Arun Excello Infrastructure Private Limited

ARUN EXCELLO INFRASTRUCTURE PRIVATE LIMITED (Demerged Company)
DIRECTORS REPORT
Your Directors have immense pleasure in presenting the Annual Report on the business and operations of your Company together with audited accounts for the financial year ended March 31, 2008. I. FINANCIAL RESULTS (Rs. in Lakhs) Particulars Sources of funds Shareholders funds Loan Fund Deferred Tax Liability TOTAL Application of Funds Fixed Asset & Pre-operative Expenses Net Current Assets Preliminary expenses Profit and Loss Account TOTAL II. 2007-2008 10,250.76 5,045.90 15,296.66 2006-2007 900.00 5,885.31 95.11 6,880.42
13,456.99 1,830.22 6.72 2.73 15,296.66
1,458.11 5,385.42 6.84 30.05 6,880.42
APPROPRIATION AND DIVIDENDS The Directors do not recommend any dividend for the current period. Further no appropriations have been made during the year under review. OPERATIONAL REVIEW During the year under review, your Company proposed to demerge other business carried out, retaining only the business relating to IT / ITES SEZ and to focus on the same. Your Company has also obtained necessary approvals from the Board / Shareholders of the Company and filed necessary application for demerger before the Honble High Court, Chennai. The Honble High Court by its order dated December 17, 2007 has approved the said demerger and accordingly your Company will focus only on IT / ITES SEZ related business. In order to meet the growing demand for IT / ITES commercial space, your Company is developing approximately 3 million Sq. ft, in an area of 28 acres of land situated at Vallancheri Village, Chenglepet Taluk. The Signature Tower will be completed by December 2008 and the whole project is expected to be completed by the year 2011-12. In accordance with the Shareholders Agreement entered by your Company with L&T Urban Infrastructure Limited, your Company allotted 9,367,347 Equity Shares of Rs. 10 each on February 18, 2008 to L&T Urban Infrastructure Limited, whereby your Company has become the subsidiary of L&T Urban Infrastructure Limited.
III.
IV.
CAPITAL EXPENDITURE As at March 31, 2008, the gross fixed assets stood at Rs. 11,277.75 lakhs and the net fixed assets including capital work-in-progress and preoperative expenses stood at Rs. 13,456.99 lakhs. AUDITORS REPORT The Auditors Report to the Shareholders does not contain any qualifications. DEPOSITS The Company has not accepted any deposits from the public.
V.
VI.
VII. PARTICULARS OF EMPLOYEES Your Company has appointed Mr. T. Velayudhan, as Manager under the provisions of the Companies Act, 1956 subject to the approval of the Shareholders in the ensuing Annual General Meeting. The resolution for the approval of the appointment of Mr. T. Velayudhan is being placed before the shareholders for approval. Further, there are no employees covered by the provisions of the Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975. VIII. DIRECTORS RESPONSIBILITY STATEMENT Pursuant to Section 217(2AA) of the Companies Act, 1956 your Directors hereby state and confirm the following:1. that in the preparation of the annual accounts, the applicable accounting standards had been followed;
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2. 3. 4. IX. that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year; that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and that the directors had prepared the annual accounts on a going concern basis.
CHANGE OF NAME Consequent upon the demerger order passed by the Honble High Court and the Companys business object of focusing only in IT/ITES SEZ activities, your Company proposes to change its existing name to L&T ARUN EXCELLO IT SEZ PRIVATE LIMITED and accordingly the resolution for the change of name has been proposed in the ensuing Annual General Meeting and after obtaining necessary approval the name of the Company will be changed as above. DIRECTORS During the year under review Mr. P . Karthikeyan and Mr. S. Rajaji resigned as Directors of the Board and your Board places its appreciation for the valuable services rendered by them. Mr. S. Hariharan, Mr. T. V. Karthikeyan, and Mr. R. Sridaran have been appointed as Additional Directors on February18, 2008. As per the provisions of Section 260 of the Companies Act, 1956, these directors hold office only up to the date of the forthcoming Annual General Meeting of the Company. The Company has received notices under Section 257 of the Companies Act, 1956 in respect of the above persons, proposing their appointment as Directors of the Company, along with requisite deposit. Resolutions seeking approval of the Shareholders for their appointment have been incorporated in the Notice of the forthcoming Annual General Meeting.
X.
XI.
AUDITORS Your Company has entered into a Shareholders Agreement with M/s L&T Urban Infrastructure Limited (LTUIL) and LTUIL has subscribed to 51% of the equity capital of your Company. Accordingly your Company has become the Subsidiary of LTUIL. A Special Notice has been received from a member of the Company proposing to appoint M/s. Sharp & Tannan, Chartered Accountants, as Auditors of the Company. M/s. Sharp & Tannan, Chartered Accountants have given their consent to be appointed as the Statutory Auditors of the Company. They have also given a letter to the effect that in case of their appointment as Statutory Auditors of the Company, be made, the same would be in accordance with the limits specified in Section 224(1B) of the Companies Act, 1956. The Board recommends the appointment of M/s. Sharp & Tannan, Chartered Accountants as Statutory Auditors of the Company.
XII. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, AND FOREIGN EXCHANGE EARNINGS AND OUTGO UNDER SECTION 217(1)(e) OF THE COMPANIES ACT, 1956 READ WITH THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF THE BOARD OF DIRECTORS) RULES, 1988 Conservation of Energy: The operations of your company are not energy intensive as company is not engaged in manufacturing activity. However, the Company has taken adequate measures to conserve the energy in regular operations. Technology Absorption: No technology has been developed and/or imported by way of foreign collaboration. Foreign Exchange Earnings and Outgo: Your Company has incurred expenditure in Foreign Currency as detailed below:(Rs. in Lakhs) Particulars Travelling Expenses Consultancy Charges (included in the Vallanchery Project Expenses) 2007-08 2.67 99.82 2006-07 13.66 130.68
XIII. ACKNOWLEDGEMENTS The Directors acknowledge the invaluable support extended to the company by the Financial Institutions, Bankers. The Directors pleased to place on record their appreciation for the valuable contribution made by the employees of the Company. For and on behalf of the Board
Place: Chennai Date : April 29, 2008
KARTHIKEYAN T. V. Director
S. HARIHARAN Director
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AUDITORS REPORT
TO THE MEMBERS OF ARUN EXCELLO INFRASTRUCTURE PRIVATE LIMITED 1. We have audited the attached Balance Sheet of ARUN EXCELLO INFRASTRUCTURE PRIVATE LIMITED (Demerged Company): CHENNAI as on March 31, 2008 and also the Profit and Loss Account of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis of our opinion. As required by the Companies (Auditors Report) Order, 2003 issued by the Company Law Board in terms of Section 227(4A) of the Companies Act, 1956, we enclose an Annexure which is a statement on the matters specified in paragraphs 4 and 5 of the said Order. Further to our comments in the Annexure referred to in paragraph 1 above. a) b) c) d) e) f) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit. In our opinion, proper books of accounts as required by law have been kept by the company, so far it as appears from our examination of books. The Balance Sheet and Profit and Loss Account dealt with by the report are in agreement with the books of accounts. In our opinion, the Balance Sheet and Profit & Loss A/c dealt with by this report have been prepared in compliance with the standards referred to in sub-section 3C of Section 211 of the Companies Act, 1956, to the extent applicable. As per representation made by the company and its directors, no director is disqualified from being appointed as director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956. In our opinion, and to the best of our information and according to the explanations given to us, the accounts, give a true and fair view in conformity with the accounting principles generally accepted in India. (i) (ii) In the case of the Balance Sheet of the State of affairs of the company as at March 31, 2008; and In the case of the Profit and Loss Account of the loss for the year ended on that date. M/s. C. A. PATEL Chartered Accountants V. L. MODI Partner Membership No. 23795
2.
3. 4.
Place : Chennai Date : April 29, 2008
ANNEXURE TO THE AUDITORS REPORT

(Referred to in paragraph 1 of our report of even date) FIXED ASSETS a) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets. b) All the assets have been physically verified by the management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification. i) ii) iii) During the year, the Company has transferred major part of the assets to the resulting company in a scheme of demerger approved by the court. During the year there was no inventory. a. The Company has taken loan from two other companies covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 2,542 Lakhs and the year end balance of loans taken from such parties was Rs. 2,042 Lakhs. Company has not granted any loans to companies or firms covered U/s 301 of the Companies Act. In our opinion, one loan is interest free & other loan carries interest and other terms and condition on which loans have been taken from companies, firm or other parties listed in the register maintained under Section 301 of the Companies Act, 1956 are not prima facie, prejudicial to the interest of the Company.
c)
b.
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c. d. iv) The Company is regular in repaying the principal amounts as stipulated and also interest where it is applicable. There is no overdue amount of loans taken from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956.
In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods, During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls. a. b. In our opinion the transactions that needs to be entered in register maintained under Section 301 of Companies Act, 1956 have been so entered. In our opinion, and according to the information and explanations given to us the transaction of purchase of goods, material or services and sale of goods, materials or services, made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956, and aggregating during the year to Rs. 500,000 or more in respect of each party, have been made at prices which are reasonable having regard to the prevailing market price for such goods, materials or services or the prices as at which transaction for similar goods, materials or services have been made with the other parties.
v)
vi)
In our opinion and according the information and explanations given to us, the Company has complied with the provision of Section 58A and 58AA of the Companies Act,1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. In our opinion, the Company did not have internal audit system commensurate with the size and nature of its business. Provision regarding maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 are not applicable. a. The Company is regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Custom Duty, Excise Duty, Cess and other material statutory dues applicable to it. According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales Tax, Customs Duty, Excise Duty and Cess were in arrears, as at March 31, 2008 for a period of more than six months from the date the became payable. According to the information and explanations given to us, there are no dues of Sale Tax, Income Tax, Customs Duty, Wealth Tax, Excise Duty and Cess which have not been deposited on account of any dispute.
vii) viii) ix)
b.
c. x) xi)
In our opinion, the accumulated losses of the Company are not more than fifty per cent of its net worth. The Company has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to financial institution, debenture holders however majority of loans are transferred to resulting company (AEUIPL) in scheme of demerger approved by the court. The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. In our opinion, the Company is not a chit fund or a Nidhi / Mutual Benefit Fund / Society. Therefore, the provisions of clause 4(xiv) of the Companies (Auditor Report) Order, 2003 are not applicable to the company. In our opinion the Company is not dealing in or trading in shares, securities, debentures and other investment. Therefore the provisions of clause 4(xiv) of the Companies (Auditor Report) Order, 2003 are not applicable to the company. We are informed by management, that no guarantee is given by the Company for loan taken by others from banks and financial institutions. In our opinion, and according information and explanations given to us, the term loans are applied for the purpose for which they were raised.
xii) xiii) xiv) xv) xvi)
xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that the no funds raised on short-term basis have been used to finance long - term investment and vice versa. However certain loans belonging to resulting company is transferred as per the scheme of demerger. xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. xix) xx) xxi) The provisions of this clause are not applicable, since Company has not issued any debentures. During the year the Company has raised the money by way of private placement at premium during the year. During the course of our examination of books of accounts carried out in accordance with generally accepted auditing practice in India, we have not come across any instance of fraud on or by the Company nor have we been informed by the management of any such instances being noticed or reported during the year. M/s. C. A. PATEL Chartered Accountants V. L. MODI Partner Membership No. 23795
Place : Chennai Date : April 29, 2008
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BALANCE SHEET AS AT MARCH 31, 2008

Schedule SOURCES OF FUNDS Shareholders Funds Share Capital Reserves & Surplus Loan Funds Secured Loans Unsecured Loans Deferred Tax Liability TOTAL APPLICATION OF FUNDS Fixed Assets Gross Block Less: Depreciation Net Block Capital Work-in-Progress Preoperative Expenses Current Assets, Loans & Advances Sundry Debtors Cash and Bank Balances Loans & Advances Land Less: Current Liabilities & Provisions Sundry Creditors Provisions 6 91,528,085 1,450,883 92,978,968 Net Current Assets Preliminary Expenses Profit and Loss Account TOTAL SIGNIFICANT ACCOUNTING POLICIES NOTES ON ACCOUNTS A B 183,021,757 672,746 273,289 1,529,666,895 19,471,893 2,845,868 22,317,761 538,542,785 684,149 3,005,157 688,043,415 5 196,272 35,620,632 240,183,821 276,000,725 176,159,402 7,547,652 109,977,965 267,175,527 560,860,546 2 3 As at 31.03.2008 Rupees Rupees As at 31.03.2007 Rupees Rupees
183,673,470 841,403,325 300,390,100 204,200,000 1,529,666,895
90,000,000 247,754,258 340,777,233 9,511,924 688,043,415
4 1,127,775,679 1,590,079 1,126,185,600 193,787,026 25,726,477 1,345,699,103 87,092,300 8,544,750 78,547,550 67,263,775 145,811,325
The Schedules referred to above and the notes attached form an integral part of the financial statements. As per our report attached M/s. C. A. PATEL Chartered Accountants V. L. MODI Partner Membership No. 23795 Place: Chennai Date: April 29, 2008 K. VENKATESAN Secretary Place: Chennai Date: April 29, 2008 P . SURESH Director S. HARIHARAN KARTHIKEYAN T. V. Director Director For and on behalf of the Board
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PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31, 2008
Schedule INCOME Income from Services / Operations Other Income / Wind Mill TOTAL 7 1,109,828 2,910,061 4,019,889 571,309,426 7,804,577 579,114,003 March 31, 2008 Rupees March 31, 2007 Rupees
EXPENDITURE Decrease in Work-in-progress Purchases & Direct Expenses Selling and Administrative Expenses Salary & Staff Expenses Finance Expenses Depreciation TOTAL 8 9 10 11 1,156,979 618,559 359,156 2,985,170 3,261,519 8,381,383 21,067,425 517,799,340 7,002,090 9,109,838 7,994,794 8,544,750 571,518,236
Profit / (Loss) for the Year Less: Provision for Income Tax FBT Provision Profit / Loss after Tax Less : Deferred Tax Liability Profit & Loss Account - Opening Balance Less: Transferred from Capital Reserve (Revaluation Reserve) Balance Carried to Balance Sheet Earning per share - Basic SIGNIFICANT ACCOUNTING POLICIES NOTES ON ACCOUNTS A B
(4,361,494) 34,000 (4,395,494) (3,005,157) 7,127,362 (273,289) (0.24)
7,595,767 853,000 236,000 6,506,767 9,511,924 (3,005,157) (0.34)
The Schedules referred to above and the notes attached form an integral part of the financial statements. As per our report attached M/s. C. A. PATEL Chartered Accountants For and on behalf of the Board
V. L. MODI Partner Membership No. 23795 Place: Chennai Date: April 29, 2008
K. VENKATESAN Secretary Place: Chennai Date: April 29, 2008
P . SURESH Director
S. HARIHARAN KARTHIKEYAN T. V. Director Director
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CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2008
2007-2008 Rupees A. Cash Flow from Operating Activities Net Profit / (Loss) before tax & extraordinary items Adjustment for Depreciation Interest paid Interest received Operating Profit before Working Capital changes Adjustments for (Increase) / Decrease in trade and other receivables (Increase) / Decrease in inventories (Increase) / Decrease in Miscellaneous Expenses (Increase) / Decrease in Pre opertive Expenses (Increase) / Decrease in Loans and Advances (Increase) / Decrease in Capital Work-in-progress (Increase) / Decrease in Land & Other expenses Increase / (Decrease) in trade payables Transfer of Reserve & Block Dep. To Resulting Company Increase / (Decrease) in Deferred Tax Liability Cash generated from Operations Direct taxes paid Net Cash from Operating Activities (A) B. Cash Flow from Investing Activities Purchase of Fixed Assets Interest received Net Cash / (used in) from Investing Activities (B) C. Cash Flow from Financing Activities Issue of Equity shares and advance against share capital Securities Premium received (Repayment) / Proceeds from other borrowings (net) Interest paid Net Cash / (used in) from Financing Activities (C) Net increase in Cash and Cash Equivalents (A+B+C) Cash and Cash Equivalents as at the beginning (including cash credit from banks) Cash and Cash Equivalents as at the end (including cash credit from banks) Notes: (a) (4,361,494) 3,261,519 2,985,170 (2,202,349) (317,154) 175,963,130 11,402 (25,605,077) (130,205,856) (126,523,251) 70,661,207 (545,417,209) (9,511,924) (590,944,732) (34,000) (590,978,732) (15,404,901) 2,202,349 (13,202,552) 93,673,470 625,507,355 (83,941,391) (2,985,170) 632,254,264 28,072,980 7,547,652 35,620,632 2006-2007 Rupees 7,595,767 8,544,750 7,994,794 (1,399,513) 22,735,798 (149,197,118) 21,067,425 (684,148) (67,263,775) (32,473,021) (74,774,512) 9,672,062 (270,917,289) (1,089,000) (272,006,289) (37,827,208) 1,399,513 (36,427,695) (46,929,599) 367,236,212 (7,994,794) 312,311,819 3,877,835 3,669,817 7,547,652
Cash flow statement has been prepared under the Indirect Method as set out in the Accounting Standard 3 issued by the Institute of Chartered Accountants of India. (b) Cash and cash equivalents represent cash and bank balances. (c) Figures for the previous year have been regrouped / reclassified wherever necessary.
As per our report attached M/s. C. A. PATEL Chartered Accountants
For and on behalf of the Board
V. L. MODI Partner Membership No. 23795 Place: Chennai Date: April 29, 2008
K. VENKATESAN Secretary Place: Chennai Date: April 29, 2008
P . SURESH Director
S. HARIHARAN KARTHIKEYAN T. V. Director Director
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SCHEDULES FORMING PART OF ACCOUNTS

As at 31.03.2008 Rupees SCHEDULE - 1 SHARE CAPITAL Authorised 2,00,00,000 Equity Shares of Rs. 10 each Issued, Subscribed and Paid-up 1,83,67,347 Equity Shares of Rs. 10 Each fully paid up (including 93,67,347 shares of Rs. 10 each issued to LTUIL during the year) Reserves & Surplus Capital Reserve Revaluation Reserves Less: Transferred to Resultant Company (AEUIPL) in the scheme of Demerger approved by the Court Less: Profit & Loss Account (Debit Balance) Share Premium (Received in Allotment of 93,67,347 equity shares) TOTAL As at 31.03.2007 Rupees
200,000,000 183,673,470
200,000,000 90,000,000
758,102,951 (535,079,619) (7,127,362) 215,895,970 625,507,355 841,403,325
SCHEDULE - 2 SECURED LOANS Term Loans - Banks & Financial Institutions (Secured by Hypothecation of Fixed Assets) Loan from Indian Overseas Bank (Line of Credit) (Company has been granted his share of LINE OF CREDIT from Indian Overseas Bank to the extent of Rs. 50,00,00,000 Secured against Vallanchery Land) TOTAL 476,696 299,913,404 55,718,553 192,035,705
300,390,100
247,754,258
SCHEDULE - 3 UNSECURED LOANS Unsecured Loan From Share Holders From Associate Companies TOTAL 204,200,000 204,200,000 47,169,884 293,607,350 340,777,233
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SCHEDULES FORMING PART OF ACCOUNTS (Contd.)

SCHEDULE - 4 FIXED ASSETS
GROSS BLOCK DESCRIPTION As At 01.04.2007 Rupees Additions During the Year Rupees Disposals During the Year Rupees 30,135 599555 629,690 1,268,893 Transfer/ Adjustments During the Year Rupees 6,864,714 1,490,034 As At 31.03.2008 Rupees As At 31.03.2007 Rupees DEPRECIATION / AMORTISATION For The Period 31.03.2008 Rupees 11,892 59,131 292 283,042 215,287 417,041 200 1,022,728 1,356,368 16,938 3,382,919 8,544,750 Transfer/ Adjustments During the Year Rupees 74,830 473,091 2484 1,895,326 528,811 1,570,616 5,765,172 25,443 10,335,773 Depriciation Withdrawn Rupees 349 1,468 1,817 As At 31.03.2008 Rupees NET BLOCK As At 31.03.2008 Rupees As At 31.03.2007 Rupees 6,864,714 1,427,096 1,989,951 8,769 11,406,693 2,096,302 8,606,616 44,114,800 2,032,609
Tangible Assets Land 6,864,714 Building 1,490,034 Furniture & Office Equipment 2,404,260 314,719 Cycle 10,961 Plant & Machinery 13,047,194 3,399,469 Data Processing Machine 2,485,360 645,170 Vehicles & Scooters 9,891,419 Land At Vallanchery 1,098,574,880 Office Equipments 8,500 Windmill Power Generator 48,857,244 Incubation Centre 24,414,622 Godown Vallancherry 2,041,114 72,777 TOTAL Previous Period Capital Work-in-progess 87,092,300 1,127,430,137 49,265,092 39,096,101
62,938 414,309 2,192 1,640,501 389,058 1,284,803 4,742,444 8,505 8,544,750
2,688,844 10,961 12,468,279 3,378,829 2,493,860 636,670 9,129,241 762,178 1,098,574,880 8,500 48,857,244 24,414,622 2,113,891 86,117,068 1,127,775,679 87,092,300
26,749 3,352,080 75,534 561,136 131,228 630,950 1,098,574,880 200 8,300 1,356,368 23,058,254 1,590,079 1,126,185,600 8,544,750 193,787,027
78,547,550 67,263,775
NOTE : Incubation Centre is a temporary strucuture constructed. It has been amortised over period of 36 months. As at 31.03.2008 Rupees Rupees SCHEDULE - 5 CURRENT ASSETS, LOANS & ADVANCES Sundry Debtors (Considered Good) Debts outstanding for a period exceeding six months Other Debts Cash and Bank Balances Cash on hand Bank Balances with Scheduled Banks on current accounts Loans and Advances Advances recoverable in cash or in kind or for value to be received (Unsecured considered good) Due from Associate Concern TOTAL As at 31.03.2007 Rupees Rupees
196,272 196,272 8,046 35,612,586 220,109,212 20,074,609 2,40,183,821 276,000,725
5,959,050 170,200,353 176,159,402 4,224,166 3,323,485 43,786,862 66,191,103 109,977,965 293,685,019
35,620,632
7,547,652
SCHEDULE - 6 CURRENT LIABILITIES & PROVISIONS Current Liabilities Due to Others Ultimate Holding Company Associates Concern Others Provisions for TDS Fringebenefit Tax / Income Tax Expenses TOTAL
489,881 85,139,219 5,898,985 91,528,085 129,389 121,860 1,199,634 1,450,883 92,978,968
6,211,881 13,260,012 19,471,893 1,487,447 853,000 505,421 2,845,868 22,317,761
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2007-08 Rupees SCHEDULE - 7 OTHER INCOME Electricity Recovery Wind Mill Receipts Interest Receipts Others TOTAL 196,272 408,142 2,202,349 103,298 2,910,061 5,750,779 1,399,513 654,285 7,804,577 2006-07 Rupees
SCHEDULE - 8 SELLING AND ADMINISTRATIVE EXPENSES Administrative Expenses Marketing Expenses Telephone, Postage & Telegrams Travel & Conveyance Professional & Consultancy Charges Printing & Stationery Preliminary Expenses Written off TOTAL 556,937 8,235 13,986 23,000 4,999 11,402 618,559 5,379,245 396,758 140,242 502,295 251,039 256,494 76,017 7,002,090
SCHEDULE - 9 STAFF EXPENSES Salaries, Wages and Bonus Contribution to and Provision for Provident Fund Welfare and other expenses TOTAL 28,716 327,360 31,797 359,156 530,691 8,682,646 427,192 9,109,838 298,644 8,151,955
SCHEDULE - 10 INTEREST AND BROKERAGE Interest and Finance Charges on Secured & Unsecured Loan TOTAL 2,985,170 2,985,170 7,994,794 7,994,794
SCHEDULE - 11 DEPRECIATION Depreciation / Amortisation for the period Depreciation capitalised with C.W.I.P . Rs. 34,466 TOTAL 3,261,519 3,261,519 8,544,750 8,544,750
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SCHEDULE - A SIGNIFICANT ACCOUNTING POLICIES Basis for Preparation of Accounts The accounts have been prepared to comply in all material aspects with applicable accounting principles in India, the Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956. Fixed Assets Fixed Assets are stated at Cost less accumulated depreciation except Land which has been revalued during the year and the cost of the land has been stated at revalued cost. Depreciation is provided (except in the case of leasehold land which is being amortised over the period of the lease) on the Straight line method and the rates and in the manner specified in Schedule XIV of the Companies Act, 1956. Impairment of Assets Impairment of loss, if any, is provided to the extent, the carrying amount of assets exceeds their recoverable amount. Recoverable amount is higher of an assets net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset at from its disposal at the end of its useful life. Sundry debtors and Loans and Advances Sundry debtors and Loans and Advances are stated after making adequate provisions for doubtful balances. Retirement / Post Retirement Benefits Contributions to schemes such as Provident Fund, etc. are charged to the Profit and Loss account as incurred in respect of certain employees. Taxes on Income Current tax is determined as the amount of tax payable in respect of taxable income for the period. Deferred tax is recognized, subject to the consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax assets are not recognized on unabsorbed depreciation and carry forward of losses unless there is virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Intangible Assets and Amortization Intangible asset are recognized as per the criteria specified in Accounting Standard (AS) 26 Intangible Assets issued by the Institute of Chartered Accountants of India are as follow: a) b) Incubation Centre: Amortised over the period of life of the Asset. Preliminary Expenses are written off in the year of commencement of operations.
Depreciation Depreciation is provided in the accounts on W.D.V. basis at the rates and in the manner specified in the Schedule XIV to the Companies Act, 1956. Depreciation on additions / deductions is calculated pro rata from / to the month of additions / deductions. Revenue Recognition The revenue from services rendered is recognized based on the agreements with the party. Provisions and Contingent Liabilities Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation. If a) b) c) a) b) The Company has a present obligation as result of a past event. a probable outflow of resources is expected to settle the obligation and The amount of the obligation can be reliably estimated. A present obligation arising from a past event, when it is not probable that an outflow of resources will be required to settle the obligation. A possible obligation, unless the probability of outflow of resources is remote.
Contingent liability is disclosed in the case of
S-989

SCHEDULE - B NOTES ON ACCOUNTS I. Contingent Liabilities: a. Estimated amount of contracts remaining to be executed on capital account and not provided for b. Liability on letter of credit opened by bankers for purchase of: c. Liability on guarantee given by the bankers d. Liability on guarantee given to bankers II.
76,08,31,106 NIL NIL NIL
NIL NIL 25,50,000 NIL
Micro and small scale business entities There are no Micro and Small Enterprises, to whom the Company owes dues, which are outstanding for more than 45 days as March 31, 2008. This information a required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with company. a. Expenditure in Foreign Exchange during the year: 31.03.2008 Rupees Travelling Expenses Consultancy Charges (Included in the Vallanchery Project Expenses) b. Auditors Remuneration (Excluding Service Tax): Audit fees 61,140 62,300 2,67,906 99,82,700 31.03.2007 Rupees 13,66,663 1,30,68,174
III.
IV.
The company has got the SEZ approval for development of I.T Park for the land at Vallanchery by Government Notification dated May 1, 2007. As per the SEZ Act land cannot be sold and can be leased only. Hence, the land kept in current assets has been transferred to Fixed Assets. Board of Directors at their meeting on May 15, 2007 decided to revalue the land at Vallanchery. As per the JMR Consultants (Chartered Engineers & Registered Valuers) reports the land at Vallanchery will fetch Rs. 350 Lakhs per acre. Based on this land has been revalued and the difference between the cost and revised value credited to the Capital Reserve Account. Initially as engineering contractors the Company was carrying out industrial contract works and Wind Mill activities. Keeping infrastructure development activity in mind the company has started procuring land and applied to the Ministry of commerce government of India for SEZ approval. The company has got SEZ approval on May 1, 2007 from the Ministry of Commerce Government of India Vide notification S.O.696 (E) for construction of I.T Park. We have been advised by our consultants that IT park activity should be exclusively carried out to avail of the various benefits offered by the government and that the company should go for a demerger. Based on this the company has applied to the honorable High court of Chennai for a scheme of demerger. The demerger scheme has been approved by the Honorable high court of Chennai vide CP . No 192/2007 dated November 28, 2007 & CP . NO.192/2007 dated December 17, 2007 with the appointed date as June 1, 2007. As on June 1, 2007 the company has transferred all the Assets and the Liabilities relating to Wind Mill and Industrial contracts to the resulting company Arun Excello Urban Infrastructure Private Limited.
V.
VI.
Under the scheme of demerger as approved by the court vide their order dated November 28, 2007 and December 17, 2007, all the assets and liabilities belonging to resulting company (Arun Excello Urban Infrastructure Private Limited) were transferred on June 1, 2007. Difference of Assets and Liabilities transferred to resulting company were reduced from Capital Reserve account amounting to Rs. 53,50,79,618.57.
VII. Revaluation Reserves (Capital Reserve) has been withdrawn to the extent of Profit & Loss Account debit balance of Rs. 71,27,362 upto May 31, 2007. VIII. Company during the year has issued equity shares to L&T Urban Infrastructure Limited at a premium of Rs. 66.7753 per share. IX. X. Company during the year transferred certain land at Vallanchery at cost to L&T Arun Excello Realty Private Limited and L&T Arun Excello Commercial Projects Private Limited as these lands were coming in the area of the respective Companies. Disclosure of Related Parties / related party transactions. A. Key Management Personel: 1. P . Suresh 2. A. M. Sundar 3. S. Hariharan 4. T. V. Karthikeyan 5. R. Sridaran B. List of Related Parties: Holding Companies : L&T Urban Infrastructure Limited (a subsidiary of L&T Infrastructure Development Projects Limited) L&T Infrastructure Development Projects Limited (a subsidiary of Larsen & Toubro Limited) Larsen & Toubro Limited (Ultimate Holding Company)
S-990

Fellow Subsidaries : L&T Arun Excello Commercial Projects Pvt. Limited L&T Transportation Infrastructure Limited L&T Infocity Limited L&T Phoneix Infoparks Private Limited Cyber Park Development & Construction Limited Arun Fabricators Arun Excello Foundations Private Limited Arun Excello Urban Infrastructure Private Limited Amount of Transaction Rupees Amount Due to Rupees Amount Due from Rupees
Group Companies
C.
Transaction with Related Parties: S. Nature of Transaction No. 1 Holding Company Larsen & Toubro Limited i) Mobilisation Advance ii) Construction of Building ii) Reimbursement of Expenses L&T Urban Infrastructure Limited Holding Company i) Cost of Services ii) Reimbursement of Expenses iii) Allotment of Shares including securities premium 2 Fellow Subsidiaries L&T Transportation Infrastructure Limited i) ICD repaid ii) Interest on ICD paid L&T Arun Excello Commercial Projects Private Limited i) Sale of land ii) Reimbursement of Expenses Cyber Park Development & Construction Limited i) Reimbursement of Expenses L&T Infocity Limited i) Reimbursement of Expenses ii) Cost of Services L&T Phoneix Infoparks Private Limited Reimbursement of Expenses Arun Excello Foundations Pvt. Limited Job Work & Funds Transfer Arun Excello Urban Infrastructure Pvt. Limited Interest Free Loan Arun Excello Urban Infrastructure Pvt. Limited Amount transferred on demerger and Funds transfer
21,50,00,000 (Nil) 8,40,83,516 (Nil) 4,89,881 (Nil) 15,41,690 (Nil) 1,10,97,505 (Nil) 71,91,80,825 (Nil)
Nil (Nil) Nil (Nil) 4,89,881 (Nil) Nil (Nil) Nil (Nil) Nil (Nil)
Nil (Nil) Nil (Nil) Nil (Nil) Nil (Nil) Nil (Nil) Nil (Nil)
11,00,00,000 (Nil) 18,52,603 (Nil) 1,97,92,661 (8,40,93,489) 35,69,211 (Nil) 4,595 (Nil) 6,30,528 (Nil) 15,699 (Nil) 80,900 (Nil) 17,43,45,319 (Nil) 14,42,00,000 (Nil) 79,60,02,009 (Nil)
6,00,00,000 (Nil) Nil (Nil) Nil (Nil) Nil (Nil) Nil (Nil) Nil (Nil) 15,699 (Nil) Nil (Nil) Nil (Nil) 14,42,00,000 (Nil) NIL (Nil)
Nil (Nil) Nil (Nil) 1,68,29,386 (9,41,50,539) 31,42,592 (Nil) Nil (Nil) Nil (Nil) Nil (Nil) Nil (Nil) Nil (Nil) NIL (Nil) 1,02,630 (Nil)
S-991

S. Nature of Transaction No. 3. Group Companies Arun Fabricators Funds Transfer L&T Arun Excello Reality Pvt. Limited Funds Transfer Transfer of Land Reimbursement of Expenses Figures in bracket relate to previous year. XI. Provision for taxes represents fringe benefit tax. The Company does not have taxable wealth under the provisions of the Wealth Tax Act, 1952. Amount of Transaction Rupees Amount Due to Rupees Amount Due from Rupees
16,17,66,166 (Nil) 14,66,01,000 (Nil) 28,25,197 (Nil) 13,79,232 (Nil)
Nil (Nil) 8,51,39,219 (Nil) Nil (Nil) Nil (Nil)
Nil (Nil) Nil (Nil) Nil (Nil) Nil (Nil)
XII. Unsecured loan repayable on demand comprises of the followings : a. b. Received from L&T Transportations Infrastructures Pvt. Limited Received from Arun Excello Urban infrastructure Pvt. Limited
XIII. Deferred Tax Liability: Net Deferred Tax Liability as of March 31, 2008 is Rs. 99,353. No provision has been made for Deferred Tax Liability in the current year since the same is expected to be reversed, during the tax holiday period u/s 80IAB of Income Tax Act, 1961. As per our report attached M/s. C. A. PATEL Chartered Accountants V. L. MODI Partner Membership No. 23795 Place: Chennai Date: April 29, 2008 K. VENKATESAN Secretary Place: Chennai Date: April 29, 2008 P . SURESH Director S. HARIHARAN KARTHIKEYAN T. V. Director Director For and on behalf of the Board
S-992

XIV. BALANCE SHEET ABSTRACT AND COMPANYS GENERAL BUSINESS PROFILE I. Registration Details Registration No. U 4 5 2 0 3 T N 2 0 0 6 P T C 0 5 9 5 9 1 3 1 0 3 0 8 Date Month Year Capital raised during the year (Amount in Rs. Thousands) Public Issue N I L Bonus Issue N I L Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands) Total Liabilities 1 5 2 9 6 6 7 Sources of Funds Paid-up Capital (Including Advance against Share Capital) 1 8 3 6 7 3 Secured Loans 3 0 0 3 9 0 Application of Funds Net Fixed Assets 1 3 4 5 6 9 9 Net Current Assets/(Liabilities) 1 8 3 0 2 2 Accumulated Losses 2 7 3 Performance of Company (Amount in Rs. Thousands) Turnover (including other income) 4 0 2 0 + Profit/Loss before tax + 4 3 6 1 + Earnings per Share in Rs. 0 . 2 4 Generic Names of Three Principal Products/Services of the Company (as per monetory terms) Item Code No. N . A . (ITC Code) Product Description DEVELOPMENT OF IT SEZ PARK Balance Sheet Date State Code 1 8
II.
Rights Issue N I L Private Placement 9 3 6 7 3 Total Assets 1 5 2 9 6 6 7 Reserves & Surplus 8 4 1 4 0 3 Unsecured Loans 2 0 4 2 0 0 Investments N I L Misc. Expenditure 6 7 2
III.
IV.
Total Expenditure 8 3 8 1 Profit/Loss after tax 4 3 9 5 Dividend rate % N I L
V.
XV. Figures for the previous period have been regrouped / reclassified wherever necessary and are not comparable as the previous period was less than a year.
Signatures to Schedule 1 to 12, A and B As per our report attached M/s. C. A. PATEL Chartered Accountants V. L. MODI Partner Membership No. 23795 Place: Chennai Date: April 29, 2008 K. VENKATESAN Secretary Place: Chennai Date: April 29, 2008 P . SURESH Director S. HARIHARAN KARTHIKEYAN T. V. Director Director For and on behalf of the Board
S-993

Arun Excello Infrastructure Private Limited

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ARUN EXCELLO INFRASTRUCTURE PRIVATE LIMITED (Demerged Company)

13,456.99 1,830.22 6.72 2.73 15,296.66

1,458.11 5,385.42 6.84 30.05 6,880.42