13% Cumulative Redeemable Preference shares of -2,00,00,0G0/- is due for redemption on 22-12-2008, and die company has not redeemed. During the year the company has not made provision for preference dividend on balance 2,00,000 preference shares, due to insufficient profits.

Arrears of Dividend as at 31st March,20l5 is f 2,28,08,763/- (as at 31st March,2034 is -2,02,08,763/-) The balance preference shareholders l)Venugopal Reddy Pakanati & Anuradha Reddy Pakanati joindy holding 1,00,000 preference shares and 2) Rajagopal Reddy Pakanati and Suneela Reddy Pakanati jointly holding 1,00,000 preference shares have filed a recovery suit in the court of City civil court at Secunderabad vide Ref No.O.S.No.492 of 2013 which is pending before U-e court The above preference shareholders have also filed winding up petition against the company in \he High Court of Judicature of Andhra Pradesh at Hyderabad vide Ref No. CP 44 of 2014 and CP 47 of 2014 which is pending before the Hon'ble High Court.

2. The Company has taken overdraft facility from Axis Bank Ltd, Jubilee Hills branch, in the month of November.2006 for an amount of -200.00 Lacs, part of the overdraft has been converted into Term Loan by the bank in November,2008 for an amount of - 50.00 Lacs at an interest rate of 14.25 %. The said term loan is secured byequitabie mortagage of 1320 & 1095.89 Sq.yds of company own land in Jaihind Nagar, Shatkpet, Hyderabad and also equitable mortagage of land & building at Plot No.66, Dream Valley, Shatkpet, Hyderabad, in the name of ICVijaya Rini & P.Vamsidhar. The loan is repayable in 60 monthly equal installments of -l,16,990/-each from die date of conversion. The company has paid 20 monthly equal installments upto September 2010.

Axis Bank Ltd has filed a case in die Hon'ble Debts Recovery tribunal against the company for recovery of debts vide case Reference No.O.A.No.436 of 2013, and die company also filed a case against Axis Bank Ltd vide case Reference No. SA.48 of 2012 and is pending before the Hon'ble Debts Recovery Tribunal.

The term loan facility is further secured by personal guarantees of Sri P.KodandaRambabu, Sri K.Vijaya Rani & SriP.Vamsidhar

3. The Company has utilised Term loan from PNB Housing Finance Ltd.Lakdikapul branch, in the month of April,2008 for an amount of -200.00 Lacs at an interest rate of 14.50 % p.a. The said term loan is secured by equitable mortagage of 7744 Sq.Yds of land belonging to SmtT.Vijaya Lakshmi who entered into developement agreement with me company forme development of Quantum Heights residential complex at Gajulararamaram. The term loan shall be repayable in 16 monthly installments commencing after 12 months of 1st disbursement of loan.

The Company has filed a case in the Hon'ble Debts Recovery Tribunal against PNB Housing Finance Limited vide case Reference No.SA 673 of 2013, which is pending before die Hon'ble Debts Recovery Tribunal.

The term loan facilities are further secured by personal guarantees of Sri G.Satyanarayana, Sri.P.Kodanda Rambabu, and Sri K.Vi)aya Rani.

4. The Company has forfeited 17,50,000 share warrants of t 2/-paid, for non payment of balance amount

5. Pursuant to die enactment of Companies Act;2013, die company has applied the estimated useful lives as specified in Schedule II. Accordingly, the unamorused carrying value is being depreciated / amortized over the revised / remain ng useful lives. The written down value of Fixed Assets whose lives expired as at 1st April'2014 have been adjusted in the opening balance of profit & loss account amounts to Rs.4,21,645/-

6. The Company has taken overdraft facility from Axis Bank Ltd, Jubilee Hills branch, in the month of November,2006 for an amount of -200.00 Lacs,(Out of it - 50.00 Lacs has been converted into Term loan in November,2008) at an interest rate of 12% p.a. The said overdraft facilities are secured by equitable mortagage of 1320 & 1095.89 Sq.yds of company own land in Jaihind Nagar, Shaikpet, Hyderabad and also equitable mortagage of land & building at Plot No.66, Dream Valley, Shaikpet, Hyderabad, in the name of Sri K .Vijaya Rani & Sri P. Vamsidhar.

Axis Bank Ltd has filed a case in the Hon'ble Debts Recovery tribunal against the company for recovery of debts vide case Reference No.O.ANo.436 of 2013, and the company also filed a case against Axis Bank Ltd vide case Reference No. SA.48 of 2012 and is pending before the Hon'ble Debts Recovery Tribunal.

The said overdraft facilities are further secured by personal guarantees of Sri P.Kodanda Rambabu, Sri K.Vijaya Rani & Sri P.Vamsidhar Ul (a) The Company has filed a case for recovery of an amount of Rs. 10,919,092/- and the same was dismissed by the District Judge, R.R. Dist The Management has decided to write off the said debt (b) An amount of Rs. 8,606,254/-, the recovery fo which is doubtful, has been written off during die year.

7. [Confirmations are not received in respect of the amounts relating to trade receivables, trade payables, loans & advances.

8. Dues to Micro, Small and Medium Enterprises:

The identification of micro, small and medium enterprise suppliers as defined und|r the provisions of "Micro, small and medium enterprises Act, 2006" is based on Management's knowledge of their status. There are no dues to micro, small and medium enterprises as on 31 March 2015.

9. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure. Figures are rounded off to the nearest-.

10 Contingent Liabilities:

a) Capital commitments on account of unexecuted contracts (Land Development Agreements) are estimated at- 513 lakhs { Previous year - 513 lakhs)

b) Disputed seignior age fees liability of- 28.43 lakhs ( Fees - 4.77 lakhs and penalty of- 23.66 lakhs) for which revision petition has been filed by the company.