GAMMON INDIA LIMITED

Franco Tosi Meccanica S.p.A.
Note 3. CONTROLLED UNDERTAKING
The reduction of the expense item described refers to the sale of participations in the Franco Tosi USA
and Franco Tosi Renewable Energie companies occurred on May 30 th 2008, as by resolution of the
Board of Directors of March 14 th 2008.
Note 4. DEFERRED INCOME TAX ASSETS
This item is made up as follows:
12.31.2008 12.31.2007
Total Non-current Current Total Non-current Current
Treasury - advance payment of income tax (IRES) 4,091,000 4,091,000 3,711,248 3,711,248
Treasury - advance payment of income tax (IRAP) 0 0 411,772 411,772
Total 4,091,000 4,091,000 0 4,123,020 4,123,020 0
Deferred income tax assets are determined based on the temporary difference between the taxable
income and the result of the balance sheet by applying the IRES (corporate income tax) rate and the
IRAP (regional tax on productive activities) respectively charged at 27,5% and 3,90%.
Based on the industrial plan and the projects in progress, we have assumed, with extreme prudence,
that at least 1/3 of the tax losses achieved in the financial year might be reasonably used during the
next three years.
12.31.2008 12.31.2007
Total Non-current current Total Non -current Current
Participation Franco Tosi USA 0 0 0 21,413 21,413 0
Participation Franco Tosi Renewable En. 0 0 0 21,413 21,413 0
Total 0 0 0 42,826 42,826 0
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