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·' Bengal Shrirai;n Hitech City Private Limited

} Balance sheet

Note EQUITY AND LIAilJLITIES

Shareholders' funds

Share capital 2 Reserves and surplus 3

Non-current liabilities

Long-term provisions 4

Current liabilities

Short-term borrowings 5 Trade payables

Dues to micro enterprises and small enterprises 6 Dues to creditors other than micro enterprises and small enterprises

Other current liabilities 7 Short-term provisions 8

ASSETS

Non-current assets

Fixed assets 9 Tangible assets Intangible assets

Long-term loans and advances 10

Current assets

Properties under development 11 Cash and bank balances 12

Short-term loans and advances 13

Significant accounting policies

The notes referred to above form an integral part of the financial statements.

As per our report of even date attached.

for B SR & Associates LLP

Partner Membership No.: 092084

Place: Bangalore Date:

2 Z SEP 2016

(Amount in Rs)

As at As at 31 March 2016 31 March 2015

49,36,53,980 49,36,53,980 1,9 1, 12,53,407 1,98,05,36,459

2,40,49,07 ,387 2,47,41,90,439

12,07,981 5, 13, 175 12,07,981 5,13,175

1,16,04,67,615 98,64, 71,446

3,12,47,665 2,53,55,62 1

3 1,43,72, 110 8,43,52,269

6,07,071 1,79,829 1,50,66,94,461 1,09,63,59,165

3,91,28,09,829 3,57,10,62,779

39,98,52 1 11 ,37,254 2,69,447 6,585

42,67,968 11 ,43,839

2,44,00,0 I 0 1,44,59,260

2,86,67,978 1,56,03,099

3,80,44,58,943 3,51,38,14,287

29,95,485 22,65,414 7,66,87,423 3,93,79,979

3,88,41,41,851 3,55,54,59,680

3,91,28,09,829 3,57' 10,62, 779

for Bengal Shriram Hitech City Private Limited

M Murali

Director DIN : 00030096

Place: Bangalore Date:

S Balasubramanian

Director DIN : 06888416

Place: Bangalore

Date:

2 O SH 2016

Bengal Shriram Hitech City Private Limited Statement of profit and loss

Revenue from operations Other income

Total revenue

Expenses Employee benefits expense

Finance cost Depreciation and amortisation

Other expenses

Total expenses

Loss before tax Tax expense

- current tax

- deferred tax

Loss after tax

Loss per share (par value: Rs 10 each, fully paid up) - Basic and diluted

Class A

Class B, C, D

Significant accounting policies

The notes referred to above form an integral part of the financial statements.


for B S R & Associates LLP

Chartered Accountants

Firm registration number: 116231W/W- 100024

Membership No.: 092084

Place: Bangalore

Date:

Note

14

15

16

9 17

23

(Amount in Rs)

For the year ended For the year ended 31 March 2016 31 March 2015

32,07,143 5,17,127

32,07,143 5,17,127

1,75,01 ,167 57,54,972

12,58,2 1,588

6,99,890 16,68,846

5,42,89, 138 1,13,23,358

7 ,24,90,195 14,45,68,764

(6,92,83,052) (14,40,51 ,637)

(6,92,83,052) (14,40,51 ,637)

(3.22) (6.70)


MMurali Director

DIN: 00030096

Place: Bangalore

Date:z 0 SE? 2016

S Balasubramanian

Director

DIN: 06888416

Place: Bangalore

Date: 2 G SEP 1nin

Bengal Shriram Hitech City Private Limited Cash flow statement

Cash flows from operating activities Loss before taxation

Adjustments: Depreciation and amortisation

Profit/(loss) on sale of fixed assets

Provision no longer required written back

Foreign exchange loss, net

Interest expense

Interest income

Operating cash flow before working capital changes

Working capital changes : in liabilities and provisions

in loans and advances

in properties under development

Cash (used in) from operating activities

Taxes paid Net cash (used in)/generatecl from operating activities

Cash flows from investing activities:

(Sale)/ purchase of fixed assets

Interest received

Net cash (used in)/ generated from investing activities

Cash flows from financing activities Interest paid [capitalised to the extent of Rs. 150,461,270 (previous year: Rs. Nil)]

Proceeds/(repayment) from/( of) borrowings

Net cash generated from financing activities

Net increase in cash and cash equivalents

Cash and cash equivalents at beginning of the year

Cash and cash equivalents at encl of the year (Refer Note 12)

This is the cash flow statement referred to in our report attached.


for B S R & Associates LLP

Chartered Accountants

Firm ·egistration number: 116231 W/W-100024

Partner

Membership No.: 092084

Place: Bangalore

Date:

2 2 SEP 7.nlfi

(Amount in Rs)

For the year ended For the year ended 31 March 2016 31 March 2015

(6,92,83,052) (14,40,51,637)

6,99,890 16,68,846 (10,000) 1,90,286

(31,22, 143)

1,26,472 12,58,21,588

(5,17,127)

(7,17 ,15,305) (1,67,61,572)

24,01,56,076 4,00,81,083

(4,66,41 ,444) (1,04,34,559)

(14,01 ,83,386) ( 6,86, 70, 117)

(1,83,84,059) (5,57,85,165)

(6,06,750) (2,21 ,439)

(1,89,90,809) (5,60,06,604)

(38, 14,019) 70,525 5,17,127

(38,14,019) 5,87,652

(15 ,04,61,270) (12,58,21,588)

17,39,96, 169 18,18,39,5 10

2,35,34,899 5,60,17,922

7,30,071 5,98,970

22,65,414 16,66,444

29,95,485 22,65,414


MMurali Director

DIN: 00030096

Place: Bangalore

Datei ~ s £? 7.n1o

S Balasubramanian

Director

DIN: 06888416

Place: Bangalore

Date: 2 0 SEP 2016

Bengal Shriram Hitech City Private Limited

Notes to the financial statements

1. Significant accounting policies

1.1. Background Bengal Shriram Hitech City Private Limited ('the Company'), was incorporated on 17 November 2006. The registered office of the Company is located at Bangalore, Karnataka, India. The Company is engaged in the business of development of real estate projects.

1.2. Basis of preparation of financial statements These financial statements are prepared and presented in accordance with Generally Accepted Accounting Principles (GAAP) in India under the historical cost convention on the accrual basis. GAAP comprises mandatory accounting standards as prescribed under section 133 of the Companies Act, 2013 ('Act') read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act (to the extent notified and applicable).

All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle. Operating cycle is the time between the acquisition of assets for processing and their realisation in cash or cash equivalents. Operating cycle for real estate development undertaken by the Company has been determined as the life cycle of the project undertaken by the Company for the purpose of current - non-current classification of assets and liabilities.

1.3. Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles in India requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities as on the date of the financial statements. Actual results could differ from those estimates. Any revision to accounting estimates is recognized prospectively in current and future periods.

1.4 Going concern These financial statements have been prepared on a going concern basis notwithstanding accumulated losses as at the balance sheet date. Shriram Properties Private Limited has provided a letter of support to the Company whereby the Company will be able to meet its financial obligations as and when they fall due. These financial statements therefore do not include any adjustments relating to recoverability and classification of asset amounts or to classification of liabilities that may be necessary if the Company is unable to continue as a going concern.

1.5. Revenue recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue from operations is net of sales tax/ value added tax/ service tax and net of adjustments on account of cancellation/returns.

Revenue from real estate development is recognised upon transfer of all significant risks and rewards of ownership of such real estate/property, as per the terms of contract entered into with the buyers, which generally coincides with the firming of the sales contracts/agreements. Where the Company still has obligations to perform substantial acts even after the transfer of all significant risks and rewards, revenue in such cases is recognised by applying the percentage of completion method, only ifthe following thresholds have been met:

Projects in progress where revenue is recognised for the first time on or after 1 April 2012 and project commencing on or after 1 April 2012.

a) all critical approvals necessary for the commencement of the project have been obtained; b) the stage of completion of the project has reached a reasonable level of development, i.e .,

25% or more of the construction and development cost related to project has been incurred; c) at least 25% of the saleable project area is secured by sales contracts/ agreements with

buyers; and

Bengal Shriram Hitech City Private Limited Notes to the financial statements (continued)

1. Significant accounting policies (continued)

1.5. Revenue recognition (continued)

d) at least 10% of the revenue as per each sales contract/ agreement with buyers are realized at the balance sheet date.

When the outcome of a real estate project can be estimated re liably and the conditions above are satisfied project revenue and project costs associated with the real estate project are recognised as revenue and expenses by reference to the stage of completion of the project activity at the reporting date arrived at with reference to the entire project costs incurred (including land and finance costs).

Contract costs include the estimated cost of construction, development and other directly attributable costs of the projects under construction. In cases where the total contract price is estimated to exceed the sale price from a sale contract, the loss is recognised immediately.

The estimates for saleable area and contract costs are reviewed by the management periodically and the cumulative effect of changes in these estimates are recognised in the period in which these changes may be reliably measured.

Interest income is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable.

Dividend income is recognised where the Company's right to receive dividend is established.

1.6. Fixed assets and depreciation/ amortisation

Fixed assets are carried at cost of acquisition or construction less accumulated depreciation. The cost of fixed assets includes freight, duties, taxes and other incidental expenses related to the acquisition or construction of the respective assets.

The cost of the fixed assets not ready for their intended use before balance sheet date, are disclosed as capital work-in-progress.

Depreciation on fixed assets is provided on the straight-line method over the useful life and in the manner prescribed in Schedule II to the Companies Act, 2013. The useful life of an asset shall not ordinarily be different from the useful life as prescribed in Schedule II to the Companies Act, 2013. However, where the management's estimate of the useful life of a fixed asset at the time of acquisition of the asset or of the remaining useful life on a subsequent review is shorter than that envisaged in the aforesaid Schedule, depreciation is provided over the remaining useful life based on the management' s estimate and shall disclose such difference and provide justification in this behalf duly supported by technical advice.

Pro-rata depreciation is provided on all fixed assets purchased or sold during the year. Assets costing individually Rs 5,000 or less are depreciated fully in the year of acquisition .

1.7. Impairment of assets

The Company periodically assesses whether there is any indication that an asset or a group of assets comprising a cash generating unit may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. For an asset or group of assets that does not generate largely independent cash inflows, the recoverable amount is determined for the cash generating unit to which the asset belongs. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognised in the statement of profit and loss. If at the balance sheet date there is an indication that if a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of depreciab le historical cost. An impairment loss is reversed only to the extent that the carrying amount of asset does not exceed the net book value that would have been determined, if no impairment loss had been recognised.



1.8. Borrowing costs Borrowing costs directly attributable to acquisition or construction of those fixed assets and inventory, which necessari ly take a substantial period of time to get ready for their intended use, are capitalised during the period, less any income on the temporary investment of those borrowed funds. Other borrowing costs are accounted as an expense when incurred and debited to statement of profit and loss.

1.9. Properties under development (inventories and project work-in-progress)

Properties under development comprise of completed property for sale and prope11y under development (work-in-progress). Completed property is valued at lower of cost or net realisable value. Cost is determined by including cost of land, materials, services and other related overheads.

Properties under development represent costs incurred in respect of unsold area of properties under development and costs incurred on projects/ portion of projects when revenue is yet to be recognised. Such costs include direct materials, labour and an appropriate portion of construction overheads based on normal operating capacity.

Properties under development are not written down below cost if the prope11y is expected to be sold at or above costs.

Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

Advances paid by the Company to the seller/ intermediary toward outright purchase of land is recognised as land advance under loans and advances or capital advances as appropriate during the course of obtaining clear and marketable title, free from all encumbrances and transfer of legal title to the Company, where upon it is transferred to capital work-in-progress or inventories and properties under development as appropriate.

The cost of undivided share in land acquired through joint development agreements entered into with land owners are recognised at the estimated cost of the constructed assets given up to the land owners.

1.10. Investments Investments that are readily realizable and are intended to be held for not more than one year from the date, on which such investments are made, are classified as current investments. All other investments are classified as long term investments. Current investments are carried at cost or fair value, whichever is lower. Long-term investments are carried at cost. However, provision for diminution is made to recognize a decline, other than temporary, in the value of the investments, such reduction being determined and made for each investment individually.

1.11. Retirement benefits

Gratuity Gratuity, a defined benefit scheme, is accrued based on an actuarial valuation at the balance sheet Date, carried out by an independent actuary. The present value of the obligation under such defined benefit plan is determined based on an actuarial valuation using the Proj ected Unit Credit Method, which recognises each and period of services as giving rise to an additional units of employee benefit entitlement and measures each unit separately to build up the final obligation.

Compensated absences The Company recognises the liabil ity for short-term compensated absences based on the entitlement of respective employees as at the balance sheet date.

Provident fund Contributions payable to the recognised provident fund, which is a defined contribution scheme, are charged to the statement of profit and loss.



1.12. Income-tax Income-tax expense comprises current tax and deferred tax charge or credit. Income tax expense comprises current tax (i.e. amount of tax for the year determined in accordance with the Income-tax law) and deferred tax charge or credit (reflecting the tax effects of timing differences between accounting income and taxable income for the year). The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognised using the tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax assets are recognised only to the extent there is reasonable ce11ainty that the assets can be realised in future; however, where there is unabsorbed depreciation or carried forward business loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of such assets.

Deferred tax assets are reviewed as at each balance sheet date and written down or written up to reflect the amount that is reasonably/ virtually certain (as the case may be) to be realised .

The Company offsets, the current (on a year on year basis) and deferred tax assets and liabilities, where it has a legally enforceable right and where it intends to settle such assets and liabilities on a net basis.

Minimum Alternative Tax ('MAT') credit is recognised as an asset only when and to the extent there is convincing evidence that the Company will pay normal income-tax during the specified period. In the year in which the MAT credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in the guidance note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the statement of profit and loss. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal income-tax during the specified period.

1.13. Earnings I (Loss) per share

The basic earnings/ (loss) per share is computed by dividing the net profit/ (loss) attributable to equity shareholders for the year by the weighted average number of equity shares outstanding during the year. The number of equity shares used in computing diluted earnings/ (loss) per share comprises the weighted average shares considered for deriving basic earnings per share, and also the weighted average number of equity shares, which would have been issued on conversion of all potentially dilutive equity shares. Potential dilutive equity shares are deemed converted as of the beginning of the year, unless they have been issued at a later date. The potentially dilutive equity shares have been adjusted for the proceeds receivable had the shares been actually issued at a fair value (i.e. the average market value of the outstanding shares). In computing the dilutive earnings per share, only potential equity shares that are dilutive and that either reduces the earnings per share or increases loss per share are included.

1.14. Foreign currency transactions

Foreign exchange transactions during the year are recorded at the rate of exchange prevailing on the date of the respective transactions. Exchange differences arising on foreign exchange transactions settled during the year are recognised in the statement of profit and loss for the year.

Monetary assets and liabi lities in fore ign currency, which are outstanding as at the year-end and not covered by forward contracts, are trans lated at the year end at the closing exchange rate and the resultant exchange differences are recognised in the statement of profit and loss. Non-monetary foreign currency items are carried at cost. Forward contracts and other derivatives are entered into to hedge the foreign currency risk of the underlying outstanding at the balance sheet date. The premium or discount on all such contracts arising at the inception of each contract is amortised as income or expense over the life of the contract. Any profit or loss arising on the cancellation or renewal of forward contracts is recognised as income or as expense for the period.



1.14. Foreign currency transactions (continued)

The exchange difference on the forward exchange contract entered into to hedge the foreign currency risk of the underlying outstanding at the balance sheet date, is calculated as the difference between the foreign currency amount of the contract translated at the exchange rate at the reporting date, or the settlement date where the transaction is settled during the reporting period, and the corresponding foreign currency amount translated at the later of the date of inception of the forward exchange contract and the last reporting date. Such exchange differences are recognised in the statement of profit and loss in the reporting period in which the exchange rates change.

1.15. Provisions and contingent liabilities

The Company recognises a provision when there is a present obligation as a result of a past (or obligating) event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is a possible obligation or a present obligation that the likelihood of outflow of resources is remote, no provision or disclosure is made.

Provision for onerous contracts, i.e. contracts where the expected unavoidable cost of meeting the obligations under the contract exceed the economic benefits expected to be received under it, are recognised when it is probable that an outflow of resources embodying economic benefits will be required to settle a present obligation as a result of an obligating event, based on a reliable estimate of such obligation.

1.16. Leases For operating leases, lease payments (excluding cost for services, such as insurance and maintenance) are recognised as an expense in the statement of profit and loss on a straight line basis over the lease term.

1.17. Cash flow Cash flows are reported using indirect method, whereby net profits/ (loss) before tax is adjusted for the effects of transactions of a non cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated. Inter corporate deposits given to associates, subsidiaries and joint ventures are considered as operating activity.

1.18. Cash and cash equivalents Cash and cash equivalents include cash in hand, term deposits with banks and other short-term highly liquid investments with original maturities of three months or less .

Bengal Shriram 1-Iitech City Private Limited

Notes to the financial statements (continued)

2 Share capital

Particulars

Authorised

Equity shares

21,500,000 (previous year: 2 1,500,000) Class 'A' equity shares of Rs I 0 each

12,500,000 (previous year: 12,500,000) Class 'B' equity shares of Rs 10 each

1,500,000 (previous year: 1,500,000) Class 'C' equity shares of Rs 10 each

750,000 (previous year: 750,000) Class 'D' equity shares of Rs 10 each

Preference shares 13 ,500,000 (previous year: 13,500,000) 0.0 I% Class 'A' compulsorily convertible cumulative preference shares of Rs I 0 each

Issued, subscribed and fully paid-up

Equity shares

21,500,000 (previous year: 21,500,000) Class 'A' equ ity shares of Rs I 0 each

12,500,000 (previous year: 12,500,000) Class 'B' equity shares of Rs I 0 each

1, 135,398 (previous year: 1,135,398) Class 'C' equity shares of Rs 10 each

750,000 (previous year: 750,000) Class 'D' equity shares of Rs 10 each

Preference shares

13,480,000 (previous year: 13,480,000) 0.01% Class 'A' compulsori ly convertible cumulative preference shares of Rs 10 each

(a) List of shareholders holding more than 5 percent shares in the Compa ny

Particulars As at 31 March 2016

(Amount in Rs)

As at As at 31 March 2016 31 March 2015

2 1,50,00,000 21,50,00,000

12,50,00,000 12,50,00,000

1,50,00,000 1,50,00,000

75,00,000 75,00,000

13 ,50,00,000 13,50,00,000

49,75,00,000 49,75,00,000

2 1,50,00,000 21,50,00,000

12,50,00,000 12,50,00,000

I, 13,53,980 1, 13,53,980

75,00,000 75,00,000

13,48,00,000 13 ,48,00,000

49,36,53,980 49,36,53,980

As at 31 March 2015 ~~~~~~~~~~~~~~~~~~~~~~~~~~-

Equity shares

Shriram Properties Private Limited Class 'A' equity shares

Class 'B' equity shares

Class 'C' equity shares

Class 'D' equity shares

WSI /WSQI V (XXXlll) Mauritius Investors Limited


Preference shares

Shriram Properties Private Limited

Class 'A' preference shares

No. of shares

2, 14,98,000

1,25,00,000

11 ,35,398

7,50,000

1,34,80,000

% holding

99.99%

100.00%

100.00%

100.00%

100.00%

(b) Reconciliation of the number of shares outstanding at the beginning and at the end of the year:

Particulars As at 31 March 2016

No. of shares % holding

2, 14,98,000 99.99% 1,25,00,000 100.00%

8,00,942 70.54%

7,50,000 100.00%

3,34,456 29.46%

1,34,80,000 100.00%

As at 31 March 2015 ~~~~~~~~~~~~~~~~~~~~~~~~~~-

No. of shares Amount (Rs) No. of shares Amount(Rs)

Equity Shares

C lass 'A' equity shares

Shares outstanding at the beginning of the year 2, 15,00,000 21,50,00,000 2, 15,00,000 2 1,50,00,000

Movement during the year

Shares outstanding at the end of the year 2,15,00,000 21,50,00,000 2,15,00,000 21,50,00,000

Class 'B' equity shares

Shares outstanding at the beginning of the year 1,25,00,000 12,50,00,000 1,25,00,000 12,50,00,000


Shares outstanding at the end of the year 1,25,00,000 12,50,00,000 1,25,00,000 12,50,00,000


Shares outstanding at the beginning of the year 11 ,35,398 I, 13,53,980 11,35,398 1, 13,53,980


Shares outstanding at the end of the year 11,35,398 I, 13,53,980 11,35,398 1,13,53,980

Class 'D' equity shares

Shares outstanding at the beginning of the year 7,50,000 75,00,000 7,50,000 75,00,000


Shares outstanding at the end of the year 7!50,000 75,00,000 7,50,000 75,00,000

Bengal Shriram 1-litech City Private Limited Notes to the financial statements (continued)

Preference shares Class 'A' preference shares

Shares outstanding at the beginning of the year Movement during the year

Shares outstanding at the end of the year

1,34,80,000

1,34,80,000

(c) Rights, preferences and restrictions attached to each class of equity shares:

Class A equity shares

13,48,00,000 1,34,80,000 13,48,00,000

13,48,00,000 1,34,80,000 13,48,00,000

Class A equity shares shall be entitled to one vote per equity share outstanding. Each Class A equity share shall be entitled to receive equal dividends. These shares are subject to the limitations on transfer specified in the Articles of Association. No dividends may be paid in respect of the Class A equity shares and no buy backs or redemptions of the Class A equity shares shall be allowed while any of the Class B equity shares, Class C equity shares and Class D equity shares remain outstanding.

Class B, Class C and Class D equity shares Class B, Class C and Class D equity shares shall not be entitled to vote on matters brought for a vote of the shareholders of the Company, except that no modification to the rights and obligations of Class B, Class C or Class D equi ty shares shall be made by the Company without the approva l of the holders of the respective class of equity shares. These shares are subject to the limitations on transfer spec ified in the Articles of Association. In the event of a merger or amalgamation of the Company with another company, the holders of the Class B, Class C and Class D equity shares shall be entitled to receive an instrument providing substantially similar economic rights as they currently enjoy.

C lass B equity shares shall be subject to re-purchase by the Company at a per share price of not less than the par value thereof

Class C equity shares shall be subject to re-purchase by the Company at a price equal to the par value thereof or such other price as may be determined by the Company.

In the event ofa public offering or sale of all the shares of the Company to third party, the Class C shares will convert, prior to such event, into such number of Class A equity shares which shall equal the aggregate par value of the Class C shares. The holder of Class C equity shares [other than Shriram Properties Private Limited ("SPPL")] shall not be entitled to sell/ transfer such shares without prior written consent of SPPL. SPPL or any person/(s) nominated by it shall at all times be entitled to purchase from the holders of Class C equity shares (other than SPPL), such shares at a price mutually agreed but not exceed ing the aggregate par value of such shares. The Company may at any time at its option, convert all or any of the Class C equity shares into Class A equity shares, the va lue of which shall be equal to par value of such shares so converted. In case of liquidation/ winding up of the Company, the Class C equity share holders shall be entitled to receive the par value of such shares held.

Further, Class D equity shares shall be entitled to a dividend distribution of Rs 1,5 12,500,000 before any dividend is paid on Class A vot ing shares, which shall be paid purs uant to the distribution priority as specified in the share holder' s agreement dated 27 September 2008 (as amended). Class B and C equity shares do not have any dividend rights.

(d) Rights attached to the preference shares:

Class A preference shares The Class A preference shares shall not be entitled to vote on matters brought for vote to the shareholders of the Company, except that no modification to the rights, terms and privileges of the Class A preference shares shall be made thereto without the approval of the holders of a majority of the Class A preference shares . The Class A preference shares shall be subject to the limitations on transfer specified in the agreement. Each holder of the Class A preference shares shall be entitled to receive, out of distributable profits of the Company, a cumulative dividend equal to 0.01 % of the aggregate par value of the total number of Class A preference shares held by such holder. Such dividends shall be payable as and when declared by the Board of Directors. The holders of the Class A preference shares shall not be entitled to any share buy back, rights of redemption or repurchase, presumptive rights, or rights to participate in connection with a rights offering. In the event of a merger or amalgamation of the Company with another person, the holders of the Class A preference shares shall be entitled to receive an instrument providing substantially similar economic rights as they currently enjoy.

The Class A preference shares shall be convertible at the election of the Company into Class A equity shares at the conversion rate of0.000178 per share at any time after the tenth ann iversary of the date of issuance of the Class A preference shares. Prior to any liquidation or winding up of the Company, the Class A preference shares shall be automatica lly converted into Class A equity shares at the aforesaid conversion rate. On the twentieth anniversary of the date of issuance of the Class A preference shares, the Class A preference shares that remain outstanding on that date shall be automatically converted into Class A equity shares at the aforesaid conversion rate .

(e) Shares in respect of equity in the Company held by its ultimate holding company, including shares held by subsidiaries or associates of the

holding company or the ultimate holding company in aggregate:

Particulars As at 31 March 2016 As at 31 March 201 5

No. of shares Amount (Rs) No. of shares Amoun t (Rs)

Holding company

Shri ram Properties Private Limited

Class 'A' equity shares 2, 14,98,000 21,49,80,000 2, 14,98,000 21,49,80,000

Class 'B' equity shares 1,25,00,000 12,50,00,000 1,25,00,000 12,50,00,000

Class 'C' equity shares 11 ,35,398 I, 13,53 ,980 8,00,942 80,09,420

Class 'D' equity shares 7,50,000 75,00,000 7,50,000 75,00,000

Class 'A' preference shares 1,34,80,000 13,48,00,000 1,34,80,000 13,48,00,000


,,,....

(I) Buy back of equity shares, shares allotted by way of bonus shares There have been no buy back of equity shares, issue of shares by way of bonus share or issue of share pursuant to contract without payment being received in cash for the period of five years immediately preceding the balance sheet date.

(g) Shares reserved for conversion of preference shares

3

4

5

6

7

8

The Company is required to retained certain shares as reserves which may be issued on convers ion of preference shares into class A equity shares. For details of shares to be kept as reserve, refer note 2( d) above.

Reserves and surplus (Amount in Rs)

Particulars As at As at 31 March 2016 31 March 201 5

Securities premium reserve Balance at the beginning of the year 2,78,0 1,07,3 14 2, 78,01 ,07 ,314


Balance at the end of the year 2,78,01,07,314 2,78,01 ,07,314

Deficit in statement of profit or loss Balance at the beginning of the year (79,95,70,855) (65,55,19,218)

Add: loss for the year (6,92,83,052) (14,40,51 ,637)

Balance at the end of the year (86,88,53,907) (79,95,70,855)

1,91, 12,53,407 1,98,05,36,459

Long-term provisions (Amount in Rs)

Particulars As at As at 31 March 2016 31 March 2015

Provision for gratuity (Refer Note 25) 10,33,470 5, 13, 175

Provis ion for compensated absences 1,74,5 11

12,07,981 5,13,175

Short-term borrowings (Amount in Rs)

Particulars As at As at 31 March 2016 31 March 201 5

Unsecured Loans and advances from related party (Refer Note 20)

- from holding company (Refer Note A) 1, 16,04,67,615 98,64, 71 ,446 1,16,04,67,615 98,64,71,446

Note A: Loan from related parties represents loan from Shriram Properties Private Limited (Holding Company) at interest of 15% p.a. Tenure and terms of repayment have not been specified and hence the loan is considered as repayable on demand. Amount outstand ing as at the year end includes accrued interest.

Trade payables (Amount in Rs)


Dues to micro enterprises and small enterprises (Refer Note 26)

Dues to creditors other than micro enterprises and small enterprises 3, 12,47,665 2,53,55,62 1 3,12,47,665 2,53,55,621

Other current liabilities (Amount in Rs)

Particula rs As at As at 31 March 2016 31 March 201 5

Advances towards joint development agreement 10, 10,00,000 4,03,25,000

Security deposits 14,00,00,000 2,74,32,000

Advances from customers 92,07,000

Other payables Other expenses 5,88,60, 19 1 37,28,667

Statutory dues 53,04,919 1,28,66,602 31,43,72,110 8,43,52,269

Short-term provisions

(Amount in Rs)


2, 19,069 1, 13,247

for compensated absences 3,88,002 66,582 6,07,071 1,79,829



9 Fixed assets

Description

Gross block

Balance as at 1 April 2014

Add: Additions for the year

Les: Deletions during the year

Balance as at 31 March 2015


Add: Additions for the year

Les: Deletions during the year


Accumulated de11reciation and amortisation


Add:- Depreciation and amortisation for the year

Less:- Depreciation on deletion



Add:- Depreciation and amortisation for the year

Less:- Depreciation on deletion


Net block



Leasehold Furnitures and improvements fixtures

46,63,146 5,21 ,283

- -- -

46,63,146 5,21,283

46,63,146 5,21,283

- 63,670

- -46,63,146 5,84,953

46,63,134 3,41,995

- 39,974

- -46,63,134 3,81,969

46,63,134 3,81,969

- 43,844

- -46,63,134 4,25,813

12 1,59,140

12 1,39,314

Tangible, owned

Vehicles Office equipments

29,89,305 16,59,689

- 49,475

7,49,500 -22,39,805 17,09,164

22,39,805 17,09,164

89,000 18,39,012

- 1,84,180

23,28,805 33,63,996

13,82,076 5,09,552

3,90,353 11 ,08,274

4,39,214 -13,33,215 16,17,826

13,33,215 16,17,826

3,97,336 1,22,392

- 1,84,180

17,30,551 15,56,038

5,98,254 18,07,958

9,06,590 91,338

(Amount in Rs) Intangible, owned

Computers Sub Total Computer Sub Total Total softwares

12,02,980 1,10,36,403 6,11,046 6,ll,046 1,16,47,449

- 49,475 - - 49,475

- 7,49,500 - - 7,49,500

12,02,980 1,03,36,378 6,ll ,046 6,ll,046 1,09,47,424

12,02,980 1,03,36,378 6,11,046 6,ll,046 1,09,47,424

15,45,454 35,37,136 2,86,883 2,86,883 38,24,019

- 1,84,180 - - 1,84,180

27,48,434 1,36,89,334 8,97,929 8,97,929 1,45,87,263

10,79,126 79,75,883 5,98,070 5,98,070 85,73,953

1,23,854 16,62,455 6,391 6,391 16,68,846

- 4,39,214 - - 4,39,214

12,02,980 91,99,124 6,04,461 6,04,461 98,03,585

12,02,980 91,99,124 6,04,461 6,04,461 98,03,585

1,12,297 6,75,869 24,021 24,021 6,99,890

- 1,84,180 - - 1,84,180

13,15,277 96,90,813 6,28,482 6,28,482 1,03,19,295

14,33,157 39,98,521 2,69,447 2,69,447 42,67,968

- 11,37,254 6,585 6,585 11,43,839



10 Long-term loans and advances

Particulars

Unsecured, considered good Security deposits (Refer note A)

Advance tax, net of provision for tax

As at 31 March 2016

2,05,60,098

38,39,912

2,44,00,010

(Amount in Rs)

As at 31 March 2015

1, 12,26,098

32,33,162

1,44,59,260

Note A: Includes Rs. 17,981,971 (previous year Rs. 8,877,971) receivable from Shriprop Infrastructure Private Limited. Also refer note 20.

11 Properties under development

Particulars

Land cost

Project development cost

As at 31 March 2016

3,01,42,93,808

79,01,65,135

3,80,44,58,943

Refer to note 1.9 of significant accounting policy for disclosure of mode of valuation of properties under development.

(Amount in Rs)

As at 31 March 2015

3,01,42,93,808

49,95,20,479

3,51,38,14,287

Subsequent to the year end, the Company has taken loan from LTC I-lousing Finance Limited and Aditya Birla Finance Limited amounting to Rs 1,000 million and Rs. 500 million respectively, against which the Company has created charge on the project assets.

The Company has kept 40 acres of land as collateral security with Government of West Bengal.

12 Cash and bank balances

Particulars

Cash and cash equivalents

Cash in hand

Balances with banks

- in current accounts

13 Short-terms loans and advances

Particulars

Unsecured, considered good Employee advances

Balance with government authorities

Vendor advances

Prepaid expenses

As at 31 March 2016

1,69,764

28,25,721

29,95,485

As at 31 March 2016

28,72,036

3,74,16,492

3,53,54,475

10,44,420

7,66,87 ,423

(Amount in Rs)

As at 31 March 2015

65,999

21,99,415

22,65,414

(Amount in Rs)

As at 31 March 2015

12,53,878

3,75,08,764

5,35,840

81,497

3,93,79,979

..:


14 Other income

Particulars

Interest income

Profit on sale of fixed asset

Provision no longer required written back

Miscellaneous income

15 Employee benefits expense

Particulars

Salaries, bonus and allowances

Contribution to provident and other funds

Gratuity (Refer note 25) Staff welfare

16 Finance cost

Particulars

Interest expense (Refer note 20) Less: Interest capitalised in properties under development

17 Other expenses

J>articulars

Legal and professional charges

Rent

Marketing expenses

Travel and conveyance

Repairs and maintenance

Rates and taxes

Security charges

Foreign exchange loss, net

Loss on sale of fixed asset

Miscellaneous expenses

(Amount in Rs) For the year ended For the year ended

31 March 2016 31 March 201 5

5, 17,127 10,000

3 1,22, 143 75,000

32,07,143 5,17,127


31 March 2016 31 March 2015

1,56,53,550 48,28,827 4,67,500 6,26, 11 7 4,20,624 7,54,000 5,05,52 1

1,75,01,167 57,54,972


31 March 2016 31 March 2015

15,04,6 1,270 12,58,21,588 (15,04,61,270)

12,58,21,588


31 March 2016 31 March 2015

66,93, 148 25,28,78 1 18,91 ,845 20,88,000

3,08,85,965 44,71,509 9,90,341 25,89,801 20,23,722 10,8 1,635 4,36,447 47,82,595 14,52,400

1,26,472 1,90,286

18,92,640 14,86,909 5,42,89,138 1, 13,23,358


18 Contingent liabilities and commitments

Particulars

(i) Estimated amount of contracts remaining to be executed and not provided for, net of advances

(ii) Arrears of dividend on 0.01% compulsorily convertible cumulative preference shares

As at 31 March 2016

5,81,69,368

1,0 1,100

5,82, 70,468

(Amount in Rs)

As at 31 March 2015

3,95,78,637

87,620 3,96,66,257

One of the vendors has claimed an amount of Rs.13.79 million along with interest towards non payment of Project Management Fess, which is under arbitration. The Company has already provided for the principal amount, however interest on the same, if any has not been provided for.

19 Auditors' remuneration (included in legal and professional charges, excluding service tax)

Particulars

As auditor

- statutory audit - reimbursement of out of pocket expenses

20 Related party

For the year ended 31 March 2016

8,00,000

80,063 8,80,063

(i) Name of the related parties and description of relationship:

(a) Parties where control exists

- Holding company

(b) Other related parties with whom the Company

had transactions during the year

( c ) Key managerial personnel

-Directors

Shriram Properties Private Limited (SPPL)

Shriprop Infrastructure Private Limited

MMurali

Gautham Radhakrishnan S Ventakraman (resigned w.e.f 12th February 20 16)

Sundaram Balasubramanian (appointed w.e.f 25th February 20 16)

(ii) The following is the summary of transactions with related parties by the Company during the year:

Particulars

Shriram Properties Private Limited Short-term borrowings received

Short-term borrowings, repaid Expenses incurred on behalf of the Company

Interest expense

Shriprop Infrastructure Private Limited Securi ty deposit given

(iii) Amount outstanding as at the balance sheet date:

Particulars

Shriram Properties Private Limited

Short-term borrowings

Shri prop Infrastructure Private Limited Security deposit

21 Segment reporting


35,00,000

2,00,34,899

15,04,6 1,270

91,04,000

As at 31 March 2016

I, 16,04,67,615

1,79,8 1,971

(Amount in Rs)


8,00,000 61,053

8,61,053

(Amount in Rs)


6,28,00,000 44,00,000

1,04,69,645 11 ,32,27,404

88,77,97 1

(Amount in Rs)

As at 31 March 2015

98,64, 71 ,446

88,77,97 1

The sole business segment is construction/project activities and the only geographical segment is India. Consequently, the requirement for a separate segment di sclosure under Accounting Standard 17 on 'Segment Reporting' is not applicable.


22 Deferred tax

.: .·

The Company has not recognised deferred tax asset on carry forward losses and other temporary timing differences in the absence of virtual certainty of realisation of such assets in future in accordance with AS 22 - "Accounting for taxes on income".

23 Earnings I (loss) per share

Particulars

Net loss after tax Add: Dividend on cumulative preference shares

Net loss attributable to equity shareholder

Weighted average number of equity shares of Rs I 0 each used for calculation of basic and diluted loss per share


Class B, C and D equity shares

Loss per share - basic and di luted:


Class B, C and D equity shares (Refer note (b) below)

Note


-6,92,83,052

-13,480

-6,92,96,532

2, 15,00,000

1,43,85,398

(3.22)

(a) Effect of conversion of convertible preference shares into equity shares has not been considered as they are anti-dilutive in nature.

(Amount in Rs) For the year ended

31 March 2015

-14,40,51,637

-13,480

-14,40,65, 117

2, 15,00,000

1,43,85,398

(6.70)

(b) Class Band C equity shares do not have any dividend rights. Further Class D equity shares shall be entitled to a fixed sum of dividend before any dividend is paid on Class A shares, which shall be paid pursuant to the distribution priority as specified in the share holder's agreement dated 27 September 2008 (as amended). These shares have therefore not been considered for computat ion of earnings/( loss) per share.

24 Operating leases

The Company has an obligation under cancellable and non-cancellable operating leases for office premises. The total rental expenses under cancellable and non-cancell able operating leases for the year amounted to Rs. 1,89 1,845 (previous year: Rs 2,088,000) respectively. Future minimum lease payments under non-cancellable operating lease are as follows:

Particulars

Not later than I year

Later than I year and not later than 5 years

Later than 5 years

As at 31 March 2016

6,90,000

25 T he following table sets out the principal actuarial assumptions of gratuity plan as required under revised AS 15.

(Amount in Rs) As at

31 March 2015

16,56,000

6,90,000

The Company has a gratuity plan, which is a defined benefit scheme. Every employee who has completed 5 years or more of serv ice is eligible for gratuity on separation worked out at 15 days salary (last drawn salary) for each completed year of service. The obligation under the scheme is unfunded.

Principal actuarial assumptions As at As at 31 March 2016 31 March 2015

Discount rate 7.52% 7.74% Salary escalation 5.00% 5.00% Attrition rate 17.11 % 17.11 % Retirement age 60 years 60 years

The estimates of future salary increases, considered in actuarial valuation, takes account of inflation, seniority, promotion, and other several factors such as supply and demand factor in the employment market.

26 Dues to Micro and Small Enterprises

The Ministry of Micro and Small Enterprises has issued an office memorandum dated 26 August 2008 which recommends that the Micro and Small Enterprises should mention in their correspondence with its customers the Entrepreneurs Memorandum Number as allocated after filing of the Memorandum in accordance with the ' Micro, Small and Medium Enterprises Development Act, 2006 ('the MSM E Act'). Accordingly, the disclosure in respect of the amounts payable to such enterprises as at 31 March 201 6 has been made in the financial statements based on information received and available with the Company. The Company has not received any claim for interest from any supplier as at the balance sheet date. The Company does not have any dues to micro and small enterpri ses as at 31 March 201 6 and 31March 20 15.

Bengal Shriram 1-litcch City Private Limited

Notes to the financial statements (continncd)

27 Since the Company does not meet the criteria specified in Section 135 of the Companies Act, 2013, the Company is not required to spend any amount on activities related to Corporate Social Responsib ility for the year ended 31 March 2016 and 31 March 2015.

28 The Company did not have any earnings and expenditure in foreign currency during the year (previous year: Rs Ni l).

29 The Company acquired 314 acres of land located at Uttar Para from Hindustan Motors Limited (HM) at various points in time and the same is registered in the name of the Company. Post acquisition, the Company embarked upon development of the projects and started seeking approval for the same. There was delay in getting the critical approvals for the project including clearances of the Environment Department, Government of West Bengal and the State Expert Appraisal Committee for the commencement of the project. Meanwhile it transpired that HM did not utilise the sale proceeds of the land for the purposes agreed with Government of West Bengal (GOWB). There arose a dispute between HM and the GOWB on this subject resulting in the delay in getting critical approval for the project. After protracted negotiation, there reached a settlement amongst the Company, GOWB and the HM. The Group of Ministries approved the proposed settlement and memorandum bearing number LRC/162/2014 dated 29 September 20 14 and was communicated to the Company which inter alia provides the following:

30

a) the Company has paid Rs 5 crores on 29 October 20 14 and has to provide bank guarantee of Rs 25 crores in favour of the State Government within the disposal of application for mutation ofland and clearance by Irrigation and Environment Authorities. b) in as much the company has to pay the non-compete fees of 4% on the revenue to HM as part of the development [which is capped to Rs 194.47 crores with interest@ 6.25% on reducing balance], the same shall be assigned and paid to GOWB within agreed time schedule which can be modified on mutual consent; c) the Company has to keep 40 acres of land as collateral security which would be released on the basis of realisation; d) the Company is free to modify the master plan and the product mix based on the ex igencies of the market subject to approval of Kolkata Metro Development Authority (KMDA). The KMDA and other Government authorities to give their approvals expeditiously after due di ligence; e) GOWB to extend all possible co-operation for smooth and uninterrupted project implementation. Further, the value of properties under development recorded in the financial statements are being considered as recoverable based on a valuation report by an independent valuer. Significant assumptions used in the valuation report relates to project commencement date which is in turn dependent on the Company obtaining the required critical approvals including clearances of the Environment Department, Government of West Bengal and the State Expert Appraisal Committee for the commencement of the project. On the basis of the above settlement and memorandum bearing number LRC/162/2014 as communicated by the GOWB, the management has obtained the req uisite approvals and has commenced the development relat ing to Phase I of the project.

Particulars of un-hcdgcd foreign currency exposure as at the balance sheet date Underlying assets/ liability Currency ___ A_s_a_t _3_1 _M_a_r_·c_h_2_0_1_6 __________ A_s_a_t_3_1 _M_a_r_c_h_2_0_t _S _____ _

Trade payables USO

Amount in foreign

currency

Amount in Rs

Amount in foreign currency

47,006

Amount in Rs

29,42,143

31 The Company did not have any imports during the year (previous year: Rs Nil).

32 The Company did not have any long-term contracts including derivative contracts for wh ich there were any foreseeable losses.

33 Previous year's figures have been regrouped I reclassified as per the current year's presentation for the purpose of comparability. The fo ll owing regrouping I reclassifications of the previous year figures have been made.

Particulars

In balance sheet

Jn statement of profit and loss

In statement of profit and loss





for BS R & Associates LLP

Chartered Accountants egistration number: 11 623 1 W/W- 100024

Vince! Dhawan

Partner Membership No.: 092084

Place: Bangalore

Date:

2 2 SEP 2ni5

Previous year grouping Trade payables-dues of creditors other than micro and small enterprises

Other expenses- Power and fuel

Other expenses- Telephone and other communication

Other expenses- Insurance

Other expenses- Donations

Other expenses- Bank charges

Current year grouping (Amount in Rs)

Other current I iabilities - other payables- 11 ,66,887 other expenses

Other expenses- Miscellaneous expenses 5,25,27 1

Other expenses- Miscellaneous expenses 3,75,481

Other expenses- Miscellaneous expenses 55,758

Other expenses- Miscell aneous expenses 17,800

Other expenses- Miscellaneous expenses 2,36,031

for Bengal Shriram Hitcch · y Private Limited

MMurali

Director

Bangalore

Z 0 SEP 2015

S Balasubramanian

Director DIN 06888416

Place: Bangalore Date: Z O SEP 2016


B S R & Associates LLP Chartered Accountants Maruthi Info-Tech Centre 11-12/1 East Wing II Floor Koramangala Inner Ring Road Bangalore 560 071

22 September 2016

Dear Sirs,

tq_ Shriram • Properties Homes that live in you

We confirm to the best of our knowledge and belief, the following representations made to you in connection with your audit of financial statements of Bengal Shriram Hi tech City Private Limited ('the Company') for the year ended 31 March 2016.

We acknowledge on behalf of the Company, our responsibility for the financial statements, which have been prepared to comply with the requirements of the generally accepted accounting principles in India and approved by the Directors this day. We further confirm that the Accounting Standards issued under the Companies (Accounting Standards) Rules, 2006 which continue to apply under Section 133 of the Companies Act, 2013 ('the Act') and other accounting principles generally accepted in India.

We understand that your examination included such tests and procedures as you considered necessary for the purpose of expressing an opinion on the financial statements. We also understand that such tests and procedures would not necessarily detect fraud, irregularities or error, should any exist. We acknowledge that control over and responsibility for the prevention and detection of fraud, irregularities and errors remains with us.

Certain representations in this letter are described as being limited to matters that are material. Items are considered material, regardless of size, if they involve an omission or misstatement of accounting information that, in the light of surrounding circumstances, makes it probable that the judgement of a reasonable person relying on the information would be changed or influenced by the omission or misstatement.

In connection with your audit we confirm, to the best of our knowledge and belief, the following representations made to you during your audit:

Financial statements and records

The financial statements are free of material errors and omissions and present fairly the financial position of the Company and the results of its operations in accordance with generally accepted accounting principles.

2 We have made avai lable to you all accounting and financial records and related data of the Company.

3 There are no material transactions that have not been properly recorded in the accounting records underlying the financial statements.

4 Current and non-current classification of assets and liabilities contained in the financial statements are appropriate.

Registered Office: No.40/43, 8th Main, 4th Cross, Sadashivanagar, Bangalore - 560 080. T +91-80-40229999 I F +91-80-41236222 I Web: www.shriramproperties.com

Bengal Shriram Hitech City Private Limited Letter of representation, 31 March 2016

Accounting policies

5 The Company's accounting principles and the practices and methods followed in applying them, are as disclosed in the financial statements and there have been no changes during the year in the Company's accounting principles and practices that have not been disclosed to you.

6 Operating cycle considered for preparation of the financial statements is. appropriate considering the operations of the Company. Operating cycle is the time between the acquisition of assets for processing and their realisation in cash or cash equivalents. Operating cycle for real estate development undertaken by the Company has been determined as the life cycle of the project undertaken by the Company.

7 Management confirms the financial statements have been prepared on the assumption that the Company will continue as a going concern.

Fixed assets Tangible assets 8 The Company has a satisfactory title to all owned assets and there are no liens or

encumbrances on such assets been pledged as collateral security.

9 There are no impairments to the value of fixed assets of the Company.

10 Expenditure of a capital nature has not been charged to the statement of profit and loss.

11 Fixed assets of the Company are being depreciated on the basis of their estimated useful life. The useful lives for these assets are as prescribed under Part C of schedule II of the Companies Act, 2013.

12 Management confirms that, the Company does not have any leases which are required to be accounted as Finance Lease.

13 There has been no material discrepancies observed during the physical verification of fixed assets conducted during the year.

14 Management confirms that there are no assets other than those disclosed in the financial statements which are yet to be capitalised.

15 All fixed assets additions during the year have been appropriately capitalised and classified under respective nature of assets. The date of capitalisation reflects the date when the assets have been put to use and the amounts capitalised represents the cost of the asset in accordance with AS 10 on Fixed Assets.

Intangible assets under development 16 We have evaluated the intangible assets and we believe that there are no intangible assets

which meet the recognition criteria as laid down Accounting Standard (AS) 26 - Intangible Assets.


Lease Accounting

17 The Company has not entered into any finance and operating leases during the year ended 31March2016.

Investments

18 There are no investments as at 31 March 2016, other than those disclosed in the financial statements

Loans and advances, current and non-current assets

19 All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle. Based on the nature of business and the time between the initiation of services and their realisation in cash and cash equivalents for processing and their realisation in cash and cash equivalents. Operating cycle for real estate development undertaken by the Company has been determined as the life cycle of the project undertaken by the Company.

20 Long term loans and advances, considered good, amounting to Rs. 24,400,010 and short term loans and advances, considered good, amounting to Rs. 76,687,423 are fully recoverable and no provision is required other than those already accounted for in the financial statements.

21 The Company has given Rs. 9.1 million to Shriprop Infrastructure Pvt Ltd by way of additional security deposit during the current year.

22 The Company has not made any loans and advances to Directors either severally or jointly with any other person, or to firms or private companies in which any director is a partner or director or a member thereof during the year ended 31 March 2016.

Project under Development

23 Management confirms that the Company has good title on the land held by it as a part of the project being undertaken by the Company.

24 The Company acquired 314 acres of land located at Uttar Para from Hindustan Motors Limited (HM) at various points in time and the same is registered in the name of the Company. Post-acquisition, the Company embarked upon development of the projects and started seeking approval for the same. There was delay in getting the critical approvals for the project including clearances of the Environment Department, Government of West Bengal and the State Expert Appraisal Committee for the commencement of the project. Meanwhile it transpired that HM did not utilise the sale proceeds of the land for the purposes agreed with Government of West Bengal (GOWB). There arose a dispute between HM and the GOWB on this subject resulting in the delay in getting critical approval for the project. After protracted negotiation, there reached a settlement amongst the Company, GOWB and the HM. The Group of Ministries approved the proposed settlement and memorandum bearing number LRC/1 62/2014 dated 29 September 2014 and was communicated to the Company which inter alia provides the following: a) the Company has paid Rs 5 crores on 29 October 2014 and has to provide bank

guarantee of Rs 25 crores in favour of the State Government within the disposal of application for mutation of land and clearance by Irrigation and Environment Authorities. Both the amounts are part of the amounts detailed infra;

b) in as much the company has to pay the non-compete fees of 4% on the revenue to HM as part of the development [which is capped to Rs 194.47 crores with [email protected]% on reducing balance], the same shall be assigned and paid to GOWB within agreed time schedule which can be modified on mutual consent;

c) the Company has to keep 40 acres ofland as collateral security which would be released on the basis of realisation;


d) the Company is free to modify the master plan and the product mix based on the exigencies of the market subject to approval ofKolkota Metro Development Authority (KMDA). The KMDA and other Government authorities to give their approvals expeditiously after due diligence;

e) GOWB to extend all possible co-operation for smooth and uninterrupted project implementation.

Further, the value of properties under development recorded in the financial statements are being considered as recoverable based on a valuation report by an independent valuer. Significant assumptions used in the valuation report relates to project commencement date which is in turn dependent on the Company obtaining the required critical approvals including clearances of the Environment Department, Government of West Bengal and the State Expert Appraisal Committee for the commencement of the project. On the basis of the above settlement and memorandum bearing number LRC/162/2014 as communicated by the GOWB, the management is confident of obtaining the requisite approvals and commencing the project.

There was delay in getting the critical approvals for the project including clearances of the Environment Department, Government of West Bengal and the State Expert Appraisal Committee for the commencement of the project. The project has been launched in the current year as the Company has obtained environment clearance in April 2015.

25 The Company has entered into a Joint Development agreement with with Ashiana Housing Limited on 9 July 2015 to develop 19. 72 acres. As per the agreement, Ashiana Housing is required to obtain necessary approvals required for construction. As per the agreement, revenue share between the Company and Ashiana Housing is in the proportion of 15:85.

Liabilities

26 All known material liabilities are included in the accounts. There are no material unrecorded liabilities as at 31 March 2016.

27 The Management confirms that Rs. 2.94 million amount payable to HOK International with respect to architectural and design services for the project is no longer payable. Hence the same has been written back during the current year.

28 Provision has been made for all known liabilities as at 31 March 2016 and all expenses have been completely booked. The Company does not expect any material deviations in estimating the period end provisions.

29 As per the section 135 of the Act, the Board of Directors shall ensure that the Company spends, in every financial year, at least two per cent of the average of the net profits of the three immediately preceding financial years, in pursuance of its Corporate Social Responsibility [CSR] Policy.

However, management confirms that since the Company does not meet the criteria specified in Section 135 of the Companies Act, 201 3, the Company is not required to spend any amount on activities related to Corporate Social Responsibility for the year ended 31 March 201 6.

30 Gratuity which is defined benefit is accrued based on actuarial valuations, carried out by an independent actuary. We have provided actuary with appropriate data/ information as required to reliably measure the gratuity liability. The data sent to actuary is complete and accurate. We have reviewed the actuarial assumptions and the assumptions are appropriate.

31 The Company pays gratuity in accordance with the provisions of the Payment of Gratuity Act, 1972.

32 Management confirms that it has paid all its statutory dues to the appropriate authorities and there are no instances of non-compliance.


33 The Company does not have any dues to micro, small and medium enterprises as at 31 March 2016.

34 The Company confirms the receipt of following advances during the year:

• advance of Rs. 20 million from Beltas Merchants Pvt Ltd; • advance of Rs. 10 million from Exim Scrips Dealers Pvt Ltd; • advance of Rs. 90 million from Arrowlink Project Pvt Ltd as per the Development

Management agreement dated 13 June 2015; • advance of Rs.60.67 million from Ashiana Housing Ltd as per the Joint Development

agreement dated 9 July 2015.

Short term borrowings

Unsecured

35 Management confirms that the Company has no unsecured loans as on 31 March 2016, other than those disclosed in the financial statements.

Further we also confirm that the tenure and terms of repayment have not been specified for borrowings from related parties and hence the loan is considered as repayable on demand. The Company has provided for interest @ 15% p.a on the above loans.

Secured

36 The Company has no secured loans as on 31 March 2016 other than those disclosed in the financial statements.

Revenue and trade receivables

37 Revenues from real estate under development/ sale of developed property is recognised upon transfer of all significant risks and rewards of ownership in such real estate/ property, as per the terms of the contracts entered into with buyers, which generally coincides with the timing of the sales contract/ agreements, except for contracts where the Company still has obligations to perform substantial act after the transfer of all significant risks and rewards. In such cases, revenue is recognised on percentage of completion method (POCM), upon the following thresholds being met as per Guidance Note on Accounting for Real Estate Transactions (revised 2012):

Project commencing and revenue recognised on or after 1 April 2012:

a) The Company has obtained all critical approvals necessary for the commencement of the project and 25 % or more of the construction and development cost related to project has been incurred.

b) The Company has secured 25% of the saleable project area by sales contracts/ agreements with buyers.

c) The Company has realized I 0% of the revenue as per each sales contract/ agreement with buyers at the balance sheet date.

Project commenced and revenue recognised prior to I April 201 2:

a) Upon stage of completion of each project reaching to a significant level, which is estimated to be at least 15% of the total estimated cost of the project. Land costs and finance costs are not included for the purpose of computing the percentage of completion.

b) There is no significant doubt exists as the balance sheet date on collection of dues from customers in excess of the milestone due as the balance sheet date. The POCM and


milestone completion is certified by the project engineer and is considered to be management's best estimate.

When the outcome ofa real estate project can be estimated reliably and the conditions above are satisfied project revenue and project costs associated with the real estate project are recognised as revenue and expenses by reference to the stage of completion of the project activity at the reporting date arrived at with reference to the entire project costs incurred (including land and finance costs).

Contract costs include the estimated cost of construction, development and other directly attributable costs of the projects under construction. In cases where the total project cost is estimated to exceed the total estimated revenue from a project, the loss is recognised immediately.

The estimates for saleable area and contract costs are reviewed by the management periodically and the cumulative effect of changes in these estimates are recognised in the period in which these changes may be reliably measured.

38 Management confirms that the Company does not meet the conditions of Guidance Note on Accounting for Real Estate Transactions (revised 2012) for the period ended 31March 2016.

Share Capital

39 As at 31 March 2016, all equity shares that are allotted are fully paid up. The disclosure given with regard to share capital is as per Schedule III.

40 There are no options to subscribe for shares of the Company.

41 The Company has not allotted any equity shares during the year.

Cash and Bank balances

42 The balances of cash in hand and bank balances in current and deposit accounts have been correctly stated. There are no balances with banks that have not been disclosed to you.

Earnings/ (loss) per share

43 The earnings/ (loss) per share have been calculated in accordance with the requirements of AS 20.

Statement of Profit and Loss

44 Except as disclosed in the financial statements, the results for the year were not materially affected by:

a) transactions of a nature not usually undertaken by the Company;

b) circumstances of an exceptional or non-recurrent nature; or

c) charges or credits relating to prior periods.

45 Management confirms that no personal expenses of employees or others, other than those for which the Company is contractually liable or those which are in accordance with normal business practice have been debited to the statement of profit and Joss account.

Contingent liabilities & Commitments

46 Management confirms that as at 31March2016, the Company has no contingent liabilities other than those disclosed in the financial statements.

47 There have been no violations or possible violations of laws or regulations the effect of which should be considered for disclosure in the financial statements as the basis for recording a contingent Joss.

48 Management confirms that as at 31 March 2016, the Company has no other commitments other than commitments disclosed in the financial statements.


49 Provision, when material, has been made for losses to be sustained in the fulfilment of, or inability to fulfil, any service commitments.

50 One of the vendors has claimed an amount ofRs.13.79 million along with interest towards non payment of Project Management Fess, which is under arbitration. The Company has already provided for the principal amount, however interest on the same, if any has not been provided for. The Company has filed a counter claim against Masters. The cross examination is initiated in the court of law and the dispute is pending to settled as on 31 March 2016.

Contracts

51 There are no significant contractual obligations, other than those disclosed to you.

52 Management confirms that, the Company has complied with all aspects of contractual agreements that would have a material effect on the financial statements in the event of noncompliance

Transaction with related parties

53 We confirm the following representations in respect of related parties:

The Company has identified all the related parties as required by the Accounting Standard 18 as specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

Transactions with the related parties and related amounts receivable or payable, including sales, purchase, loans, transfers, leasing arrangements, and guarantees, have been properly recorded and disclosed in the financial statements.

Other than the transactions disclosed in the financial statements of the Company as on 31 March 2016, there have been no other transactions with the related parties during the year ended 3 1 March, 2016.

No amounts have been written off I provided in respect of related party transactions during the year ended 31 March 2016.

The disclosures made in the financial statements with respect to related parties are adequate having regard to the framework under which the financial statements have been drawn.

Post balance sheet events

54. The management confirms that subsequent to the year end, the Company has taken loan from LIC Housing Finance Limited and Aditya Birla Finance Limited amounting to Rs. 1,000 million and Rs. 500 million respectively, against which the Company has created charge on the project assets.

Minutes

55 The following meetings have been held during the year and the minutes as recorded and produced to you are complete and authentic:

Board Meetings:

30-Jun-15 29-Sep-15 28-Dec-15 19-Feb-16 25-Feb-16

Annual General Meeting:

30 September 2015


Corporate law matters

56 The Company has complied with all the applicable provisions of the Companies Act, 2013 as and when they were notified during the year. The Company updates all the mandatory statutory registers on a regular basis and it is ensured that details entered in such registers are complete and accurate.

57 The Company has obtained a legal opinion on implication of Section 185 of the Companies Act, 2013 on intercompany loans and advances and accordingly concluded that the Company is in compliant with provisions of Section 185 of the Companies Act, 2013.

Taxes

58 We confirm that the Company deducts, and has deducted the applicable Indian withholding taxes in respect of all payments made, wherever applicable.

59 Management confirms that sums payable by the Company, which are covered by the provisions of section 43B of the Act, such as taxes, duties, cess or fees , etc. have been paid or will be paid on or before the applicable due dates.

60 Management confirms that the Company has reasonably quantified and disclosed all material claims and reliefs which it proposes to make in the return of income and all disallowances it could be subject to, based on past experience.

61 All orders, relevant communication and notices from the income-tax department, if any, received during the period under review have been disclosed.

62 Company has not withheld any taxes on certain expenditures cross charged by the holding company on cost to cost basis.

63 Transactions undertaken with holding company does not fall under the purview of section 2(22)( e) of the Income-tax Act, 1961 .

64 Management confirms the Company does not have any items covered under the provisions of section 43B or 40A(7) or 40(a)(i)/(ia) of the Act.

Deferred Tax

65 Company has not recognised deferred tax asset on carry forward losses and other temporary timing differences in the absence of virtual certainty of realisation of such assets in future in accordance with AS 22 - "Accounting for taxes on income".

Companies (Auditor's Report) Order, 2016 issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Companies Act, 2013.

We confirm the following representations made by our Company to you in connection with the matters contained in the Companies (Auditor's Report) Order, 201 6:

66 The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

67 The Company has a regular programme of physical verification of its fixed assets by which fixed assets are verified every year. We confirm that, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its fixed assets. No material discrepancies were noticed on such verification.

68 The Company does not have any immovable property.

69 The Company is in the business of real estate development and related services and holds inventories only in the form of land, properties under development and constructed properties.


70 The Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 189 of the Companies Act, 2013 ('the Act').

71 The Company has not entered into any transactions attracting the provisions of Section 185 and 186 of the Act.

72 The Company has not accepted any deposits from public.

73 We confirm that the Company has maintained the books of account pursuant to the rules prescribed by the Central Government for maintenance of cost records under section 148( I) of the Act.

74 We confirm that amounts deducted or accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Income-tax, Service tax, Sales tax, Value added tax, Employees' State Insurance, Cess and other material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities. The Company does not have any dues on account of Customs duty and Excise duty.

Also, there no undisputed amounts payable in respect of Income tax, Service tax, Value added tax/Sales tax, Employees' State Insurance, Cess and other material statutory dues were in arrears as at 31 March 2016 for a period of more than six months from the date they became payable.

75 We confirm that there are no dues oflncome tax, Service tax, Value added tax/Sales tax and Cess which have not been deposited with the appropriate authorities on account of any dispute.

76 The Company does not have any borrowings from banks or financial institutions. The Company did not have any outstanding dues to debenture-holders or government during the year.

77 The Company has not raised any money by way of public issue or further public offer (including debt instruments) during the year. Further, we confirm that the term loans taken by the Company were applied for the purposes for which they were raised.

78 The Company is a private company and accordingly the provisions of Section 197 read with Schedule V to the Act are not applicable to the Company.

79 The Company is not a Nidhi Company as prescribed under Section 406 of the Act. 80 The Company has complied with the provisions of Sections 177 and 188 of the Act in case

of transactions with related parties. 81 The Company has not made any preferential allotment or private placements of shares or

debentures during the year. 82 The Company has not entered into any non-cash transactions with directors or persons

connected with him. 83 The Company is not required to be registered under section 45- IA of the Reserve Bank of

India Act, 1934.

Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act").

84 We are responsible for establishing and maintaining adequate and effective internal financial controls based on the internal control over financial reporting criteria and the preparation and presentation of the financial statements and, in particular, the assertions to you on the internal financial controls in accordance with the internal financial control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants oflndia.


85 We have performed an evaluation and made an assessment of the adequacy and effectiveness of the company's internal financial controls and based on the nature and size of the Company.

86 Based on the nature and size of the Company, the Company's internal financial controls are adequate and effective that were operating effectively as at the 31 March 2016

87 There is no deficiencies in the design or operation of internal financial controls

88 There were no instances of fraud resulting in a material misstatement to the company's financial statements and any other fraud that does not result in a material misstatement to the company's financial statements but involves senior management or management or other employees who have a significant role in the company's internal financial controls.

89 There have been no communications from regulatory agencies concerning non- compliance with or deficiencies in financial reporting practices.

90 We have provided you with:

• All information, such as records and documentation, and other matters that are relevant to your assessment of internal financial controls;

• Additional information that you have requested from us; and • Unrestricted access to those within the entity.

91 There are no changes in the internal financial controls system from 3 1 March 2016 till the date of this representation letter.

92 There was no changes proposed to the internal financial control system as on date.

General

93 There are no shortages or other irregularities that have been discovered and not disclosed to you.

94 The Company uses certain resources of the holding company for its day to day operations and has accordingly received a charge back from the holding company for the use of these resources as per the agreement entered with the holding company.

95 The share-holders have not issued any notice from on account of any non-compliance of the terms of the shareholder's agreement or on account of any dispute between shareholders that may impact the going concern of the Company.

96 The Company has no plans or intentions that may materially affect the carrying value or classification of assets or liabilities.

97 The financial statements have been prepared on the basis of accrual accounting and are based on the same set of accounting policies as those followed in the previous accounting year.

98 We acknowledge our responsibility for the design and implementation of programs and controls to prevent and detect fraud. We understand that the term "fraud" includes misstatements arising from fraudulent financial reporting and misstatements arising from misappropriation of assets. Misstatements arising from fraudulent financial reporting are intentional misstatements or omissions of amounts or disclosures in financial statements to deceive financial statement users. Misstatements arising from misappropriations of assets involve the theft of an entity's assets where the effect of the theft causes the financial statements not to be presented in conformity with generally accepted accounting principles.

99 The Management reviews the performance of the Company based on the business segments. The sole business segment is 'Development of real estate residential projects' and the only geographical segment is ' India'. Consequently, the requirement for a separate segment


disclosure as required under Accounting Standard 17 on 'Segment Reporting' is not considered relevant.

100 There have been no:

a Instances of fraud involving management or employees who have significant roles in internal control.

b Instances of fraud involving others that could have a material effect on the financial statements.

c Communications from regulatory agencies concerning non-compliance with, or deficiencies in, financial reporting practices.

d Violations or possible violations of laws or regulations, the effect of which should be considered for disclosure in the financial statements or as a basis for recording a loss contingency.

e Allegations, either written or oral, of misstatements or other misapplications of accounting principles in the Company's financial statements that have not been disclosed to you in writing.

f Allegations, either written or oral, of deficiencies in internal control that could have a material effect on the Company's financial statements that have not been disclosed to you in writing.

g False statements, affecting the Company's financial statements made to you, our internal auditors, or other specialists I experts upon whose work you may be relying in connection with your audits.

101 We confirm that we have obtained written representations from all the directors and have recorded in the minutes of the Board meeting that none of the directors is disqualified to be appointed as a director in terms of Section 164(2) of the Companies Act, 2013.

Specific representation on Report on Other Legal and Regulatory Requirements:

As per section 143(3) of the Act.

i. We the management confirm that the Company did not have any pending litigations on its financial position in the financial statements, except for those disclosed in the financial statements

ii. We the management confirm that the Company did not have any long-term contracts including derivatives contracts for which there were any material foreseeable losses.

iii. We the management confirm that there were no amounts during the year which were required to be transferred to the Investor Education and Protection Fund.

I, the undersigned, confirm that I am authorised to sign this letter of representation on behalf of the Company.

Yours faithfully, For and on behalf of Bengal Shriram itech C~ Private Limited

~urali Director

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