Notes to Accounts of Melstar Information Technology Ltd.

Mar 31, 2024

Note 27 (b) : Financial Risk Management Objectives and Policies

The Company''s principal financial liabilities, other than derivatives, comprise loans and
borrowings, trade and other payables, and financial guarantee contracts. The main purpose of
these financial liabilities is to finance the Company''s operations and to provide guarantees to
support its operations directly or indirectly. The Company''s principal financial assets include
investments, loans, trade and other receivables, cash and cash equivalents that derive directly
from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The below note explains the
sources of risk which the entity is exposed to and how the entity manages the risk:

Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or
customer contract, leading to a financial loss.

Trade receivables

Customer credit risk is managed by the Company''s established policy, procedures and control
relating to customer credit risk management. Credit quality of a customer is assessed by the
management on regular basis with market information and individual credit limits are defined
accordingly. Outstanding customer receivables are regularly monitored and any further services
to major customers are approved by the senior management. Based on the business environment
in which the company operates.

On account of adoption of Ind-AS 109, the Company uses expected credit loss model to assess the
impairment loss or gain. The Company uses a provision matrix to compute the expected credit
loss allowance for trade receivables. The provision matrix takes into account available external
and internal credit risk factors and the Company''s historical experience for customers. The
company manages its credit risk through credit approvals,

Financial instruments and cash deposits

Credit risk from balances/investments with banks and financial institutions is managed in
accordance with the Company''s treasury risk management policy. Investments of surplus funds

are made only with approved counterparties and within limits assigned to each counterparty. The
limits are assigned based on corpus of investable surplus and corpus of the investment avenue.
The limits are set to minimize the concentration of risks and

The Company''s maximum exposure to credit risk for the components of the balance sheet at March
31, 2024 and March 31, 2013 is the carrying amounts as stated in balance sheet. The Company''s
maximum exposure relating to financial guarantees and financial derivative instruments is noted
in the liquidity table below.

Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they
become due. The objective of liquidity risk

The Treasury Risk Management Policy includes an appropriate liquidity risk management
framework for the management of the short-term, medium- term and long term funding and cash
management requirements. The Company manages the liquidity risk by maintaining adequate
cash reserves, banking facilities and reserve borrowing facilities, by continuously monitoring
forecast and actual cash flows, and by matching the maturity profiles of

Market Risk

Market risk comprises two types of risk: price risk, interest rate risk and currency risk. The risks
may affect income and expenses, or the value of its financial instruments of the Company. The
objective of the Management of the Company for market risk is to maintain this risk within
acceptable

Price risk

Equity price risk is related to the change in market price of the investments in quoted equity
securities. The value of the financial instruments is not material and accordingly any change in the
value of these investments will not affect materially the profit or loss of the Company.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in market interest rates. Since, the Company has insignificant interest
bearing borrowings, the exposure to risk of changes in market interest rates is very low. The
Company has not used any interest rate derivatives.

The exposure of the Company to interest rate changes at the end of the reporting period are as
under:

Interest rate sensitivity

No sensitivity analysis is prepared as the Company does not expect any material effect on the
Company''s results arising from the effects of reasonably

possible changes to interest rates on interest bearing financial instruments at the end of the
reporting period.

Foreing Exchange Risk

Foreign exchange risk arises on future commercial transactions and on all recognised monetary
assets and liabilities, which are denominated in a currency other than the functional currency of
the Company. The Company''s management has set policy wherein exposure is identified,
benchmark is set and monitored closely, and accordingly suitable hedges are undertaken. Policy
also includes mandatory initial hedging requirements for exposure

There is no Foreign currency exposure for the company as on 31st March 2024.

Note 27(c) : Capital Management

For the purpose of the Company''s capital management, capital includes issued equity share
capital, securities premium and all other reserves attributable to the equity holders of the
Company. The primary objective of the Company''s capital management is to maximise the value
of the share and to reduce the cost of capital.

The Company manages its capital structure and makes adjustments in light of changes in economic
conditions and the requirements of the financial covenants. To maintain or adjust the capital
structure, the Company can adjust the dividend payment to shareholders, issue new shares, etc.
The Company monitors capital using a gearing ratio, which is net debt divided by total equity. The
Company includes within net debt, interest bearing loans and borrowings, less cash and cash
equivalents.

Note 27(f): Employee Benefits:

During the year, the provision for Gratuity and Leave Encashment created in earlier years has
been written back in the books of accounts.

Note 27(g) : Operating lease arrangements

There are no operating lease arrangements as on 31.03.2024.

Note 27(h) : Expenditure on Corporate Social Responsibility:

Section 135 of the Companies Act provides the threshold limit for applicability of the CSR to a
Company i.e. (a) net worth of the company to be Rs 500 crore or more; (b) turnover of the company
to be Rs 1000 crore or more; (c) net profit of the company to be Rs 5 crore or more. Further as per
the CSR Rules, the provisions of CSR are not only applicable to Indian companies, but also
applicable to branch and project offices of a foreign company in India CSR Committee and Policy:
Every qualifying company requires spending of at least 2% of its average net profit for the
immediately preceding 3 financial years on CSR activities. Further, the qualifying company will be
required to constitute a committee (CSR Committee) of the Board of Directors (Board) consisting
of 3 or more directors. The CSR Committee shall formulate and recommend to the Board, a policy
which shall indicate the activities to be undertaken (CSR Policy); recommend the amount of
expenditure to be incurred on the activities referred and monitor the CSR Policy of the company.
The Board shall take into account the recommendations made by the CSR Committee and approve
the CSR Policy of the company. The company is not meeting the Threeshold limit specified under
companies Act so CSR provision is not applicable

Note 27(i)

The National Company Tribunal (“NCLT”), Mumbai Bench, vide order dated 1st October 2019
(“Insolvency Commencement Order”) has initiated corporate insolvency resolution process
(“CIRP”) based on petitions filed by Nityo Infotech Services Private Limited under section 9 of the
Insolvency and bankruptcy Code, 2016 (“the code”). Mr. Neehal Pathan IP Registration No.:
IBBI/IPA-001/IP-P01561/2018-19/12406 was appointed as interim resolution professional
(“IRP”) to manage the affairs of the Company in accordance with the provisions of code. In the first
meeting of Committee of creditors held on 30th October 2019, Mr. Neehal Pathan had been
confirmed as resolution professional (“RP/Resolution Professional”) for the Company. Pursuant
to the Insolvency Commencement Order and in line with the provisions of the Code, the powers of
the Board of Directors were suspended and the same were to be exercised by IRP/RP. By an order
dated 16th October, 2020, NCLT has extended the CIRP for a further period of 90 days with effect
from 16th October, 2020.

Since the Company is under Corporate Insolvency Resolution Process (CIRP), as per Section 17 of
the Insolvency & Bankruptcy Code, from the date of appointment of the Resolution professional.

• The management of the affairs of the company shall vest in the Resolution Professional.

• The powers of the Board of Directors of the company shall stand suspended and be
exercised by the Resolution Professional.

• The officers and managers of the Company shall report to the Resolution Professional and
provide access to such documents and records of the company as may be required by the
Resolution Professional.

The financial institutions maintaining accounts of the company shall act on the instructions of the
Resolution Professional in relation to such accounts and furnish all information relating to the
company available with them to the Resolution Professional.

Accordingly, the standalone financial statements are continued to be prepared on going concern
basis. The Company continues the process for ascertaining the realisable value for its assets
(including inventories and trade receivables) and necessary adjustments to the carrying value will
be effected in due course, the impact of which is not ascertainable at this stage.

Pursuant to commencement of CIRP of the Company under Insolvency and Bankruptcy Code, 2016,
there are various claims submitted by the financial creditors, operational creditors, employees and
other creditors to the RP. The overall obligations and liabilities including interest on loans and the
principal amount of loans was determined and accordingly accounting impact in provided the
books of accounts in respect of excess, short, or non-receipts of claims for operational and financial
creditors.

Note 27(j) : Going Concern:

The Company Is incurring a losses which may create uncertainties. However, various Initiatives
undertaken by the Company in relation to saving cost, optimize revenue management
opportunities and enhance ancillary revenues Is expected to result in improved operating
performance. Further, our continued thrust to improve operational efficiency and initiatives to
raise funds are expected to result in sustainable cash flows addressing any uncertainties,
Accordingly, the statement of financial results continues to be prepared on a going concern basis,
which contemplates realization of assets and settlement of liabilities in the normal course of
business.

Note 27(k): Related Party Disclosure: Nil
Note 27(l):

The balance of Trade Payables, Trade Receivables, Loans and Advances, Current Liabilities,
Borrowings from others etc. are considered as per books of account. The management has not sent
direct confirmations to parties. In the opinion of the management, since the amount due to/ from
these parties are fully payable/recoverable, no material difference is expected to arise at the time
of settlement, requiring further accounting effect as on 31/03/2024.

Note 27(m): Previous year regrouping:

Previous year''s figures have been regrouped / reclassed, where necessary, to confirm to current
year''s classification. This does not impact recognition and measurement principles followed for
preparation of standalone financial statements.

For and on behalf of the Board of Directors

Vineet Govardhan Shah Alyzaa Merchant

Managing Director Director

DIN:01761772 DIN:07164228

Neehal Mahamulal Pathan Meenakshi Ramandasani

Resolution Professional Company Secretary

Reg. No.IBBI/IPA-001/IP-P/01561/2018-19/12406 Membership No A47336

Place: Mumbai
Date: 14.08.2024

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Mar 31, 2015

Note :

a) Clean Overdraft Facility and Cash Credit Facility is secured by equitable mortgage by deposit of title deeds of office premises of the Company situated at Andheri(Mumbai) and further secured by hypothecation of book debts/ receivables and other current assets of the Company.

b) Clean Overdraft Facility and Cash Credit Facility is repayable on demand subject to annual review. The rate of interest for Clean Overdraft Facility is Base Rate 5.70% and Base Rate 4.70% on Cash Credit Facility.

* Amount Written off in respect of Leasehold land for the period of lease which has expired.

** Building was revalued on 1st April, 2005 with reference to the fair market value; amount added on revaluation was Rs.76,558,113; the revalued amount substituted for historical cost on 1st April 2005 was Rs. 126,130,511, based on report issued by approved independent valuer.

Note:

1 Adjustments/ deductions include obsolete fixed assets discarded during the year. Cost Rs. 168758/- accumulated depreciation and amortization Rs. 168758/- (Previous year Cost Rs.405523/- and depreciation and amortization Rs 302100/-)

2 Consequent to enactment of the Companies Act, 2013 and its applicability w.e.f. 1st April 2014, the Company has reworked depreciation on the basis of the useful lives of assets as prescribed in Part 'C' of schedule II of the Act. As a result depreciation for the year ended 31st March, 2015 is lower by Rs.634,536 due to change in the useful lives of certain assets.

In case of assets where the remaining useful life as on 1st April 2014 is Nil, the carrying amount of such assets have been adjusted to the opening balance of Retained Earnings after retaining their residual value. Accordingly, a sum of Rs. 2,822,670 has been adjusted against Opening Reserves.

1. The Company, considering the erosion/substantial erosion in the net worth of its wholly-owned subsidiaries located at U.S.A., U.K. and Singapore, had made provision for diminution in the value of investments in the said subsidiaries aggregating to Rs. 214,674,767 (Previous year Rs.214,674,767) and for doubtful loans/advances given to said subsidiaries aggregating to Rs.114,306,058 (Previous year Rs.114,306,058) and also for doubtful debts being debts due from one of the step down subsidiary located at UK and a wholly-owned subsidiary located at U.S.A. of Rs.17,167,788(Previous year Rs. 17,167,788).

The two subsidiaries and one step down subsidiary, located at U.K. stands dissolved in the earlier year. Pursuant to application made to the Regulatory Authority, the name of the subsidiary located at Singapore had been Struck Off in the earlier year.

Consequent to such dissolutions/ struck off, the Company is in the process of seeking approvals from the Reserve Bank of India (RBI), for writing off these amounts from the books of account. The Company would make the necessary adjustments as and when approvals from the RBI are received. Such adjustments would have no impact on the Profit and Loss Account.

2. In the earlier year, the Company had given Inter Corporate Deposits to one party amounting to Rs. 17,854,503 including interest accrued thereon. This deposits is due for repayment for more than six months. Consequent to liquidation proceedings initiated against the said party, the Company has provided Rs.17,854,503 (including interest) towards doubtful advances, being Exceptional Item.

3. Consequent to enactment of the Companies Act, 2013 and its applicability w.e.f. 1st April 2014, the Company has reworked depreciation on the basis of the useful lives of assets as prescribed in Part 'C' of schedule II of the Act. As a result depreciation for the year ended 31st March, 2015 is lower by Rs.634,536 due to change in the useful lives of certain assets.

In case of assets where the remaining useful life as on 1st April 2014 is Nil, the carrying amount of such assets have been adjusted to the opening balance of Retained Earnings after retaining their residual value. Accordingly, a sum of Rs. 2,822,670 has been adjusted against Opening Reserves.

The deferred tax assets, not recognized as at the year end on the basis of prudence, would be accounted for in the subsequent year/years considering the requirements of the Accounting Standard (AS) 22 on " Accounting for Taxes on Income", regarding reasonable/virtual certainty and the accounting policy followed by the Company in this respect.

Note: Expenses of Foreign branches Rs. 1,038,339 (Previous year Rs. 10,326,758 ) have been included in the appropriate heads above.

*Excludes Service Tax

4. Additional information pursuant to the provisions of paragraph 5(ii)(d) part II of the revised schedule VI to the Companies Act, 1956. (To the extent applicable)

5. Related parties disclosures

1) Names of related parties and description of relationship:

i. Subsidiaries and step down subsidiary Melstar Inc.

Melstar Limited (Dissolved on 19th May, 2010)

Linkhand Support Limited (Dissolved on 12th August, 2008)

Melstar UK Limited (Dissolved on 26th April, 2011)

Melstar Singapore Pte. Limited (Struck Off as on 05th October, 2010)

ii. Key Management Personnel with whom Mr. P. V. R. Murthy (Non-Executive Director) (Up to 24th October, 2013)

the transactions have taken place during

Mr. Richard D'Souza (Chief Executive Officer and Manager) (Up to 22nd May,2013) &

the year (Managing Director) (Up to 09th December, 2013)

Mr. Vijay Mishra (Managing Director) (w.e.f.13th November, 2013)

Mr. Anil S. Korpe (Chief Financial Officer)

Mr. Vijaykumar H. Modi (Company Secretary)

iii. Enterprises Over which Key Birla Edutech Limited(Up to 25th June, 2013)

Management Personnel and / or their

Birla Power Solutions Limited (Up to 14th August, 2013)

relatives have significant influence with

Birla Global Corporate Limited whom the transactions have taken place during the year

** Interest bearing loan @7% p.a. up to March 31,2005, interest free thereafter and repayable by March 31, 2007 as per revised repayment schedule, as approved by the Board of Directors and intimated to Reserve Bank of India as per Foreign Exchange Management Act, 1999 (FEMA).

# Amounts outstanding as at March 31, 2015 stand fully provided for towards doubtful recoveries.

Note: There are no investments by the loaners in the shares of the parent company and /or subsidiary companies.

6. The Company has presented the data relating to its segments based on its consolidated financial statements, which are presented in the same annual report. Accordingly in terms of provisions of Accounting Standard (AS) 17 on 'Segment Reporting', no disclosures related to segments are presented in its stand-alone financial statements.

* Of these, Rs. 42,787,667 (previous year Rs. 42,787,667) has been provided towards doubtful recoveries. ** Fully provided towards doubtful recoveries (previous year Rs.71,954,100). Note: Figures in Brackets indicate previous year figures.

8. Post Employment Benefit Plans

(i) Defined contribution plans

The Company makes contributions towards provident fund to a Defined contribution retirement benefit plan for qualifying employees. The Provident Fund plan is operated by Regional Provident Fund Commissioner. Under the plan, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit plan to fund the benefits.

The Company recognized Rs. 5,486,908 (Previous year Rs. 5,164,474) for provident fund contributions in the Profit and loss account. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

(ii) Defined benefit plan

The Company has Defined benefit plan for qualifying employees in respect of Gratuity benefits. The scheme provides for payment to vested employees as under:

On Normal retirement/early retirement/withdrawal/resignation:

As per the provisions of Payment of Gratuity Act, 1972 with vesting period of 5 years of service.

On death in service:

As per the provisions of Payment of Gratuity Act, 1972 without any vesting period.

The most recent actuarial valuation of the present value of Defined benefit obligation for gratuity was carried out at March 31, 2015 by an actuary. The present value of the Defined benefit obligations and the related current service cost and past service cost, were measured using the Projected Unit Credit Method.

The liability towards short-term compensated absences is Rs. 1,626,427 (Previous year Rs. 1,343,503) is provided on actual basis.

Note:

Provision towards compensated absences made on the basis of actuarial valuation as per Accounting Standard 15 (Revised). Actuarial value liability is Rs.771,437 (Previous year Rs.418,711 ) based upon the following assumptions:

9. Trade receivables, trade payables, short term loans and advances, other current assets and other current liabilities are subject to confirmation and reconciliation if any.

10. Previous year's figures have been regrouped wherever necessary, to correspond with the figures of the current year. Amounts and other disclosures for the preceding year are included as integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year. Figures have been rounded off to the nearest rupee.

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Mar 31, 2014

1. Contingent Liability: (In rupees)

As at As at 31.03.2014 31.03.2013

(i) Claims against Company not acknowledged as debt and pending before the Courts in Mumbai. 457,392 387,620 The Company expects that the matter will be resolved in Company''s favour and no liability is expected.

(ii) Disputed ESIC Liability:

ESIC demand disputed and pending decisions before higher authorities. Amount paid there 135,627 135,627 against and included under "Short Term Loans and Advances" Note No. 13 Rs. 35,000 Previous year (Rs. 35,000)

(iii) Disputed Property Tax Liability:

Property Tax demand disputed and pending before the Court in Mumbai. Amount paid there 1,613,047 - against and included under " Short Term Loans and Advances" Note No.13 Rs.806,524 Previous year (Rs. Nil)

2. The Company, considering the erosion/substantial erosion in the net worth of its wholly-owned subsidiaries located at U.S.A., U.K. and Singapore, had made provision for diminution in the value of investments in the said subsidiaries aggregating to Rs. 214,674,767 (Previous year Rs.214,674,767) and for doubtful loans/advances given to said subsidiaries aggregating to Rs.114,306,058 (Previous year Rs.114,306,058) and also for doubtful debts being debts due from one of the step down subsidiary located at UK and a wholly-owned subsidiary located at U.S.A. of Rs.17,167,788(Previous year Rs. 17,167,788).

The two subsidiaries and one step down subsidiary, located at U.K. stands dissolved in the earlier year. Pursuant to application made to the Regulatory Authority, the name of the subsidiary located at Singapore had been Struck Off in the earlier year.

Consequent to such dissolutions/ struck off, the Company is in the process of seeking approvals from the Reserve Bank of India (RBI), for writing off these amounts from the books of account. The Company would make the necessary adjustments as and when approvals from the RBI are received. Such adjustments would have no impact on the Profit and Loss Account.

3. One of the Overseas Branch located at U.K., has been closed w.e.f. 22.07.2013. Consequently, the related exchange difference of Rs.744,755 accumulated in the Foreign Currency Translation Reserve, has been credited to Profit and Loss Account under "Other Operating Income", in accordance with AS-11(Revised) "The Effect of Changes in Foreign Exchange Rates".

4. The break-up of deferred tax assets as at 31st March, 2014 is as under:

The deferred tax assets, not recognised as at the year end on the basis of prudence, would be accounted for in the subsequent year/years considering the requirements of the Accounting Standard (AS) 22 on " Accounting for Taxes on Income", regarding reasonable/virtual certainty and the accounting policy followed by the Company in this respect.

FOB Value of Exports includes:

Software Services Exports Rs. 1,248,809 (Previous year Rs. 1,951,922) and Income from Software Services by foreign Branch Rs. 9,387,776 (Previous year Rs. 20,015,247)

5. Related parties disclosures

1) Names of related parties and description of relationship: i.

Subsidiaries and step down subsidiary :

Melstar Inc.

Melstar Limited (Dissolved on 19th May, 2010)

Linkhand Support Limited (Dissolved on 12th August, 2008)

Melstar UK Limited (Dissolved on 26th April, 2011)

Melstar Singapore Pte. Limited (Struck Off as on 05th October, 2010)

ii. Key Management Personnel with whom the transactions have taken place during the year :

i Mr. Yashovardhan Birla (Chairman)(Up to 06th November, 2012)

Mr. P. V. R. Murthy (Non-Executive Director)(Up to 24th October, 2013)

Mr. Richard D''Souza (Chief Executive Officer and Manager) (Up to 22nd May, 2013) (Managing Director) (Up to 09th December, 2013)

Mr. Vijay Mishra (Managing Director)(w.e.f.13th November, 2013)

iii. Enterprises Over which Key

Management Personnel and / or their relatives have significant influence with whom the transactions have taken place during the year

Birla Shloka Edutech Limited(Up to 06th November, 2012)

Birla Edutech Limited(Up to 25th June, 2013)

Birla Viking Travels Limited (Up to 06th November, 2012)

Birla Cotsyn India Limited(Up to 06th November, 2012)

Birla Power Solutions Limited (Up to 14th August, 2013)

Birla Global Corporate Limited

* Repayable on demand and interest free.

** Interest bearing loan @7% p.a. upto March 31,2005, interest free thereafter and repayable by March 31,2007 as per revised repayment schedule, as approved by the Board of Directors and intimated to Reserve Bank of India as per Foreign Exchange Management Act, 1999 (FEMA).

# Amounts outstanding as at March 31,2014 stand fully provided for towards doubtful recoveries.

Note: There are no investments by the loanees in the shares of the parent company and /or subsidiary companies.

6. The Company has presented the data relating to its segments based on its consolidated financial statements, which are presented in the same annual report. Accordingly in terms of provisions of Accounting Standard (AS) 17 on ''Segment Reporting'', no disclosures related to segments are presented in its stand-alone financial statements.

7. The year-end foreign currency exposures that have not been hedged by a derivative instrument or otherwise are as follows:

Amount receivable in foreign currency on account of the following Of these, Rs. 42,787,667 (previous year Rs. 42,348,262) has been provided towards doubtful recoveries.

** Fully provided towards doubtful recoveries (previous year Rs.71,954,100).

Note: Figures in Brackets indicate previous year figures.

8. Post Employment Benefit Plans (i) Defined contribution plans

The Company makes contributions towards provident fund to a defined contribution retirement benefit plan for qualifying employees. The Provident Fund plan is operated by Regional Provident Fund Commissioner. Under the plan, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit plan to fund the benefits.

The Company recognized Rs. 5,164,474 (Previous year Rs. 5,529,994) for provident fund contributions in the profit and loss account. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

(ii) Defined benefit plan

The Company has defined benefit plan for qualifying employees in respect of Gratuity benefits. The scheme provides for payment to vested employees as under:

On Normal retirement/early retirement/withdrawal/resignation:

As per the provisions of Payment of Gratuity Act, 1972 with vesting period of 5 years of service.

On death in service:

As per the provisions of Payment of Gratuity Act, 1972 without any vesting period.

The most recent actuarial valuation of the present value of defined benefit obligation for gratuity was carried out at March 31, 2014 by an actuary. The present value of the defined benefit obligations and the related current service cost and past service cost, were measured using the Projected Unit Credit Method.

Note:

Provision towards compensated absences made on the basis of actuarial valuation as per Accounting Standard 15 (Revised). Actuarial value liability is Rs.418,711 (Previous year Rs. 857,796 ) based upon the following assumptions:

The liability towards short-term compensated absences is Rs. 1,343,503 (Previous year Rs. 1,369,551) is provided on actual basis.

9. Disclosures relating to amounts payable as at the yearend together with interest paid / payable to Micro, Small and Medium Enterprises have been made in the accounts, as required under the Micro, Small and Medium Enterprises Development Act, 2006 to the extent of information available with the Company determined on the basis of intimation received from suppliers regarding their status and the required disclosure are given below:

10. Trade receivables, trade payables, short term loans and advances, other current assets and other current liabilities are subject to confirmation and reconciliation if any.

11. Previous year''s figures have been regrouped wherever necessary, to correspond with the figures of the current year. Amounts and other disclosures for the preceding year are included as integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year. Figures have been rounded off to the nearest rupee.

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Mar 31, 2013

1. The Company, considering the erosion/substantial erosion in the net worth of its wholly-owned subsidiaries located at U.S.A., U.K. and Singapore, had made provision for diminution in the value of investments in the said subsidiaries aggregating to Rs. 214,674,767 (Previous year Rs.214,674,767) and for doubtful loans/advances given to said subsidiaries aggregating to Rs.114,306,058 (Previous year Rs.114,306,058) and also for doubtful debts being debts due from one of the step down subsidiary located at UK and a wholly-owned subsidiary located at U.S.A. of Rs.17,167,788(Previous year Rs.17,393,388).

Out of the two subsidiaries located at U.K. one subsidiary stands dissolved in the earlier year and another stands dissolved in the previous year. The step down subsidiary was also dissolved in the earlier year. Pursuant to application made to the Regulatory Authority, the name of the subsidiary located at Singapore had been Struck Off in the earlier year.

Consequent to such dissolutions/ struck off, the Company is in the process of seeking approvals from the Reserve Bank of India (RBI), for writing off these amounts from the books of account. The Company would make the necessary adjustments as and when approvals from the RBI are received. Such adjustments would have no impact on the Profit and Loss Account.

Software Services Exports Rs. 1,951,922 (Previous year Rs. 3,203,139) and Income from Software Services by foreign Branch Rs. 20,015,247(Previous year Rs. 8,103,801)

Notes: Related party relationship is as identified by the Company and relied upon by the auditors.

* Repayable on demand and interest free.

** Interest bearing loan @7% p.a. up to March 31,2005, interest free thereafter and repayable by March 31, 2007 as per revised repayment schedule, as approved by the Board of Directors and intimated to Reserve Bank of India as per Foreign Exchange Management Act, 1999 (FEMA).

# Amounts outstanding as at March 31, 2013 stand fully provided for towards doubtful recoveries.

Note: There are no investments by the loaners in the shares of the parent company and /or subsidiary companies.

2. The Company has presented the data relating to its segments based on its consolidated financial statements, which are presented in the same annual report. Accordingly in terms of provisions of Accounting Standard (AS) 17 on ''Segment Reporting'', no disclosures related to segments are presented in its stand-alone financial statements.

* Of these, Rs. 42,348,262 (previous year Rs. 42,348,262) has been provided towards doubtful recoveries.

** Fully provided towards doubtful recoveries (previous year Rs.71,954,100).

Note: Figures in Brackets indicate previous year figures.

3. Post Employment Benefit Plans

(i) Defined contribution plans

The Company makes contributions towards provident fund to a defined contribution retirement benefit plan for qualifying employees. The Provident Fund plan is operated by Regional Provident Fund Commissioner. Under the plan, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit plan to fund the benefits.

The Company recognized Rs. 5,529,994 (Previous year Rs. 6,775,404) for provident fund contributions in the profit and loss account. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

(ii) Defined benefit plan

The Company has defined benefit plan for qualifying employees in respect of Gratuity benefits. The scheme provides for payment to vested employees as under:

On Normal retirement/early retirement/withdrawal/resignation:

As per the provisions of Payment of Gratuity Act, 1972 with vesting period of 5 years of service.

On death in service:

As per the provisions of Payment of Gratuity Act, 1972 without any vesting period.

The most recent actuarial valuation of the present value of defined benefit obligation for gratuity was carried out at March 31, 2013 by an actuary. The present value of the defined benefit obligations and the related current service cost and past service cost, were measured using the Projected Unit Credit Method.

4. Trade receivables, trade payables, short term loans and advances, other current assets and other current liabilities are subject to confirmation and reconciliation if any.

5. Previous year''s figures have been regrouped wherever necessary, to correspond with the figures of the current year. Amounts and other disclosures for the preceding year are included as integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year. Figures have been rounded off to the nearest rupee.

Note:

Indian Rupee equivalent figures have been arrived at by applying the year end inter-bank Exchange Rate : 1 US$ = Rs. 54.395

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Mar 31, 2012

Terms /Rights attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

* Amount Written off in respect of Leasehold land for the period of lease which has expired.

** Building was revalued on 1st April, 2005 with reference to the fair market value; amount added on revaluation was Rs.76,558,113; the revalued amount substituted for historical cost on 1st April 2005 was Rs. 126,130,511, based on report issued by approved independent valuer.

Note:

1. Adjustments/ deductions include obsolete fixed assets discarded during the year. (Cost Rs.Nil accumulated depreciation and amortization Rs.Nil) (Previous year Cost Rs.66,180 and depreciation and amortization Rs 13,373)

2. Figures shown in brackets are in respect of Previous Period.

1. (i) In rupees As at 31.03.2012 As at 31.03.2011

Claims against Company not acknowledged as debt and pending before the Courts in 887,150 882,963

Mumbai. The Company expects that the matter will be re solved in Company's favour and no liability is expected.

(ii) Contingent Liability :

In rupees

Particulars As at 31.03.2012 As at 31.03.2011

Disputed ESIC Liability: 135,627 135,627

ESIC demand disputed and pending decisions before higher authorities. Amount paid there against and included under "Short Term Loans and Advances"

Note No.15 Rs.35,000 Previous year (Rs.35,000)

2. (a) The Company, considering the erosion/substantial erosion in the net worth of its wholly-owned subsidiaries located at U.S.A., U.K. and Singapore, had made provision for diminution in the value of investments in the said subsidiaries aggregating to Rs. 214,674,767 (Previous year Rs.214,674,767) and for doubtful loans/advances given to said subsidiaries aggregating to Rs.114,306,058 (Previous year Rs.114,306,058) and also for doubtful debts being debts due from one of the step down subsidiary located at UK and a wholly-owned subsidiary located at U.S.A. of Rs.17,393,388(Previous year Rs.17,393,388).

Out of the two subsidiaries located at U.K. one subsidiary stands dissolved in the previous year and another stands dissolved in the current year. The step down subsidiary was also dissolved in the earlier year. Pursuant to application made to the Regulatory Authority, the name of the subsidiary located at Singapore had been Struck Off in the previous year.

Consequent to such dissolutions/ struck off, the Company is in the process of seeking approvals from the Reserve Bank of India (RBI), for writing off these amounts from the books of account. The Company would make the necessary adjustments as and when approvals from the RBI are received. Such adjustments would have no impact on the Profit and Loss Account.

(b) A wholly-owned subsidiary located at UK, was dissolved during the year. Accordingly, in the previous year, Exceptional Item of Rs.1,517,688 on account of loan written back as no longer payable to said subsidiary, was credited to Profit and Loss Account.

The deferred tax assets, not recognized as at the year end, would be accounted for in the subsequent year/years considering the requirements of the Accounting Standard (AS) 22 on " Accounting for Taxes on Income", regarding reasonable/virtual certainty and the accounting policy followed by the Company in this respect.

FOB Value of Exports includes:

Software Services Exports Rs. 3,203,139 (Previous year Rs. 3,799,578) and Income from Software Services by foreign Branch Rs. 8,103,801 (Previous year Rs. 5,594,564)

* Repayable on demand and interest free.

** Interest bearing loan @7% p.a. up to March 31,2005, interest free thereafter and repayable by March 31, 2007 as per revised repayment schedule, as approved by the Board of Directors and intimated to Reserve Bank of India as per Foreign Exchange Management Act, 1999 (FEMA).

# Amounts outstanding as at March 31, 2012 stand fully provided for towards doubtful recoveries.

Note: There are no investments by the loaners in the shares of the parent company and /or subsidiary companies.

3. The Company has presented the data relating to its segments based on its consolidated financial statements, which are presented in the same annual report. Accordingly in terms of provisions of Accounting Standard (AS) 17 on 'Segment Reporting, no disclosures related to segments are presented in its stand-alone financial statements.

* Of these, Rs.42,348,262 (previous year Rs. 42,348,262) has been provided towards doubtful recoveries.

** Fully provided towards doubtful recoveries (previous year Rs.71,954,100).

Note: Figures in Brackets indicate previous year figures.

4. Post Employment Benefit Plans

(i) Defined contribution plans

The Company makes contributions towards provident fund to a defined contribution retirement benefit plan for qualifying employees. The Provident Fund plan is operated by Regional Provident Fund Commissioner. Under the plan, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit plan to fund the benefits.

The Company recognized Rs. 6,775,404 (Previous year Rs. 6,335,783) for provident fund contributions in the profit and loss account. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

(ii) Defined benefit plan

The Company has defined benefit plan for qualifying employees in respect of Gratuity benefits. The scheme provides for payment to vested employees as under:

On Normal retirement/early retirement/withdrawal/resignation:

As per the provisions of Payment of Gratuity Act, 1972 with vesting period of 5 years of service.

On death in service:

As per the provisions of Payment of Gratuity Act, 1972 without any vesting period.

The most recent actuarial valuation of the present value of defined benefit obligation for gratuity was carried out at March 31, 2012 by an actuary. The present value of the defined benefit obligations and the related current service cost and past service cost, were measured using the Projected Unit Credit Method.

5. Trade receivables, trade payables, short term loans and advances, other current assets and other current liabilities are subject to confirmation and reconciliation if any.

6. Previous year's figures have been regrouped wherever necessary, to correspond with the figures of the current year. Amounts and other disclosures for the preceding year are included as integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year. Figures have been rounded off to the nearest rupee.

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Mar 31, 2011

(i) Contingent Liability :

Rupees

Particulars As at 31.03.2011 As at 31.03.2010

Disputed ESIC Liability: 135,627 135,627

ESIC demand disputed and pending decisions before higher authorities. Amount paid there against and included under "Loans and advances" Schedule 10 (Rs.35,000) Previous year (Rs.35,000)

2. (a) The Company, considering the erosion/substantial erosion in the net worth of its wholly-owned subsidiaries (including a wholly-owned subsidiary located at Singapore which was Struck Off during the year and the two wholly-owned subsidiaries located at UK, one of which was dissolved during the year and another stands dissolved subsequent to the year-end), has made provision for diminution in the value of investments in the said subsidiaries aggregating to Rs. 214,674,767 (Previous year Rs.214,674,767) and for doubtful loans/advances and debts due from such subsidiaries (includes Rs.16,303,514 (Previous year Rs.16,303,514) being debts due from one of the step down subsidiary located at UK which was dissolved in the earlier year) aggregating to Rs. 131,699,446 (Previous year Rs. 131,699,446).

The Company is in the process of seeking approvals from the Reserve Bank of India (RBI) for writing off these amounts from the books of account. The Company would make thenecessary adjustments as and when approvals from the RBI is received.Such adjustments would have no impact on the Profit and Loss Account.

(b) A wholly-owned subsidiary located at UK, was dissolved subsequent to the year-end. Accordingly, Exceptional Item for the year of Rs.1,517,688 on account loan written back as no longer payable to said subsidiary, credited to Profit and Loss Account.

Notes:

1) Remuneration for the current year is the minimum managerial remuneration paid to one of the Directors for the period from 1st April, 2010 to 30th June, 2010, in accordance with Schedule XIII of the Companies Act, 1956 and is in accordance with the shareholders resolution.

2) The Company has received the approval of the Central Government under section 269, 198/309, 310 and 637AA of the Companies Act, 1956 vide its letter no. SRN No.A96579347/4/2011 – CL-VII dated 21st April, 2011 with respect to appointment and remuneration of a Manager of the Company for a period of three years from 5th May, 2010 to 4th April, 2013.

3) The above amount does not include remuneration paid by a foreign subsidiary company to one of the non executive director of the Company Rs. Nil (previous year Rs. 1,450,087).

4) In addition to the aforesaid remuneration, the Company has paid notice pay to an Executive Director Rs. Nil (Previous year Rs.750,000), in terms of service agreement with the said Director.

5) Since the employee wise break up of liabilities on account of retirement schemes based on actuarial valuation is not ascertainable, the amount relatable to Directors could not be included in above.

6. Additional information pursuant to the provisions of paragraphs 3 and 4D of part II of schedule VI to the Companies Act, 1956. (To the extent applicable.)

Notes:

1. Related party relationship is as identifi ed by the Company and relied upon by the auditors.

2. Previous year fi gures are given in brackets.

* Includes notice pay paid to an Executive Director Rs. Nil (Previous year Rs.750,000), in terms of service agreement with the said Director.

7. The Company has presented the data relating to its segments based on its consolidated fi nancial statements, which are presented in the same annual report. Accordingly in terms of provisions of Accounting Standard (AS) 17 on ‘Segment Reporting', no disclosures related to segments are presented in its stand-alone fi nancial statements.

8. Post Employment Benefit Plans

(i) Defined contribution plans

The Company makes contributions towards provident fund to a defined contribution retirement benefit plan for qualifying employees. The Provident Fund plan is operated by Regional Provident Fund Commissioner. Under the plan, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit plan to fund the benefits.

The Company recognised Rs. 6,335,783 (Previous year Rs. 5,355,331) for provident fund contributions in the profit and loss account. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

(ii) Defined benefit plan

The Company has defined benefit plan for qualifying employees in respect of Gratuity benefits. The scheme provides for payment to vested employees as under:

On Normal retirement/early retirement/withdrawal/resignation:

As per the provisions of Payment of Gratuity Act, 1972 with vesting period of 5 years of service.

9. The Company achieved higher turnover during the current year, compared to the previous year. The Company has earned profit for the year and the net worth though eroded, continues to be positive. The Company continues its efforts for rationalization of resources to achieve maximum operational efficiencies and is further considering various business strategies/ avenues of growth in revenues. On that basis, the Company expects increase in its business operations, turnover and operational efficiencies in the subsequent period resulting in better margins and profitability.

10. The Company has received confirmations from few debtors/ creditors. Remaining Debtors/ Creditors are subject to confirmation and reconciliation if any.

11. Previous year's figures have been regrouped wherever necessary, to correspond with the figures of the current year. Amounts and other disclosures for the preceding year are included as integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year. Figures have been rounded off to the nearest rupee.

---

Mar 31, 2010

1 Contingent Liabilities in respect of :- Rupees

Particulars As at 31.03.2010 As at 31.03.2009

ESIC demand disputed and pending decisions before higher authorities. 135,627 135,627 Amount paid there against and included under "Loans and advances" Schedule 10 (Rs.35,000) Previous year (Rs.35,000)

Other claims against Company not acknowledged as debt and pending 695,982 91,286 before the Courts in Mumbai. The Company expects that the matter will be resolved in Companys favour and no liability is expected.

2. The Company, considering the erosion/substantial erosion in the net worth of its wholly-owned subsidiaries (including the wholly-owned subsidiary located at UK, in respect of which the Company Voluntary Arrangement (CVA) was completed during the previous year and which stands dissolved subsequent to the year-end), has made provision for diminution in the value of investments in the said subsidiaries aggregating to Rs. 214,674,767 (Previous year Rs.214,674,767) and for doubt- ful loans/advances and debts due from such subsidiaries aggregating to Rs. 131,699,446 (Previous year Rs.130,457,103). The Company is seeking approvals from the Reserve Bank of India (RBI) for writing off these amounts from the books of account. The Company would make the necessary adjustments as and when approvals from the RBI is received. Such adjustments would have no impact on the Profit and Loss Account.

3. The Company has presented the data relating to its segments based on its consolidated financial statements, which are presented in the same annual report. Accordingly in terms of provisions of Accounting Standard (AS) 17 on ‘Segment Reporting, no disclosures related to segments are presented in its stand-alone financial statements.

4. Post Employment Benefit Plans

(i) Defined contribution plans

The Company makes contributions towards provident fund to a defined contribution retirement benefit plan for qualifying employees. The Provident Fund plan is operated by Regional Provident Fund Commissioner. Under the plan, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit plan to fund the benefits.

The Company recognised Rs. 5,355,331 (Previous year Rs. 4,761,437) for provident fund contributions in the profit and loss account. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

(ii) Defined benefit plan

The Company has defined benefit plan for qualifying employees in respect of Gratuity benefits. The scheme provides for payment to vested employees as under:

On Normal retirement/early retirement/withdrawal/resignation:

As per the provisions of Payment of Gratuity Act, 1972 with vesting period of 5 years of service.

On death in service:

As per the provisions of Payment of Gratuity Act, 1972 without any vesting period.

5. The Company achieved higher turnover during the current year, compared to the previous year. Though the Company has incurred loss for the year, the net worth continues to be positive. The Company continues its efforts for rationalization of resources to achieve maximum operational efficiencies and is further considering various business strategies/ avenues of growth in revenues. On that basis, the Company expects increase in its business operations, turnover and operational efficiencies in the subsequent period resulting in better margins and profitability.

6. Previous years figures have been regrouped wherever necessary, to correspond with the figures of the current year. Amounts and other disclosures for the preceding year are included as integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year. Figures have been rounded off to the nearest rupee.