La familia y su composición estructural.

M/s Deepak Menghnani Contracts Pvt Ltd was one of the sub contractor of the Company. The contractor has claimed a sum of Rs. 98.97 lakhs for the work purportedly done by them.The company refutes the same and has approved a sum of Rs.60.21 lakhs as value of work done. M/s Deepak Menghnani Contracts Pvt ltd has issued a notice against the company for recovery of dues and winding up on 13/09/07 under section 560 of the Companies Act, 1956 and the company has filed a counter case in High court for winding up. The dispute is not resolved

B. FILED AGAINST THE COMPANY:

1. LITIGATION INVOLVING CRIMINAL LAWS:

Application under Negotiable Instruments Act has been filed against the company in the Court of Judicial Magistrate, First Class, Vashi, CBD Navi Mumbai against the Company as below:

(i) Bombay JCB Earth Movers (JCBEM) had rented out two of its excavating machines to Niraj Cement Structurals Ltd and we had executed a rental agreement on 30.04.2004. We had submitted 11 Post dated cheques for an aggregate amount of Rs 24.79 lakhs as a security for the transaction. There is a dispute regarding performance of the machinery during the contractual period However, the party had claimed payment for full period of contractual utilization of the machines instead of their actual utilization. Thus there is a dispute between the company and the firm. In the meantime JCBEM presented the post dated cheques which were offered as security for payment even after making an aggregate payment of Rs 29.73 lakhs . On presentation the cheques were dishonored by us as the payment of this amount was not due by us to JCBEM as per the terms of the contract. The firm issued a notice to on us August 9, 2005 under sec 138 of NI Act and a criminal complaint was filed against the company as well as the Managing Director of the company (no. 3272 of 2005) in the Court of Judicial Magistrate First Class, Vashi at CBD, Navi Mumbai. The matter was posted for hearing on November 20, 2006 when the Company was ordered to file an Affidavit in reply and the matter has been posted to 23RD _July

2008 for orders.

Application under Negotiable Instruments Act has been filed against the company in the Court of Judicial Magistrate, First Class, Cantt Pune against the Company as below:-

ii) The company had borrowed from Mr Jugal Kishore Gupta, Mrs Uma J. Gupta and Ms Reema J. Gupta a sum aggregating to Rs 26.25 lakhs on various dates as unsecured loans and we have given them Post dated cheques. Mr Jugal Kishore Gupta, Mrs Uma J. Gupta and Ms Reema J. Gupta have presented the cheques for payment which were dishonoured. The lenders has filed 4 cases against the company for recovery of money in the court of Judicial Magistrate First Class Cantt, Pune. The matter is posted for hearing on June 30,2008

Matters / litigations against the company settled.

Matters / disputes with following parties are settled as on date and the details are:

i. Mrs S. Agarwal : Mrs S. Agarwal w/o Sri Amit Agarwal had provided an unsecured loan to the issuer company based on the post dated cheques of the company. 11 Complaints under section 138 were filed in the Hon. Court of M.M. New Delhi for an aggregate amount of Rs 37 lacs. On 9.2.2007 we have amicably decided to settle the dispute and have filed a joint application before the Hon. Court for recording a compromise. As per the settlement we have to pay the Principal amount of Rs 39 lacs (including Rs 2.00 lacs for which complaint under sec.138 was not filed). A repayment programme has been agreed to by both the parties and the final payment has to be made by 7.5.2008. We are adhering to the repayment programme as decided in the compromise and only Rs 1.00 Lac has to be paid.

ii. M/s. Ashok Leyland Finance Ltd: M/s. Ashok Leyland Finance Ltd had granted loans for purchase of new machinery and refinance against the used machinery about Rs. 12 Crores which were repayable in 4 years period. Out of the said amount Rs 8.75 Crores was paid till 31.3.2006 and an amount of approx. Rs. 3.37 Crores was overdue at the end of contract period. M/s. Ashok Leyland Finance Ltd. (presently merged with Indus Ind Bank) has issued a notice for repayment but no suit was filed. Both the parties have decided to settle the dispute amicably but, no written agreement is entered into between us to this effect. As per the settlement between the two parties the company has paid Rs. 1.95 Crores during the financial year 2006-07 and the remaining amount is payable by June 08.

2. LITIGATION INVOLVING SECURITIES AND ECONOMIC LAWS:

There is no litigation involving securities and economic laws by the Company. 3. LITIGATION INVOLVING STATUTORY LAWS:

There is no litigation involving statutory laws. 4. LITIGATION INVOLVING CIVIL LAWS:

Legal Notice from M/s Swiss Consultancy, Mumbai

i) M/s. SWIS CONSULTANCY, MUMBAI M/s. Swiss Consultancy provides management consultancy services to the companies. Niraj Cement Structurals Ltd to come out with an IPO in the year 2005 and has approached M/s. Swiss Consultancy to assist them in that behalf for a fee of Rs 20 lacs. The Company has paid an initial amount of Rs.2 lacs and issued a post dated cheque for an amount of Rs.3 lacs. However, the same was dishonoured. The consultancy firm has issued a legal notice on 17.5.2006 but no action has been initiated under section 138 till date. The firm has not provided the required professional services and hence the payments were withheld.

Payment dispute with M/s Deepak Meganani - a drain contractor

MMRDA (client) has awarded a contract for widening of LBS Marg from Sion to Mulund to Ashoka Buildcon Ltd (Main contractor). A part of the contract work was sub contracted to us (Sub contractor) and an agreement was entered between the main contractor and us on 25.09.2004. We had appointed M/S Deepak Menghnani contractors Pvt Ltd (DMCPL) to execute a portion of the above work contract on 19,11,2004. As per the terms of the work order, the payment to DMCPL was to be released progressively based on the certified bill by us, main contractor and the client. DMCPL has not completed the allocated work and hence the claim bills were not certified by the main contractor and client. Further DMCPL did not respond to the joint inspection. No legal proceedings have been initiated so far. We have paid an excess amount of Rs 9.59 lakhs to DMCPL.

Payment dispute with M/s Samser singh of M/s Vijay construction

M/s. Vijay Construction was awarded a contract on back to back basis at the Mumbai site of the Company. The payment was to be made on the basis of certification by department. M/s. Vijay Construction is seeking Rs.14 lacs more from us but Vijay constructions is not accounting for the material recoveries. However, the dispute is being sorted out for settlement with the said M/s. Vijay Construction. However, No legal proceedings have been initiated.

Payment dispute with Late Mr Jaykar Shetty of Technomech Engineers

We had awarded Technomech Engineering a contract on back to back basis at the LBS work site. The payment was to be made on the basis of certification by MMRDA. However, we have received a Notice u/s 220 of the Income-tax Act restraining us from making any payment to Technomech Engineering and called upon us to pay Rs.57 lacs as Technomech Engineering had some income tax liabilities. We have disputed the amount being payable to Technomech Engineering and, therefore, filed an affidavit with the Income-tax Department undertaking to pay to income tax, if any amount is due and payable by us to the said Technomech Engineering.