Antecedentes

We are involved in various legal proceedings including, among others, income tax, central excise duty and service tax cases and criminal proceedings. Except as described below, we believe that we are not involved in any material legal proceedings, and in our opinion, no proceedings are threatened, which may have, or have had during the 12 months preceding the date of this Red Herring Prospectus, a material adverse effect on our business, financial position, profitability or results of operations.

Litigation against our Company

A summary of litigation and disputes involving potential financial liability of ` 10 million and certain other litigation which we consider material, is as follows:

Criminal Proceedings

1. The Factory Inspector issued letter dated May 30, 2007 to our Company for alleged violation of provisions of the Factories Act, 1948 (the “Factories Act”) and the Jharkhand Factories Rules, 1950 at our Company’s Jamshedpur facility pursuant to an inspection of the factory. The alleged violation includes inter alia non-production of register required to be maintained under the Factories Act, not displaying working hours of the workmen in the office premises, improper operation of the canteen, discrepancies in awarding weekly leave and non-maintenance of register for annual leave of the workmen. Our Company filed a reply dated June 5, 2007. Subsequently, the Deputy Chief Factory Inspector (“DCFI”) filed a criminal petition before the Chief Judicial Magistrate, East Singhbum. Our Company filed a writ petition before the High Court of Jharkhand to quash the criminal proceedings instituted by the DCFI. The High Court rejected the petition of our Company. The prosecution is currently ongoing.

2. Show cause notice dated November 22, 2010 was issued by the Inspector of Legal Metrology (“Inspector”), Chandrapur for alleged violation of provisions of the Standards of Weights and Measures Act, 1976 and the Standards of Weights and Measures (Packaged Commodities) Rules, 1977. Our Company replied to the show cause notice vide letter dated April 11, 2011. The Inspector filed a criminal complaint dated May 4, 2011 before the Judicial Magistrate, First Class, Chandrapur against our Company and named the Directors (as representatives of our Company). The matter is currently pending.

Regulatory notices

1. We received a notice from the cost- audit department of the Ministry of Corporate Affairs, GoI (the “MCA”) on February 12, 2013 in relation to the non-submission of a form by our cost auditor, on their appointment. We responded to the notice pursuant to a letter dated February 19, 2013, and have not received further communication from the MCA in this regard, as of the date of this Red Herring Prospectus.

2. We have received a notice from the Deputy Inspector, Industrial Health and Safety, Department of Labour, Government of Chattisgarh on February 13, 2013 alleging violations of provisions of the Factories Act regarding obtaining approval for the construction of building at our Company’s Raipur facility. We are currently in the process of replying to the notice.

Income tax proceedings

1. Our Company has filed an appeal dated August 30, 2010 before the Income Tax Appellate Tribunal (“ITAT”), Ranchi bench against orders passed by the Commissioner of Income Tax (Appeals) (“CIT Appeals”), Jamshedpur partly allowing the order passed by the Commissioner of Income Tax (“CIT”), Kolkata for assessment year 2002-03 disallowing various expenses such as leave travel expenses, software expenses, disallowance for bad debt written off and disallowance for various deductions claimed by our Company and re-computation by the transfer pricing officer of the arm’s length price of international transactions by our Company. The aggregate amount claimed is ` 23.93 million. The matter is currently pending.

2. Our Company has filed an appeal before the CIT Appeals, Jamshedpur on January 27, 2009 against the assessment order passed by the Joint CIT, Jamshedpur on December 31, 2008 for the assessment year 2005-06 disallowing various deductions claimed by our Company such as deduction under certain staff welfare scheme, deductions for provisions of warranty and other disallowances of similar nature including leave travel concessions and motor vehicle expenses. The assessment order also disallowed expenses paid to the Timken Company as TDS was not deducted on the payments made. The aggregate amount involved is ` 24.14 million. The matter is currently pending.

3. Our Company has filed an appeal and stay petition, both dated January 27, 2010, along with additional grounds of appeal on February 17, 2012 before the CIT Appeals, Jamshedpur against the assessment order passed by the Assistant CIT, Jamshedpur on December 30, 2009 for the assessment year 2006-07 disallowing various expenses such as deduction of bad debt, deduction under certain staff welfare schemes, deductions for provisions of warranty and other disallowances of similar nature. The aggregate amount involved is ` 16.12 million. The matter is currently pending.

4. Our Company had filed an appeal to the ITAT, Circuit Bench, Ranchi against the order of the CIT Appeals, Jamshedpur dated January 31, 2007 partly allowing the assessment order of the Assistant CIT, Circle 3, Jamshedpur dated March 31, 2006 for the assessment year 2003-2004. The assessment order disallowed various deductions including claims by our Company for exclusion of excise duty from the closing stock and charge back expenses. The amount claimed was ` 23.5 million and ` 23.8 million respectively. Further the assessing officer disallowed deductions claimed by our Company for utilisation of DEPB benefits. Pursuant to the order of the ITAT, Circuit Bench dated October 18, 2010, the amounts claimed under exclusion of excise duty from the closing stock of ` 23.5 million was remanded to assessing officer and charge back expense of ` 23.8 million was remanded to the CIT Appeals, for fresh assessment. These matters are currently pending reassessment.

Excise and service tax proceedings

1. The Commissioner of Central Excise and Service Tax (“CESC”), Jamshedpur has filed a show cause notice on April 24, 2009 in relation to alleged non-payment of central excise duty, education cess and higher education cess for the fiscal years 2004-05, 2005-06, 2006-07 and 2007-08. The aggregate amount claimed is ` 82.61 million. Our Company filed a reply to the notice on August 20, 2009. The matter is currently pending.

2. Our Company has filed an appeal and stay petition on May 12, 2012 before the Customs, Excise & Service Tax Appellate Tribunal (“CESTAT”), Kolkata against the order of the Commissioner of Central Excise & Service Tax (“Commissioner”), Jamshedpur dated January 27, 2010 arising out of the show cause notice issued by the Commissioner on October 17, 2008. The show cause notice relates to alleged non-payment of service tax along with educational cess on royalty, technology fee and technical know-how expense paid to Timken Company for the fiscal years 2003-04 and 2004-05. The aggregate amount involved is ` 16.99 million along with interest and penalty. The matter is currently pending.

3. Our Company has filed an appeal and stay petition on May 12, 2010 before the CESTAT, Kolkata against the order of the Commissioner, Jamshedpur dated January 27, 2010, as revised by the order dated April 8, 2010 arising out of the show cause notice issued by the Commissioner on January 15, 2008. The show cause notice relates to various grounds, inter alia, alleged contradiction in the amount of service tax paid for different taxable services, not obtaining the relevant service tax registrations for providing various services, alleged non-payment of service tax on the technical assistance fee paid for technical know-how received from the Timken Company, evasion of service tax by not obtaining service tax registration under ‘franchise services’ category for the period from July 2003 to December 2006. The aggregate amount involved is ` 24.41 million along with interest and penalty. The matter is currently pending.

Sales tax proceedings

1. Our Company filed an appeal and stay petition, both dated April 25, 2005 before the Joint Commissioner of Commercial Taxes (Appeals) (“JCCT”), Jamshedpur against the order dated March 18, 2005 passed by the assessing officer, Jamshedpur disallowing the entire claim of export sale on the ground that certain documents that were required to be submitted to claim the deduction were not

submitted for the fiscal year 2000-01. The JCCT has passed an order dated November 3, 2009 remanding the matter to the assessing officer. Subsequently, the assessing officer passed ex-parte order dated April 16, 2012 upholding the earlier assessment order for a total tax liability of ` 75.29 million. Our Company has filed a revision petition dated June 29, 2012 before the Commissioner of Commercial Taxes, Jharkhand against the ex-parte order passed by the assessing officer. The matter is currently pending.

2. Our Company filed an appeal before the JCCT, Jamshedpur against the order dated November 2, 2005 passed by the assessing officer enhancing the gross turnover claim of our Company for the fiscal year 2001-02. The assessing officer has also disallowed certain claims made by our Company on the ground that certain documents that were required to be submitted to claim the deduction were not submitted by our Company. The JCCT has passed an order dated June 27, 2009 remanding the matter to the assessing officer. The assessing officer has passed an ex-parte order dated April 16, 2012. Our Company has filed a revision petition dated June 29, 2012 before the CCT, Jharkhand against the ex- parte order passed by the assessing officer dated April 16, 2012. The aggregate amount in dispute is ` 10.82 million. The matter is currently pending.

3. Our Company has filed an appeal and stay petition, both dated March 12, 2009 before the JCCT, Jamshedpur against the order passed by the assessing officer partly disallowing the deduction claimed by our Company for fiscal year 2005-06 on the ground that certain documents that were required to be submitted to claim the deduction were not submitted by our Company. The aggregate amount involved is ` 64.62 million. The matter is currently pending.

4. Our Company has filed an appeal and stay petition, both dated August 28, 2009 against order dated July 30, 2009 passed by the Assistant Commissioner of Commercial Tax, JR Circle (“ACCT”), Jamshedpur. The order relates to disallowance for non-submission of certain documents that were required to be submitted for claiming deductions for the fiscal year 2006-07. The aggregate amount claimed is ` 113.78 million. The matter is currently pending.

5. Our Company has filed an appeal and stay petition, on July 14, 2010 against the order dated March 8, 2010 passed by the ACCT, Jamshedpur. The order relates to disallowances, disputed by our Company, of a total amount aggregating of ` 10.95 million, for non-submission of certain documents that were required to be submitted for claiming deductions for the fiscal year 2007-08.

6. Our Company has filed an appeal and stay petition dated October 31, 2011 against the order passed by the ACCT, Jamshedpur dated March 25, 2011. The order relates to disputed tax liability of an amount aggregating to ` 16.04 million, for non-submission of certain documents that were required to be submitted for claiming deductions for the fiscal year 2008-09. The matter is currently pending.