Balance Sheet 2011 - moneycontrol.com filenotes: 1. a member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and vote instead of himself and such

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Notice is hereby given that the Twenty Ninth Annual GeneralMeeting of the Members of Lakhani India Limited will beheld on Tuesday, the 27th December, 2011 at 09:00 A.M. atBhagat Vasu Ram Lakhani Community Centre, 2F Park, NIT,Faridabad - 121 001, Haryana to transact the followingbusiness :

ORDINARY BUSINESS

1. To receive, consider and adopt the Audited BalanceSheet as at March 31, 2011 and the Profit and LossAccount for the year ended on that date and the Reportsof the Directors’ and Auditors’ thereon.

2. To appoint a Director in place of Mrs. Suman Lakhaniwho retires by rotation and being eligible, offers herselffor re-appointment.

3. To appoint M/s Rakesh Gupta & Associates, CharteredAccountants as Auditors of the Company and to fix theirremuneration.

SPECIAL BUSINESS

4. To appoint Mr. S. K. Kundra as Director

To consider and, if thought fit, to pass with or withoutmodification(s), the following Resolution as an OrdinaryResolution:-

“RESOLVED that Mr. S. K. Kundra, who was appointedwith effect from 15.11.2011 as an additional Director ofthe Company and holds office up to the date of thisAnnual General Meeting under Section 260 of theCompanies Act, 1956 and in respect of whom theCompany has received a notice in writing from a Memberproposing his candidature for the office of the Director,be and is hereby appointed as a Director of theCompany.

By order of the Boardfor Lakhani India Limited

Arun VirmaniPlace : Faridabad Company Secretary &Dated :15th November, 2011 Legal Head

NOTES:

1. A MEMBER ENTITLED TO ATTEND AND VOTE ATTHE MEETING IS ENTITLED TO APPOINT A PROXYTO ATTEND AND VOTE INSTEAD OF HIMSELF ANDSUCH PROXY NEED NOT BE A MEMBER. THEINSTRUMENT OF PROXY, TO BE VALID, SHOULD BEDEPOSITED AT THE REGISTERED OFFICE OF THECOMPANY NOT LESS THAN FORTY-EIGHT HOURSBEFORE THE COMMENCEMENT OF THE MEETING.

NOTICENOTICENOTICENOTICENOTICE

2. The Register of Members and Share Transfer Books ofthe Company will remain closed from 22nd December,2011 to 27th December, 2011 (both days inclusive).

3. Change of Address: The Members holding physicalshares are requested to intimate changes, if any, in theiraddress with PIN Code to the Company. However theMembers holding Demat Shares are advised to intimatetheir change of Address to their Depository Participant.

4. Members seeking any information with regard toAccounts and Operations of the Company are requestedto write to the Company at least 7 days before the AnnualGeneral Meeting so as to enable the Company to keepthe information ready.

5. As a measure of economy, copies of Annual Report willnot be distributed at the Annual General Meeting.Members/Proxies are requested to bring their copies ofAnnual Report and the Attendance Slip duly filled in forattending the Meeting.

6. All documents referred to the accompanying Notice areopen for inspection at the Registered Office of theCompany during office hours on all working daysbetween 11.00 A.M. and 1.00 P.M. up to the date of theAnnual General Meeting.

7. Pursuant to the provisions of Section 205A (5) [asamended by the Companies (Amendment) Act, 1999]the Company is required to transfer Unclaimed orUnpaid Dividend amount after the expiry of Seven (7)years from the date of Transfer to Unpaid DividendAccount to the “Investor Education and Protection Fund”(IEPF) constituted under Section 205C of the CompaniesAct, 1956 and thereafter no Shareholders will be entitledto claim the dividend.

8. The Members desirous to appoint Nominee in respectof their Shareholding in physical form in the Companyare requested to approach to the Company for theprescribed form and thereafter send the duly filled inand signed Nomination Form to the Company for record.

9. In order to facilitate trading of shares by the members ofthe Company in dematerialized form and to hold sharesin dematerialized form, your Company has joined withtwo Depositories namely, National Securities DepositoryLtd. and Central Depository Services (India) Ltd.,the Members may avail their services by openingDepository Account with the Depository Participants intheir locality.

10. The Members who hold shares in dematerialized formare requested to bring their Client Identification Numbers(DP A/c No.) and Depository Participant IdentificationNumbers (DP ID) for easy identification of attendance atthe Annual General Meeting.

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11. The Ministry of Corporate Affairs has introduced ‘GreenInitiative’ whereby the documents are permitted to beserved on the members through electronic mode i.eemail. The initiative is a step towards protection ofenvironment and enabling faster communication withthe members.

Accordingly, the Company proposes to serve allthe documents to e-mail addresses of themembers. Members are requested to provide/update their e-mail addresses with their respectiveDepository Participants (DP) or send and emailat [email protected] to getthe Annual Report and other documents on suche-mail address. Members holding share in physicalform are also requested to intimate their e-mail addressto RCMC Share Registry Pvt. Ltd. by email [email protected] or by sending a communicationat the address mentioned below:

M/s RCMC Share Registry Pvt. Ltd.Unit: Lakhani India LimitedB-106, Sector-2, Noida - 201301 (U.P.)

12. Members/ proxies are requested to note that nogifts/ coupons shall be distributed at the AnnualGeneral Meeting.

ANNEXURE TO NOTICEEXPLANATORY STATEMENT PURSUANT TOSECTION 173(2) OF THE COMPANIES ACT, 1956

Item No. 4

Mr. S. K. Kundra has been appointed as additional Directorof the Company with effect from 15.11.2011. According tothe provisions of Section 260 of the Companies Act, 1956,the above Director holds office up to the date of the nextAnnual General Meeting. As required by Section 257 of theCompanies Act, 1956 a notice has been received from aMember signifying his intention to propose the appointmentof Mr. S. K. Kundra, as Director at the forthcomingAnnual General Meeting. Hence, necessary resolution isplaced before the Meeting for Member’s approval. TheCompany has also received an amount of Rs. 500/- asdeposit.

Mr. S. K. Kundra is deemed to be interested in the proposedresolution to the extent of his appointment as a Director. Noother Director is interested in the resolution.

Directors recommend the resolution as proposed in theNotice for Member’s approval.

DETAILS OF DIRECTOR SEEKING RE-APPOINTMENT IN 29th ANNUAL GENERAL MEETING FIXED FOR27TH DECEMBER, 2011

Name of Director Mrs. Suman Lakhani

Date of Birth 21.01.1957

Date of Appointment 01.10.1996

Qualification Graduate

Expertise in Specific Functional Area She is associated with the Company for the last severalyears having rich experience.

List of other Companies in which Directorship held Lakhani Footcare P Ltd.Lakhani Rubber Udyog P Ltd.Laksons Footwear P Ltd.Lakhani Detergents & Soaps P Ltd.Lakhani Apparel P Ltd.Lakhani Medicare P Ltd.Lakhani Fashion (India) P Ltd.Freshness Coatings P Ltd.Lakhani Platinum Lifestyle P Ltd.Vardaan Detergents P Ltd.Alpha Omega Retail P Ltd.Lakhani Vardaan Auto P Ltd.In addition to the above companies she is also directorin 11 companies.

Chairman/ Member of The Committee of Board ofDirectors of The Companies NIL

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DETAILS OF DIRECTOR SEEKING APPOINTMENT IN 29th ANNUAL GENERAL MEETING FIXED FOR27TH December, 2011

Name of Director S. K. Kundra

Date of Birth 01-05-1949

Date of Appointment 15-11-2011

Qualification B. Sc., MBA, CAIIB

Expertise in Specific functional Area Worked as Deputy General Manager (Audit) in Bank ofIndia and has about 40 years experience in Banking andrelated areas.

List of other Companies in which Directorship held NIL

Chairman/ Member of the Committee of Board of Lakhani India Ltd.Directors of the Companies Member- Audit Committee

Member - Remuneration Committee

By order of the Boardfor Lakhani India Limited

Arun VirmaniPlace : Faridabad Company Secretary &Dated :15th November, 2011 Legal Head

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DIRECTORS’ REPORT

To the Members,

Your Directors have pleasure in presenting the Twenty NinthAnnual Report of your Company together with AuditedAccounts for the year ended 31st March, 2011.

FINANCIAL RESULTS (Rs. in Lacs)

PARTICULARS 2010-11 2009-10

Sales & Other Income 34695.99 28073.03

Profit before Depreciation (1664.98) 1241.44

Less: Depreciation 762.96 702.02

Profit before Tax (2427.94) 539.42

Provision for Tax :

Current 0.00 100.00

Prior period – –

Deferred 64.46 111.76

Net Profit after Tax (2492.40) 327.66

Add: Balance Brought Forward 1617.66 1289.99

Balance Carried to Balance Sheet (874.74) 1617.65

DIVIDEND

No dividend is recommended for the period ended 31st

March, 2011.

DEPOSITS

During the year the Company has not accepted any Depositsunder Section 58A of the Companies Act, 1956 read with theCompanies (Acceptance of Deposits) Rules, 1975.

AUDITORS

M/s Sameer Charu & Associates, Statutory Auditor of theCompany had resigned on 23.05.2011 and thus causingcasual vacancy in the office of Statutory Auditor of theCompany. M/s Rakesh Gupta & Associates, CharteredAccountants, Delhi has been appointed as Statutory Auditorsof the Company through postal ballot conducted as persection 192 A of the Companies Act, 1956 to hold office untilthe conclusion of the ensuing 29th Annual General Meeting.

M/s Rakesh Gupta & Associates, Chartered Accountants,offer themselves for appointment as Statutory Auditors fromconclusion of this Annual General Meeting to the conclusionof the next Annual General Meeting. The Company has alsoreceived a Certificate from the Auditors to the effect that theirappointment, if made, would be in accordance with Section224(1B) of the Companies Act, 1956. The Report of theAuditors is self explanatory and does not call for any furthercomment.

COST AUDITORS

Pursuant to the directives of the Central Government andprovisions of Section 233B of the Companies Act, 1956 M/sK. V. Sharma & Co., Cost Accountants, have been appointedto conduct the Cost Audit of the foot-wear manufactured bythe Company for the year 2011-2012, the Cost Audit Reportwill be directly submitted to the Central Government.

DIRECTORS

Mr. S. K. Kundra was appointed as additional directorpursuant to section 260 of companies act, 1956 in the boardmeeting held on 15.11.2011. He holds office up toforthcoming Annual General Meeting of the company. Yourcompany has received notice from a member seeking hisappointment as Director of your Company pursuant toSection 257 of the Companies Act, 1956.

Mr. Narendra Kumar Pandey has resigned from thedirectorship w.e.f. 09.09.2011. Your Directors place onrecord their appreciation for the valuable services renderedby Dr. N.K. Pandey during his tenure on the board.Mrs. Suman Lakhani, Director of the Company, retires byrotation at the ensuing Annual General Meeting and beingeligible offers herself for re-appointment.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the provisions under Section 217(2AA) of theCompanies Act, 1956, the Directors confirm that inpreparation of Annual Accounts for the Financial Year ended31st March, 2011:

(i) the applicable Accounting Standards have beenfollowed along with proper explanation relating tomaterial departures;

(ii) the appropriate Accounting policies have been selectedand applied consistently, judgments and estimatesmade are reasonable and prudent so as to give trueand fair view of the state of affairs of the Company at theend of the financial year 31st March, 2011 and of theProfit and Loss Account of the company for that period;

(iii) the proper and sufficient care has been taken formaintenance of adequate accounting records inaccordance with the provisions of the Companies Act,1956 for safeguarding the Assets of the Company andfor preventing and detecting fraud and otherirregularities;

(iv) the Annual Accounts for the financial year ended on31st March, 2011 have been prepared on a goingconcern basis.

SUBSIDIARY AND CONSOLIDATED FINANCIALSTATEMENT

The Ministry of Corporate Affairs vide its General CircularNo.2/2011, dated February 08, 2011 has granted a general

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exemption under Section 212(8) of the Companies Act, 1956to all the Companies from annexing the annual accountsand other statements of subsidiary companies with theannual report of the holding company.

A statement setting out important financials of thesubsidiary company is attached and forms a part of thisAnnual Report.

The Annual Accounts of the subsidiary are also available forinspection for any member/ investor, during business hours,at the Registered Office of the Company.

The Consolidated Accounts of the Company are annexed tothis report.

REPORT ON CORPORATE GOVERNANCE ANDMANAGEMENT DISCUSSION AND ANALYSISREPORT

A separate statement on Corporate Governance andManagement Discussion & Analysis Reports along withAuditors’ Certificate is enclosed as an annexure.

PARTICULARS OF EMPLOYEES

There were no Employees who were in receipt ofremuneration in excess of the Limits prescribed underSection 217(2A) of the Companies Act, 1956 read with theCompanies (Particulars of Employees) Rules, 1975, asamended.

CONSERVATION OF ENERGY

The particulars required under Section 217(1) (e) ofthe Companies Act, 1956 read with the Companies(Disclosure of Particulars in the Report of the Board ofDirectors) Rules, 1988 are set out in the Annexure, formingpart of this report.

ACKNOWLEDGEMENT

The Board acknowledges with gratitude the co-operationand assistance provided to your Company by the bankersand authorities of State Government from time to time. TheBoard wishes to place on record its appreciation to thecontribution made by employees of the Company. YourDirectors thank the customers, clients, vendors and otherbusiness associates for their continued support. YourDirectors are thankful to the shareholders for their continued

patronage.

For and on behalf of Board of Directors

P. D. LakhaniPlace : Faridabad Chairman &Dated :15th November, 2011 Managing Director

ANNEXURE TO DIRECTORS’ REPORT:

Statement pursuant to Section 217(1) (e) of the CompaniesAct, 1956 read with the Companies (Disclosure of particularsin the Report of Board of Directors) Rules, 1988 andforming part of the Directors’ Report for the Year ended 31st

March, 2011:

A. CONSERVATION OF ENERGY:

(a) Energy Conservation measures taken:

1. Use of energy efficient motors.

2. Proper care has been taken in the factorybuilding for natural lighting and ventilation.

3. Automatic power factor correction panels havebeen installed.

4. Strict controls on wastage of energy have beenmade.

5. The Company uses efficient lighting equipmentto save the power.

6. The Company invests in the latest energyefficient technologies to conserve energy.

7. The Company maintains machineries onregular basis to ensure optimum utilization ofenergy resources, especially power and fuelcosts.

8. All the section workers have been providedwith Distribution Boxes so that they can shutdown the power during idle time.

(b) Additional investments and proposals beingimplemented for reduction of consumption ofenergy:

The Company has developed systems to identifyareas for making investment and implementingproposals to reduce consumption of energyresources and for optimum utilization of limitedenergy resources.

(c) Impact of measures at (a) and (b) above forreduction of energy consumption andconsequent impact on the cost of production ofgoods:

As a result of energy conservation measuresadopted, there has been considerable saving inthe energy consumption. The Company continuesto make all efforts to keep energy consumption atoptimum level.

(d) Total energy consumption and energyconsumption per unit of production:

Form-A is not applicable.

(e) Efforts made in technology absorption are givenas per Form-B annexed.

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(f) Total Foreign Exchange used and earned:

Year ended Year ended31.03.2011 31.03.2010

Used 14.96 Lacs 18.95 Lacs

Earned 4141 Lacs 1629.40 Lacs

ANNEXURE TO DIRECTORS’ REPORT:

FORM-B

For disclosure of particulars with respect of absorption:

RESEARCH AND DEVELOPMENT (R & D):

1. Specific areas in which R & D carried out by theCompany:

The material development, product development,process development, waste recycling and energysaving were the specific areas for Research &Development during the year under review.

2. Benefits derived as a result of the above R & D:

Improvement in quality, energy efficiency as well as thedevelopment of eco friendly processes enabled thecompany’s products to be competitive in the market.

3. Future plan of action:

The Company will continue to focus on developing highquality products to drive growth and a relentless focuson reducing cost to fund growth.

4. Expenditure on R & D:

Expenditure on R & D is not separately allocated andidentified due to the nature of industry.

TECHNOLOGY ABSORPTION, ADAPTATION ANDINNOVATION:

1. Efforts in brief, made towards technology absorption,adaptation and innovation:

The technological know-how for manufacture of productshas been fully absorbed and adapted by the Company’spersonnel in the production process. The R & D teamensures successful absorption and adaptation of latesttechnologies with all the manufacturing divisions.

2. Benefits derived as a result of the above efforts:

i) Improvement in product quality

ii) Reduction in wastage & process losses.

iii) Reduction in process cycle time.

iv) Abatement in pollution

v) Improved productivity

3. Technology imported during last five years - NIL


P.D. LakhaniPlace : Faridabad Chairman &Dated :15th November, 2011 Managing Director

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ECONOMIC – OVERVIEW

The Indian economy plays a major role in the world. Lastyear the GDP growth rate was registered at 8%. With over8% growth rate in last three quarters, it is estimated that theGDP growth rate will continue between 8% to 10%. TheIndian markets have been strong and supported by itsdomestic demand and growing population. Besides this,there have been other factors for the growth of Indian marketssuch as consumer habits, investment in infrastructure andfriendly government policies.

The manufacturing sector has recorded growth. Despite thesteady growth in the economy, inflation and increasinginterest rates have been obstructions in the industrial growthand consumer spending.

On the one hand, economic growth provides theopportunities for investment and expansion in manufacturingsector and development in infrastructure. On the other hand,inflation and rising interest rates turn into obstructions ingrowth of manufacturing sector.

INDUSTRY STRUCTURE, OPPORTUNITIES ANDTHREATS

India is the one of the biggest producer of footwear. In India,footwear is manufactured both in organized and unorganizedsector. The unorganized sector accounts almost half of totalproduction. The Indian consumer has become more qualityconscious and trendy. The organized sector which isequipped with advanced technological infrastructure andResearch & Development can meet out the demand ofconsumer preferences, quality and modern trends. This hasprovided more opportunities to the organized sector forgrowth in its size and product range.

The footwear industry has been contributory to the economicgrowth. On the one hand, it provides employment to alarge number of people and on the other hand itdevelops the market and product and contributes in industrialoutput. However, the competitive environment, economicslowdown and financial crisis have been concern forfootwear industry.

SEGMENTWISE OR PRODUCTWISE PERFORMANCE

The Company is mainly engaged in the businessof manufacturing of Footwear, so the Managementconsiders “Footwear” as the only business segment of theCompany.

FINANCIAL PERFORMANCE

The Management Discussion and Analysis Segmentconstitute the part of Directors’ Report and FinancialPerformance and Review of Operations have been fullydisclosed in Directors’ Report.

MANAGEMENT DISCUSSION AND ANALYSIS

OUTLOOK & KEY CHALLENGES

Lakhani India Ltd. is an established name in footwearmarket for its high quality products. The companymanufactures footwear and a diversified range of shoeproducts with the help of technological advancement andbuilt up infrastructure. The company has developed andestablished its brands and retail network. It has been theprime responsibility to meet the consumer demand and toprovide high quality products at lowest possible price incompetitive environment and to ensure the sustainablegrowth.

INTERNAL CONTROL SYSTEM

The Company has a proper and adequate system of internalcontrols to ensure that all assets are safeguarded andprotected against loss from unauthorized use or disposition,and to ensure that all transactions are authorized, recordedand reported correctly and adequately.

The Company’s internal controls are supplemented by anextensive programme of internal audits, review bymanagement and documented policies, guidelinesand procedures. The internal control is designed to ensurethat financial and other records are reliable for preparingfinancial information. All financial and audit control systemsare also reviewed by the Audit Committee of the Board ofDirectors of the Company.

ENVIRONMENT AND SAFETY

The Company continued to strive toward its commitment toprotect and promote the environment. On environmentalmatters, all plants of the Company continue to perform wellbeyond the stringent operational norms prescribed by theHaryana Pollution Control Board. The Company had plantednumber of trees around the factory premises on road.

Adequate measures for safe guarding the safety and healthof employees and labourers are installed at the plants ofCompany. The Workers and staff are regularly trained tohandle the fire fighting equipments at all manufacturing plantsin case of need.

HUMAN RESOURCES & INDUSTRIAL RELATIONS

We firmly believe that it is our people who are most importantvaluable assets and resources. The Company strives toensure best working conditions for its people and that thereare no compromises on the health and safety of itsemployees. The Company has a healthy work culture builtaround strong corporate value. The Company alsoencourages and supports its employees to upgrade theirskil ls on a continual basis through organizing skil ldevelopment programs. The employees are provided trainingand also encouraged to participate in skill development

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courses. The devotion and commitment of our employeeshas enabled the Company to fulfill its targets and deadlinesin time. Employer – Employee relations continued to remaincordial during the year.

CAUTIONARY STATEMENT

Statements in the Management discussion and analysisreport describing the Company’s estimates, expectations orpredictions may be forward-looking statements within themeaning of applicable securities laws and regulations. Actualresults could differ materially from those expressed orimplied. Important factors that would make a difference to

the Company’s operations include demand-supplyconditions, raw material prices, changes in Governmentregulations, tax regimes, economic developments within thecountry and other factors


P. D. LakhaniPlace : Faridabad Chairman &Dated :15th November, 2011 Managing Director

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CORPORATE GOVERNANCE REPORTING

1. COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCE CODE

Your company has been practicing the principle of good corporate governance, which comprises all activities thatresult in the control of the Company in a regulated manner, aiming to achieve transparent, accountable and fairmanagement.

2. BOARD OF DIRECTORS

a) Composition

The present strength of the Board is Six Directors. The Chairman of the Board is an Executive Director. Thenumber of Independent Directors is not less than 50% of the total number of Directors.

b) Number of Board Meetings held and the dates of the Board Meeting:

There were 17 Board Meetings held during the financial year 2010-11 on 06th May, 2010, 15th June, 2010, 17th

June, 2010, 02nd July, 2010, 13th July, 2010, 20th July, 2010, 12th August, 2010, 18th August, 2010, 28th August,2010, 21st September, 2010, 30th September, 2010, 07th October, 2010, 30th October, 2010, 03rd November, 2010,15th November, 2010, 08th December, 2010 and 22nd January, 2011.

c) Attendance of each Director at the Board Meetings and the last Annual General Meeting

The names of Directors and their attendance at the Board Meetings held during 2010-2011 along with thenumber of directorships and committee memberships held by them in other public limited companies as onMarch, 31, 2011 are given below. The detail of attendance of the Directors at the Annual General Meeting heldon November 15, 2010 is also provided.

Directors Attendance At Attendance Number of Number of CommitteeBoard Meeting At AGM Directorship positions held in other

in other public public companiescompanies

Held Attended Chairman Member Chairman Member

Mr. P. D. Lakhani 17 17 Yes - - - -

Mrs. Suman Lakhani 17 17 No - - - -

Dr. N. K. Pandey 17 07 No - 1 - -

Mr. Suresh Elwadhi 17 14 Yes - - - -

Mr. S. N. Sood 17 17 Yes - 1 - -

Mr. Amar Jeet Kalra 17 17 Yes - - - -

* Committees included are Audit and Investor / Shareholders’ Grievance Committee only.

3. AUDIT COMMITTEE

The Audit Committee comprises three independent Directors. Its composition is as under

1. Mr. Satinder Nath Sood – Chairman, Independent Director

2. Mr. Suresh Elwadhi – Member, Independent Director.

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3. Mr. S.K. Kundra – Member, Independent Director

All the members are financially literate and Mr. Satinder Nath Sood has accounting and related financialmanagement expertise.

a) The Terms of Reference:

The terms of reference include:

To investigate any activity within its terms of reference;

To seek information from any employee;

To obtain outside legal or other professional advice;

To secure attendance of outsiders with relevant expertise, if it considers necessary.

The role of Audit Committee includes the matters specified in the clause 49 of the Listing Agreementwith the Stock Exchanges as well as reviewing the applicability of various Accounting Standardsissued by the Institute of Chartered Accountants of India.

b) Meeting and Attendance during the year:

There were 04 Audit Committee meetings held during the financial year 2010-11 i.e. on 26th April, 2010,20th July, 2010, 07th October, 2010 and 22nd January, 2011.

Attendance of Directors

At the Audit Committee Meeting held during the financial year 2010-2011

Members No. of Meeting Held Meeting Attended Designation

Mr. S. N. Sood 4 4 Non-Executive Independent Director

Mr. Suresh Elwadhi 4 4 Non-Executive Independent Director

4. REMUNERATION COMMITTEE

The Remuneration Committee presently comprises three members and all members including the Chairman are Non-Executive and Independent Directors:-

1. Mr. Satinder Nath Sood – Chairman, Independent Director

2. Mr. Suresh Elwadhi – Member, Independent Director.

3. Mr. S. K. Kundra – Member, Independent Director

a) Terms of Reference:

The terms of reference of the Remuneration Committee is to determine the Company’s policy on remunerationpackages of Executive & Non-Executive Directors and for considering any revision in their remuneration packages.

b) Meeting during the year:

No meeting of Remuneration Committee held during the period under review.

c) Remuneration Policy:

1. The Whole Time Director of the Company is paid remuneration by way of salary, perquisites and allowanceswithin the limits envisaged under Schedule XIII of the Companies Act, 1956.

2. No sitting fee is paid to Non-Executive & Independent Directors for attending Board and other CommitteeMeetings.

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d) Details of Remuneration paid to all the Directors:

No remuneration was paid to any Director during the year under review except to Whole Time Director as givenbelow.

(Amount in Rs.)

S.No. Names Positions Sitting Fees Salary & Perquisites

1 Mr. Amarjeet Kalra WTD Nil 10,39,947

The detail of shareholding of the Directors is given below:

Equity shares of Company held by Directors

Members No. of Shares Held

Mr. Parmeshwar Dayal Lakhani 1227140

Mrs. Suman Lakhani 1489510

Dr. Narendra Kumar Pandey 535

Mr. Suresh Elwadhi 250

5. SHAREHOLDERS/INVESTORS GRIEVANCES COMMITTEE:

The Board of Directors of the Company has set up the Shareholders/Investors’ Grievances Committee of Directors. TheCommittee is empowered to perform all the functions of the Board in relation to share transfer/transmission and alliedmatters and handling of Shareholders’ Grievances. The shareholders of the Company are serviced by the fully equippedin-house secretarial department and by Share Transfer Agent of the Company namely M/s RCMC Share RegistryPrivate Ltd, Noida. All requests for dematerialization of shares are likewise processed and confirmation thereof isnormally communicated to the investors and depository participants within 15 working days of receipt thereof. TheBoard of Directors has delegated the power of approving transfer of securities to Company Secretary and President(Finance).

The Shareholders/Investors’ Grievances Committee presently comprises two members The Chairman of the Committeeis Non-Executive and Independent Director:-

1. Mr. Suresh Elwadhi – Chairman, Independent Director.

2. Mr. P. D. Lakhani – Member

As required by the Stock Exchanges, the Company has appointed Mr. Arun Virmani, Company Secretary, as theCompliance Officer to monitor the share transfer process with Share Transfer Agent and liaison with the regulatoryauthorities. During the year no complaints were received by the Company.

Four meetings of the Committee held during the year. The dates of the meeting were 15th May, 2010,22nd August, 2010, 09th December, 2010 and 22nd January, 2011. All the members of the Committee were present in theaforesaid meetings.

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6. GENERAL BODY MEETINGS

a) Location and time, where the last three Annual General Meetings were held:

The last Three Annual General Meetings of the Company were held as per following details:

Financial Year Date and Time Location

2009-10 15th November, 2010, 09:00 A.M. Bhagat Vasu Ram Lakhani CommunityCentre, 2F Park, NIT, Faridabad – 121 001

2008-09 24th December, 2009, 9.00 A.M. Bhagat Vasu Ram Lakhani Community Centre,2F Park, NIT, Faridabad – 121 001

2007-08 18th December, 2008, 10. 00 A. M. Bhagat Vasu Ram Lakhani Community Centre,2F Park, NIT, Faridabad – 121 001

b) Whether any special resolution passed in the previous three Annual General Meetings:

No Special Resolution was passed in the previous Annual General Meeting.

c) Whether any special resolution passed last year through postal ballot and the person who conductedthe postal ballot exercise:

No special resolution was passed last year through postal ballot.

d) Whether any special resolution is proposed to be conducted through postal ballot and procedurefor postal ballot

No special resolution is proposed to be conducted through postal ballot.

7. DISCLOSURES

1. Transactions with the related parties are disclosed in Notes to Accounts in the Annual Report.

2. Presently, the Company does not have any Whistle Blower Policy. No personnel of the Company havebeen denied access to the Audit Committee.

3. The Company has complied with all the mandatory requirements of this clause. The extent of adoption ofnon-mandatory requirements has been stated separately in this report.

8. CODE OF CONDUCT

The Board of Directors has adopted the Code of Conduct for all Board Members and Senior Management of theCompany. The said Code of Conduct has been communicated to all Board Members and Senior Managementand they have confirmed the compliance with the Code of Conduct. A declaration to that extent signed byChairman & Managing Director and President (Finance) has been annexed to the Annual Report of theCompany.

9. GENERAL SHAREHOLDER INFORMATION

(a) Annual General Meeting

Date & Time 27th December, 2011 at 09:00 A.M.

Venue Bhagat Vasu Ram Lakhani Community Centre, 2F Park, NIT, Faridabad – 121 001

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(b) Financial Year : 1st April to 31st March

(c) Date of Book Closure: From 22nd December, 2011 to 27th December, 2011 inclusive of both days.

(d) Listing on Stock Exchanges

Name of Stock Exchange Stock Code

Bombay Stock Exchange Limited Phiroze JeejeebhoyTowers, Dalal Street, Mumbai - 400001 531085

ISIN no. of the Company INE935C01015

(e) Market Price Data

During the year the trading of the securities of the Company on the stock exchange was suspended. Sothe Market Price Data is not available for the period.

(f) Registrar and Transfer AgentM/s RCMC Share Registry Pvt. Ltd.Unit: Lakhani India LimitedB-106, Sector-2, Noida - 201301 (U.P.)Phone: 0120-4015880, 4015886Fax: 0120-2444346E-mail: [email protected]

All the work relating to shares in both dematerialized and physical mode are handled by the same agency.

(g) Share Transfer System

The Transfer of shares pertaining to shares in physical form are registered and returned within stipulatedtime, if documents are clear in all respects.

Categories of Shareholders (as on 31st March, 2011)

S.No. Category No. of Shareholders No. of Shares Held Voting Strength %

1. Promoter Group 44 8905565 66.20

2. Bodies Corporate 56 3384964 25.17

3. Banks 01 135200 1.00

4. Non-Resident Indians 17 7297 0.05

5. Individual 8080 1019974 7.58

Total 8198 13453000 100.00

(h) Distribution of Shareholding

Shareholding of Value of Rs. Shareholders Shareholding

Number % to total Shares % to total

Upto To 5000 7950 96.97 746801 5.55

5001 To 10000 125 1.52 94940 0.71

10001 To 20000 46 0.56 65402 0.49

20001 To 30000 19 0.23 47846 0.36

30001 To 40000 9 0.11 31903 0.24

40001 To 50000 2 0.02 9800 0.07

50001 To 100000 11 0.13 66104 0.49

100001 To Above 36 0.44 12390204 92.10

Gross Total 8198 100.00 13453000 100.00

14

(i) Dematerialization of Shares

The Company has arrangements with both National Securities Depositories Ltd. (NSDL) and Central DepositoryServices (India) Ltd. (CDSL) and established electronic connectivity of shares for scrip less trading. As on 31st

March, 2011; 2090950 Equity Shares of the Company were held in dematerialized form.

(j) Plant Locations as on 31.03.2011

Plot no.265, 143-144 and 122, Sector-24, Faridabad, Haryana-121005, India.Plot no.22-23-24, Sector-4, SIDCUL, Haridawar, Uttaranchal, India.

(k) Address for correspondence

The Correspondence may be addressed to Compliance Officer of the Company at the following address:

Mr. Arun VirmaniCompany SecretaryLakhani India LimitedPlot No.131, Sector-24,Faridabad-121005Haryana, IndiaPhones: 0129-2232793/94/95Fax No. : 0129-2231517, 2234933E-mail Id: [email protected]

(l) Listing Fees:

Listing fees as prescribed have been paid to the Stock Exchange up to March 31, 2012.

Declaration regarding compliance with Code of Conduct

The Company has adopted a “Combined Code of Corporate Governance & Conduct”. This Code deals with the ‘GovernancePractices’ which the Company is expected to follow and ‘Code of Conduct’ for Board Members and Senior Management ofthe Company.

It is hereby affirmed that all the Directors and Senior Managerial Personnel have complied with the Code of Conduct andhave affirmed compliance in this regard.

Place : Faridabad P.D. LakhaniDate : 15th November, 2011 Chairman & Managing Director

15

Managing Director and Finance Head CertificationWe have reviewed financial statement and cash flow statement for the period April 1, 2010 to March 31, 2011 and to the bestof our knowledge and belief:

i) These statements do not contain any materially untrue statement or omit any material fact or contain statement that mightbe misleading;

ii) These statements together present a true & fair view of the Company’s affairs and are in compliance with existingaccounting standards, applicable laws and regulations;

iii) No transaction entered into by the Company during the above said period which are fraudulent, illegal or violative of theCompany’s Code of Conduct;

Further, we accept that it is our responsibility to establish and maintain internal controls. Accordingly, we have evaluatedthe effectiveness of internal control systems of the Company and have disclosed to the Auditors and Audit Committee,wherever applicable:

a) deficiencies in the design or operation of internal controls, if any, which came to our notice and steps have beentaken/proposed to be taken to rectify these deficiencies;

b) Significant changes in internal control during the year;

c) Significant changes in accounting policies during the year and that the same have been disclosed in the notes to thefinancial statements; and

d) Instances of significant fraud of which we became aware and the involvement therein, if any, of the management oran employee having a significant role in the Company’s internal control system.

Place: Faridabad P.D. Lakhani Rakesh MalhotraDate: 15th November, 2011 Chairman & Managing Director President (Finance)

Auditor’s Certificate on Corporate Governance

To the Members ofLakhani India Limited

We have examined the compliance of the conditions of Corporate Governance by Lakhani India Limited, for the year endedon 31st March, 2011 as stipulated in clause 49 of the Listing Agreement of the Company with Bombay Stock Exchange Ltd.

The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination waslimited to the procedure and implementation thereof, adopted by the Company for ensuring the compliance of the conditionsof Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us, we certify that the Companyhas complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.

We have also examined the records relating to the Shareholders’/Investors’ Grievance Committee as maintained by theCompany and observe that Company has adequate mechanism to deal with the investors and no investor grievance ispending for the period exceeding one month against the Company as per the records maintained by the Shareholders’/Investors’ Grievance Committee.

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

For RAKESH GUPTA & ASSOCIATESChartered Accountants

ICAI- Registration No. – 0571N

Rakesh GuptaPlace : Faridabad (Proprietor)Dated : 15th November, 2011 M. No. 80126

16

To The Members of Lakhani India Limited

We have audited the attached Balance Sheet of LakhaniIndia Limited as at March 31, 2011, and the Profit & LossAccount and Cash Flow Statement for the period 01.04.2010to 31.03.2011 annexed thereto. These financial statementsare the responsibility of the company’s management. Ourresponsibility is to express an opinion on these financialstatements based on our audit.

1. We conducted our audit in accordance with AuditingStandards generally accepted in India. ThoseStandards require that we plan and perform theaudit to obtain reasonable assurance about whetherthe financial statements are free of materialmisstatements. An audit includes examining, on a testbasis, evidence supporting the amounts and disclosuresin the financial statements. An audit also includesassessing the accounting principles used and significantestimates made by the management, as well asevaluating the overall financial statement presentation.We believe that our audit provides a reasonable basisfor our opinion.

2. As required by the Companies (Auditors’ Report) order,2003, issued by the Central Government of India in termsin Sub-section (4A) Section 227 of the Companies Act,1956, we enclose in the Annexure a statement on thematters specified in paragraphs 4 &5 of the said order.

3. Further to our comments in the Annexure referred toabove, we report that:

(i) We have obtained all the information andexplanations, which to the best of our knowledgeand belief were necessary for the purpose of ouraudit;

(ii) In our opinion, proper Books of Account as requiredby law have been Kept by the Company so far asappears from examinations of these books.

(iii) The Balance Sheet, Profit & Loss Account and CashFlow Statement dealt with by this report are inagreement with the books of account.

AUDITORS’ REPORT

(iv) In our opinion, the Balance Sheet, Profit & LossAccount Cash Flow Statement dealt with by thisreport comply with Accounting Standards referredto in sub-section (3C), of Section 211 of theCompanies Act, 1956,

(v) On the basis of the written representations receivedfrom the directors, as on 31 March, 2011 and takenon record by the Board of Directors, we report thatnone of the Directors is disqualified as on 31 March,2011 from being appointed as a director in terms ofclause (g) of sub-section (1) of Section 274 of theCompanies Act, 1956.

(vi) In our opinion and to the best of our informationand according to the explanations given to us, thesaid financial statement read with notes thereongive the information required by the Companies Act,1956 in the manner so required and give a true andfair view in conformity with the accounting principlesgenerally accepted in India.

a) In the case of the Balance Sheet, of theState of the affairs of the Company as at 31st

March, 2011.

b) In the case of the Profit and Loss Account,of the Loss for the year ended on thatdate; and

c) In the case of the Cash Flow Statement,of the cash flow for the year ended onthat date.



Rakesh GuptaPlace : Faridabad (Proprietor)

Dated : 15th November, 2011 M. No. 80126

17

ANNEXURE TO AUDITORS’ REPORT(Referred to in paragraph 2 of our Report of even date)

1. The nature of Company’s activities during the year have been such that clauses (xii),(xiii),(xiv) of the Companies(Auditor’s Report) Order, 2003 are not applicable to the Company for the year.

2. (a) The Company has maintained proper records showing full particulars, including quantitative details and situationof fixed assets.

(b) As informed company has programme of physical verification of Fixed Assets in a phased manner. In accordancewith the same, certain plants & machineries were physically verified during the year. We are informed that nomaterial discrepancies were noticed by the management on such verification.

(c) The company has not disposed off a substantial part of fixed assets during the year.

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

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

(c) The company is maintaining proper records of inventory. As per information and explanations given to us, nomaterial discrepancies has been noticed on physical verification.

4. The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in theregister maintained under Section 301 of the Companies Act, 1956. Therefore provisions of clauses (iii)(b),(iii)(c),(iii)(d)of paragraph 4 of the Order are not applicable.

The Company has taken unsecured loans from its directors / parties covered in the register maintained under Section301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 1175.78 lacs and the yearend balance of loans taken was Rs.1083.53 lacs.

In our opinion and according to the information and explanation given to us, the rate of interest and other terms andconditions of such loans are prima-facie not prejudicial to the interest of the Company.

In respect of unsecured loan taken by the Company, the loan amount is payable on demand and is interest free.

(5) In our opinion and according to the information and explanations given to us, there are adequate internal controlprocedures commensurate with the size of the Company and the nature of its business for purchase of inventory, fixedassets and for the sale of goods. During the course of audit, we have not observed any other continuing failure tocorrect major weaknesses in internal controls.

(6) In our opinion and according to the information and explanations given to us, the transactions that need to be enteredinto register in pursuance of Section 301 of the Act, have been so entered and the transactions have been made atprices, which are reasonable having regard to prevailing market prices at the relevant time.

(7) The Company has not accepted deposits from the public within the meaning of Section 58A and 58AA of the CompaniesAct, 1956 and the Rules framed there under.

(8) There is no formal Internal Audit System prevalent in the organization. However we are informed that there aresufficient check systems commensurate with the size of company and nature of its business.

(9) We have broadly reviewed the cost records of the Company under section 209 (1)(d) of the Companies Act, 1956 andare of the opinion that prime-facie the records prescribed by the Central Government have been maintained. We havenot, however made detailed examination of the records.

(10) According to the information and explanation given to us in respect of statutory and other dues:

(a) The Company has been generally regular in depositing with appropriate authorities (subject to point no. 12 ofschedule - ‘P’) undisputed statutory dues including Provident Fund, Investor Education and Protection Fund,E.S.I, Sales Tax, Customs Duty, Excise Duty, Income Tax, Wealth Tax, Cess and any other statutory dues duringthe year.

(b) According to the information and explanation given to us, no undisputed amounts payable in respect of incometax, wealth tax, sales tax, customs duty, excise duty and cess were in arrears , as at 31st March 2011 for a periodof more than six months from the date they become payable.

18

(c ) According to the information and explanations given to us, there are no cases of non-deposit with the appropriateauthorities of disputed dues of sales tax / income tax / excise duty/ custom duty / wealth tax and cess except asstated below:-

Nature of dues Period Amount Forum of pending(in Rs.)

Income Tax AY-2005-06 19,97,420/- Before ITAT

Income Tax AY-2006-07 13,20,595/- Before ITAT

Income Tax AY-2007-08 1,90,938/- Before CIT(A)

Income Tax AY-2008-09 5,36,307/- Before CIT(A)

Sales Tax FY 2006-07 28,65,435/- Appeal yet to filed

Sales Tax FY 2006-07 1,06,31,238/- Appeal yet to filed

(11) The Company does not have any accumulated losses as on 31st March, 2011. The Company has incurred cash lossesduring the financial year covered by our audit and in the immediately preceding financial year to the tune of Rs. 16.65crores.

(12) In our opinion and according to the information and explanation given to us, the Company has not defaulted inrepayments of dues to financial institution and banks.

(13) According to the information and explanations given to us, the company has not given any guarantee for loans takenby others from banks or financial institutions.

(14) In our opinion the term loans have been applied for the purpose for which they were obtained.

(15) According to information and explanation given to us and on an overall examination of the balance sheet of thecompany, we report that no funds raised on short-term basis have been used for long- term investment.

(16) The Company has not made any preferential allotment of shares during the year and hence we have no comments tooffer in respect of clause 4(xvii) of the companies (Auditor’s Report) Order, 2003.

(17) No debentures have been issued by the company during the year as such no securities for the purpose has beencreated.

(18) During the year, the Company has not raised money by public issue.

(19) According to the information and explanation given to us, no fraud on or by the Company has been noticed or reported

during the financial year.




19

LAKHANI INDIA LIMITEDBALANCE SHEET AS AT MARCH 31ST, 2011

31.03.2011 31.03.2010SCHEDULE (Rs.) (Rs.)

SOURCES OF FUNDS

SHAREHOLDER’S FUNDShare Capital A 134,530,000 134,530,000Reserves & Surplus B 297,994,030 547,234,355

LOAN FUNDSSecured Loans C 1,817,019,662 1,550,450,509Unsecured Loans D 108,352,693 3,108,149

DEFERRED TAX LIABILITIES E 84,223,416 77,777,247

TOTAL 2,442,119,801 2,313,100,260

APPLICATION OF FUNDS

FIXED ASSETSGross Block F 1,193,293,910 1,134,383,741Less: Depreciation 357,416,619 281,261,459

Net Block 835,877,291 853,122,282

INVESTMENTS G 167,604,406 167,604,406

CURRENT ASSETS, HLOANS & ADVANCESInventories 1,119,832,547 1,272,642,418Sundry Debtors 1,399,113,348 853,368,773Cash & Bank Balances 13,869,801 14,075,424Loans & Advances 147,207,452 179,149,204

2,680,023,148 2,319,235,819

CURRENT LIABILITIESAND PROVISIONS I 1,241,385,044 1,026,862,246

NET CURRENT ASSETS 1,438,638,104 1,292,373,573

TOTAL 2,442,119,801 2,313,100,261

SIGNIFICANT ACCOUNT POLICIES &NOTES ON ACCOUNTS P

AS PER OUR REPORT OF EVEN DATE ATTACHED

For RAKESH GUPTA & ASSOCIATESCHARTERED ACCOUNTANTSICAI Registration No- 0571N

(RAKESH GUPTA)(Proprietor)M. No.: 80126

FARIDABAD P.D. LAKHANI AMARJEET KALRA ARUN VIRMANI15th November, 2011 Chairman & Managing Director Director Company Secretary

20

LAKHANI INDIA LIMITEDPROFIT & LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31ST, 2011

31.03.2011 31.03.2010SCHEDULE (Rs.) (Rs.)

INCOMESales(Gross) 3,457,269,322 2,819,640,621Less: Excise duty 24,490,783 18,727,548

3,432,778,539 2,800,913,073Other Income 36,820,668 6,390,173

3,469,599,207 2,807,303,246

EXPENDITURE

Materials J 2,503,606,528 1,693,982,850Personnel Expenses K 376,311,600 353,768,846Manufacturing Expenses L 234,531,581 273,745,743Administrative Expenses M 59,702,954 60,645,897Selling Expenses N 164,020,204 95,048,965Finance Expenses O 297,924,185 205,966,340Depreciation F 76,296,311 70,202,244

3,712,393,363 2,753,360,885

PROFIT BEFORE TAX –242,794,156 53,942,361

Provision for Current Tax – 10,000,000Provision for Fringe Benefit Tax –Provision for Deferred Tax 6,446,169 11,175,728Prior period tax adjustments –

PROFIT AFTER TAX –249,240,325 32,766,633

Add: Balance Brought Forward 161,766,528 128,999,895

Balance Carried to Balance Sheet –87,473,797 161,766,528

Basic/Diluted Earning Per share of Rs.10/- each –18.53 2.44

SIGNIFICANT ACCOUNT POLICIES &NOTES ON ACCOUNTS P





21

SCHEDULES FORMING PART OF THE ACCOUNTS

31.03.2011 31.03.2010(Rs.) (Rs.)

SCHEDULE- A

SHARE CAPITAL

Authorised3,00,00,000 Equity Shares of Rs.10/- each 300,000,000 300,000,000(Previous year 3,00,00,000 equity share of Rs. 10 each)

Issued, Subscribed Capital and paid up1,34,53,000 Equity Shares of Rs.10/- each fully paid up 134,530,000 134,530,000(Previous year 1,34,53,000 Equity Share of Rs. 10 each fully paid up)

Out of the Above:45,00,000 (Previous year 45,00,000)Equity Shares of Rs.10/- each were alloted as 134,530,000 134,530,000fully paid bonus shares by capitalisation of general reserves.

SCHEDULE - B

RESERVE & SURPLUS

General ReserveAs per last Balance Sheet 31,267,868 31,267,868

Share Premium AccountAs per last Balance Sheet 353,667,145 353,667,145

Investment Allowance ReserveAs per last Balance Sheet 482,814 482,814

Generator SubsidyAs per last Balance Sheet 50,000 50,000

Profit & Loss Account

Surplus, being balance as per Profit & Loss A/c -87,473,797 161,766,528

297,994,030 547,234,355

22


31.03.2011 31.03.2010(Rs.) (Rs.)

SCHEDULE-C

SECURED LOANS

FROM BANKS

Cash Credits/ Working Capital Facilities 1,315,196,671 882,584,279Term Loans 496,044,566 657,434,102Vehicle Loan 5,778,425 10,432,128

1,817,019,662 1,550,450,509

(a) Cash Credit/working capital facilities are secured against hypothecation of raw material,semit finished goods,storesspares and book debts both present and future and by way of second charged on the fixed assets of the company

(b) (i) Term loans of Rs.2381.87 Lacs from Indian overseas bank were secured by equitable mortgare charged on Company’sfixed assets situated atPlot no 143-44 Sector-24 Faridabd and at plot nos 22-24 Sector 4 Sidcul Haidwar, addtionalysecured by additional equitable mortgare on land & building of M/s Lakhani Auto Components (P) Ltd. At Plot no25A Sector II Pant Nagar.

(ii) Term loan of Rs.2157.07 Lacs from Allahabad secured by equtable mortgare on Company’s land & building at Plotno 265 Sector-24 Faridabad and concurrent charge on plant & machinery along with Allahabad Bank.

(iii) Terms loan of Rs.410.80 Lacs from Bank of India secured by equitable mortgare on Residential house no 1306/14,Faridabd owned by Ms. Shweta Lakhani.

(c) Term loans and working capital facilities are also secured by persoanl guarantee of Sh. P.D Lakhani and Mrs. SumanLakhani directors of the Company.

(d ) Vehicle loans are secured by hypothecation of vehicles in favour of respective lender.

SCHEDULE-D

UNSECURED LOANS

From Directors 108,352,693 3,108,149

108,352,693 3,108,149

SCHEDULE-E

Deferred Tax Liability

At the start of the year 77,777,247 66,601,519For the year 6,446,169 11,175,728

84,223,416 77,777,247

23

SCHEDULE-FSCHEDULE OF FIXED ASSETS

PARTICULARS GROSS BLOCK DEPRECIATION NET BLOCK

As on Additions Adjustment / As at Upto during Adjustments Upto Value as at Value as at01.04.2010 during Deductions 31.03.2011 31.03.2010 the year during 31.03.2011 31.03.2011 31.03.2010

the year during the yearthe year

Land 35,660,595 – 2,359,447 33,301,148 399,338 – – 399,338 32,901,810 35,261,257

Building 348,949,576 24,286,856 – 373,236,432 48,649,368 11,984,013 – 60,633,381 312,603,051 300,300,208

Plant & Machinery 651,054,845 34,108,346 – 685,163,189 202,880,464 55,208,327 – 258,088,791 427,074,399 448,174,380

Office Equipment 27,306,495 1,295,697 15,000 28,587,194 7,912,948 3,152,272 – 11,065,220 17,521,975 19,393,549

Furniture & Fixtures 14,009,012 164,861 – 14,173,873 3,349,498 804,339 – 4,153,837 10,020,035 10,659,514

Vehicles 57,403,217 1,868,339 439,482 58,832,074 18,069,843 5,147,360 141,150 23,076,052 35,756,021 39,333,374

TOTAL 1,134,383,740 61,724,099 2,813,929 1,193,293,910 281,261,458 76,296,311 141,150 357,416,619 835,877,291 853,122,281

Previous Year 1,039,417,889 102,921,486 7,955,635 1,134,383,740 212,143,854 70,202,244 1,084,639 281,261,459 853,122,281

31.03.2011 31.03.2010(Rs.) (Rs.)

SCHEDULE-G

INVESTMENTS (at cost unless otherwise stated)

In Wholly Owned Subsidiary:(Unquoted fully Paid-up):10000 (nil) Equity Shares of Rs.10/- each fully 100,000 100,000Paid up of Lakhani Platinum Lifestyle Pvt Ltd.

Trade-Unquoted:50000(Previous year 50000) Equity Shares of Rs.10/- each fully 565,779 565,779Paid up of Lakhani Footcare Pvt. Ltd.

Non-Trade-Unquoted:Lakhani Auto Components Pvt Ltd34,740,(Previous year 34740 ) 7% Preference Sharesof Rs. 100/- each fully paid up. 3,931,031 3,931,031

Lakhani Medicare Pvt Ltd4,90,000,(Previous year 4,90,000) 7% Preference Sharesof Rs. 100/- each fully paid up. 57,046,852 57,046,852

Lakhani Apparel Pvt Ltd6,60,000,(Previous year 6,60,000) 7% Preference Sharesof Rs. 100/- each fully paid up. 76,845,216 76,845,216

Vardaan Detergents Pvt Ltd2,50,000,(Previous year 2,50,000) 7% Preference Sharesof Rs. 100/- each fully paid up. 29,105,528 29,105,528

National Saving Certificates 10,000 10,000

167,604,406 167,604,406

*(Interest Capitalised upto last Financial year)

24


31.03.2011 31.03.2010(Rs.) (Rs.)

SCHEDULE - H

CURRENT ASSETS, LOANS AND ADVANCESa) Inventories

(As per inventories, taken valuedand certified by the management )

Raw Material, Stores and Spares 635,632,598 774,763,903Work-in-Progess 297,011,928 194,980,554Finished goods 151,894,232 265,364,965Packing Materials 31,967,583 34,492,952Goods in Transit 3,326,206 1,119,832,547 3,040,044 1,272,642,418

b) Sundry Debtors (Unsecured,Considered Good)(i) Outstanding for a period

exceeding six months 87,444,584 37,051,567(ii) Others. 1,311,668,764 1,399,113,348 816,317,206 853,368,773

c) Cash & Bank BalancesCash in Hand 5,275,124 3,204,860On Current A/c with Scheduled Banks 5,853,554 5,421,509On Fixed Deposit a/c 2,741,123 13,869,801 5449055 14,075,424(Margin money pledged with bank)

d) Loans & Advances(Unsecured,:- Considered Good)(i) Advances recoverable in cash

or in kind for value to be received 121,412,192 147,634,611(ii) Advance Tax (net of provision) 2,574,533 9,661,317(iii) Security Deposits 6,976,479 4,526,997(iv) Balances with Central Excise &

Custom Authorities 16,244,248 147,207,452 17,326,279 179,149,204

2,680,023,148 2,319,235,819

SCHEDULE-I

CURRENT LIABILITIES AND PROVISIONS

Sundry CreditorsMicro and Small Enterprises – –Others 1,014,426,154 1,014,426,154 861,226,632 861,226,632Expenses Payable 192,767,351 125,435,346Security Deposits 10,640,494 10,138,494

1,217,833,999 996,800,472ProvisionsProvisions for Income Tax – 10,000,000Provision for Gratuity 17,088,380 14,022,346Provision for Leave encashment 6,462,665 23,551,045 6,039,428 30,061,774

1,241,385,044 1,026,862,246

25

SCHEDULES FORMING PART OF THE ACCOUNTSFor the year For the year

ended 31.03.2011 ended 31.03.2010(Rs.) (Rs.)

SCHEDULE-J

MATERIAL COSTOpening Stock 774,763,903 650,862,893Add: Purchases 1,444,240,023 978,207,970

Purchase (Trading) 908,795,840 1,007,422,521

3,127,799,766 2,636,493,384Less: Destroyed due to fire – 7,910,653Less: Closing Stock 635,632,598 774,763,903

2,492,167,168 1,853,818,828

INCREASE/(DECREASE) IN FINISHEDGOODS & WORK IN PROGRESSOpening Stock:

Finished Goods 265,364,965 181,716,547Work In Process 194,980,554 142,600,438

Less: Closing StockFinished Goods 151,894,232 265,364,965Less:Destroyed due to fire – 23,807,444Work In Process 297,011,927 11,439,360 194,980,554 (159,835,978)

Total Material Cost 2,503,606,528 1,693,982,850

SCHEDULE-K

PERSONNEL EXPENSESSalary, Wages, Bonus& Gratuity 329,926,247 313,021,839Contribution to Provident & other funds 44,878,734 37,924,005Employee Welfare Expenses 1,506,619 2,823,002

376,311,600 353,768,846

SCHEDULE-L

MANUFACTURING EXPENSESPacking Material 98,738,048 112,747,921Power, Electricity & Fuel 82,413,277 82,564,809Rent 15,688,389 17,833,053Loss by fire – 15,836,539Repair to Machinery & Generator 7,832,383 7,570,091Cartage & Freight Inward 9,954,760 9,568,225Cess Duty 962,255 1,147,210Water Charges 354,252 396,310Job Work/Stitching Charges 18,588,217 26,081,585

234,531,581 273,745,743

26

For the year For the yearended 31.03.2011 ended 31.03.2010

(Rs.) (Rs.)

SCHEDULE-M

OTHER ADMINISTRATIVE EXPENSESGeneral Repair 6,262,719 9,738,890Printing & Stationary 1,598,686 2,763,316Postage, Telegram & Telephone Expenses 5,337,555 7,551,337Rates, Taxes & Fees 2,131,011 2,693,090Misc Expenses 869,383 646,731Legal & Professional Expenses 5,460,587 2,697,685Traveling & Conveyance 9,368,532 10,768,872Insurance Charges 7,022,559 3,853,968Local Conveyance 6,740,282 7,941,793Vehicles running Expenses 1,986,583 1,471,240Loss of Sale of Fixed Assets 188,332 494,814Subscription & Membership Fee 690,105 125,440AUDITORS REMUNERATIONAudit Fees 120,000 60,000Tax Audit fees 40,000 15,000Income Tax fees 20,000 10,000Service Tax 18,540 198,540 7,725 92,725Other Expenses 11,848,080 9,805,996

59,702,954 60,645,897

SCHEDULE-N

SELLING EXPENSESAdvertisement & Sales Promotion Expenses 23,457,208 40,127,418Cartage & Freight Outward 55,888,862 16,423,236Rebate & Discount 84,223,793 38,272,703Other selling expenses 450,341 225,608

164,020,204 95,048,965

SCHEDULE-O

FINANCE EXPENSES

Interest on Term Loan 76,262,414 76,262,414Other Interest & Bank Charges 221,661,771 129,703,926

297,924,185 205,966,340


27

SCHEDULE-P

A. Significant Accounting Policies

a) Method of Accounting:The accompanying financial statements have been prepared in accordance with the historical cost conventionsin accordance with the Accounting Standards referred to in Section 211(3C) of the Companies Act,1956 andother relevant provisions of the said Act. All the expenses and revenue exceeding Rs 2000 are accounted onaccrual basis.

b) Fixed Assets :(i) Fixed Assets are shown at Original cost in the Balance Sheet.(ii) Expenditure incurred on renovation/modernisation on the existing fixed assets is added to the book

value of these assets where such renovation/modernisation increases the future benefit from thembeyond their previously assessed standard of performance.

c) Depreciation:Depreciation is provided on straight line method at the rates prescribed in schedule XIV of the CompaniesAct,1956, on prorata basis with reference to the date of addition/deletion.

d) Investment: Long Term investments are stated at cost, less provision if any for diminution in the value of such investments,other than temporary. Till last financial year interest was capitalised on the amount invested in group companies.But during the current year the policy of capitalising interest was discontinued. Due to this the loss of theCompnay is higher by Rs.85.81 Lacs . Consequently reserves are also lower by Rs.85.81 Lacs.

e) Inventories:Inventories are valued at cost or net realisable value whichever is lower

f) Foreign Exchange:Foreign currency transactions are accounted for at the exchange rate prevailing on the date of transaction.Gain/ Loss arising out of fluctuation in rate between transaction date and on the last date of the financial yearis accounted for in profit & loss account according to AS-11(Revised).

g) Excise duty:The Liability towards excise duty on finished goods is accounted for at the time of removal of finished goodsfrom Excise godown.

h) Employee benefits:In accordance with the Payment of Gratuity Act 1972, the Company provides for gratuity covering eligibleemployees on the basis of actuarial valuation as carried out by an Actuary. The liability is unfunded.

- Provision is made for leave encashment based on actuarial valuation carried out by an independentactuary as at the Balance Sheet date. The liability is unfunded.

- Contributions payable by the Company to the concerned government authorities in respect of providentfund, family pension fund and employees state insurance are charged to Profit and Loss Account.

- The liability for bonus is provided @8.33% of eligible salary and wages under the Payment of BonusAct, 1965.

- Other employee benefits are accounted for on accrual basis.

i) Provision for Taxation:Provision for taxation is made taking into consideration the provisions of Income Tax Act,1961

j) Deferred Taxation:Deferred tax is provided for all timing differences as required under the provisions of AccountingStandard-22 issued by The Institute of Chartered Accountants of India.

28

k) Borrowing Costs:Borrowing Costs that are attibutable to the acquistion, construction or production of qualifying assets arecapitalised as part of cost of such assets upto the date the assets are ready for its intended use.

All other borrowing costs are recognised as an expense in the year in which they are incurred.

l) Provisions, Contingent Liabilities and Contingent Assets:A provision is recognised for a present obligation as result of past events if it is probable that an outflow ofresources will be required to settle the obligation and in respect of which a reliable estimate can be made.Provisions are determined based on best estimate of the amount required to settle the obligation at the BalanceSheet date. Contingent liabilities are not recognised but are disclosed in the notes.Contingent assets are neither recognised nor disclosed in the financial statement.

B. Notes to the Accounts

1 Contingent liabilities not provided for: 31.03.2011 31.03.2010

L/C’s issued by Bank 15,405,879 NilBank Guarantee 234,726 Nil

2 Turnover Rs. 3,457,269,322 Rs. 2,819,640,621Quantity(Footwears) Pairs 42,140,843 Pairs 38,413,282Destroyed Due to Fite – Pairs 370,948

3 Raw Material Consumed2010-2011 2009-2010

Quantity Value (Rs.) Quantity Value (Rs.)

a) D.O.P 171.480 M.T 20,639,332 253.462 M.T 28,925,083

b) Pvc/ Resin/Compound 326.325 M.T. 22,633,902 310.440 M.T 16,465,737

d) Local Napa 199979 Meter 44,123,300 173868 Meter 32,165,580

e) Purchase Trading Goods 19728002 Pairs 908,795,840 25294302 Pairs 1,007,422,521

f) Others 1,495,974,794 768,839,907

2,492,167,168 1,853,818,828

4 Finished Goods2010-2011 2009-2010

Units Quantity Value (Rs.) Quantity Value (Rs.)

Opening Stock Pairs 4,183,756 265,364,965 1,684 150 181,716,547

Closing Stock Pairs 1,628,680 151,894,232 4183756 265364965

5 Installed CapacitySports Shoes ( PVC Injected Shoes) 6,024,000 Pairs P.A. 6,024,000 Pairs P.A.

Stuck-on-Sports Shoes ( Cold Cemented) 3,367,000 Pairs P.A. 3,367,000 Pairs P.A.

Canvas Shoes 3,000,000 Pairs P.A. 3,000,000 Pairs P.A.

Hawai Chappal & Slippers 12,330,000 Pairs P.A. 12,330,000 Pairs P.A.

Actual Production 19,857,765 Pairs 15,989,534 Pairs

6 Value of imports on C.I.F basis

Raw Material Rs. 99,671,053 Rs. 77,429,212

Capital Goods. Rs. 13,308,639 Rs. 16,006,350

7 Expenditure In Foreign Currency on other matters

Travelling 1,496,117 Rs. 1,895,875

8 Earning in foreign Exchange ( FOB Value of Exports) Rs. 414,140,303 Rs. 162,940,315

29

9 Breakup of expenditure incurred on the employees who were in receipt of remuneration aggregating toRs.24,00,000/- or more per annum, if employed through out the year, or Rs. 2,00,000- per month if employed fora part of year Nil ( Previous Year Nil)

10 Auditors Remuneration 31.03.2011 31.03.2010Rs. Rs

a) Audit Fee 120,000 60,000

c) Tax Audit fee 40,000 15,000

b) Income Tax Fee 20,000 10,000

d) Service Tax 18,540 7,725

198,540 92,72511 EMPLOYEE BENEFITS

Gratuity has been charged in the accounts on the basis of last year’s provisions as actuarials valuation was not available.

12 Statutory Dues like ESI and PF are not deposited for more than six months.

13 There are no Micro, Small and medium Enterprise to whom the company owes dues, which are outstanding for more than45 Days at the balance sheet date. The information regarding Micro, Small, and Medium Enterprise has been determined tothe extent such parties have been identified on the basis of data available with the company

14 Remuneration to Directors

The total remuneration of the directors included in the Profit & Loss Accounts is as under:

31.03.2011 (Rs.) 31.03.2010 (Rs.)

Salaries and Other Perquisites 1,039,947 1,177,950

1,039,947 1,177,950

15 Related Party TransationsDescription Firms in which Directors Companies In which

are Interested as Directors are interestedPartners/Propreitor as Director

2011 2010 2011 2010

Sale 90,879,434 39,760,819 953,988,878 297,682,109Purchase 30,334,082 47,428,270 1,111,020,352 1,026,843,465Services Received/Jobwork — — 5,154,326Rent Paid — — 12,206,400 11,880,000Allocation of expenses — — 8,104,881Investment in Subsidiary Companies — — 100,000 100,000Investment in share application money 167,604,406 –Salary & Perks to Director 1,039,947 1,053,408Receivable 80,736,240 — 652,145,810 231,663,806Payables 38,606,360 — 220,658,860 77,285,140

Related Party DisclosuresHolding Company Lakhani India LimitedSubsidiary Company Lakhani Platinum Lifestyle P ltd.Associates Companies Lakhani Rubber Udyog P Ltd. Lakhani Exim (India) P Ltd.

Lakhani Footcare P Ltd Lakhani Fashion (India) P Ltd.Laksons Footwear P Ltd Vardaan Detergents P LtdLakhani Detergents & Soaps P Ltd. AlphaOmega Retail Private LimitedLakhani Auto Components P Ltd. AlphaOmega Environmentel Private LimitedVardaan Developers India P Ltd. Freshness Coatings Pvt. Ltd.Lakhani Apparel Private Ltd. Boost Shoe Company P Ltd.Reliable Logistics Private Limited Lakhani Vardaan Auto P Ltd.Lakhani Medicare Private Limited Lakhani Hitech Rubber P Ltd.Zest Auto Private LimitedJubliant Real Estate P Ltd.Progress Real Estate P Ltd.Rise Real Estate P Ltd.

Boost Real Estate P Ltd.Firms in whichDirectors are interested Lakhani Marketing Inc. Vardaan Exim Co.

Lakhani PackagingKey Management Personnel Mr. Parmeshwar Dayal Lakhani Managing Director

Dr. A.J. Kalra Whole Time Director

30

16 Segment Reporting

The Board of Directors of the Company consider and Maintain “Footwear as the only business segment of theCompany.

17 Deferred Tax Liability/AssetsDeferred Tax Liability/Assets has been arrived at after considering the timing difference on account of depriciationallowable under the Companies Act and Income Tax Act.

18 Income tax assessment has been completed upto A.Y 2008-09. Demand of Rs.46.66 Lacs has been createdin respect of various years against which company has preferred appeals which are pending. No provision hasbeen made in the account as company is hopeful that demand created will be knocked off in appeals.

19 Sales tax assessment have been completed upto 2007-08. Demand of Rs.106.31 Lacs Is created includingdemand of Rs.104.65 Lacs pending against “C” Forms. Company is of the view that the above demand will besubstantially reduced on receipt of “C” Forms. For the remaining amount company is seeking opinion for the theappeal. As a result no provision has been made in the books of account.

20 Basic and Diluted Earning per Share

Basic and Diluted earning per share of the Company is as under-

Description 2010-2011 2009-2010

Profit after Taxation (249,240,325) 32,766,633No. of Equity Shares(Rs. 10/- paid up) 13,453,000 13,453,000Basic & Diluted Earning Per Share (18.53) 2.44

21 Previous year’s figures have been re-arranged/ regrouped wherever considered necessary, Figures in bracketpertains to previous year.

22 Figures have been rounded off to the nearest Rupee.





31

CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2011(Rs. In Lacs)

Year Ended Year Ended31.03.2011 31.03.2010

A. CASH FLOWS FROM OPERATING ACTIVITIES:

NET PROFIT BEFORE TAX AND (2,427.94) 539.42EXTRAORDINARY ITEMS

ADJUSTMENT FOR :

Depreciation 762.96 702.02Interest 2979.24 2,059.66Loss By Fire 24.75Profit/Loss On Sale Of Assets -19.52 4.95

3,722.68 2,791.38Operating Profit BeforeWorking Capital Changes 1,294.74 3,330.80

ADJUSTMENTS FOR:Current Assets Loan and advances (5,138.03) (1,598.98)Current Liabilities 2,145.23 1,364.21Inventories 1,528.10 (2,726.85)

(1,464.70) (2,961.62)

Net Cash from Operating Activities (169.96) 369.18

B. CASH FROM INVESTING ACTIVITIES

Purchasing of Fixed Assets (617.24) (1,029.22)Sale of Fixed Assets 46.25 13.86Investment in Associates Concerns – (105.21)NET CASH USED IN INVESTING ACTIVITIES (570.99) (1,120.57)

C. CASH FLOW FROM FINANCING ACTIVITIES

Interest paid (2,979.24) (2,059.66)Proceeds from Borrowings 2,665.69 2,894.12Proceeds/(repayment) of unsecured Loans 1,052.45 –NET CASH FROM FINANCING ACTIVITIES – 738.90 858.79

D. NET INCREASE/DECREASE IN CASH AND CASH (2.05) 107.40EQUIVALENTSCASH AND CASH EQUIVALENTS OPENING BALANCE 140.75 33.35CASH AND CASH EQUIVALENTS CLOSING BALANCE 138.70 140.75



(RAKESH GUPTA)(Proprietor)M. No.: 80126FARIDABAD P.D. LAKHANI AMARJEET KALRA ARUN VIRMANI15th November, 2011 Chairman & Managing Director Director Company Secretary

32

BALANCE SHEET ABSTRACT AND COMPANY’S GENERAL BUSINESS PROFILEI. Registration details

Registration No. State Code

CIN No.

Balance sheet date

Date Month YearII. Capital raised during the year (Amount in Rs. Thousands)

Public issue Right issue

Bonus issue Private placement

III. Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands)Total liabilities Total Assets

Sources of fundsPaid-up Capital Reserves & Surplus

Secured Loans Unsecured Loans

Deferred Tax Liabilities (Net)

Application of FundsNet Fixed Assets Net Current Assets

Investments Miscellaneous expenditure

IV. Performance of Company (Amount in Rs. Thousands)Turnover Profit/(Loss) After Tax

Total Expenditure Earning per share (Rs.)

Profit/(Loss) Before Tax Dividend rate %

V. Generic names of Three Principal Products/Services of the CompanyProduct Description : SPORTS SHOES (PVC) INJECTED SHOES Item Code No. (ITC Code)Product Description : CANVAS RUBBER VULCANI SED SHOES Item Code No. (ITC Code)

AS PER OUR REPORT OF EVEN DATE

0 1 2 9 0 3

N I LN I L

2 4 4 2 1 1 9 2 4 4 2 1 1 9

1 3 4 5 3 0

1 0 8 3 5 3

N I LN I L

3 1 0 3 2 0 1 1

0 5

L 1 9 2 0 1 H R 1 9 8 1 P L C 0 1 2 9 0 3

2 9 7 9 9 4

1 8 1 7 0 1 9

8 4 2 2 3

8 3 5 8 7 7 1 4 3 8 6 3 8

1 6 7 6 0 4 N I L

3 4 6 9 5 9 9 - 2 4 9 2 4 0

3 7 1 2 3 9 3 - 1 8 . 5 3



- 2 4 2 7 9 4 N I L

6 4 0 2 0 0 0 0

6 4 0 2 0 0 0 0

33

INFORMATION PURSUANT TO APPROVAL UNDER SECTION 212 (8) OF THE COMPANIESACT,1956 FOR THE FINANCIAL YEAR 2010-11

Particulars Lakhnai Platinum Lifestyle Pvt. LtdAs at March 31,2011

POSITION OF MOBILISATION AND DEPLOYMENT OF FUNDS

Total Liabilities 227,728,871.00

Total Assets 353,008,252.00

Source of funds

Paid up Capital 100,000.00

Reserves &Surplus -

Secured Loans 116,452,048.00

Unsecured Loans 21,222,519.00

Share Application Money 8,200,000.00

Deferred Tax(Net) 33,773.00

146,008,340.00

Application of Funds

Net fixed assets 574,252.00

Capital work in progressinclusive capital advances -

Preoperative expenditure Pending for capitalisation -

Investment 2,900,000.00

Net Current Assets 125,279,381.00

Miscellaneous Expenditure -

Profit & Loss Accounts 17254707

146,008,340.00

For the year ended March 31,2011

PERFORMANCE OF THE COMPANY

Total Turnover 357,640,082.00

Total Expenditure 376,792,361.00

Profit /(Loss) before Taxation (18,032,524.00)

Deferred Tax Charge /Write back 7,767.00

Prior Period Tax Adjustment 11,276.00

Provision for Taxation -

Profit /(Loss) After Taxation (18,029,015.00)

Shares of the subsidary held by the company on the above date equity

Equity

a) No.of shares 10,000.00

b) Face value per share 10.00

Preference

a) No.of shares -

b) Face value per share -

c) Extent of holding 100%

34

The Board of Directors, Lakhani India Ltd., Faridabad.

We have examined the attached ConsolidatedBalance Sheet of Lakhani India Ltd., and its subsidiary as at31-03-2011, the Consolidated Profit & Loss Account andalso the Consolidated Cash Flow Statement for the yearthen ended.

The Financial statements are the responsibility of LakhaniIndia Ltd’s management. Our responsibility is to express anopinion on these financial statements based on our Audit.We conducted our audit in accordance with generallyaccepted auditing standards in India. These standardsrequire that we plan and perform the audit to obtainreasonable assurance whether the financial statements areprepared, in all material respects, in accordance with theidentified financial reporting framework and are free frommaterial mis-statements. An audit includes, examining on atest basis, evidence supporting the amounts and disclosuresin the financial statements. An Audit also includes assessingthe accounting principles used in significant estimates madeby management, as well as evaluating the overall financialstatements. We believe our audit provides a reasonablebasis of our opinion.

We report that the Consolidated Financial Statements havebeen prepared by the Company in accordance with therequirements of Accounting Standard (AS)21, ConsolidatedFinancial Statements, issued by the Institute of CharteredAccountants of India and on the basis of the separate audited

financial statements of Lakhani India Ltd. , and its subsidiary,included in the Consolidated Financial Statements.

Based on our audit and to the best of our information andaccording to explanation given to us, we are of the opinionthat :

(a) The Consolidated Balance Sheet gives a true and fairview in conformity with the accounting principlesgenerally accepted in India of the consolidated state ofaffairs of Lakhani India Ltd., and its subsidiary as at31.03.2011;

(b) The Consolidated Profit & Loss Account gives a trueand fair view of the consolidated results of operationsof Lakhani India Ltd., and its subsidiary for the yearended on that date; and

(c) In case of Consolidated Cash Flow Statement, of theconsolidated cash flow of the company and its subsidiaryfor the year then ended.




AUDITORS’ REPORT

35

LAKHANI INDIA LIMITEDCONSOLIDATED BALANCE SHEET AS AT MARCH 31ST, 2011

31.03.2011 31.03.2010SCHEDULE (Rs.) (Rs.)

SOURCES OF FUNDS

SHAREHOLDER’S FUNDShare Capital A 142,730,000 142,730,000Reserves & Surplus B 280,739,323 548,008,662

LOAN FUNDSSecured Loans C 1,933,471,710 1,633,562,149Unsecured Loans D 129,575,212 23,708,174

DEFERRED TAX LIABILITIES E 84,257,189 77,803,253

TOTAL 2,570,773,434 2,425,812,238

APPLICATION OF FUNDS

FIXED ASSETSGross Block F 1,194,113,815 1,135,203,645Less: Depreciation 357,662,272 281,426,367Net Block 836,451,543 853,777,278

INVESTMENTS G 170,404,406 170,404,406

CURRENT ASSETS, HLOANS & ADVANCES

Inventories 1,360,863,963 1,399,295,169Sundry Debtors 1,496,095,344 952,952,159Cash & Bank Balances 19,824,437 18,211,439Loans & Advances 156,247,656 187,544,691

3,033,031,400 2,558,003,458

CURRENT LIABILITIES AND PROVISIONS I 1,469,113,915 1,156,408,988

NET CURRENT ASSETS 1,563,917,485 1,401,594,470

MISCELLANEOUS EXPENDITURE(To the extent not written off or adjusted)Preliminary Expenses 36,084

TOTAL 2,570,773,434 2,425,812,238

SIGNIFICANT ACCOUNT POLICIES & NOTES ON ACCOUNTS P





36

LAKHANI INDIA LIMITEDCONSOLIDATED PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31ST, 2011

31.03.2011 31.03.2010SCHEDULE (Rs.) (Rs.)

INCOMESales(Gross) 3,629,549,565 2,916,681,469Less: Excise duty 24,490,783 18,727,548

3,605,058,782 2,897,953,921

Other Income 37,940,424 8,812,506

3,642,999,206 2,906,766,427

EXPENDITUREMaterials J 2,651,392,894 1,736,343,019Personnel Expenses K 382,506,169 364,672,152Manufacturing Expenses L 234,531,581 273,745,743Administrative Expenses M 63,300,779 65,439,647Selling Expenses N 182,346,312 122,637,773Finance Expenses O 313,371,094 219,176,362Depreciation F 76,377,056 70,280,515

3,903,825,886 2,852,295,211

PROFIT BEFORE TAX –260,826,680 54,471,216

Provision for Current Tax – 10,380,000

Provision for Fringe Benefit Tax –

Provision for Deferred Tax 6,453,936 11,197,540

Prior period tax adjustments –11276 (4,261)

PROFIT AFTER TAX –267,269,340 32,897,937

Add: Balance Brought Forward 162,540,836 129,642,898

Balance Carried to Balance Sheet –104,728,504 162,540,835

Basic/Diluted Earning Per share of Rs.10/- each -19.87 2.45

SIGNIFICANT ACCOUNT POLICIES & NOTES ON ACCOUNTS P





37

SCHEDULES FORMING PART OF THE CONSOLIDATED ACCOUNTS

31.03.2011 31.03.2010(Rs.) (Rs.)

SCHEDULE- A

SHARE CAPITAL

Authorised3,00,00,000 Equity Shares of Rs.10/- each 300,000,000 300,000,000(Previous year 3,00,00,000 equity share of Rs. 10 each)

Issued, Subscribed Capital and paid up1,34,53,000 Equity Shares of Rs.10/- each fully paid up 134,530,000 134,530,000(Previous year 1,34,53,000 Equity Share of Rs. 10 each fully paid up)

Out of the Above:45,00,000 (Previous year 45,00,000)Equity Shares of Rs.10/- each were alloted asfully paid bonus shares by capitalisation of general reserves.

Share Application Money 8,200,000 8,200,000

142,730,000 142,730,000

SCHEDULE - B

RESERVE & SURPLUS

General ReserveAs per last Balance Sheet 31,267,868 31,267,868

Share Premium AccountAs per last Balance Sheet 353,667,145 353,667,145

Investment Allowance ReserveAs per last Balance Sheet 482,814 482,814

Generator SubsidyAs per last Balance Sheet 50,000 50,000

Profit & Loss Account

Surplus, being balance as per Profit & Loss A/c –104,728,504 162,540,835

280,739,323 548,008,662

38


31.03.2011 31.03.2010(Rs.) (Rs.)

SCHEDULE-C

SECURED LOANS

FROM BANKS

Cash Credits/ Working Capital Facilities 1,431,648,719 965,521,221Term Loans 496,044,566 657,434,102Vehicle Loan 5,778,425 10,606,826

1,933,471,710 1,633,562,149

(a) Cash Credit/working capital facilities are secured against hypothecation of raw material,semit finished goods,storesspares and book debts both present and future and by way of second charged on the fixed assets of the company

(b) (i) Term loans of Rs.2381.87 Lacs from Indian overseas bank were secured by equitable mortgare charged on Company’sfixed assets situated atPlot no 143-44 Sector-24 Faridabd and at plot nos 22-24 Sector 4 Sidcul Haidwar, addtionalysecured by additional equitable mortgare on land & building of M/s Lakhani Auto Components (P) Ltd. At Plot no25A Sector II Pant Nagar.

(ii) Term loan of Rs.2157.07 Lacs from Allahabad secured by equtable mortgare on Company’s land & building at Plotno 265 Sector-24 Faridabad and concurrent charge on plant & machinery along with Allahabad Bank.

(iii) Terms loan of Rs.410.80 Lacs from Bank of India secured by equitable mortgare on Residential house no 1306/14,Faridabd owned by Ms. Shweta Lakhani.

(c) Term loans and working capital facilities are also secured by persoanl guarantee of Sh. P.D Lakhani and Mrs. SumanLakhani directors of the Company.

(d ) Vehicle loans are secured by hypothecation of vehicles in favour of respective lender.

SCHEDULE-D

UNSECURED LOANS

From Directors 110,558,168 3,191,128

Inter Corporate Loan 19,017,046 20,517,046

129,575,212 23,708,174

SCHEDULE-E

Deferred Tax Liability

At the start of the year 77,803,253 66,605,713For the year 6,453,936 11,197,540

84,257,189 77,803,253

39

SCHEDULE-FSCHEDULE OF FIXED ASSETS

PARTICULARS GROSS BLOCK DEPRECIATION NET BLOCK

As at Additions Adjustment / As at Upto during Adjustments Upto Value as at Value as at01.04.2010 during Deductions 31.03.2011 31.03.2010 the year during 31.03.2011 31.03.2011 31.03.2010

the year during the yearthe year

Land 35,660,595 – 2,359,447 33,301,148 399,338 – – 399,338 32,901,810 35,261,257

Building 348,949,576 24,286,856 – 373,236,432 48,649,368 11,984,013 – 60,633,381 312,603,051 300,300,208

Plant & Machinery 651,054,845 34,108,346 – 685,163,191 202,880,464 55,208,327 – 258,088,791 427,074,399 448,174,380

Office Equipment 27,514,699 1,295,697 15,000 28,795,396 7,959,244 3,174,904 – 11,134,148 17,521,975 19,555,457

Furniture & Fixtures 14,009,012 164,861 – 14,173,873 3,349,498 804,339 – 4,153,837 10,020,035 10,659,514

Vehicles 58,014,918 1,868,339 439,482 59,443,775 18,188,455 5,205,473 141,150 23,252,777 35,756,021 39,826,463

TOTAL 1,135,203,645 61,724,099 2,813,929 1,194,113,815 281,426,366 76,377,056 141,150 357,662,272 835,877,291 853,777,278

Previous Year 1,040,222,534 102,936,746 7,955,635 1,135,203,645 212,230,491 70,280,515 1,084,639 281,426,367 853,777,278

31.03.2011 31.03.2010(Rs.) (Rs.)

SCHEDULE-G

INVESTMENTS (at cost unless otherwise stated)

Trade-Unquoted:50000(Previous year 50000) Equity Shares of Rs.10/- each fully 565,779 565,779Paid up of Lakhani Footcare Pvt. Ltd.

Non-Trade-Unquoted:Lakhani Auto Components Pvt Ltd34,740,(Previous year 34740 ) 7% Preference Sharesof Rs. 100/- each fully paid up. 3,931,031 3,931,031

Investment Subscription in Lakhani autoComponents Pvt Ltd 2,900,000 2,900,000

Lakhani Medicare Pvt Ltd4,90,000,(Previous year 4,90,000) 7% Preference Sharesof Rs. 100/- each fully paid up. 57,046,852 57,046,852

Lakhani Apparel Pvt Ltd6,60,000,(Previous year 6,60,000) 7% Preference Sharesof Rs. 100/- each fully paid up. 76,845,216 76,845,216

Vardaan Detergents Pvt Ltd2,50,000,(Previous year 2,50,000) 7% Preference Sharesof Rs. 100/- each fully paid up. 29,105,528 29,105,528

National Saving Certificates 10,000 10,000

170,404,406 170,404,406

*(Interest Capitalised upto last Financial year)

40


31.03.2011 31.03.2010(Rs.) (Rs.)

SCHEDULE - H

CURRENT ASSETS, LOANS AND ADVANCESa) Inventories

(As per inventories, taken valuedand certified by the management )

Raw Material, Stores and Spares 635,632,598 774,763,903Work-in-Progess 297,011,928 194,980,554Finished goods 392,925,648 392,017,716Packing Materials 31,967,583 34,492,952Goods in Transit 3,326,206 1,360,863,963 3,040,044 1,399,295,169

b) Sundry Debtors (Unsecured, Considered Good)(i) Outstanding for a period

exceeding six months 87,444,584 46,184,795(ii) Others. 1,408,650,760 1,496,095,344 906,767,364 952,952,159

c) Cash & Bank BalancesCash in Hand 9,588,741 3,650,934On Current A/c with Scheduled Banks 6,659,197 5,832,683On Fixed Deposit a/c 3,576,499 19,824,437 8727822 18,211,439(Margin money pledged with bank)

d) Loans & Advances(Unsecured,:- Considered Good)(i) Advances recoverable in cash

or in kind for value to be received 130,229,486 155,963,734(ii) Advance Tax (net of provision) 2,797,443 9,727,681(iii) Security Deposits 6,976,479 4,526,997(iv) Balances with Central Excise &

Custom Authorities 16,244,248 156,247,656 17,326,279 187,544,691

3,033,031,400 2,558,003,458

SCHEDULE-I

CURRENT LIABILITIES AND PROVISIONS

Sundry CreditorsMicro and Small Enterprises – -Others 1,234,146,538 1,234,146,538 985,273,838 985,273,838Expenses Payable 200,775,838 129,704,754Security Deposits 10,640,494 10,138,494

1,445,562,870 1,125,117,086ProvisionsProvisions for Income Tax – 11,230,128Provision for Gratuity 17,088,380 14,022,346Provision for Leave encashment 6,462,665 23,551,045 6,039,428 31,291,902

1,469,113,915 1,156,408,988

41


(Rs.) (Rs.)SCHEDULE-J

MATERIAL COSTOpening Stock 774,763,903 650,862,893

Add: Purchases 1,444,240,023 978,207,970Purchase (Trading) 1,356,320,710 1,196,903,424

3,575,324,636 2,825,974,287Less: Destroyed due to fire – 7,910,653Less: Closing Stock 635,632,598 774,763,903

2,939,692,038 2,043,299,731

INCREASE/(DECREASE) IN FINISHEDGOODS & WORK IN PROGRESSOpening Stock:

Finished Goods 392,017,716 268,139,690Work In Process 194,980,554 142,600,438

Less: Closing StockFinished Goods 392,925,648 392,017,716Less:Destroyed due to fire – 23,807,444Work In Process 297,011,927 (102,939,305) 194,980,554 (200,065,586)

Total Material Cost 2,836,752,733 1,843,234,145

SCHEDULE-K

PERSONNEL EXPENSES Salary, Wages, Bonus& Gratuity 335,812,780 323,172,185Contribution to Provident & other funds 45,065,807 38,218,913Employee Welfare Expenses 1,627,582 3,281,054

382,506,169 364,672,152

SCHEDULE-L

MANUFACTURING EXPENSESPacking Material 98,738,048 112,747,921Power, Electricity & Fuel 82,413,277 82,564,809Rent 15,688,389 17,833,053Loss by fire – 15,836,539Repair to Machinery & Generator 7,832,383 7,570,091Cartage & Freight Inward 9,954,760 9,568,225Cess Duty 962,255 1,147,210Water Charges 354,252 396,310Job Work/Stitching Charges 18,588,217 26,081,585

234,531,581 273,745,743


42


(Rs.) (Rs.)

SCHEDULE-M

OTHER ADMINISTRATIVE EXPENSESGeneral Repair 6,290,127 9,794,079Printing & Stationary 1,608,377 2,785,121Postage, Telegram & Telephone Expenses 5,587,618 8,010,959Rates, Taxes & Fees 2,147,633 2,693,360Misc Expenses 869,383 646,731Legal & Professional Expenses 5,513,819 3,113,232Traveling & Conveyance 9,836,737 12,314,992Insurance Charges 7,111,228 4,062,506Local Conveyance 6,740,282 7,941,793Vehicles running Expenses 1,986,583 1,471,240Loss of Sale of Fixed Assets 188,332 494,814Subscription & Membership Fee 690,105 125,440

AUDITORS REMUNERATIONAudit Fees 142,000 80,000Tax Audit fees 50,000 25,000Income Tax fees 20,000 10,000Service Tax 21,836 233,836 10,815 125,815Other Expenses 14,496,719 11,859,565

63,300,779 65,439,647

SCHEDULE-N

SELLING EXPENSESAdvertisement & Sales Promotion Expenses 24,276,061 41,253,212Cartage & Freight Outward 57,967,679 18,934,676Rebate & Discount 86,464,231 40,621,955Other selling expenses 13,638,341 21,827,930

182,346,312 122,637,773

SCHEDULE-O

FINANCE EXPENSES

Interest on Term Loan 90,418,528 87,410,903Other Interest & Bank Charges 222,952,566 131,765,459

313,371,094 219,176,362


43


SCHEDULE-P

A. Significant Accounting Policies

a) Method of Accounting:The accompanying financial statements have been prepared in accordance with the historical cost conventionsin accordance with the Accounting Standards referred to in Section 211(3C) of the Companies Act,1956 andother relevant provisions of the said Act. All the expenses and revenue exceeding Rs 2000 are accounted onaccrual basis.

b) Fixed Assets :(i) Fixed Assets are shown at Original cost in the Balance Sheet.(ii) Expenditure incurred on renovation/modernisation on the existing fixed assets is added to the book

value of these assets where such renovation/modernisation increases the future benefit from thembeyond their previously assessed standard of performance.

c) Depreciation:Depreciation is provided on straight line method at the rates prescribed in schedule XIV of the CompaniesAct,1956, on prorata basis with reference to the date of addition/deletion.

d) Investment: Long Term investments are stated at cost, less provision if any for diminution in the value of such investments,other than temporary. Till last financial year interest was capitalised on the amount invested in group companies.But during the current year the policy of capitalising interest was discontinued. Due to this the loss of theCompnay is higher by Rs.85.81 Lacs . Consequently reserves are also lower by Rs.85.81 Lacs.

e) Inventories:Inventories are valued at cost or net realisable value whichever is lower

f) Foreign Exchange:Foreign currency transactions are accounted for at the exchange rate prevailing on the date of transaction.Gain/ Loss arising out of fluctuation in rate between transaction date and on the last date of the financial yearis accounted for in profit & loss account according to AS-11(Revised).

g) Excise duty:The Liability towards excise duty on finished goods is accounted for at the time of removal of finished goodsfrom Excise godown.

h) Employee benefits:In accordance with the Payment of Gratuity Act 1972, the Company provides for gratuity covering eligibleemployees on the basis of actuarial valuation as carried out by an Actuary. The liability is unfunded.

- Provision is made for leave encashment based on actuarial valuation carried out by an independentactuary as at the Balance Sheet date. The liability is unfunded.

- Contributions payable by the Company to the concerned government authorities in respect of providentfund, family pension fund and employees state insurance are charged to Profit and Loss Account.

- The liability for bonus is provided @8.33% of eligible salary and wages under the Payment of BonusAct, 1965.

- Other employee benefits are accounted for on accrual basis.

i) Provision for Taxation:Provision for taxation is made taking into consideration the provisions of Income Tax Act,1961

j) Deferred Taxation:Deferred tax is provided for all timing differences as required under the provisions of AccountingStandard-22 issued by The Institute of Chartered Accountants of India.

44

k) Borrowing Costs:Borrowing Costs that are attibutable to the acquistion, construction or production of qualifying assets arecapitalised as part of cost of such assets upto the date the assets are ready for its intended use.

All other borrowing costs are recognised as an expense in the year in which they are incurred.

l) Provisions, Contingent Liabilities and Contingent Assets:A provision is recognised for a present obligation as result of past events if it is probable that an outflow ofresources will be required to settle the obligation and in respect of which a reliable estimate can be made.Provisions are determined based on best estimate of the amount required to settle the obligation at the BalanceSheet date. Contingent liabilities are not recognised but are disclosed in the notes.Contingent assets are neither recognised nor disclosed in the financial statement.

B. Notes to the Accounts

1 EMPLOYEE BENEFITS

Gratuity has been charged in the accounts on the basis of last year’s provisions as actuarials valuation was not available.

2 There are no Micro, Small and medium Enterprise to whom the company owes dues, which are outstanding for more than45 Days at the balance sheet date. The information regarding Micro, Small, and Medium Enterprise has been determined tothe extent such parties have been identified on the basis of data available with the company

3 Related Party TransationsDescription Firms in which Directors Companies In which

are Interested as Directors are interestedPartners/Propreitor as Director

2011 2010 2011 2010

Sale 90,879,434 39,760,819 990,604,254 196,213,614Purchase 30,334,082 47,428,270 1,500,677,460 1,064,844,541Services Received/Jobwork — — 5,154,326Rent Paid — — 12,206,400 11,880,000Allocation of expenses — — 8,104,881Investment 170,504,406 170,817,606

Receivable 80,736,240 — 729,498,028 216,196,816Payables 38,606,360 — 316,850,480 62,839,830

Related Party DisclosuresHolding Company Lakhani India LimitedSubsidiary Company Lakhani Platinum Lifestyle P ltd.Associates Companies Lakhani Rubber Udyog P Ltd. Lakhani Exim (India) P Ltd.

Lakhani Footcare P Ltd Lakhani Fashion (India) P Ltd.Laksons Footwear P Ltd Vardaan Detergents P LtdLakhani Detergents & Soaps P Ltd. AlphaOmega Retail Private LimitedLakhani Auto Components P Ltd. AlphaOmega Environmentel Private LimitedVardaan Developers India P Ltd. Freshness Coatings Pvt. Ltd.Lakhani Apparel Private Ltd. Boost Shoe Company P Ltd.Reliable Logistics Private Limited Lakhani Vardaan Auto P Ltd.Lakhani Medicare Private Limited Lakhani Hitech Rubber P Ltd.Zest Auto Private LimitedJubliant Real Estate P Ltd.Progress Real Estate P Ltd.Rise Real Estate P Ltd.

Boost Real Estate P Ltd.Firms in whichDirectors are interested Lakhani Marketing Inc. Vardaan Exim Co.

Lakhani PackagingKey Management Personnel Mr. Parmeshwar Dayal Lakhani Managing Director

Dr. A.J. Kalra Whole Time Director

4 Deferred Tax Liability/AssetsDeferred Tax Liability/Assets has been arrived at after considering the timing difference on account of depriciationallowable under the Companies Act and Income Tax Act.

45

5 Basic and Diluted Earning per Share

Basic and Diluted earning per share of the Company is as under-

Description 2010-2011 2009-2010

Profit after Taxation (267,269,340) 32,897,937No. of Equity Shares(Rs. 10/- paid up) 13,453,000 13,453,000Basic & Diluted Earning Per Share (19.87) 2.45

6 Previous year’s figures have been re-arranged/ regrouped wherever considered necessary, Figures in bracketpertains to previous year.

7 Figures have been rounded off to the nearest Rupee.





46

CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2011(Rs. In Lacs)

Year Ended Year Ended31.03.2011 31.03.2010

A. CASH FLOWS FROM OPERATING ACTIVITIES:

NET PROFIT BEFORE TAX AND (2,608.23) 544.71EXTRAORDINARY ITEMS

ADJUSTMENT FOR :DEPRECIATION 763.77 702.81INTEREST 3133.71 2,191.76Loss by fire 24.75PROFIT/LOSS ON SALE OF ASSETS -19.52 4.95Prior period tax adjustments 0.11 0.04Other Interest 3.12Preliminary expenses written off 0.36 0.36

3,881.55 2,924.67OPERATING PROFIT BEFORE

WORKING CAPITAL CHANGES 1,273.32 3,469.38

ADJUSTMENTS FOR:Current Assets Loan and advances (5,121.60) (1,807.60)Current Liabilities 3,127.05 1,913.47Inventories 384.31 (3,129.15)

(1,610.24) (3,023.28)NET CASH FROM OPERATING ACTIVITIES (336.92) 446.10

B. CASH FROM INVESTING ACTIVITIESPurchasing of Fixed Assets (617.24) (1,029.37)Sale of Fixed Assets 46.25 13.86Investment in Associates Concerns - (108.34)NET CASH USED IN INVESTING ACTIVITIES (570.99) (1,123.85)

C. CASH FLOW FROM FINANCING ACTIVITIESInterest paid (3,133.71) (2,191.76)Proceeds from Borrowings 2,999.09 2,957.53Proceeds/(repayment) of unsecured Loans 1,058.67 26.86

- 924.05 - 792.63NET CASH FROM FINANCING ACTIVITIES

D. NET INCREASE/DECREASE IN CASH AND CASH 16.14 114.88EQUIVALENTS

CASH AND CASH EQUIVALENTS OPENING BALANCE 182.11 67.23\

CASH AND CASH EQUIVALENTS CLOSING BALANCE 198.25 182.11AS PER OUR REPORT OF EVEN DATE ATTACHED



47

LAKHANI INDIA LIMITEDRegd. Office : Plot No. 131, Sector-24, Faridabad, Haryana-121005

(Please complete the attendance slip and hand it over at the Entrance of the Meeting Hall)

ATTENDANCE SLIP

Folio No. No. of Shares

Name & Address of the Shareholder/Proxy*

__________________________________________________________________________________

__________________________________________________________________________________

__________________________________________________________________________________

I hereby record my presence at the 29th Annual General Meeting being held on Tuesday the 27th December, 2011 at 9:00A.M. at Bhagat Vasu Ram Lakhani Community Centre, 2F Park, NIT, Faridabad - 121 001, Haryana.

Signature of Shareholder/Proxy**Strike out whichever is not applicable

Note: Only Shareholders of the Company or their Registered Proxies will be allowed to attend the Annual GeneralMeeting.

PROXY FORM

LAKHANI INDIA LIMITEDRegd. Office : Plot No. 131, Sector-24, Faridabad, Haryana-121005

Folio No. No. of Shares

I/we....................................... of ................................................................................................................ ............... in the District of

................... being a member/members of Lakhani India Limited hereby appoint............................of.......................................in

the District of....................or failing him.............. .........................................of .........................in the District of............................as

my/our Proxy to vote for me/us on my/our behalf at the 29th Annual General Meeting of the Company to be held on

Tuesday, the 27th December, 2011 at 9:00 A.M. at Bhagat Vasu Ram Lakhani Community Centre, 2F Park, NIT,

Faridabad - 121 001, Haryana and at any adjournment thereof.

Signed this....................day of ................2011.

Signature.................................* Strike out whichever is not applicable.Note:1. The Proxy Form must be deposited at the Registered Office of the Company not less than 48 hours before the

time for holding the meeting.2. A proxy need not to be Member of the Company.

AffixRevenueStamp

48

BOARD OF DIRECTORS

MR. P.D. LAKHANI(Chairman & Managing Director)

MR. AMARJEET KALRA(Whole Time Director)

MRS. SUMAN LAKHANI

MR. SATINDER NATH SOOD

MR. SURESH ELWADHI

MR. S. K. KUNDRA

Company Secretary & Legal HeadMr. Arun Virmani

AuditorsM/S RAKESH GUPTA & ASSOCIATES53, Ashoka Apartments, A-2, Paschim Vihar,New Delhi-110063

Share Transfer AgentM/s RCMC Share Registry Pvt. Ltd.UNIT : M/S LAKHANI INDIA LTD.B-106, Sector-2, NOIDA-201301 (U.P.)

Registered OfficePlot No.131, Sector-24,Faridabad-121005 (Haryana)

WorksPlot No.265, Sector-24, Faridabad (Haryana)Plot No.143-144, Sector-24, Faridabad (Haryana)Plot No.122, Sector-24, Faridabad (Haryana)Plot No. 22-24, Sector-4, Industrial Area,BHEL, SIDCUL, Haridwar (Uttranchal)

Phone Nos. : 0129-2232793/94/95Fax No. : 0129-2231517, 2434933E-Mail : [email protected] : www.lakhanivardaan.com

49

CONTENTS .............................................. PAGE NO.

Notice ........................................................................1

Directors’ Report ......................................................4

Report on Corporate Governance ...........................9

Auditors’ Report ..................................................... 16

Balance Sheet ....................................................... 19

Profit & Loss Account ............................................. 20

Schedules to the Accounts .................................... 21

Cash Flow Statement ............................................ 31

Balance Sheet Profile ............................................ 32

Statement Pursuant to Section 212 (3) and otherdetails of subsidary company under section212(8) of the Companies Act, 1956 ...................... 33

Consolidated Balance Sheet ................................ 35

Attendance Sheet & Proxy Form ........................... 47

Documents

Balance Sheet 2011 - moneycontrol.com filenotes: 1. a member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and vote instead of himself and such