks Act, 1999, on page 1923 of the Trade
Marks Journal No. 1435 dated 1st March 2010. The same is pending
registration.
4. We have been granted permission vide a License Authorisation annexed to Joint Wireless
th
License No. USR-531/WRLO-09/1-10 dated 19 August, 2009 from file no. Advisor,
L-14028/01/WRLO-09, to use ―PACER PLUS‖, ―Motorola‖ Walky-Talky sets. Ministry of
th
The license was valid upto 30 June, 2010. We still have to renew the same. Communication
& IT, RLO
Mumbai.

Except as stated above, we have received the necessary consents, licenses, permissions and
approvals from the government and various governmental agencies required for our present business
and no further approvals are required for carrying on our present business.
.

143
 OTHER REGULATORY AND STATUTORY DISCLOSURES

AUTHORITY FOR THE PRESENT ISSUE

The Issue is authorised pursuant to a board resolution under section 81(1) of the Companies Act,
th
1956 dated 29 April, 2010.

The details of the Rights Issue to the existing shareholders of the Company as decided in the Rights
th
Issue Committee meeting held on 25 May, 2010 are as follows:

Issue of [●] Equity Shares of Rs. 10/- each at a premium of Rs. [●] per equity share (Issue Price
of Rs. [●]) aggregating upto Rs. 7500.00 Lacs on rights basis to the existing Equity
Shareholders of the Company in the ratio of [●] Equity Share for every [●] Equity Share held on
[●] (Record Date). The ratio and number of shares will be decided by the Board prior to the
issue at the appropriate time as per applicable rules/regulations.

PROHIBITION BY SEBI

Neither our Company, nor our Promoters, our Directors or any of the Promoter Group Entities, or
companies or entities with which the Company‘s Directors are associated with, as directors or
promoters, or persons in control of our Promoters have been prohibited from accessing or operating in
the capital markets or restrained from buying, selling or dealing in securities under any order or
direction passed by SEBI.

Neither we nor our Directors, our Promoters, Promoter Group Entities or relatives of Promoters have
been identified as wilful defaulters by RBI / Government authorities and there are no proceedings
relating to violations of securities laws pending against them and there are no violations of securities
laws committed by them in the past.

None of our Directors is associated with the Securities Market.

ELIGIBILITY FOR THE ISSUE

Shree Ram Urban Infrastructure Limited is an existing listed Company.

The Company is in compliance as prescribed under Part E of Schedule VIII of the SEBI (ICDR)
Regulations, 2009. It satisfies the following conditions

a. The Company has been filing periodic reports, statements and information in compliance with the
listing agreement for the last three years immediately preceding the date of filing this Draft Letter
of Offer with the designated stock exchange.

b. The reports, statements and information referred to sub-clause (a) above are available on the
website of Bombay Stock Exchange Limited (BSE) one of the recognized stock exchange with
nationwide trading terminals

c. The Company has investor grievance – handling mechanism which includes meeting of the
Shareholder‘s or Investor‘s Grievance Committee at frequent intervals, appropriate delegation of
power by the board of directors of the Company as regards share transfer and have clearly laid
down systems and procedures for timely and satisfactory redressal of investor grievances.

DISCLAIMER CLAUSE

AS REQUIRED, A COPY OF THIS DRAFT LETTER OF OFFER HAS BEEN SUBMITTED TO THE
SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI).

“IT IS TO BE DISTINCTLY UNDERSTOOD THAT SUBMISSION OF DRAFT LETTER OF OFFER

TO SEBI SHOULD NOT IN ANY WAY BE DEEMED OR CONSTRUED THAT THE SAME HAS
BEEN CLEARED OR APPROVED BY SEBI. SEBI DOES NOT TAKE ANY RESPONSIBILITY

144
EITHER FOR THE FINANCIAL SOUNDNESS OF ANY SCHEME OR THE PROJECT FOR WHICH
THE ISSUE IS PROPOSED TO BE MADE OR FOR THE CORRECTNESS OF THE STATEMENTS
MADE OR OPINIONS EXPRESSED IN THE OFFER DOCUMENT. LEAD MANAGER, ARYAMAN
FINANCIAL SERVICES LIMITED HAS CERTIFIED THAT THE DISCLOSURES MADE IN THE
DRAFT LETTER OF OFFER ARE GENERALLY ADEQUATE AND ARE IN CONFORMITY WITH
SEBI (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 IN
FORCE FOR THE TIME BEING. THIS REQUIREMENT IS TO FACILITATE INVESTORS TO TAKE
AN INFORMED DECISION FOR MAKING INVESTMENT IN THE PROPOSED ISSUE.

IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE ISSUER COMPANY IS

PRIMARILY RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL
RELEVANT INFORMATION IN THE DRAFT LETTER OF OFFER, LEAD MANAGER IS EXPECTED
TO EXERCISE DUE DILIGENCE TO ENSURE THAT THE COMPANY DISCHARGES ITS
RESPONSIBILITY ADEQUATELY IN THIS BEHALF AND TOWARDS THIS PURPOSE, THE LEAD
MANAGER ARYAMAN FINANCIAL SERVICES LIMITED HAS FURNISHED TO SEBI A DUE
TH
DILIGENCE CERTIFICATE DATED 30 OCTOBER, 2010 WHICH READS AS FOLLOWS:

1. WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO

LITIGATIONS LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTES WITH
COLLABORATORS ETC. AND OTHER MATERIAL IN CONNECTION WITH THE
FINALISATION OF THE DRAFT LETTER OF OFFER PERTAINING TO THE SAID ISSUE;

2. ON THE BASIS OF SUCH EXAMINATION AND THE DISCUSSIONS WITH THE COMPANY,
ITS DIRECTORS AND OTHER OFFICERS, OTHER AGENCIES, INDEPENDENT
VERIFICATION OF THE STATEMENTS CONCERNING THE OBJECTS OF THE ISSUE, PRICE
JUSTIFICATION AND THE CONTENTS OF THE DOCUMENTS OTHER PAPERS FURNISHED
BY THE COMPANY, WE CONFIRM THAT:

a. THE DRAFT LETTER OF OFFER FILED WITH THE BOARD IS IN CONFORMITY WITH
THE DOCUMENTS, MATERIALS AND PAPERS RELEVANT TO THE ISSUE;

b. ALL THE LEGAL REQUIREMENTS TO THE SAID ISSUE AS ALSO THE GUIDELINES,
INSTRUCTIONS, ETC. FRAMED/ISSUED BY THE BOARD, THE CENTRAL
GOVERNMENT AND ANY OTHER COMPETENT AUTHORITY IN THIS BEHALF HAVE
BEEN DULY COMPLIED WITH; AND

c. THE DISCLOSURES MADE IN THE DRAFT LETTER OF OFFER ARE TRUE, FAIR AND
ADEQUATE TO ENABLE THE INVESTORS TO MAKE A WELL INFORMED DECISION AS
TO THE INVESTMENT IN THE PROPOSED ISSUE AND SUCH DISCLOSURES ARE IN
ACCORDANCE WITH THE REQUIREMENTS OF THE COMPANIES ACT, 1956, THE SEBI
(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 AND
OTHER APPLICABLE LEGAL REQUIREMENTS.

3. WE CONFIRM THAT BESIDES OURSELVES, ALL THE INTERMEDIARIES NAMED IN THE

DRAFT LETTER OF OFFER ARE REGISTERED WITH THE BOARD AND THAT TILL DATE
SUCH REGISTRATION IS VALID.

4. WE HAVE SATISFIED OURSELVES ABOUT THE CAPABILITY OF THE UNDERWRITERS TO

FULFIL THEIR UNDERWRITING COMMITMENTS – NOT APPLICABLE AS THE ISSUE IS
NOT UNDERWRITTEN.

5. WE CERTIFY THAT WRITTEN CONSENT FROM PROMOTERS HAS BEEN OBTAINED FOR
INCLUSION OF THEIR SPECIFIED SECURITIES AS PART OF PROMOTERS‟
CONTRIBUTION SUBJECT TO LOCK-IN AND THE SPECIFIED SECURITIES PROPOSED TO
FORM PART OF PROMOTERS‟ CONTRIBUTION SUBJECT TO LOCK-IN SHALL NOT BE
DISPOSED/ SOLD/ TRANSFERRED BY THE PROMOTERS DURING THE PERIOD STARTING
FROM THE DATE OF FILING THE DRAFT LETTER OF OFFER WITH THE BOARD TILL THE
DATE OF COMMENCEMENT OF LOCK-IN PERIOD AS STATED IN THE DRAFT LETTER OF
OFFER. – NOT APPLICABLE AS THE PRESENT ISSUE IS A RIGHTS ISSUE.

145
6. WE CERTIFY THAT REGULATION 33 OF THE SECURITIES AND EXCHANGE BOARD OF
INDIA (ISSUES OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009,
WHICH RELATES TO SPECIFIED SECURITIES INELIGIBLE FOR COMPUTATION OF
PROMOTERS CONTRIBUTION, HAS BEEN DULY COMPLIED WITH AND APPROPRIATE
DISCLOSURES AS TO COMPLIANCE WITH THE SAID REGULATION HAVE BEEN MADE IN
THE DRAFT LETTER OF OFFER – NOT APPLICABLE AS THE PRESENT ISSUE IS A
RIGHTS ISSUE.

7. WE UNDERTAKE THAT SUB-REGULATION (4) OF REGULATION 32 AND CLAUSE (C ) AND

(D) OF SUB-REGULATION (2) OF REGULATION 8 OF THE SEBI (ISSUE OF CAPITAL AND
DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 SHALL BE COMPLIED WITH. WE
CONFIRM THAT ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT PROMOTERS‟
CONTRIBUTION SHALL BE RECEIVED AT LEAST ONE DAY BEFORE THE OPENING OF
THE ISSUE. WE UNDERTAKE THAT AUDITORS‟ CERTIFICATE TO THIS EFFECT SHALL BE
DULY SUBMITTED TO THE BOARD. WE FURTHER CONFIRM THAT ARRANGEMENTS
HAVE BEEN MADE TO ENSURE THAT PROMOTERS‟ CONTRIBUTION SHALL BE KEPT IN
AN ESCROW ACCOUNT WITH A SCHEDULED COMMERCIAL BANK AND SHALL BE
RELEASED TO THE ISSUER ALONG WITH THE PROCEEDS OF THE PUBLIC ISSUE. - NOT
APPLICABLE AS THE PRESENT ISSUE IS RIGHTS ISSUE.

8. WE CERTIFY THAT THE PROPOSED ACTIVITIES OF THE ISSUER FOR WHICH THE FUNDS
ARE BEING RAISED IN THE PRESENT ISSUE FALL WITHIN THE “MAIN OBJECTS” LISTED
IN THE OBJECT CLAUSE OF THE MEMORANDUM OF ASSOCIATION OR OTHER
CHARTER OF THE ISSUER AND THAT THE ACTIVITIES WHICH HAVE BEEN CARRIED OUT
UNTIL NOW ARE VALID IN TERMS OF THE OBJECT CLAUSE OF ITS MEMORANDUM OF
ASSOCIATION.

9. WE CONFIRM THAT NECESSARY ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT

THE MONIES RECEIVED PURSUANT TO THE ISSUE ARE KEPT IN A SEPARATE BANK
ACCOUNT AS PER THE PROVISIONS OF SUB SECTION (3) OF SECTION 73 OF THE
COMPANIES ACT, 1956 AND THAT SUCH MONIES SHALL BE RELEASED BY THE SAID
BANK ONLY AFTER PERMISSION IS OBTAINED FROM ALL THE STOCK EXCHANGE
MENTIONED IN THE DRAFT LETTER OF OFFER. WE FURTHER CONFIRM THAT THE
AGREEMENT ENTERED INTO BETWEEN THE BANKERS TO THE ISSUE AND THE ISSUER
SPECIFICALLY CONTAINS THIS CONDITION.

10. WE CERTIFY THAT A DISCLOSURE HAS BEEN MADE IN THE DRAFT LETTER OF OFFER
THAT THE INVESTORS SHALL BE GIVEN AN OPTION TO GET THE SHARES IN DEMAT OR
PHYSICAL MODE.

11. WE CERTIFY THAT ALL APPLICABLE DISCLOSURES MANDATED IN SECURITIES AND

EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS)
REGULATIONS, 2009 HAVE BEEN MADE IN THE ADDITION TO DISCLOSURES WHICH, IN
OUR VIEW, ARE FAIR AND ADEQUATE TO ENABLE THE INVESTOR TO MAKE A WELL
INFORMED DECISION.

12. WE CERTIFY THAT THE FOLLOWING DISCLOSURES HAVE BEEN MADE IN THE DRAFT
LETTER OF OFFER:

a. AN UNDERTAKING FROM THE ISSUER THAT AT ANY GIVEN TIME THERE SHALL BE
ONLY ONE DENOMINATION FOR THE SHARES OF THE COMPANY AND

b. AN UNDERTAKING FROM THE ISSUER THAT IT SHALL COMPLY WITH SUCH

DISCLOSURE AND ACCOUNTING NORMS SPECIFIED BY THE BOARD FROM TIME TO
TIME.

13. WE UNDERTAKE TO COMPLY WITH THE REGULATIONS PERTAINING TO THE

ADVERTISEMENT IN TERMS OF SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE
OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 WHILE MAKING
THE ISSUE.

146
14. WE ENCLOSE A NOTE EXPLAINING HOW THE PROCESS OF DUE DILIGENCE HAS BEEN
EXERCISED BY US IN VIEW OF THE NATURE OF CURRENT BUSINESS BACKGROUND OF
THE ISSUER, SITUATION AT WHICH THE PROPOSED BUSINESS STANDS, THE RISK
FACTORS, PROMOTERS‟ EXPERIENCE, ETC.

15. WE ENCLOSE A CHECKLIST CONFIRMING REGULATION WISE COMPLIANCE WITH THE

APPLICABLE PROVISIONS OF SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF
CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009, CONTAINING
DETAILS SUCH AS THE REGULATION NUMBER, ITS TEXT, THE STATUS OF
COMPLIANCE, PAGE NUMBER OF THE DRAFT LETTER OF OFFER WHERE THE
REGULATION HAS BEEN COMPLIED WITH AND OUR COMMENTS, IF ANY.

THE FILING OF THE OFFER DOCUMENT DOES NOT, HOWEVER, ABSOLVE THE ISSUER
FROM ANY LIABILITIES UNDER SECTION 63 OR SECTION 68 OF THE COMPANIES ACT, 1956
OR FROM THE REQUIREMENT OF OBTAINING SUCH STATUTORY OR OTHER CLEARANCES
AS MAY BE REQUIRED FOR THE PURPOSE OF THE PROPOSED ISSUE. SEBI FURTHER
RESERVES THE RIGHT TO TAKE UP, AT ANY POINT OF TIME; WITH THE LEAD MANAGER
ANY IRRREGULARITIES OR LAPSES IN OFFER DOCUMENT”.

CAUTION STATEMENT / DISCLAIMER CLAUSE OF THE ISSUER AND THE LEAD MANAGER

The Issuer Company and the Lead Manager accept no responsibility for statements made
otherwise than in this Offer Document or in the advertisement or in any other material issued
by or at the instance of the Company and the Lead Manager and any one placing reliance on
any other source of information would be doing so at his/her/their own risks.

DISCLAIMER CLAUSE OF THE BSE

As required, a copy of this Draft Letter of Offer has been submitted to BSE. The Disclaimer Clause as
intimated by BSE to us, post scrutiny of this Draft Letter of Offer, shall be included in the Letter of
Offer prior to filing with the Stock Exchange.

DISCLAIMER IN RESPECT OF JURISDICTION

This offer is being made in India to persons resident in India (including Indian nationals resident in
India who are majors, Hindu Undivided Families, companies, corporate bodies and societies
registered under the applicable laws in India and authorized to invest in shares, Indian mutual funds
registered with SEBI, Indian financial institutions, commercial banks, regional rural banks, co-
operative banks (subject to RBI permission), Trusts registered under the Societies Registration Act,
1860, or any other Trust law and who are authorized under their constitution to hold and invest in
shares), Foreign Collaborators and to NRIs, OCBs and FIIs as defined under the Indian laws. This
Offer Document does not, however, constitute an offer to sell or an invitation to subscribe to securities
issued hereby in any jurisdiction other than India. Any person into whose possession this Offer
Document comes is required to inform himself about and to observe any such restrictions. Any
dispute arising out of this Offer will be subject to the jurisdiction of appropriate court(s) in Mumbai,
State of Maharashtra, India only.

No action has been or will be taken to permit a public offering in any jurisdiction where action would
be required for that purpose, except that this Offer Document has been submitted to the SEBI.
Accordingly, the equity shares represented thereby may not be offered or sold, directly or indirectly,
and this Offer Document may not be distributed, in any jurisdiction, except in accordance with the
legal requirements applicable in such jurisdiction. Neither the delivery of Offer Document nor any sale
hereunder shall, under any circumstances, create any implication that there has been no change in
the affairs of the Shree Ram Urban Infrastructure Limited since the date hereof or that the information
contained herein is correct as of any time subsequent to this date.

FILING

147
A copy of this Draft Letter of Offer has been filed with SEBI at SEBI Bhavan, Plot No. C-4A, G-Block,
Bandra Kurla Complex, Bandra (East), Mumbai – 400 051 and with Bombay Stock Exchange Limited
(BSE) at Phiroze Jeejeebhoy Towers, Dalal Street, Fort, Mumbai.

EXPENSES OF THE ISSUE

The total expenses of the issue are estimated to be Rs. [●] Lacs. All expenses with respect to the
issue would be met out of the proceeds of the issue. The split of issue expenses is as under:

Expense
Sr. Expense Expense (% of
Particulars (% of Total
No. (Rs. in Lacs) issue size)
Expenses)
1 Fees to Intermediaries [●] [●] [●]
2 Fees to SEBI and Stock Exchange [●] [●] [●]
Printing and Stationary (includes
3 [●] [●] [●]
Postage and Dispatch)
4 Advertisement [●] [●] [●]
5 Legal Expenses [●] [●] [●]
6 Miscellaneous Expenses [●] [●] [●]
Total [●] [●] [●]
* The details shall be finalized at the time of filing the Letter of Offer with the Stock Exchange.

INVESTOR GRIEVANCE REDRESSAL SYSTEM

The investor grievances against the Company are handled by the Registrars and Transfer Agent in
consultation with the secretarial department of the Company. To handle the grievances received, the
Company has appointed Ms. Manju Batham, as the Compliance Officer. She will supervise redressal
of complaints received from the investors at the office of the Company as well as the Registrars to the
Rights Issue and ensure timely settlement.

All grievances related to the offer may be addressed to the Registrar to the Rights Issue quoting the
application No. (Including prefix), Number of equity shares applied for, amount paid on application,
date, Bank and branch/ Collection center where application was submitted.

The normal time taken by the Company for redressal of investor grievance is given below:

Sr. Normal Time Taken

Type of Request
No. (No. of Days)
1 Issue of Duplicate Share Certificate Within 30 days
2 Transfer of shares Within 30 days
3 Transmission of shares Within 30 days
4 Demat / Remat of shares Within 30/21 days
5 Non receipt of dividend Within 15 to 30 days
6 Non receipt of Annual Report Within 7 to 15 days
7 Change of residential address / Bank mandate Within 15 to 30 days
8 Consolidation / split of share certificates Within 30 days

148
 SECTION VIII – OFFERING INFORMATION
TERMS OF THE ISSUE

The Equity Shares proposed to be issued on rights basis, are subject to the terms and conditions
contained in the Draft Letter of Offer, the enclosed CAF, the Memorandum of Association and Articles
of Association of the Company, the provisions of the Companies Act, the terms and conditions as may
be incorporated in the Foreign Exchange Management Act, 1999, as amended (―FEMA‖), guidelines
and regulations issued by SEBI, guidelines, notifications and regulations for issue of capital and for
listing of securities issued by GoI and/or other statutory authorities and bodies from time to time,
terms and conditions as stipulated in the allotment advice or security certificate and rules as may be
applicable and introduced from time to time..

Basis for the Issue

The Equity Shares are being offered for subscription for cash to those existing Equity Shareholders
whose names appear as beneficial owners as per the list to be furnished by the depositories in
respect of the shares held in the electronic form and on the Register of Members of the Company in
respect of shares held in the physical form at the close of business hours on the Record Date i.e. [●]
fixed in consultation with the Designated Stock Exchange.

Rights Entitlement

As your name appears as beneficial owner in respect of Equity Shares held in the electronic form or
appears in the register of members as an Equity Shareholder of the Company as on the Record Date,
i.e., [●], you are entitled to the number of Equity Shares as set out in Part A of the enclosed CAFs.

PRINCIPAL TERMS OF THE EQUITY SHARES

Face value

Each Equity Share shall have the face value of Rs. 10

Issue Price

Each Equity Share shall be offered at an Issue Price of Rs. [●] for cash at a premium of Rs. [●] per
Equity Share. The Issue Price has been arrived in consultation between the Company and the Lead
Manager.

Rights Entitlement Ratio

The Equity Shares are being offered on rights basis to the existing Equity Shareholders of the
Company in the ratio of [●] Equity Shares for every [●] Equity Shares held as on the Record Date.

Terms of payment

The entire Issue Price of Rs. [●] per Share is payable on application only.

Fractional entitlements

If the shareholding of any of the equity shareholders is not in the multiples of [●] then the fractional
entitlement of such shareholders shall be rounded off to the next higher integer, subject to the
minimum entitlement of 1 equity share. The equity shares needed for rounding off will be adjusted
from the promoters‘ entitlement.

Ranking of the Equity Shares

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The Equity Shares shall be subject to the Memorandum and Articles of Association of the Company
and shall rank pari passu in all respects including dividends with the existing Equity Shares of the
Company.

Listing and trading of Equity Shares proposed to be issued

The Company‘s existing Equity Shares are currently traded on the Stock Exchange under the ISIN
INE164H01011. The fully paid up Equity Shares proposed to be issued on a rights basis shall be
listed and admitted for trading on the Stock Exchange under the existing ISIN for fully paid Equity
Shares of the Company.

The listing and trading of the Equity Shares shall be based on the current regulatory framework
applicable thereto. Accordingly, any change in the regulatory regime would accordingly affect the
schedule.

The Equity Shares allotted pursuant to this Issue will be listed as soon as practicable but in no case
later than seven working days from the finalisation of the basis of allotment. The Company has made
an application for ―in-principle‖ approval for listing of the Equity Shares to the BSE through letter dated
[●] and has received such approval from the BSE pursuant to the letter no. [●], dated [●].

Rights of the Equity Shareholder

Subject to applicable laws, the equity shareholders shall have the following rights:

• Right to receive dividend, if declared;

• Right to attend general meetings and exercise voting powers, unless prohibited by law;
• Right to vote on a poll in person or by proxy;
• Right to receive offers for rights shares and be allotted bonus shares, if announced;
• Right to receive surplus on liquidation;
• Right to free transferability of Equity shares; and
• Such other rights as may be available to a shareholder of a listed public Company under the
Companies Act and Memorandum and Articles of Association.

General Terms of the Issue

Market lot

The Equity Shares of the Company are tradable only in dematerialized form. The market lot for Equity
Shares in dematerialized mode is one. In case of holding in physical form, the Company would issue
to the allottees one certificate for the Equity Shares allotted to one folio (―Consolidated Certificate‖).

Joint-holders

Where two or more persons are registered as the holders of any Equity Shares, they shall be deemed
to hold the same as joint-tenants with benefits of survivorship subject to provisions contained in the
Articles of Association of the Company.

Nomination facility

In terms of Section 109A of the Act, nomination facility is available in case of Equity Shares. The
applicant can nominate any person by filling the relevant details in the CAF in the space provided for
this purpose.

A sole Equity Shareholder or first Equity Shareholder, along with other joint Equity Shareholders being
individual(s) may nominate any person(s) who, in the event of the death of the sole holder or all the
joint-holders, as the case may be, shall become entitled to the Equity Shares. A Person, being a
nominee, becoming entitled to the Equity Shares by reason of the death of the original Equity
Shareholder(s), shall be entitled to the same advantages to which he would be entitled if he were the
registered holder of the Equity Shares. Where the nominee is a minor, the Equity Shareholder(s) may
also make a nomination to appoint, in the prescribed manner, any person to become entitled to the

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Equity Share(s), in the event of death of the said holder, during the minority of the nominee. A
nomination shall stand rescinded upon the sale of the Equity Share by the person nominating. A
transferee will be entitled to make a fresh nomination in the manner prescribed. When the Equity
Share is held by two or more persons, the nominee shall become entitled to receive the amount only
on the demise of all the holders. Fresh nominations can be made only in the prescribed form available
on request at the registered office of the Company or such other person at such addresses as may be
notified by the Company. The applicant can make the nomination by filling in the relevant portion of
the CAF.

Only one nomination would be applicable for one folio. Hence, in case the Equity Shareholder(s) has
already registered the nomination with the Company, no further nomination needs to be made for
Equity Shares to be allotted in this Issue under the same folio.

In case the allotment of Equity Shares is in dematerialized form, there is no need to make a
separate nomination for the Equity Shares to be allotted in this Issue. Nominations registered
with respective DP of the applicant would prevail. If the applicants want to change their
nomination, they are requested to inform their respective DP.

Notices

All notices to the Equity Shareholder(s) required to be given by the Company shall be published in
one English national daily with wide circulation and one Hindi national daily and one regional
language daily newspaper with wide circulation at the place where registered office of the Company is
situated and / or will be sent by ordinary post to the registered holders of the Equity Share from time
to time.

Additional Subscription by the Promoter

The Promoters have confirmed that they intend to subscribe to the full extent of their Rights
Entitlement in the Issue. Subject to compliance with the Takeover Code, the Promoters and Promoter
Group reserve their right to subscribe for Equity Shares in this Issue by subscribing for renunciation, if
any, made by any other Promoters or Promoter Group or any other shareholders. The Promoters
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have provided an undertaking dated 7 October, 2010 to the Company to apply for additional Equity
Shares in the Issue, to the extent of the unsubscribed portion of the Issue. As a result of this
subscription and consequent allotment, the Promoters and Promoter Group may acquire Equity
Shares over and above their Rights Entitlement in the Issue, which may result in an increase of the
shareholding being above the current shareholding with the Rights Entitlement. This subscription and
acquisition of additional Equity Shares by the Promoters and Promoter Group through this Issue to the
extent of under subscription, if any, will not result in change of control of the management of the
Company and shall be exempt in terms of proviso to Regulation 3(1)(b)(ii) of the Takeover Code. As
such, other than meeting the requirements indicated in the section ―Objects of the Issue‖ on page 17,
there is no other intention/purpose for this Issue, including any intention to delist the Company, even
if, as a result of allotments to the Promoters and Promoter Group, in this Issue, the Promoters‘
shareholding in the Company exceeds their current shareholding. The Promoters and Promoter
Group shall subscribe to such unsubscribed portion as per the relevant provisions of the law.
Allotment to the Promoters and Promoter Group of any unsubscribed portion, over and above their
Rights Entitlement shall be done in compliance with the Listing Agreement and other applicable laws
prevailing at that time relating to continuous listing requirements. For details, please see the section
―Basis of Allotment‖ on page 158.

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 ISSUE PROCEDURE

The CAF would be printed in black ink for all shareholders. An additional separate advise for
nonresident shareholders will be provided. In case the original CAF is not received by the applicant or
is misplaced by the applicant, the applicant may request the Registrars to the Issue, M/s. Bigshare
Services Pvt. Ltd., for issue of a duplicate CAF, by furnishing the registered folio number, DP ID
Number, Client ID Number and their full name and address. Non-resident shareholders can obtain a
copy of the CAF from the Registrars to the Issue, M/s. Bigshare Services Pvt. Ltd., from their office
located at E/2, Ansa Industrial Estate, Sakivihar Road, Sakinaka, Andheri (E), Mumbai – 400 072, by
furnishing the registered folio number, DP ID number, Client ID number and their full name and
address.

Acceptance of the Issue

You may accept the Issue and apply for the Equity Shares offered, either in full or in part by filling Part
A of the enclosed CAF and submit the same along with the Application Money payable to the Bankers
to the Issue or any of the branches as mentioned on the reverse of the CAF before the close of the
banking hours on or before the Issue Closing Date or such extended time as may be specified by the
Board thereof in this regard. Applicants at centers not covered by the branches of collecting banks
can send their CAF together with the cheque /demand draft, net of bank and postal charges, payable
at Mumbai to the Registrar to the Issue by registered post. Such applications sent to anyone other
than the Registrar to the Issue are liable to be rejected. The applications received through registered
post shall be dealt with by the Registrars to the Issue in the normal course.

Offer to Non-Resident Equity Shareholders/Applicants

As per Regulation 6 of notification No. FEMA 20/200-RB dated May 3, 2000 the RBI has given
general permission to Indian companies to issue rights shares to non-resident shareholders including
additional shares. Applications received from NRIs and non-residents for allotment of Equity Shares
shall be inter alia, subject to the conditions imposed from time to time by the RBI under the Foreign
Exchange Management Act, 1999 (FEMA) in the matter of refund of application moneys, allotment of
Equity Shares, issue of letter of allotment / notification No. FEMA 20/200-RB dated May 3, 2000. The
Board of Directors may at its absolute discretion, agree to such terms and conditions as may be
stipulated by RBI while approving the allotment of Equity Shares, payment of dividend etc. to the non-
resident shareholders. The rights shares purchased by non-residents shall be subject to the same
conditions including restrictions in regard to the repatriability as are applicable to the original shares
against which rights shares are issued.
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By virtue of Circular No. 14 dated 16 September, 2003 issued by the RBI, overseas corporate bodies
(―OCBs‖) have been derecognized as an eligible class of investors and the RBI has subsequently
issued the Foreign Exchange Management (Withdrawal of General Permission to Overseas
Corporate Bodies (OCBs)) Regulations, 2003. Accordingly, OCBs shall not be eligible to subscribe to
the Equity Shares. The RBI has however clarified in its circular, A.P. (DIR Series) Circular No. 44,
th
dated 8 December, 2003 that OCBs which are incorporated and are not under the adverse notice of
the RBI are permitted to undertake fresh investments as incorporated nonresident entities. Thus,
OCBs desiring to participate in this Issue must obtain prior approval from the RBI. On providing such
approval to the Company at its registered office, the OCB shall receive the Draft Letter of Offer and
the CAF.

Draft Letter of Offer and CAF shall only be dispatched to non-resident Equity Shareholders with
registered address in India.

Option available to the Equity Shareholders

The Composite Application Form clearly indicates the number of Equity Shares that the Equity
Shareholder is entitled to. If the Equity Shareholder applies for an investment in Equity Shares, then
he can:

• Apply for his entitlement in part;

• Apply for his entitlement in part and renounce the other part;

152
 • Apply for his entitlement in full;
• Apply for his entitlement in full and apply for additional Equity Shares.
• Renounce his Rights Entitlement in full.

Renouncees for Equity Shares can apply for the Equity Shares renounced to them and also apply for
additional Equity Shares.

Additional Equity Shares

You are eligible to apply for additional Equity Shares over and above your Rights Entitlement,
provided that you have applied for all the Equity Shares offered without renouncing them in whole or
in part in favour of any other person(s). Applications for additional Equity Shares shall be considered
and allotment shall be made at the sole discretion of the Board, subject to sectoral caps and in
consultation if necessary with the Designated Stock Exchange and in the manner prescribed under
―Basis of Allotment‖ on page 158.

If you desire to apply for additional Equity Shares, please indicate your requirement in the place
provided for additional Equity Shares in Part A of the CAF. The Renouncee applying for all the Equity
Shares renounced in their favour may also apply for additional Equity Shares.

Where the number of additional Equity Shares applied for exceeds the number available for allotment,
the allotment would be made on a fair and equitable basis in consultation with the Designated Stock
Exchange.

Renunciation

This Issue includes a right exercisable by you to renounce the Equity Shares offered to you either in
full or in part in favour of any other person or persons. Your attention is drawn to the fact that our
Company shall not allot and/or register Equity Shares in favour of more than three persons (including
joint holders), partnership firm(s) or their nominee(s), minors, HUF(s), any trust or society (unless the
same is registered under the Societies Registration Act, 1860 or the Indian Trust Act, 1882 or any
other applicable law relating to societies or trusts and is authorized under its constitution or bye laws
to hold Equity Shares, as the case may be).

Any renunciation from resident Indian Shareholder(s) to Non/resident Indian(s) or from Non/resident
Indian Shareholder(s) to Resident Indian(s) is subject to the renouncer(s)/Renouncee(s) obtaining the
approval of the FIPB and/or necessary permission of the RBI under the FEMA and such permissions
should be attached to the CAF. Applications not accompanied by the aforesaid approvals are liable to
be rejected.
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By virtue of the Circular No. 14 dated 16 September, 2003 issued by the RBI, Overseas Corporate
Bodies (―OCBs‖) have been derecognized as an eligible class of investors and the RBI has
subsequently issued the Foreign Exchange Management (Withdrawal of General Permission to
Overseas Corporate Bodies (OCBs) Regulations, 2003. Accordingly, the existing Equity Shareholders
of our Company who do not wish to subscribe to the Equity Shares being offered but wish to renounce
the same in favour of Renouncee shall not renounce the same (whether for consideration or
otherwise) in favour of OCB(s).

‗Part A‘ of the CAF must not be used by any person(s) other than those in whose favour this offer has
been made. If used, this will render the application invalid. Submission of the enclosed CAF to the
Banker to the Issue at its collecting branches specified on the reverse of the CAF with the form of
renunciation (‗Part B‘ of the CAF) duly filled in shall be conclusive evidence for the Company of the
Renouncees applying for Equity Shares in ‗Part C‘ of the CAF to receive allotment of such Equity
Shares. The Renouncees applying for all the Equity Shares renounced in their favour may also apply
for additional Equity Shares. ‗Part A‘ of the CAF must not be used by the Renouncee(s) as this will
render the application invalid. Renouncee(s) will have no further right to renounce any Equity Shares
in favour of any other person.

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Procedure for renunciation

a) To renounce the whole offer in favour of one renounce

If you wish to renounce the offer indicated in Part A, in whole, please complete Part B of the CAF. In
case of joint holding, all joint holders must sign Part B of the CAF. The person in whose favor
renunciation has been made should complete and sign Part C of the CAF. In case of joint
renouncees, all joint renouncees must sign this part of the CAF.

b) To renounce in part/or renounce the whole to more than one person(s)

If you wish to either accept this offer in part and renounce the balance or renounce the entire offer in
favour of two or more renouncees, the CAF must be first split into requisite number of forms.

Please indicate your requirement of split forms in the space provided for this purpose in Part D of the
CAF and return the entire CAF to the Registrar to the Issue so as to reach them latest by the close of
business hours on the last date of receiving requests for split forms. On receipt of the required
number of split forms from the Registrar, the procedure as mentioned in paragraph above shall have
to be followed.

In case the signature of the Equity Shareholder(s), who has renounced the Equity Shares, does not
agree with the specimen registered with the Company, the application is liable to be rejected.

Renouncee(s)
The person(s) in whose favour the Equity Shares are renounced should fill in and sign Part C of the
Application Form and submit the entire Application Form to the Bankers to the Issue on or before the
Issue Closing Date along with the application money.

Change and/ or introduction of additional holders

If you wish to apply for Equity Shares jointly with any other person(s), not more than three, who is/are
not already a joint holder with you, it shall amount to renunciation and the procedure as stated above
for renunciation shall have to be followed. Even a change in the sequence of the name of joint holders
shall amount to renunciation and the procedure, as stated above shall have to be followed.

However, this right of renunciation is subject to the express condition that the Board of Directors of the
Company shall be entitled in its absolute discretion to reject the request for allotment from the
Renouncee(s) without assigning any reason thereof.

Instructions for Options

The summary of options available to the Equity Shareholder is presented below. You may exercise
any of the following options with regard to the Equity Shares offered, using the enclosed CAF:

Sr. No. Option Available Action Required

A Accept whole or part of your entitlement Fill in and sign Part A (All joint holders must
without renouncing the balance. sign)
B Accept your entitlement in full and apply for Fill in and sign Part A including Block III
additional Equity Shares. relating to the acceptance of entitlement and
Block IV relating to additional Equity Shares
(All joint holders must sign).
C Renounce your entitlement in full to one Fill in and sign Part B (all joint holders must
person (Joint renouncees not exceeding sign) indicating the number of Equity Shares
three are considered as one renouncee). renounced and hand over the entire CAF to
the renouncee. The renouncees must fill in
and sign Part C of the CAF (All joint
renouncees must sign).
D Accept a part of your entitlement and Fill in and sign Part D (all joint holders must
renounce the balance to one or more sign) requesting for Split Application Forms.

154
 renouncee(s). Send the CAF to the Registrar to the Issue
so as to reach them on or before the last
OR date for receiving requests for Split Forms.
Splitting will be permitted only once.
Renounce your entitlement to all the Equity
Shares offered to you to more than one On receipt of the Split Form take action as
renouncee. indicated below:

i. For the Equity Shares you wish to

accept, if any, fill in and sign Part A of
one split CAF (only for option 1).

ii. For the Equity Shares you wish to

renounce, fill in and sign Part B
indicating the number of Equity Shares
renounced and hand over the split CAFs
to the renouncees.

iii. Each of the renouncees should fill in

and sign Part C for the Equity Shares
accepted by them.
E Introduce a joint holder or change the This will be treated as a renunciation. Fill in
sequence of joint holders and sign Part B and the renouncees must fill
in and sign Part C.

Please note that:

 Part A of the CAF must not be used by any person(s) other than those in whose favour this
Issue has been made. If used, this will render the application invalid.

 Request for SAF should be made for a minimum of one Equity Share or, in either case, in
multiples thereof and one SAF for the balance Equity Shares, if any.

 Request by the applicant for the Split Application Form should reach the Registrars on or
before [●]

 Only the person to whom this Draft Letter of Offer has been addressed to and not the
renouncee(s) shall be entitled to renounce and to apply for Split Application Forms. Forms
once split cannot be split again.

 Split form(s) will be sent to the applicant(s) by post at the applicant‘s risk.

INVESTORS MAY PLEASE NOTE THAT THE EQUITY SHARES OF THE COMPANY CAN BE
TRADED ON THE STOCK EXCHANGE ONLY IN DEMATERIALIZED FORM.

Application by Resident Equity Shareholders / Applicants

All cheques / drafts accompanying the CAF should be drawn in favour of ―[●]‖ and marked ‗A/c Payee
only‘.

Applicants residing at places other than places where the bank collection centres have been opened
by the Company for collecting applications, are requested to send their applications together with
Demand Draft of amount net of bank and postal charges, for the full application amount favouring ―[●]‖
and marked ‗A/c Payee only‘ payable at Mumbai directly to the Registrar to the Issue by registered
post so as to reach them on or before the Issue Closing Date. The Company or the Registrar to the
Issue will not be responsible for postal delays or loss of applications in transit, if any.

155
Application by Non-Resident Equity Shareholders/ Applicants

As regards the application by non-resident equity shareholders, the following further conditions shall
apply:

Payment by non-residents must be made by demand draft / cheque payable at Mumbai or funds
remitted from abroad in any of the following ways:

Application with repatriation benefits

Payment by NRIs / FIIs / foreign investors must be made by demand draft/cheque payable at Mumbai
or funds remitted from abroad in any of the following ways:

 By Indian Rupee drafts purchased from abroad and payable at Mumbai or funds remitted from
abroad (submitted along with Foreign Inward Remittance Certificate); or

 By cheque / draft on a Non-Resident External Account (NRE) or FCNR Account maintained in

Mumbai; or

 By Rupee draft purchased by debit to NRE / FCNR Account maintained elsewhere in India
and payable in Mumbai; or

 FIIs registered with SEBI must remit funds from special non-resident rupee deposit account.

 All cheques/drafts submitted by non-residents applying on repatriable basis should be drawn

in favour of ―[●]‖ payable at Mumbai and crossed ‗A/c Payee only‘ for the amount payable.

A separate cheque or bank draft must accompany each application form. Applicants may note that
where payment is made by drafts purchased from NRE / FCNR accounts as the case may be, an
Account Debit Certificate from the bank issuing the draft confirming that the draft has been issued by
debiting the NRE / FCNR account should be enclosed with the CAF. In the absence of the above the
application shall be considered incomplete and is liable to be rejected.

In the case of NR who remits their application money from funds held in FCNR / NRE Accounts,
refunds and other disbursements, if any shall be credited to such account details of which should be
furnished in the appropriate columns in the CAF. In the case of NRIs who remit their application
money through Indian Rupee Drafts from abroad, refunds and other disbursements, if any will be
made in US Dollars at the rate of exchange prevailing at such time subject to the permission of RBI.
The Company will not be liable for any loss on account of exchange rate fluctuation for converting the
Rupee amount into US Dollars or for collection charges charged by the applicant‘s Bankers.

Application without repatriation benefits

As far as non-residents holding shares on non-repatriation basis is concerned, in addition to the

modes specified above, payment may also be made by way of cheque drawn on Non-Resident
(Ordinary) Account maintained in Mumbai or Rupee Draft purchased out of NRO Account maintained
elsewhere in India but payable at Mumbai. In such cases, the allotment of Equity Shares will be on
non-repatriation basis.

All cheques/drafts submitted by non-residents applying on non-repatriation basis should be drawn in

favour of ‗[●]‘ payable at Mumbai and must be crossed ‗A/c Payee only‘ for the amount payable.

The CAF duly completed together with the amount payable on application must be deposited with the
Collecting Bank indicated on the reverse of the CAF before the close of banking hours on or before
the Issue Closing Date. A separate cheque or bank draft must accompany each CAF.

If the payment is made by a draft purchased from an NRO account, an Account Debit Certificate from
the bank issuing the draft, confirming that the draft has been issued by debiting the NRO account,

156
should be enclosed with the CAF. In the absence of the above, the application shall be considered
incomplete and is liable to be rejected.

New demat account shall be opened for holders who have had a change in status from resident
Indian to NRI.

Note:

 In case where repatriation benefit is available, interest, dividend, sales proceeds derived from
the investment in Equity Shares can be remitted outside India, subject to tax, as applicable
according to Income Tax Act, 1961.

 In case Equity Shares are allotted on non-repatriation basis, the dividend and sale proceeds
of the Equity Shares cannot be remitted outside India.

 The CAF duly completed together with the amount payable on application must be deposited
with the Collecting Bank indicated on the reverse of the CAF before the close of banking
hours on or before the Issue Closing Date. A separate cheque or bank draft must accompany
each CAF.

 In case of an application received from non-residents, allotment, refunds and other

distribution, if any, will be made in accordance with the guidelines / rules prescribed by RBI as
applicable at the time of making such allotment, remittance and subject to necessary
approvals.

Application by Mutual Funds

A separate application can be made in respect of each scheme of an Indian mutual fund registered
with the SEBI and such applications shall not be treated as multiple applications. The applications
made by asset management companies or custodians of a mutual fund should clearly indicate the
name of the concerned scheme for which the application is being made.

Application on Plain Paper

An Equity Shareholder who has neither received the original CAF nor is in a position to obtain the
duplicate CAF may make an application to subscribe to the Issue on plain paper, along with a demand
draft net of bank and postal charges, drawn in favor of ―[●]‖ in case of resident shareholders and
nonresident shareholders applying on non-repatriable basis and in favour of ―[●]‖ payable at Mumbai,
in case of non-resident shareholders applying on repatriable basis and send the same by registered
post directly to the Registrar to the Issue so as to reach them on or before the closure of the Issue. In
such case the demand draft should be payable at Mumbai. The envelope should be subscribed ―[●]‖
in case of resident shareholders and non-resident shareholders applying on non-repatriable basis and
in favour of ―[●]‖ in case of non-resident shareholders applying on repatriable basis.

The application on plain paper, duly signed by the applicants including joint holders, in the same order
as per specimen recorded with the Company, must reach the office of the Registrar to the Issue
before the Issue Closing Date and should contain the following particulars:

 Name of Issuer, being Shree Ram Urban Infrastructure Limited

 Name and address of the Equity Shareholder including joint holders
 Registered Folio No./ DP ID No. and Client ID No.
 Number of shares held as on Record Date.
 Certificate numbers and distinctive Nos., if held in physical form.
 Number of Rights Equity Shares entitled.
 Number of Rights Equity Shares applied for.
 Number of additional Equity Shares applied for, if any.
 Total number of Equity Shares applied for.
 Total amount paid on application
 Particulars of cheque/draft

157
  Savings/Current Account Number and name and address of the bank where the Equity
Shareholder will be depositing the refund order.
 PAN number, Income Tax Circle/Ward/District, photocopy of the Pan card/Form 60/ Form 61
declaration and for each applicant in case of joint names.
 Signature of Equity Shareholders to appear in the same sequence and order as they appear
in the records of the Company.

Please note that those who are making the application otherwise than on original CAF shall not be
entitled to renounce their rights and should not utilize the original CAF for any purpose including
renunciation even if it is received subsequently. If the applicant violates any of these requirements,
he/she shall face the risk of rejection of both the applications. The Company shall refund such
application amount to the applicant without any interest thereon.

Last date of Application

The last date for submission of the duly filled in CAF is [●]. The Issue will be kept open for a minimum
of 15 (fifteen) days and the Board or any committee thereof will have the right to extend the said date
for such period as it may determine from time to time but not exceeding 30 (thirty) days from the Issue
Opening Date.

If the CAF together with the amount payable is not received by the Banker to the Issue/Registrar to
the Issue or if the CAF is not received by the SCSB on or before the close of banking hours on the
aforesaid last date or such date as may be extended by the Board/Committee of Directors, the offer
contained in this Draft Letter of Offer shall be deemed to have been declined and the
Board/Committee of Directors shall be at liberty to dispose off the Equity Shares hereby offered, as
provided under ―Basis of Allotment‖ below.

Basis of Allotment

Subject to the provisions contained in the Draft Letter of Offer, the Articles of Association of the
Company and the approval of the Designated Stock Exchange, the Board will proceed to allot the
Equity Shares in the following order of priority:

a. Full allotment to those Equity Shareholders who have applied for their Rights Entitlement
either in full or in part and also to the Renouncee(s) who has/ have applied for Equity Shares
renounced in their favour, in full or in part.

b. Allotment pertaining to fractional entitlements in case of any shareholding other than in

multiples of [●].

c. Allotment to the Equity Shareholders who having applied for all the Equity Shares offered to
them as part of the Issue and have also applied for additional Equity Shares. The allotment of
such additional Equity Shares will be made as far as possible on an equitable basis having
due regard to the number of Equity Shares held by them on the Record Date, provided there
is an undersubscribed portion after making full allotment in (a) and (b) above. The allotment of
such Equity Shares will be at the sole discretion of the Board / Committee of Directors in
consultation with the Designated Stock Exchange, as a part of the Issue and will not be a
preferential allotment.

d. Allotment to Renouncees who having applied for all the Equity Shares renounced in their
favour, have applied for additional Equity Shares provided there is surplus available after
making full allotment under (a), (b) and (c ) above. The allotment of such Equity Shares will
be at the sole discretion of the Board/Committee of Directors in consultation with the
Designated Stock Exchange, as a part of the Issue and not preferential allotment.

After taking into account allotment to be made under (a) above, if there is any unsubscribed portion,
the same shall be deemed to be ‗unsubscribed‘ for the purpose of regulation 3(1)(b) of the Takeover
Code which would be available for allocation under (b), (c) and (d) above. The Promoters have
confirmed that they intend to subscribe to the full extent of their Rights Entitlement in the Issue.
Subject to compliance with the Takeover Code, the Promoter and Promoter Group reserve their right

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to subscribe for Equity Shares in this Issue by subscribing for renunciation, if any, made by any other
Promoters or Promoter Group or any other shareholders. The Promoters have provided an
th
undertaking dated 7 October, 2010 to the Company to apply for additional Equity Shares in the
Issue, to the extent of the unsubscribed portion of the Issue. As a result of this subscription and
consequent allotment, the Promoters and Promoter Group may acquire Equity Shares over and above
their Rights Entitlement in the Issue, which may result in an increase of the shareholding being above
the current shareholding with the Rights Entitlement. This subscription and acquisition of additional
Equity Shares by the Promoters and Promoter Group through this Issue, if any, will not result in
change of control of the management of the Company and shall be exempt in terms of proviso to
Regulation 3(1)(b)(ii) of the Takeover Code. As such, other than meeting the requirements indicated
in the section ―Objects of the Issue‖ on page 17, there is no other intention/purpose for this Issue,
including any intention to delist the Company, even if, as a result of allotments to the Promoters and
Promoter Group, in this Issue, the Promoters‘ shareholding in the Company exceeds their current
shareholding. The Promoters and Promoter Group shall subscribe to such unsubscribed portion as
per the relevant provisions of the law. Allotment to the Promoters and Promoter Group of any
unsubscribed portion, over and above their Rights Entitlement shall be done in compliance with the
Listing Agreement and other applicable laws prevailing at that time relating to continuous listing
requirements.

PROCEDURE FOR APPLICATION THROUGH THE APPLICATIONS SUPPORTED BY BLOCKED

AMOUNT (“ASBA”) PROCESS

This section is for the information of the ASBA Investors proposing to subscribe to the Issue
through the ASBA Process. The Company and the Lead Managers are not liable for any
amendments or modifications or changes in applicable laws or regulations, which may occur
after the date of this Draft Letter of Offer. Equity Shareholders who are eligible to apply under
the ASBA Process are advised to make their independent investigations and to ensure that the
CAF is correctly filled up.

The list of banks who have been notified by SEBI to act as SCSB for the ASBA Process are provided
on http://www.sebi.gov.in/pmd/scsb.pdf. For details on designated branches of SCSB collecting the
CAF, please refer the above mentioned SEBI link.

Shareholders who are eligible to apply under the ASBA Process

The option of applying for Equity Shares in the Issue through the ASBA Process is only available to
Equity Shareholders of the Company on the Record Date and who:

• are holding Equity Shares in dematerialised form and has applied towards his/her rights
entitlements or additional Securities in the Issue in dematerialised form;

• Has not renounced his entitlements in full or in part;

• are not a Renouncee;

• are applying through blocking of funds in a bank account with one of the SCSBs.

CAF

The Registrar will dispatch the CAF to all Equity Shareholders as per their Rights Entitlement on the
Record Date for the Issue. Those Equity Shareholders who wish to apply through the ASBA payment
mechanism will have to select for this mechanism in Part A of the CAF and provide necessary details.

Equity Shareholders desiring to use the ASBA Process are required to submit their applications by
selecting the ASBA Option in Part A of the CAF only. Application in electronic mode will only be
available with such SCSB who provides such facility. The Equity Shareholder shall submit the CAF to
the SCSB for authorising such SCSB to block an amount equivalent to the amount payable on the
application in the said bank account maintained with the same SCSB.

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Acceptance of the Issue

You may accept the Issue and apply for the Equity Shares offered, either in full or in part, by filling
Part A of the CAFs sent by the Registrar, selecting the ASBA process option in Part A of the CAF and
submit the same to the SCSB before the close of the banking hours on or before the Issue Closing
Date or such extended time as may be specified by the Board of Directors of the Company in this
regard.

Mode of payment

The Equity Shareholder applying under the ASBA Process agrees to block the entire amount payable
on application (including for additional Equity Shares, if any) with the submission of the CAF, by
authorizing the SCSB to block an amount, equivalent to the amount payable on application, in a bank
account maintained with the SCSB.

After verifying that sufficient funds are available in the bank account provided in the CAF, the SCSB
shall block an amount equivalent to the amount payable on application mentioned in the CAF until it
receives instructions from the Registrars. Upon receipt of intimation from the Registrar, the SCSBs
shall transfer such amount as per Registrar‘s instruction allocable to the Equity Shareholders applying
under the ASBA Process from bank account with the SCSB mentioned by the Equity Shareholder in
the CAF. This amount will be transferred in terms of the SEBI Guidelines, into the separate bank
account maintained by the Company as per the provisions of section 73(3) of the Companies Act,
1956. The balance amount remaining after the finalisation of the basis of allotment shall be either
unblocked by the SCSBs or refunded to the investors by the Registrar on the basis of the instructions
issued in this regard by the Registrar to the Issue and the Lead Manager to the respective SCSB.

The Equity Shareholders applying under the ASBA Process would be required to block the entire
amount payable on their application at the time of the submission of the CAF.

The SCSB may reject the application at the time of acceptance of CAF if the bank account with the
SCSB details of which have been provided by the Equity Shareholder in the CAF does not have
sufficient funds equivalent to the amount payable on application mentioned in the CAF. Subsequent to
the acceptance of the application by the SCSB, the Company would have a right to reject the
application only on technical grounds.

Options available to the Equity Shareholders applying under the ASBA Process

The summary of options available to the Equity Shareholders is presented below. You may exercise
any of the following options with regard to the Equity Shares offered, using the respective CAFs
received from Registrar:

Option Available Action Required

Accept whole or part of your entitlement without Fill in and sign Part A of the CAF (All joint holders
renouncing the balance. must sign)
Accept your entitlement in full and apply for Fill in and sign Part A of the CAF including Block
additional Shares III relating to the acceptance of entitlement and
Block IV relating to additional Shares (All joint
holders must sign)

The Equity Shareholder applying under the ASBA Process will need to select the ASBA option
process in the CAF and provide required necessary details. However, in cases where this
option is not selected, but the CAF is tendered to the SCSB with the relevant details required
under the ASBA process option and SCSB blocks the requisite amount, then that CAF would
be treated as if the Equity Shareholder has selected to apply through the ASBA process
option.

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Additional Equity Shares

You are eligible to apply for additional Equity Shares over and above the number of Equity Shares
that you are entitled too, provided that (i) you have applied for all the Equity Shares (as the case may
be) offered without renouncing them in whole or in part in favour of any other person(s). Applications
for additional Equity Shares shall be considered and allotment shall be made at the sole discretion of
the Board, in consultation with the Designated Stock Exchange and in the manner prescribed under
―Terms of the Issue - Basis of Allotment‖ on page 158.

If you desire to apply for additional Equity Shares please indicate your requirement in the place
provided for additional Equity Shares in Part A of the CAF.

Renunciation under the ASBA Process

Renouncees cannot participate in the ASBA Process.

Application on Plain Paper

An Equity Shareholder who has neither received the original CAF nor is in a position to obtain the
duplicate CAF and who is applying under the ASBA Process may make an application to subscribe to
the Issue on plain paper, along with Demand Draft, net of bank and postal charges payable at
Mumbai which should be drawn in favour of the ―Shree Ram Urban Infrastructure Limited – Rights
Issue‖ and the Equity Shareholders should send the same by registered post directly to SCSB.

The envelope should be super scribed ―Shree Ram Urban Infrastructure Limited – Rights Issue‖ and
should be postmarked in India. The application on plain paper, duly signed by the Investors including
joint holders, in the same order as per specimen recorded with the Company, must reach the office of
the Registrar to the Issue before the Issue Closing Date and should contain the following particulars:

 Name of Issuer, being Shree Ram Urban Infrastructure Limited;

 Name and address of the Equity Shareholder including joint holders;
 Registered Folio Number/ DP and Client ID no.;
 Number of Equity Shares held as on Record Date;
 Number of Equity Shares entitled to;
 Number of Equity Shares applied for;
 Number of additional Equity Shares applied for, if any;
 Total number of Equity Shares applied for;
 Total amount paid at the rate of Rs. [●] per Equity Share;
 Particulars of cheque/draft; and
 Except for applications on behalf of the Central or State Government and the officials appointed
by the courts, PAN number of the Investor and for each Investor in case of joint names,
irrespective of the total value of the Equity Shares applied for pursuant to the Issue.

Option to receive Securities in Dematerialized Form

SHAREHOLDERS UNDER THE ASBA PROCESS MAY PLEASE NOTE THAT THE EQUITY
SHARES OF THE COMPANY UNDER THE ASBA PROCESS CAN ONLY BE ALLOTTED IN
DEMATERIALIZED FORM AND TO THE SAME DEPOSITORY ACCOUNT IN WHICH THE EQUITY
SHARES ARE BEING HELD ON RECORD DATE.

General instructions for Equity Shareholders applying under the ASBA Process

a. Please read the instructions printed on the respective CAF carefully.

b. Application should be made on the printed CAF only and should be completed in all respects.
The CAF found incomplete with regard to any of the particulars required to be given therein,
and/or which are not completed in conformity with the terms of this Draft Letter of Offer are
liable to be rejected. The CAF must be filled in English.

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 c. The CAF in the ASBA Process should be submitted at a Designated Branch of the SCSB and
whose bank account details are provided in the CAF and not to the Bankers to the
Issue/Collecting Banks (assuming that such Collecting Bank is not a SCSB), to the Company
or Registrar or Lead Manager to the Issue.

d. All applicants, and in the case of application in joint names, each of the joint applicants,
should mention his/her PAN number allotted under the Income-Tax Act, 1961, irrespective of
the amount of the application. CAFs without PAN will be considered incomplete and are liable
to be rejected.

e. All payments will be made by blocking the amount in the bank account maintained with the
SCSB. Cash payment is not acceptable. In case payment is affected in contravention of this,
the application may be deemed invalid and the application money will be refunded and no
interest will be paid thereon.

f. Signatures should be either in English or Hindi or in any other language specified in the
Eighth Schedule to the Constitution of India. Signatures other than in English or Hindi and
thumb impression must be attested by a Notary Public or a Special Executive Magistrate
under his/her official seal. The Equity Shareholders must sign the CAF as per the specimen
signature recorded with the Company/or Depositories.

g. In case of joint holders, all joint holders must sign the relevant part of the CAF in the same
order and as per the specimen signature(s) recorded with the Company. In case of joint
applicants, reference, if any, will be made in the first applicant‘s name and all communication
will be addressed to the first applicant.

h. All communication in connection with application for the Securities, including any change in
address of the Equity Shareholders should be addressed to the Registrar to the Issue prior to
the date of allotment in this Issue quoting the name of the first/sole applicant Shareholder,
folio numbers and CAF number.

i. Only the person or persons to whom Securities have been offered and not renouncee(s) shall
be eligible to participate under the ASBA process.

Do‟s:

a. Ensure that the ASBA Process option is selected in part A of the CAF and necessary details
are filled in.

b. Ensure that you submit your application in physical mode only. Electronic mode is only
available with certain SCSBs and not all SCSBs and you should ensure that your SCSB offers
such facility to you.

c. Ensure that the details about your Depository Participant and beneficiary account are correct
and the beneficiary account is activated as Equity Shares will be allotted in the dematerialized
form only.

d. Ensure that the CAFs are submitted at the SCSBs whose details of bank account have been
provided in the CAF.

e. Ensure that there are sufficient funds (equal to {number of Equity Shares, as the case may be
applied for} X {Issue Price of Equity Shares, as the case may be}) available in the bank
account maintained with the SCSB mentioned in the CAF before submitting the CAF to the
respective Designated Branch of the SCSB.

f. Ensure that you have authorised the SCSB for blocking funds equivalent to the total amount
payable on application mentioned in the CAF, in the bank account maintained with the
respective SCSB, of which details are provided in the CAF and have signed the same.

162
 g. Ensure that you receive an acknowledgement from the SCSB for your submission of the CAF
in physical form.

h. Each applicant should mention their Permanent Account Number (―PAN‖) allotted under the I.
T. Act.

i. Ensure that the name(s) given in the CAF is exactly the same as the name(s) in which the
beneficiary account is held with the Depository Participant. In case the CAF is submitted in
joint names, ensure that the beneficiary account is also held in same joint names and such
names are in the same sequence in which they appear in the CAF.

j. Ensure that the Demographic Details are updated, true and correct, in all respects.

Don‟ts:

a. Do not apply on duplicate CAF after you have submitted a CAF to a Designated Branch of the
SCSB.

b. Do not pay the amount payable on application in cash, by money order or by postal order.

c. Do not send your physical CAFs to the Lead Manager to Issue / Registrar / Collecting Banks
(assuming that such Collecting Bank is not a SCSB) / to a branch of the SCSB which is not a
Designated Branch of the SCSB / Company; instead submit the same to a Designated Branch
of the SCSB only.

d. Do not submit the GIR number instead of the PAN as the application is liable to be rejected
on this ground.

e. Do not instruct your respective banks to release the funds blocked under the ASBA Process.

Grounds for Technical Rejection under the ASBA Process

In addition to the grounds listed under ―Grounds for Technical Rejection‖ on page 170 of this Draft
Letter of Offer, applications under the ABSA Process are liable to be rejected on the following
grounds:

a. Application for entitlements or additional Equity Shares in physical form.

b. DP ID and Client ID mentioned in CAF not matching with the DP ID and Client ID records
available with the Registrar.

c. Sending CAF to a Lead Manager / Registrar / Collecting Bank (assuming that such Collecting
Bank is not a SCSB) / to a branch of a SCSB which is not a Designated Branch of the SCSB /
Company.

d. Renouncee applying under the ASBA Process.

e. Insufficient funds are available with the SCSB for blocking the amount.

f. Funds in the bank account with the SCSB whose details are mentioned in the CAF having been
frozen pursuant to regulatory orders.

g. Account holder not signing the CAF or declaration mentioned therein.

Depository account and bank details for Equity Shareholders applying under the ASBA
Process

IT IS MANDATORY FOR ALL THE EQUITY SHAREHOLDERS APPLYING UNDER THE ASBA
PROCESS TO RECEIVE THEIR EQUITY SHARES IN DEMATERIALISED FORM. ALL EQUITY

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SHAREHOLDERS APPLYING UNDER THE ASBA PROCESS SHOULD MENTION THEIR
DEPOSITORY PARTICIPANT‟S NAME, DEPOSITORY PARTICIPANT IDENTIFICATION NUMBER
AND BENEFICIARY ACCOUNT NUMBER IN THE CAF. EQUITY SHAREHOLDERS APPLYING
UNDER THE ASBA PROCESS MUST ENSURE THAT THE NAME GIVEN IN THE CAF IS
EXACTLY THE SAME AS THE NAME IN WHICH THE DEPOSITORY ACCOUNT IS HELD. IN
CASE THE CAF IS SUBMITTED IN JOINT NAMES, IT SHOULD BE ENSURED THAT THE
DEPOSITORY ACCOUNT IS ALSO HELD IN THE SAME JOINT NAMES AND ARE IN THE SAME
SEQUENCE IN WHICH THEY APPEAR IN THE CAF.

Equity Shareholders applying under the ASBA Process should note that on the basis of name
of these Equity Shareholders, Depository Participant‟s name and identification number and
beneficiary account number provided by them in the CAF, the Registrar to the Issue will obtain
from the Depository demographic details of these Equity Shareholders such as address, bank
account details for printing on refund orders and occupation (“Demographic Details”). Hence,
Equity Shareholders applying under the ASBA Process should carefully fill in their Depository
Account details in the CAF.

These Demographic Details would be used for all correspondence with such Equity
Shareholders including mailing of the letters intimating unblock of bank account of the
respective Equity Shareholder. The Demographic Details given by Equity Shareholders in the
CAF would not be used for any other purposes by the Registrar. Hence, Equity Shareholders
are advised to update their Demographic Details as provided to their Depository Participants.

By signing the CAFs, the Equity Shareholders applying under the ASBA Process would be deemed to
have authorised the Depositories to provide, upon request, to the Registrar to the Issue, the required
Demographic Details as available on its records.

Letters intimating allotment and unblocking or refund (if any) would be mailed at the address
of the Equity Shareholder applying under the ASBA Process as per the Demographic Details
received from the Depositories. Refunds, if any, will be made directly to the bank account in
the SCSB and which details are provided in the CAF and not the bank account linked to the DP
ID. Equity Shareholders applying under the ASBA Process may note that delivery of letters
intimating unblocking of bank account may get delayed if the same once sent to the address
obtained from the Depositories are returned undelivered. In such an event, the address and
other details given by the Equity Shareholder in the CAF would be used only to ensure
dispatch of letters intimating unblocking of bank account.

Note that any such delay shall be at the sole risk of the Equity Shareholders applying under
the ASBA Process and none of the Company, the SCSBs or the Lead Managers shall be liable
to compensate the Equity Shareholder applying under the ASBA Process for any losses
caused due to any such delay or liable to pay any interest for such delay.

In case no corresponding record is available with the Depositories that matches three parameters,
namely, names of the Equity Shareholders (including the order of names of joint holders), the DP ID
and the beneficiary account number, then such applications are liable to be rejected.

DISPOSAL OF APPLICATIONS AND APPLICATION MONEYS AND INTEREST IN CASE OF

DELAY IN INSTRUCTIONS TO SCSB BY THE REGISTRAR TO THE ISSUE

In accordance with the Companies Act, the requirements of the Stock Exchange and SEBI
Guidelines, the Company undertakes that:

• Allotment and transfer shall be made only in dematerialised form within 15 days from the Issue
Closing Date;

• Instructions for unblocking of the ASBA shareholder‘s Bank Account shall be made within 15 days
from the Issue Closing Date; and

• If the instructions to SCSB to unblock funds in the ASBA accounts are not given within 8 days
after the Company becomes liable to repay all moneys received from the applicants in pursuance

164
 of this Draft Letter of Offer, i.e. within 7 days from the Issue Closing Date, then the Company and
every Director of the Company who is an officer in default shall, on and from such expiry of 8
days, be liable to repay the money, with interest at the rate of 15% p.a. on application money, as
prescribed under Section 73 of the Companies Act.

In case no corresponding record is available with the Depositories that matches three parameters,
namely, names of the Shareholders (including the order of names of joint holders), the DP ID and the
beneficiary account number, then such applications are liable to be rejected.

Disposal of Investor Grievances

All grievances relating to the ASBA process may be addressed to the Registrar to the Issue, with a
copy to the SCSB, giving full details such as name, address of the applicant, number of Equity Shares
applied for, Amount blocked on application, bank account number and the Designated Branch or the
collection centre of the SCSB where the Application Form was submitted by the ASBA shareholder.

Underwriting

The present Issue is not underwritten.

Allotment / Refund

The Company will issue and dispatch allotment advice/ share certificates / demat credit and/or letters
of regret along with refund order or credit the allotted Equity Shares to the respective beneficiary
accounts, if any, within a period of 15 days from the Issue Closing Date. If such money is not repaid
within eight days from the day the Company becomes liable to repay it, (i.e. 15 days after the Issue
Closing Date or the date of the refusal by the Stock Exchange(s), whichever is earlier) the Company
and every Director of the Company who is an officer in default shall, on and from expiry of eight days,
be jointly and severally liable to pay the money with interest as prescribed under Section 73 of the
Companies Act.

Investors residing at centers where clearing houses are managed by the Reserve Bank of India
(―RBI‖) will get refunds through Electronic Clearing Service (―ECS‖) except where Investors are
otherwise disclosed as applicable/eligible to get refunds through direct credit and real time gross
settlement (―RTGS‖).

In case of those Investors who have opted to receive their Rights Entitlement in dematerialized form
using electronic credit under the depository system, advice regarding their credit of the Equity Shares
shall be given separately. Investors to whom refunds are made through electronic transfer of funds
will be sent a letter through ordinary post intimating them about the mode of credit of refund within 15
days of the Issue Closing Date.

In case of those Investors who have opted to receive their Rights Entitlement in physical form and the
Company issues letter of allotment, the corresponding share certificates will be kept ready within three
months from the date of allotment thereof or such extended time as may be approved by the
Company Law Board under Section 113 of the Companies Act or other applicable provisions, if any.
Investors are requested to preserve such letters of allotment, which would be exchanged later for the
share certificates. For more information, please see the section ―Terms of the Issue‖ on page 149.

The letter of allotment / refund order exceeding Rs. 1,500 would be sent by registered post/speed
post to the sole/first Investors registered address. Refund orders up to the value of Rs. 1,500 would
be sent under certificate of posting. Such refund orders would be payable at par at all places where
the applications were originally accepted. The same would be marked ‗Account Payee only‘ and
would be drawn in favour of the sole/first Investor. Adequate funds would be made available to the
Registrar to the Issue for this purpose.

As regards allotment/ refund to non-residents, the following further conditions shall apply:

In case of non-residents, who remit their application monies from funds held in NRE/ FCNR accounts,
refunds and/ or payment of interest/ dividend and other disbursement, if any, shall be credited to such

165
accounts, details of which should be furnished in the CAF. Subject to the approval of the RBI, in case
of non-residents, who remit their application monies through Indian Rupee draft purchased from
abroad, refund and/ or payment of dividend/ interest and any other disbursement, shall be credited to
such accounts (details of which should be furnished in the CAF) and will be made net of bank
charges/ commission in US Dollars, at the rate of exchange prevailing at such time. The Company will
not be responsible for any loss on account of exchange fluctuations for converting the Indian Rupee
amount into US Dollars. The share certificate(s) will be sent by registered post at the Indian address
of the non-resident applicant.

Mode of Making Refunds

The payment of refund, if any, would be done through various modes in the following order of
preference:

1. ECS – Payment of refund would be done through ECS for applicants having an account at
any of the 68 centres where clearing houses for ECS are managed by the Reserve Bank of
India, State Bank of India, Punjab National Bank, Union Bank of India, Andhra Bank,
Corporation Bank, Bank of Baroda, State Bank of Travancore, Central Bank of India, Canara
Bank, Oriental Bank of Commerce, United Bank of India, State Bank of Hyderabad and State
Bank of Bikaner and Jaipur. This mode of payment of refunds would be subject to availability
of complete bank account details including the nine digit Magnetic Ink Character Recognition
(MICR) code as appearing on a cheque leaf, from the depository. The payment of refund
through ECS is mandatory for applicants having a bank account at any of the 68 centers,
except where applicant is otherwise disclosed as eligible to get refunds through direct credit
or RTGS.

2. NEFT (National Electronic Fund Transfer) – Payment of refund shall be undertaken through
NEFT wherever the applicants‘ bank has been assigned the Indian Financial System Code
(IFSC), which can be linked to a Magnetic Ink Character Recognition (MICR), if any, available
to that particular bank branch. IFSC Code will be obtained from the website of RBI as on a
date immediately prior to the date of payment of refund, duly mapped with MICR numbers.
Wherever the applicants have registered their nine digit MICR number and their bank account
number while opening and operating the demat account, the same will be duly mapped with
the IFSC Code of that particular bank branch and the payment of refund will be made to the
applicants through this method.

3. Direct Credit – Applicants having their bank account with the Refund Banker, i.e. Punjab
National Bank shall be eligible to receive refunds, if any, through direct credit. The refund
amount, if any, would be credited directly to the eligible applicant‘s bank account with the
Refund Banker.

4. RTGS – Applicants having a bank account at any of the 68 centers detailed above, and
whose application amount exceeds Rs. 1 million, shall be eligible to exercise the option to
receive refunds, if any, through RTGS. All applicants eligible to exercise this option shall
mandatorily provide the IFSC code in the CAF, the refund shall be made through the ECS or
direct credit, if eligibility disclosed.

5. For all other Investors, including those who have not updated their bank particulars with the
MICR code, the refund orders will be dispatched under certificate of posting for value up to
Rs. 1,500 and through speed post / registered post for refund orders of Rs. 1,500 and above.
Such refunds will be made by cheques, pay orders or demand drafts drawn in favour of the
sole / first Investor and payable at par.

6. Credit of refunds to Investors in any other electronic manner permissible under the banking
laws, which are in force, and is permitted by the SEBI from time to time.

Printing Of Bank Particulars on Refund Orders

As a matter of precaution against possible fraudulent encashment of refund orders due to loss or
misplacement, the particulars of the applicant‘s bank account are mandatory for printing on the refund

166
orders. Bank account particulars will be printed on the refund orders/refund warrants which can then
be deposited only in the account specified. The Company will in no way be responsible if any loss
occurs through these instruments falling into improper hands either through forgery or fraud.

Letters of Allotment / Share Certificates / Demat Credit

Allotment advice / share certificates / demat credit will be dispatched to the registered address of the
first named Investor or respective beneficiary accounts will be credited within 15 (fifteen) days, from
the Issue Closing Date. In case the Company issues allotment advice, the relative shared certificates
will be dispatched within one month from the date of the allotment. Allottees are requested to preserve
such allotment advice (if any) to be exchanged later for share certificates.

Option to receive Equity Shares in Dematerialized Form

Applicants to the Equity Shares of the Company issued through this Issue shall be allotted the
securities in dematerialized (electronic) form at the option of the applicant. The Company has signed
the following tripartite agreements to enable the Investors to hold and trade in securities in a
dematerialized form, instead of holding the securities in the form of physical certificates:

- Agreement dated 26/09/2005 with NSDL and Bigshare Services Pvt. Ltd.
- Agreement dated 24/10/2005 with CDSL and Bigshare Services Pvt. Ltd.

In this Issue, the allottees who have opted for Equity Shares in dematerialized form will receive their
Equity Shares in the form of an electronic credit to their beneficiary account with a depository
participant. The CAF shall contain space for indicating number of shares applied for in demat and
physical form or both. Investor will have to give the relevant particulars for this purpose in the
appropriate place in the CAF. Applications, which do not accurately contain this information, will be
given the securities in physical form. No separate applications for securities in physical and/or
dematerialized form should be made. If such applications are made, the application for physical
securities will be treated as multiple applications and is liable to be rejected. In case of partial
allotment, allotment will be done in demat option for the shares sought in demat and balance, if any,
will be allotted in physical shares.

The Equity Shares of the Company will be listed on the BSE and NSE.

INVESTORS MAY PLEASE NOTE THAT THE EQUITY SHARES OF THE COMPANY CAN BE
TRADED ON THE STOCK EXCHANGE ONLY IN DEMATERIALIZED FORM.

Procedure for availing the facility for allotment of Equity Shares in this Issue in the electronic form is
as under:

- Open a beneficiary account with any depository participant (care should be taken that the
beneficiary account should carry the name of the holder in the same manner as is exhibited in the
records of the Company. In the case of joint holding, the beneficiary account should be opened
carrying the names of the holders in the same order as with the Company). In case of Investors
having various folios in the Company with different joint holders, the Investors will have to open
separate accounts for such holdings. Those Equity Shareholders who have already opened such
Beneficiary Account (s) need not adhere to this step.

- For Equity Shareholders already holding Equity Shares of the Company in dematerialized form as
on the Record Date, the beneficial account number shall be printed on the CAF. For those who
open accounts later or those who change their accounts and wish to receive their Equity Shares
pursuant to this Issue by way of credit to such account, the necessary details of their beneficiary
account should be filled in the space provided in the CAF. It may be noted that the allotment of
Equity Shares arising out of this Issue may be made in dematerialized form even if the original
Equity Shares of the Company are not dematerialized. Nonetheless, it should be ensured that the
Depository Account is in the name(s) of the Equity Shareholders and the names are in the same
order as in the records of the Company.

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Responsibility for correctness of information (including applicant‘s age and other details) filled in the
CAF vis-à-vis such information with the applicant‘s depository participant, would rest with the
applicant. Applicants should ensure that the names of the applicants and the order in which they
appear in CAF should be the same as registered with the applicant‘s depository participant.

If incomplete / incorrect beneficiary account details are given in the CAF the applicant will get Equity
Shares in physical form.

The Equity Shares pursuant to this Issue allotted to investors opting for dematerialized form, would be
directly credited to the beneficiary account as given in the CAF after verification. Allotment advice,
refund order (if any) would be sent directly to the applicant by the Registrar to the Issue but the
applicant‘s depository participant will provide to him the confirmation of the credit of such Equity
Shares to the applicant‘s depository account.

Renouncees will also have to provide the necessary details about their beneficiary account for
allotment of securities in this Issue. In case these details are incomplete or incorrect, the application is
liable to be rejected.

Option to subscribe

Other than the present Issue, and except as disclosed in - Terms of the Issue on page 149, the
Company has not given any person any option to subscribe to the Equity Shares of the Company.
The Investors shall have an option either to receive the security certificates or to hold the securities in
dematerialised form with a depository.

Utilization of Proceeds

Subscription received against this Issue will be kept in a separate bank account(s) and the Company
would not have access to such funds unless the basis of allotment approved by the Designated Stock
Exchange.

General instructions for applicants

a. Please read the instructions printed on the enclosed CAF carefully.

b. Application should be made on the printed CAF, provided by the Company except as mentioned
under the head Application on Plain Paper and should be completed in all respects. The CAF
found incomplete with regard to any of the particulars required to be given therein, and/ or which
are not completed in conformity with the terms of this Draft Letter of Offer are liable to be rejected
and the money paid, if any, in respect thereof will be refunded without interest and after deduction
of bank commission and other charges, if any. The CAF must be filled in English and the names
of all the applicants, details of occupation, address, and father‘s / husband‘s name must be filled
in block letters.

c. The CAF together with cheque / demand draft should be sent to the Bankers to the Issue /
Collecting Bank or to the Registrar to the Issue and not to the Company or Lead Manager to the
Issue. Applicants residing at places other than cities where the branches of the Bankers to the
Issue have been authorized by the Company for collecting applications, will have to make
payment by Demand Draft payable at Mumbai of amount net of bank and postal charges, and
send their application forms to the Registrar to the Issue by REGISTERED POST. If any portion
of the CAF is / are detached or separated, such application is liable to be rejected.

d. Applications for any value made by the Investor, or in the case of joint names, each of the joint
Investors, should mention his / her PAN number allotted under the Income-Tax Act, 1961,
irrespective of the amount of the application. CAF without PAN will be considered incomplete and
are liable to be rejected.

e. Bank Account Details: It is mandatory for applicants to provide information as to their

savings/current account number and the name of the Bank with whom such account is held in the
CAF to enable the Registrar to the Issue to print the said details in the refund orders, if any, after

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 the names of the payees. Application not containing such details is liable to be rejected. For
Eligible Equity Shareholders holding Equity Shares in dematerialised form, such bank details will
be drawn from the demographic details of the Eligible Equity Shareholder in the records of the
Depository.

f. All payments should be made by cheque / DD only. Cash payment is not acceptable. In case
payment is affected in contravention of this, the application may be deemed invalid and the
application money will be refunded and no interest will be paid thereon.

g. Signatures should be either in English or Hindi or in any other language specified in the Eight
Schedule to the Constitution of India. Signatures other than in English or Hindi and thumb
impression must be attested by a Notary Public or a Special Executive Magistrate under his/ her
official seal. The Equity Shareholders must sign the CAF as per the specimen signature recorded
with the Company or depositories.

h. In case of an application under power of attorney or by a body corporate or by a society, a

certified true copy of the relevant power of attorney or relevant resolution or authority to the
signatory to make the relevant investment under this Issue and to sign the application and a copy
of the Memorandum and Articles of Association and / or bye laws of such body corporate or
society must be lodged with the Registrar to the Issue giving reference of the serial number of the
CAF. In case the above-referred documents are already registered with the Company, the same
need not be a furnished again. In case these papers are sent to any other entity besides the
Registrar to the Issue or are sent after the Issue Closing Date, then the application is liable to be
rejected. In no case should these papers be attached to the application submitted to the Bankers
to the Issue.

i. In case of joint holders, all joint-holders must sign the relevant part of the CAF in the same order
and as per the specimen signature(s) recorded with the Company. Further, in case of joint
applicants who are renouncees, the number of applicants should not exceed three. In case of joint
applicants, reference, if any, will be made in the first applicant‘s name and all communication will
be addressed to the first applicant.

j. Application(s) received from Non-Resident / NRIs, or persons of Indian origin residing abroad for
allotment of Equity Shares shall, inter alia, be subject to conditions, as may be imposed from time
to time by the RBI under FEMA in the matter of refund of application money, allotment of Equity
Shares, subsequent issue and allotment of Equity Shares, interest, export of share certificates,
etc. In case a Non-Resident or NRI Equity Shareholder has specific approval from the RBI, in
connection with his shareholding, he should enclose a copy of such approval with the CAF.

k. All communication in connection with application for the Equity Shares, including any change in
address of the Equity Shareholders should be addressed to the Registrar to the Issue prior to the
date of allotment in this Issue quoting the name of the first / sole applicant Equity Shareholder,
folio numbers and CAF number. Please note that any intimation for change of address of Equity
Shareholders, after the date of allotment, should be sent to the Secretarial Department, Shree
Ram Urban Infrastructure Limited, Shree Ram Mills Premises, Ganpatrao Kadam Marg, Lower
Parel, Mumbai – 400 013. in the case of Equity Shares held in physical form and to the respective
depository participant, in case of Equity Shares held in dematerialized form.

l. Split forms cannot be re-split.

m. Only the person or persons to whom Equity Shares have been offered and not renouncee(s) shall
be entitled to obtain split forms.

n. Applicants must write their CAF number at the back of the cheque / demand draft.

o. Only one mode of payment per application should be used. The payment must be either in cash
or by cheque / demand draft drawn on any of the banks, including a co-operative bank, which is
situated at and is a member or a sub member of the Bankers Clearing House located at the
centre indicated on the reverse of the CAF where the application is to be submitted.

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p. A separate cheque / draft must accompany each CAF. Outstation cheques / demand drafts or
post-dated cheques and postal / money orders will not be accepted and applications
accompanied by such cheques / demand drafts / money orders or postal orders will be rejected.
The Registrar will not accept payment against application if made in cash. (For payment against
application in cash please refer point (f) above)

q. No receipt will be issued for application money received. The Bankers to the Issue / Collecting
Bank / Registrar will acknowledge receipt of the same by stamping and returning the
acknowledgment slip at the bottom of the CAF.

Grounds for Technical Rejections

Applicants are advised to note that applications are liable to be rejected on technical grounds,
including the following:

 Amount paid does not tally with the amount payable for;
 Bank account details (for refund) are not given;
 Age of first applicant not given;
 PAN not mentioned for application of any value;;
 In case of Application under power of attorney or by limited companies, corporate, trust, etc.,
relevant documents are not submitted;
 If the signature of the existing shareholder does not match with the one given on the Application
Form and for renouncees if the signature does not match with the records available with their
depositories;
 If the Applicant desires to have shares in electronic form, but the Application Form does not have
the Applicant‘s depository account details;
 Application Forms are not submitted by the Applicants within the time prescribed as per the
 Application Form and the Draft Letter of Offer;
 Applications not duly signed by the sole/joint Applicants;
 Applications by OCBs unless accompanied by specific approval from the RBI permitting the OCBs
to invest in the Issue;
 Applications accompanied by Stockinvest;
 In case no corresponding record is available with the Depositories that matches three parameters,
namely, names of the Applicants (including the order of names of joint holders), the Depositary
Participant‘s identity (DP ID) and the beneficiary‘s identity;
 Applications by US persons;
 Applications by ineligible Non-residents (including on account of restriction or prohibition under
applicable local laws) and where last available address in India has not been provided.

Payment by Stockinvest
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In terms of RBI Circular DBOD No. FSC BC 42/24.47.00/2003- 04 dated 5 November, 2003, the
Stockinvest Scheme has been withdrawn with immediate effect. Hence, payment through Stockinvest
would not be accepted in this Issue.

Disposal of application and application money

No acknowledgment will be issued for the application moneys received by the Company. However,
the Bankers to the Issue / Registrar to the Issue receiving the CAF will acknowledge its receipt by
stamping and returning the acknowledgment slip at the bottom of each CAF.

The Board reserves its full, unqualified and absolute right to accept or reject any application, in whole
or in part, and in either case without assigning any reason thereto.

In case an application is rejected in full, the whole of the application money received will be refunded.
Wherever an application is rejected in part, the balance of application money, if any, after adjusting
any money due on Equity Shares allotted, will be refunded to the applicant within 15 days from the
close of the Issue in accordance with section 73 of the Act.

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For further instruction, please read the Composite Application Form (CAF) carefully.

Utilization of Issue Proceeds

The Board of Directors declares that:

1. The funds received against this Issue will be transferred to a separate bank account as per sub-
section (3) of Section 73 of the Act.

2. Details of all moneys utilized out of the Issue shall be disclosed under an appropriate separate
head in the balance sheet of the Company indicating the purpose for which such money has been
utilized.

3. Details of all such unutilized moneys out of the Issue, if any, shall be disclosed under an
appropriate head in the balance sheet of the Company indicating the form in which such
unutilized moneys have been invested.

4. The Company may utilize the funds collected in the Issue only after the basis of allotment is
finalized.

Undertakings by the Company

1. The complaints received in respect of the Issue shall be attended to by the Company
expeditiously and satisfactorily.

2. All steps for completion of the necessary formalities for listing and commencement of trading at all
Stock Exchanges where the securities are to be listed will be taken within seven working days of
finalization of basis of allotment.

3. The funds required for dispatch of refund orders/ allotment letters/ certificates by registered post
shall be made available to the Registrar to the Issue.

4. That where refunds are made through electronic transfer of funds, a suitable communication shall
be sent to the applicant within 15 days of closure of the issue, as the case may be, giving details
of the bank where refunds shall be credited along with amount and expected date of electronic
credit of refund.

5. The certificates of the securities/ refund orders shall be dispatched within the specified time.

6. Certificates of securities/refund orders of the Non-Resident/Non Resident Indians shall be

dispatched within the specified time subject to receipt of approval from RBI/FIPB, if required;

7. The Company accepts full responsibility for the accuracy of information given in this Draft Letter of
Offer and confirms that to best of its knowledge and belief, there are no other facts the omission
of which makes any statement made in this Draft Letter of Offer misleading and further confirms
that it has made all reasonable enquiries to ascertain such facts.

8. Except as disclosed, no further issue of securities affecting equity capital of the Company shall be
made till the securities issued/offered through the Issue are listed or till the application moneys
are refunded on account of non-listing, under-subscription etc.

9. Adequate arrangements shall be made to collect all ASBA applications and to consider then
similar to non-ASBA applications while finalising the Basis of Allotment.

10. All information shall be made available by the Lead Manager and the Issuer to the investors at
large and no selective or additional information would be available for a section of the investors in
any manner whatsoever.

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11. At any given time, there shall be only one denomination of the Equity Shares of the Company and
the Company shall comply with such disclosure and accounting norms specified by SEBI from
time to time.

Minimum Subscription

If the Company does not receive the minimum subscription of 90% of the Issue, the Company shall
forthwith refund the entire subscription amount received within 15 days from the Issue Closing Date. If
such money is not repaid within eight days from the day the Company becomes liable to repay it, (i.e.
15 days after the Issue Closing Date or the date of the refusal by the Stock Exchange(s), whichever is
earlier) the Company and every Director of the Company who is an officer in default shall, on and
from expiry of eight days, be jointly and severally liable to repay the money with interest as prescribed
under sub-section (2) and (2A) of Section 73 of the Companies Act.

Impersonation

As a matter of abundant caution, attention of the Investors is specifically drawn to the provisions of
sub-section (1) of section 68A of the Companies Act which is reproduced below:

“Any person who makes in a fictitious name an application to a Company for acquiring, or subscribing
for, any shares therein, or otherwise induces a Company to allot, or register any transfer of shares
therein to him, or any other person in a fictitious name, shall be punishable with imprisonment for a
term which may extend to five years”

Important

Please read this Draft Letter of Offer carefully before taking any action. The instructions contained in
the accompanying Composite Application Form (CAF) are an integral part of the conditions of this
Draft Letter of Offer and must be carefully followed; otherwise the application is liable to be rejected.

All enquiries in connection with this Draft Letter of Offer or accompanying CAF and requests for Split
Application Forms must be addressed (quoting the Registered Folio Number/ DP and Client ID
number, the CAF number and the name of the first Equity Shareholder as mentioned on the CAF and
super scribed ‗[●] on the envelope) to the Registrar to the Issue at the following address:

M/s. Bigshare Services Pvt. Ltd.

E/2, Ansa Industrial Estate, Sakivihar Road, Sakinaka, Andheri (E), Mumbai – 400 072.
Tel: +91 22 40430200 / +91 22 28470652

It is to be specifically noted that this Issue of Equity Shares is subject to the section entitled ―Risk
Factors‖ beginning on page viii of this Draft Letter of Offer.

The Issue will remain open for at least 15 days. However, the Board will have the right to
extend the Issue period as it may determine from time to time but not exceeding 30 days from
the Issue Opening Date.

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 SECTION IX: OTHER INFORMATION
MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION

The following contracts (not being contracts entered in to in the ordinary course of business carried on
by the Company or entered into more than two years before the date of this Draft Letter of Offer)
which are or may be deemed material have been entered or are to be entered in to by the Company.
These Contracts and also the documents for inspection referred to hereunder, may be inspected at
the Registered Office of the Company situated at Shree Ram Mills Premises, Ganpatrao Kadam
Marg, Lower Parel, Mumbai – 400 013, Maharashtra, India from 10.00 a.m. to 1.00 p.m., on Business
Days, from the date of this Draft Letter of Offer until the date of closure of the Issue.

Material Contracts
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1. MOU dated 15 September, 2010 with Aryaman Financial Services Limited, appointing them as
Lead Manager to the Issue.
rd
2. MOU dated 23 September, 2010 with Bigshare Services Pvt. Limited, appointing them as
Registrars to the Issue.

3. Tripartite Agreements among the Company, Bigshare Services Pvt. Limited, and CDSL and
NSDL dated 24th October, 2005 and 26th September, 2005 respectively.

Documents for inspection

1. Memorandum and Articles of Association of the Company.

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2. Certificate of Incorporation dated 25 January, 1935 of the Company

3. Consents of the Directors, Auditors, Company Secretary, Lead Manager to the Issue, Legal
Advisor to the Issue and Registrar to the Issue to include their names in the Draft Letter of Offer to
act in their respective capacities.
th
4. Due Diligence certificate from the Lead Manager dated 30 October, 2010.
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5. Copy of the resolution of the Board of Directors dated 29 April, 2010 approving this Issue.

6. Annual Reports of the Issuer Company for the last five years.
th
7. Limited Review Report dated 30 October, 2010 issued by M/s. Khandelwal Jain & Co. and M/s.
Habib & Co. - statutory Auditors of the Company on the interim stand-alone and consolidated
st st
financial statements of the Company for the period from 1 January, 2010 to 31 July, 2010.
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8. Statement of Tax Benefits dated 19 July 2010 from M/s. Habib & Co. – Statutory Auditors of the
Company.

9. Copy of the prospectus of the Initial Public Offering made in 1968

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10. Copy of AAIFR Order dated 11 November 1994

11. Copy of in-principle approval received from Bombay Stock Exchange Limited vide letter no. [●]
dated [●].

12. Copy of SEBI Observation letter no. [●] dated [●] and compliance thereof.

Any of the contracts or documents mentioned in this Draft Letter of Offer may be amended or modified
at any time if so required in the interest of the Company or if required by the other parties, without
reference to the shareholders subject to compliance of the provisions contained in the Companies Act
and other relevant statutes.

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 DECLARATION

No statement made in this Draft Letter of Offer contravenes any of the provisions of the Companies
Act, 1956 and the rules made there under. All the legal requirements connected with the Issue as also
the guidelines, instructions etc. issued by SEBI, Government and any other competent authority in this
behalf have been duly complied with.

We hereby certify that all the disclosures in this Draft Letter of Offer are true and correct.

Signed by all the Directors of the Company

________________________________ ________________________________

MR. SHAMBHUKUMAR. S. KASLIWAL MR. VIKAS S. KASLIWAL

Chairman Vice-Chairman & CEO

________________________________ ________________________________

MR. AMBUJ A. KASLIWAL MR. MUKUL S. KASLIWAL

Vice-Chairman Director

________________________________ ________________________________

MR. SUBHKARAN K. LUHARUKA MR. VIJAY G. KALANTRI

Whole-Time Director Director

________________________________ ________________________________

DR. OM PRAKASH CHAWLA MR. LALIT MOHAN

Director Director

________________________________ ________________________________

MR. XERXES N. TALATI MR. MOHAN JAYAKAR

Director Director

________________________________ ________________________________

DR. POORNIMA ADVANI MR. SURENDRA S. BHANDARI

Director Director

________________________________ ________________________________

MR. N. K. MODANI MS. MANJU B BATHAM

President (Finance) & CFO Company Secretary & Compliance Officer

Place: Mumbai
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Date: 30 October, 2010

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