SBEC Systems (India) Limited is an engineering and consultancy company primarily engaged in rendering scientific, technical, engineering, professional, commercial and all other types of skilled services and dealing in designs, plans and specifications of all type of contracts turnkey or otherwise, assignments, process and undertaking fabrication ,refection, commissioning of projects and providing high-tech equipment to sugar and power industries.

a. (1) The company has only one class of issued shares i.e. Equity shares having par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per and equal right for dividend. The dividend proposed by the board of directors is subject to the approval of shareholders in the ensuing general meeting, except in case of interim dividend . in the event of liquidation the entity shareholders are eligible to receive the remaining assets of the company after payment of all preferential amounts, in proportion to their shareholding.

(2) No member shall exercise any voting rights in respect of any share on which any calls payable , or in respect of which the company has exercise its right of lien.

(3) The Company shall have a first and paramount lien upon all partly paid shares registered in the name of any member either alone or jointly with other person and such lien shall extend to all dividend from time to time, subject to section 205AoftheAct, provided that the board of directors may at anytime, declare shares to be exempted wholly or partly from the provision of articles.

c. None of shares have been reserved for issue under options and contracts/commitments for sale of shares/disinvestment as at the balance sheet date. None of the securities are convertible into shares at the end of the reporting period.

No calls are unpaid by any director or officer of the company during the year.

NOTE - 2 :CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF

                                                          (Rs in Lacs)

Particulars                              Current Year  Previous Year

Trade Tax                                      2.55            2.55

Security to Shamrao Vithai                   700.00             Nil 
Co-operative Bank Ltd

Interest on Foreign Currency Loan            145.30 @        127.28  

Note 3. The Company holds 100% (Previous year 100%) shares of SBEC Investment Limited.

Note 4. Balances of Sundry Debtors, Sundry Creditors and Loan and advances in few cases are subject to confirmation and reconciliation. However in the opinion of the management the differences arising on such reconciliation, if any, are not likely to be material.

Note 5 In the absence of necessary agreements/approvals, interest on loans from foreign lenders has not been provided.

Note 6. Liability of Rs. 7.66 lakh (Previous year Rs. 7.66 lakh) related to deputation charges of foreign technicians has not been provided. The same will be provided at the time of actual payment.

Note 7. The accounts of the Company for the year ending 31.03.12 have been prepared on going concern basis. The management is confident to revive the business activities in near future depending upon more favourable conditions prevailing in the market bearing unforeseen circumstances.

Note 8 Liability of Rs.28.74Lacs (USD 55,781.77) (previous year Rs.25,18 Lacs) in respect of interest on foreign currency loan has not been provided. The same will be provided at the time of actual payment.

Note 9. Reversal of diminution of Current Quoted investment aggregating Rs.31.53 lacs( Prv. Year Rs. 89.32 Lacs) has not been provided. Resulting of such non reversal of diminution the loss for the year and investment are shown higher by Rs. 31.53 lacs (Prv. Year Rs. 89.32 Lacs)

Note 10. Difference on exchange rate fluctuation on Foreign Liabilities amounting to Rs.1.79 lacs (previous year Rs. 176.55 lacs has not been provided. The fluctuation in foreign transaction, if any will be accounted for in the year of remittance/final adjustment. Resulting of such non provision the loss for the year and liability are shown lower by Rs.1.79 lacs (Prv. Year Profits shown lower and liability shown higher by Rs. 176.55 lacs)

Note 11. In respect of disputes with two foreign parties / suppliers M/s Silver webull Sweden AB and M/s Hagglunds drives AB Sweden the Hon'ble Delhi High Court has passed order dated 01/09/2010 and 21/09/2010 directing the company to settle the outstanding of these suppliers in instalments on the dates stated in the orders. The consequential effect of the orders has not been accounted. Resulting of such non provision the Loss for the year and liability are shown higher by Rs. 106.77 lacs.

Note 12. Liability of Rs. 5.48 lacs (USD 10628.94) (Prv. Year - Nil) in respect of interest on deffered payment credit and supplier credits has not been provided. The same will be provided at the time of actual payment. Resulting on such non provision the loss for the year and liability are shown lower by Rs. 5.48 lacs.

Note 13 Expenses pertaining to Prv. Year, included under relevant expenses heads, amount to Rs. 1,88,375/- (Prv. Year - Nil).

Note 14. Managers have been paid remuneration in terms of resolution and in accordance with Schedule XIII to the Companies Act, 1956, as under: Remuneration to Sh Anil Jain ((Up to 31/12/2011 ) and Sh. Amit Jain (from 01/01/2012 ) appointed manager under section 269 of the Companies Act, 1956.

* Remuneration excludes provisions for Gratuity determined on actuarial basis , as these are determined for the Company as a whole.

** Remuneration amounting to Rs. 1.13 lacs paid to Sh. Amit Jain (appointed manager from 01/01/2012) is subject to approval of shareholders by a ordinary resolution to be passed at the general meeting of the company.

Note 15. Segment Reporting

The Company operates in a single business and geographical segment and the requirements of Accounting Standard 17 on Segment Reporting are not relevant.

Note 16. Related Parties Disclosures

1. The names of the Related Parties as certified by the management are as follows :

a) Enterprises Where Control Exists

i. SBEC Investments Limited (Subsidiary company)

ii. SBEC Sugar Limited (Substantial Interest Exist)

b) Enterprises that directly or indirectly controlled or are under common control with the reporting enterprises, i. SBEC System limited (United Kingdom)

c) Key Managerial Personnel

Mr. Anil Jain, Chief Financial Officer (appointed as Manager up to 31/12/2011 under Section 269 of the Companies Act, 1956). Mr. Amit jain Chief Financial Officer (appointed as Manager from 01/01/2012 under Section 269 of the Companies Act, 1956).

d) Individual owning, directly or indirectly , an interest in the voting power of the reporting enterprise that gives them control or significant influence over the enterprise : Mr.U.K.Modi

e) Relative of individual owning substantial interest and their Enterprises :

Mrs.Kumkum Modi, Mr.Abhishek Modi, Ms.Meghna modi, Mrs. Himani Modi, Mr.Jayesh Modi, Modi Arts Pvt Ltd., Modi Goods and Retail Services Pvt Ltd., Jai Abhishek Investments Pvt Ltd., Kamakhya Cosmetics & Pharmaceutical Pvt.Ltd., Modi Diagnostics Pvt Ltd., Modi Revlon Pvt.Ltd., Modi Senator (India) Pvt Ltd., First Move Management Services Pvt Ltd. , Revlon Lanka Pvt Ltd., Swasth Investment Pvt Ltd., Umesh Modi Corp Pvt Ltd., Modi Omega Pharma (India) Pvt Ltd., Modi lllva India Pvt Ltd., A to Z Holding Pvt Ltd., Longwell Investment Pvt Ltd., SBEC Sugar Limited* , Bihar Sponge Iron Ltd., Modi Mundipharma Pvt Ltd., Modiline Travel Service Pvt Ltd., Modi Industries Ltd*., Morgardshammer India Ltd., Win Medicare Pvt Ltd*., H.M.Tubes & Containers Pvt Ltd., * Modi Motors Pvt Ltd*., M.G.Mobile India Pvt Ltd.,Modi Gourmet Limited,Chandil Power Ltd..Revlon Trading Bangladesh Pvt. Ltd, SBEC Bio Energy Ltd*., Meghna AutoWorks Pvt. Ltd., Mundipharma (Bangladesh) Pvt. Ltd., Jayesh Tradex Pvt. Ltd.

* Indicates that during the period , there is transaction with these relatives and enterprises.

Note 17. Deferred Taxation

The Company has no deferred tax liability. There are deferred tax assets on account of unabsorbed depreciation and carried forward business losses, which as a matter of prudence have not been recognised.

Note 18. (a) Current Liabilities include credit balance of Rs. 0.37 lacs (Previous year cr. Balance Rs 0.90 lacs in the name of Mr. Anil Jain) in the name of Mr. Amit Jain appointed as Manager under Section 269 of the Companies Act, 1956.

(b) Current Liabilities include Rs.0.36 lacs (Previous year 0.37 lacs) in the name of Shwetambery Khurana as Company Secretary under the Companies Act, 1956.

Note 19. Employee Benefits

The company has adopted Revised AS-15 `Employee Benefits'. In accordance with the transitional provision of revised AS -15, additional liability (net of tax) under new method.

Contributions to Defined Benefit /Contribution Plan, recognized as expense for the year are as under:

a) Defined Contribution Plan

b) Defined Benefit Plan

The employees gratuity fund scheme is a Defined Benefit Plan (DBP). The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

The estimates of rate of escalation in salary considered in actuarial valuation, takes into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The actuary certifies the above information.

Disclosure in respect of previous four annual periods as required by Revised AS-15 `Employee Benefits' is not presented as the management considers it impracticable in the absence of requisite information

Note 20. Previous Year figures are given in brackets and have been regrouped / rearranged wherever required.