Notes to Accounts of Nettlinx Ltd.

Mar 31, 2024

Note 29

Note 27

CONTINGENT LIABILITIES (IndAS-37) Contingent liabilities/claims not provided for:

a) Claims against the Company not	2023-24	2022-23
acknowledged as Debt:
i) ‘Provisional Licence fee assessment	43.30	43.30
ii) Licence fee assessment notice-	911.67	911.67
outstanding with interest and penalty
iii. **GST	-	308.89

*Company has received revised provisional license fee assessment notice from Department of Telecommunications-AP circle for the years 2005-06, 2006-07, 2007-08 and 2008-09 w.r.t ISPCIT) License for Rs.43.30 Lakhs.

Company has received a license fee assessment notice from Department of Telecommunications-AP circle for the years 2011-12 to 2017-18 w.r.t ISPCIT) License for Rs.911.67 Lakhs

In the light of judgment dated 24.10.2019 of Hon''ble Supreme Court on the dispute between DoT and Telecom Service Providers CTSPs) regarding interpretation of AGR, DoT vide communication dated 05.12.2019 requested submission of a comprehensive representation since all the demands are being re-examined w.r.t. the Hon''ble Supreme Court Judgement. The company has represented to DoT stating

inter-alia that the demands raised are not sustainable either in law or on facts as the nature of license in case of telecom service providers is different and distinct from the licenses given to the company

**Company has paid Rs.308.89 Lakhs under section 74C5) of CGST Act, 2017 as pre deposit, pending finalization of investigation and Notice.During the year an order received in favour of the company and during the year the Company has received back Rs.308.89lakhs.

Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006.

Under the Micro, Small and Medium Enterprises Development act, 2006CMSMED) which came into force from Oct 2, 2006, certain disclosures are required to be made relating to MSMED. On the basis of information and records available with the company, the following

disclosures are made for the amounts due to the micro and small enterprises.

Balances Outstanding with related parties: 75.72 lakhs

Based on the recommendation of the Nomination, Remuneration and Compensation Committee, all decisions relating to the remuneration of the Directories of the Company, in accordance with shareholder''s approval, wherever necessary

Terms and Conditions of transactions with Related Parties:

The sale to related parties are made in the normal course of business and on terms equivalent to those that prevail in arm''s length transactions. Outstanding balances at the year-end are unsecured and interest free.

For the year ended March 31, 2024, the Company has not recorded any impairment of receivables relating to amounts owed by related parties. This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

Note 31

Defined Benefit Plan

The Company provides its employees with benefits under a defined benefit plan, referred to as the “Gratuity Plan". The Gratuity Plan entitles an employee, who has rendered at least five years of continuous service, to receive 15 days salary for each year of completed service [service of six months and above is rounded off as one year) at the time of retirement / exit.

The following tables summarize the components of net benefit expense recognized in the statement of profit or loss and the amounts recognized in the balance sheet for the plan:

Reconciliation of opening and closing balances of the present value of the defined benefit obligatio

Note 33

As stipulated in IndAS-36, the Company has assessed its potential of economic benefits of its business units and is of the view of that the assets employed in continuing business are capable of generating adequate returns over their useful life in the usual course of its business.

Note 34

Financial risk management objectives and policies

The Company''s principal financial liabilities comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance and support Company''s operations. The Company''s principal financial assets include trade and other receivables, cash and cash equivalents and refundable deposits that derive directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company''s senior management overseas the management of these risks. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarized below.

i) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises two types of risk, interest rate risk and other price risk, such as equity price risk and commodity/ real estate risk. Financial instruments affected by market risk include loans and borrowings and refundable deposits. The sensitivity analysis in the following sections relate to the position as at March 31, 2024 and March 31, 2023.

The sensitivity analyses have been prepared on the basis that the amount of net debt and the ratio of fixed to floating interest rates of the debt.

The analysis excludes the impact of movements in market variables on: the carrying values of gratuity and other postretirement obligations; provisions.

The below assumption has been made in calculating the sensitivity analysis:

The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at March 31, 2024 and March 31, 2023 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. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s long-term debt obligations with floating interest rates.

The Company manages its interest rate risk by having a balanced portfolio of fixed and variable rate loans and borrowings. The Company does not enter into any interest rate swaps.

ii) 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. The credit risk arises principally from its operating activities [primarily trade receivables) and from its investing activities, including deposits with banks and financial institutions and other financial instruments.

Credit risk is controlled by analysing credit limits and creditworthiness of customers on a continuous basis to whom credit has been granted after obtaining necessary approvals for credit. The collection from the trade receivables is monitored on a continuous basis by the receivables team.

As per the Management estimation, the company is confident of recovering the present Trade Receivables. Hence no ECL [Expected Credit Loss) has created. Customers accounted for more than 5% of the revenue as of March 31, 2024is The Principal Secretary, ITE&C Department Hyderabad, Telangana for Rs.743.2 Lakhs Credit risk on cash and cash equivalent is limited as the Company generally transacts with banks and financial institutions.

iii) Liquidity risk

The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of bank deposits and loans.

The table below summarises the maturity profile of the Company''s financial liabilities based on contractual undiscounted payments:

Note 35

Capital management

The Company''s policy is to maintain a stable capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Management monitors capital on the basis of return on capital employed as well as the debt to total equity ratio.

For the purpose of debt to total equity ratio, debt considered is long-term and short-term borrowings. Total equity comprises of issued share capital and all other equity reserves excluding Debenture Redemption Reserve.

Note 36

Corporate Social Responsibility:

The provisions of Section 135 of the Companies Act, 2013 are applicable to the Company from the current Financial Year i.e. 2024-2025 as the net profit of the Company for the year 2023-2024 is more than Rs.5.00 Crores. The utilization of the 2% of the net profits towards the activities mentioned in the Companies [Corporate Social Responsibility Policy) Rules, 2014, will be taken up in the Financial Year 2024-2025.

In this regard, the Board of Directors constituted the Corporate Social Responsibility Committee consisting of • Mr. Vijaya Bhasker Reddy Maddi • Dr. Manohar Loka Reddy • Mr. M Vijay Kumar

Note 37

Details of foreign exchange Inflow or Out flow during the year: NIL Note 38

The Company is in the process of obtaining confirmations for the Balances of Trade Payables, Trade receivables, Advances from the Customers and other balances.

41. Title deeds of immovable properties

The title deeds of all the immovable properties, as disclosed in note 4.1 to the financial statements, are held in the name of the company.

42. Valuation of Property Plant & Equipment, intangible asset

The Company has not revalued its property, plant and equipment or intangible assets or both during the current or previous year.

43. Loans or advances to specified persons

No loans or advances in the nature of loans are granted to promoters, directors, KMPS and the related parties [as defined under Companies Act, 2013,) either serially or jointly with any other person, that are repayable on demand

or without specifying any terms or period of repayment.

44. Details of benami property held

No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami Transactions [Prohibition) Act, 1988 [45 of 1988) and rules made thereunder

45. Borrowing secured against current assets

The Company has borrowings from banks on the basis of security of current assets. The quarterly returns or statements of current assets filed by the Company with banks are in agreement with the books of accounts.

46. Wilful defaulter

The Company has not been declared wilful defaulter by any bank or financial institution or other lender.

47. Relationship with struck off companies

The Company has no transactions with the companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of the Companies Act, 1956.

48. Registration of charges or satisfaction with Registrar of Companies (ROC)

There are no charges or satisfaction yet to be registered with Registrar of Companies [ROC) beyond the statutory period.

49. Compliance with number of layers of companies

The Company has complied with the number of layers prescribed under the Section 2(87) of the Companies Act, 2013 read with Companies [Restriction on number of layers) Rules, 2017.

50. Compliance with approved scheme(s) of arrangements

The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.

51. Utilisation of borrowed funds and share premium

No funds have been advanced or loaned or invested [either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entities [“Intermediaries") with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company [Ultimate Beneficiaries). The Company has not received any fund from any party[Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company [“Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries

52. Undisclosed income

There is no income surrendered or disclosed as income during

the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded previously in the books of account.

53. Details of crypto currency or virtual currency

The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.

54. Utilisation of borrowings availed from banks and financial institutions

The borrowings obtained by the company from banks and financial institutions have been applied for the purposes for which such loans were taken.

The accompanying notes are an integral part of the standalone financial statements.

As per our report of even date.

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Mar 31, 2018

A. General Information

Nettlinx Limited (‘the Company’) is a Public Limited Company incorporated in India, registered under Companies Act 1956 having registered office at 5-9-22 Flat No.303 , 3^rd Floor My Home Sarovar Plaza, Secretariat, Hyderabad, Telangana-500063, India and its securities listed on the BSE Limited and MSEI Limited.

Nettlinx Limited provides a portfolio of high quality Internet solutions for data voice and security to cater to the corporate customer needs.

B. Basis of preparation of financial statements

B.1. Statement of Compliance

These financial statements are prepared in accordance with the generally accepted accounting principles (GAAP) in India and in compliance with the Indian Accounting Standards (Ind AS) Specified under section 133 of the Companies Act 2013(“the Act”) read with rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 , the Companies (Indian Accounting Standards) (Amendment) Rules, 2017 and other provisions to the Act, to the extent notified and applicable as well as applicable guidance notes and pronouncements of the Institute of Chartered Accountants of India (the ICAI)

The financial statements were authorized for issue by the Company’s Board of Directors on 29 May, 2018.

Details of the accounting policies are included in Note 1.

B.2 Basis of preparation and presentation

These financial statements for the year ended March 31, 2018 are the first financial statement that the Company has prepared under Ind AS. For all periods up to and including the year ended March 31, 2017, the Company prepared its financial statements in accordance with the accounting standards notified under Section 133 of the Act, read together with Rule 7 of the Companies (Accounts) Rules, 2014 (hereinafter referred to as ‘the Previous GAAP’) used for its statutory reporting requirements in India immediately before adopting Ind AS.

These financial statements have been prepared on the historical cost convention and on an accrual basis, except for the following material items in the statement of financial position:

- Certain financial assets and liabilities are measured at fair value;

- Employee defined benefit assets/(liability) are recognized as the net total of the fair value of plan assets, plus actuarial losses, less actuarial gains and the present value of the defined benefit obligation;

- Long term borrowings are measured at amortized cost using the effective interest rate method.

B.3 Functional and presentation currency

The financial statements are presented in Indian rupees, which is the functional currency of the Company.

All amounts are in Indian Rupees except share data, unless otherwise stated.

B.4 Operating Cycle

All the assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle and other criteria set out under Ind As and in the Schedule III to the Companies Act, 2013. Based on the nature of services and their realization in cash and cash equivalents, the company has ascertained its operating cycle as twelve months for the purpose of current or non-current classification of assets and liabilities.

B.5 Critical accounting judgements and key sources of estimation uncertainty.

In the application of the Company’s accounting policies, which are described in Note 1, the management of the Company are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

The following are the areas of estimation uncertainty and critical judgements that the management has made in the process of applying the Company’s accounting policies and that have the most significant effect on the amounts recognised in the financial statements:

Provision and contingent liability

On an ongoing basis, Company reviews pending cases, claims by third parties and other contingencies. For contingent losses that are considered probable, an estimated loss is recorded as an accrual in financial statements. Loss Contingencies that are considered possible are not provided for but disclosed as Contingent liabilities in the financial statements. Contingencies the likelihood of which is remote are not disclosed in the financial statements. Gain contingencies are not recognized until the contingency has been resolved and amounts are received or receivable.

Useful lives of depreciable assets

Useful life of Property, Plant and Equipment including intangible asset: Residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.

Investment in equity instruments of subsidiary and associate companies

During the year, the Company assessed the investment in equity instrument of subsidiary and associate companies carried at cost for impairment testing. These companies are expected to generate positive cash flows in the future years. Detailed analysis has been carried out on the future projections and the Company is confident that the investments do not require any impairment.

B.6 Fair value measurement and valuation process:

The company measured financial assets and liabilities, if any, at fair value for financial reporting purposes.

The Company recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

*Company has received revised provisional license fee assessment notice from Department of Tele-communications-AP circle for the years 2005-06, 2006 07, 2007-08 and 2008-09 w.r.t ISP(IT) License for Rs. 43,30,195/-

B. Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006.

Under the Micro, Small and Medium Enterprises Development act, 2006(MSMED) which came into force from Oct 2, 2006, certain disclosures are required to be made relating to MSMED. On the basis of information and records available with the company, the following disclosures are made for the amounts due to the micro and small enterprises.

Based on the recommendation of the Nomination, Remuneration and Compensation Committee, all decisions relating to the remuneration of the Directories of the Company, in accordance with shareholder’s approval, wherever necessary

Terms and Conditions of transactions with Related Parties:

The sale to related parties are made in the normal course of business and on terms equivalent to those that prevail in arm’s length transactions. Outstanding balances at the year-end are unsecured and interest free.

For the year ended March 31,2018, the Company has not recorded any impairment of receivables relating to amounts owed by related parties. This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

A. The Company provides its employees with benefits under a defined benefit plan, referred to as the “Gratuity Plan”. The Gratuity Plan entitles an employee, who has rendered at least five years of continuous service, to receive 15 days salary for each year of completed service (service of six months and above is rounded off as one year) at the time of retirement / exit.

The following tables summarize the components of net benefit expense recognised in the statement of profit or loss and the amounts recognised in the balance sheet for the plan:

B) As stipulated in IndAS-36, the Company has assessed its potential of economic benefits of its business units and is of the view of that the assets employed in continuing business are capable of generating adequate returns over their useful life in the usual course of its business. There is no indication to the contrary and accordingly the management is of the view that no impairment provision is called for in these accounts.

C) Operating Lease (Ind AS 17)

The Company has not taken any office premises under operating leases.

D) Financial risk management objectives and policies

The Company’s principal financial liabilities comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance and support Company’s operations. The Company’s principal financial assets include trade and other receivables, cash and cash equivalents and refundable deposits that derive directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company’s senior management overseas the management of these risks. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarized below.

i) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises two types of risk, interest rate risk and other price risk, such as equity price risk and commodity/ real estate risk. Financial instruments affected by market risk include loans and borrowings and refundable deposits. The sensitivity analysis in the following sections relate to the position as at March 31, 2018 and March 31, 2017. The sensitivity analyses have been prepared on the basis that the amount of net debt and the ratio of fixed to floating interest rates of the debt.

The analysis excludes the impact of movements in market variables on: the carrying values of gratuity and other post retirement obligations; provisions.

The below assumption has been made in calculating the sensitivity analysis:

The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at March 31, 2018 and March 31, 2017.

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. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s long-term debt obligations with floating interest rates.

The Company manages its interest rate risk by having a balanced portfolio of fixed and variable rate loans and borrowings. The Company does not enter into any interest rate swaps.

Interest rate sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings affected. With all other variables held constant, the Company’s profit before tax is affected through the impact on floating rate borrowings, as follows:

ii) 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. The credit risk arises principally from its operating activities (primarily trade receivables) and from its investing activities, including deposits with banks and financial institutions and other financial instruments.

Credit risk is controlled by analysing credit limits and creditworthiness of customers on a continuous basis to whom credit has been granted after obtaining necessary approvals for credit. The collection from the trade receivables are monitored on a continuous basis by the receivables team.

The Company establishes an allowance for credit loss that represents its estimate of expected losses in respect of trade and other receivables based on the past and the recent collection trend. The trade receivables as on March 31, 2018 is Rs.459.35 Lakhs (March 31, 2017: Rs.445.54 Lakhs). The movement in allowance for credit loss in respect of trade and other receivables during the year was as follows:

No single customer accounted for more than 5% of the revenue as of March 31, 2018 and March 31, 2017 and there is no significant concentration of credit risk.

Credit risk on cash and cash equivalent is limited as the Company generally transacts with banks and financial institutions.

iii) Liquidity risk

The Company’s objective is to maintain a balance between continuity of funding and flexibility through the use of bank deposits and loans.

The table below summarises the maturity profile of the Company’s financial liabilities based on contractual undiscounted payments:

E) Capital management

The Company’s policy is to maintain a stable capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Management monitors capital on the basis of return on capital employed as well as the debt to total equity ratio.

For the purpose of debt to total equity ratio, debt considered is long-term and short-term borrowings. Total equity comprises of issued share capital and all other equity reserves excluding Debenture Redemption Reserve.

F) Corporate Social Responsibility:

The Company is not required to spend towards Corporate Social Responsibility (CSR) as per Section 135 of the Companies Act, 2013, since the company is within the threshold limit given as per the provisions of the Act.

G) Standards issued but not effective

Ind AS 115, Revenue from contracts with customers

In March 2018, the Ministry of Corporate Affairs has notified Ind AS 115, ‘Revenue from Contracts with Customers’, which is effective for accounting periods beginning on or after 1 April 2018. This comprehensive new standard will supersede existing revenue recognition guidance, and requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard also will result in enhanced disclosures about revenue, provide guidance for transactions that were not previously addressed comprehensively (for example, service revenue and contract modifications) and improve guidance for multiple-element arrangements.

Ind AS 115 is effective for annual reporting periods beginning on or after April 1, 2018.

The Company intends to adopt Ind AS 115 effective April 1, 2018, using the modified retrospective method. The adoption of Ind AS 115 is not expected to have a significant impact on the Company’s recognition of revenues.

Other amendments to Indian Accounting Standards

The Ministry of Corporate Affairs (MCA), on 28 March 2018, issued certain bamendments to Ind AS. The amendments relate to the following standards:

Ind AS 21, The Effects of Changes in Foreign Exchange Rates - The amendment lays down the principle regarding advance payment or receipt of consideration denominated or priced in foreign currency and recognition of non-monetary prepayment asset or deferred income liability.

Ind AS 12, Income Taxes - The amendment explains that determining temporary differences and estimating probable future taxable profit against which deductible temporary differences are assessed for utilization are two separate steps and the carrying amount of an asset is relevant only to determining temporary differences.

Ind AS 28, Investments in Associates and Joint Ventures - The amendment clarifies when a venture capital, mutual fund, unit trust or similar entities elect to initially recognize the investments in associates and joint ventures.

Ind AS 112, Disclosure of Interests in Other Entities - The amendment clarifies that disclosure requirements for interests in other entities also apply to interests that are classified as Held for sale or discontinued operations in accordance with Ind AS 105.

Ind AS 40, Investment Property - The amendment clarifies when a property should be transferred to / from investment property.

The amendments are effective 1 April 2018. The Company believes that the aforementioned amendments will not materially impact the financial position, performance or the cash flows of the Company.

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Mar 31, 2016

(a) Reconciliation of Shares outstanding at the beginning and the end of the year

There is no change in Equity Share Capital during the year ended March 31, 2016 and March 31, 2015.

(b) Terms/rights attached to Equity Shares

The Company has only one class of Equity share having a par value of ''.10/- each. Each holder of equity share is entitled to one vote per share.

(c) Details of share holders holding more than 5% of equity shares in the Company

Note 1 Term Loan

HDFC Term Loan is secured against Property at 5-9-22,3rd floor My Home Sarovar Plaza,Secretriat road,saifabad,Hyderabad

Note 2 Service tax payable

Liability for Service Tax Payable of Rs..8,85,217/- is pending and till now the company has not received the outstanding amount from debtors.

Note 3 Terms and Conditions of Short Term Borrowings

Cash Credit facility is secured by hypothecation of book debts, outstanding monies, receivables, claims, bills etc.

Note 4 Terms and Conditions of Vehicle Loan

Vehicle Loan Secured by hypothecation of the vehicle

Note 5 Dues to Micro, Small and Medium Enterprises

Dues to Micro, Small and Medium Enterprises is NIL as per the records of the company

Note 6 TDS Adjustment Account

Since, the Appeal is pending before the Honourable High Court of A.P., in respect of Income Tax for the Assessment years 1996-97 and 1997-98 of Northeast Spinners Limited, a company in existence prior to amalgamation with Nettlinx Limited, the balance lying in TDS Adjustment account Rs.28,62,989/ - is shown in Advance Taxes.

Note 7 Long Term Receivables

Long term trade receivables includes the balance debt of Rs.32,62,114/-receivable from M/s. Integrated Broadcasting Private Limited which was in arbitration proceedings. The Company has recovered an amount of Rs.33,35,914/- out of outstanding debt of Rs.65,98,028/-(as at 31st March,2012) by withdrawing the winding up petition and entering into arbitration proceedings. As on 24th January 2015, The arbitral tribunal of sole arbitrator, Hyderabad has passed the decision in favour of the company and arbitral has ordered the respondent party i.e M/s Integrated broadcasting company private limited to pay an amount of Rs. 29,08,037 with interest at 10% p.a from the date of 05th April 2014 till the date of payment. The respondent party i.e M/s Integrated broadcasting company private limited has filled the petition in the city civil court against above order.

Company has received Revised provisional license fee assessment notice from Department of Telecommunications-AP circle for the years 2005-06, 2006-07,2007-08and 2008-09 w.r.t ISP(IT) License for Rs.43,30,195/- which is disclosed as contingent liability for the year ended 31st March 2012.However the management feels that even this demand is not tenable and hence liability is not provided in the books of accounts.

Note 8: Employee benefits

A) Gratuity

The Company has a defined gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days last drawn salary for each completed years of services.

The following tables summarize the components of net benefit expense recognized in the statement of profit and loss and balance sheet positions:

B) Leave Encashment:

The Company has a defined policy for Leave Encashment.

The following tables summarize the components of net benefit expense recognized in the statement of profit and loss and balance sheet positions:

Note 9 Figures for the previous year have been regrouped, recast and rearranged.

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Mar 31, 2014

Terms/rights attached to Equity Shares

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

1. During the year the Company has entered into an agreement with Interserver, Inc of New Jersey to sell the 100% Foreign subsidary-Host department LLC at the terms as mentioned in the agreement dated 28th March, 2014.

2. During the year company has sold LGI IT solutions pvt ltd''s shares to its 100% subsidary Netllinx Aquaculture Pvt Ltd

3. During the year the name of the subsidary company Nettlinx Channels Private limited has been changed to Nettlinx Aquaculture Private Limited effective from 20/03/2014

5. Contingent Liabilities :

As at 31st March, As at 31st March, 2014 Rs. 2013 Rs.

Unexpired Bank Guarantees 21,22,765 21,22,765

Provisional License fee 43,30,195 43,30,195 Assessment

Company has received Revised provisional license fee assessment notice from Department of Telecommunications-AP circle for the years 2005-06, 2006-07,2007-08and 2008-09 w.r.t ISP(IT) License for Rs.43,30,195/- which is disclosed as contingent liability for the year ended 31st March 2012.However the management feels that even this demand is not tenable and hence liability is not provided in the books of accounts.

6. In line with revised Schedule VI, figures for the previous year have been regrouped, recast and rearranged.

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Mar 31, 2013

Note 1 Contingent Liabilities and Commitments

As at 31st March, 2013 As at 31st March, 2012

Contingent Liabilities :

Unexpired Bank Guarantees 21,22,765 21,10,942

Provisional License fee Assessment 43,30,195 43,30,195

Company has received Revised provisional license fee assessment notice from Department of Telecommunications-AP circle for the years 2005-06, 2006-07,2007-08and 2008-09 w.r.t ISP(IT) License for Rs. 43,30,195/- which is disclosed as contingent liability for the year ended 31st March 2012.However the management feels that even this demand is not tenable and hence liability is not provided in the books of accounts.

Note 2

In line with revised Schedule VI, figures for the previous year have been regrouped, recast and rearranged.

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Mar 31, 2012

COMPANY BACKGROUND:

Nettlinx Limited is a Category B licensed ISP, with operations in Andhra Pradesh started in 1999. Currently Nettlinx has its operations across major cities in Andhra Pradesh.

Nettlinx Limited provides a portfolio of high quality Internet solutions for data voice and security, to cater to the corporate customer needs. Leveraging its technological and Regional presence, Nettlinx is able to bring value and strong support to the customers. Nettlinx has strategic and long lasting relationships with major Telecom Operators in India.

The company is backed by over 14 years of experience, not to mention an uncompromising standard in the provision of best-in-class products and uninterrupted services. The company delivers maximum uptime, expertise and specialist knowledge to assist both individuals and businesses in harnessing the benefits of Internet technology for real business productivity.

(a) Terms/rights attached to Equity Shares

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

(b) Details of share holders holding more than 5% of equity shares in the Company.

Terms and Conditions of Short Term Borrowings

i) Term Loan from Bank is repayable in three equitable quarterly installments from March 31, 2012 and carries a floating rate of interest of @ 15.75% . Term loan and CC is secured jointly by Equitable mortgage of immovable property, Flat No.301, 3rd Floor, My Home Sarovar Plaza, Hyderabad and Equitable Mortagage on Immovable Property, Survey No.23, Gachibowli, RR District, admeasuring 3630 Sq. Yards of its subsidary Nettlinx Realty Private Limited.

Since, the Appeal is pending before the Honourable High Court of A.P., in respect of Income Tax for the Assessment years 1996-97 and 1997-98 of Northeast Spinners Limited, a company in existence prior to amalgamation with Nettlinx Limited, the balance lying in TDS Adjustment account Rs..28,62,989/- is shown in Advance Taxes.

Long Term Trade Receivables include amount receivable from Integrated Broadcasting Pvt Ltd, the company was issued legal notice for not paying outstanding debt amounting to Rs.65,98,028/ - as at 30th June, 2011.Legal proceedings for winding up of the company U/s.433(a) of the Companies Act 1956 is initiated by filing a petition in the High Court Judicature of Andhra Pradesh. The court decision is not finalized till date.

2 Contingent Liabilities and Commitments

As at 31st March, 2012 As at 31st March, 2011 Rs. Rs.

Contingent Liabilities :

Provisional License fee Assessment 43,30,195 1,07,31,323

Commitments : - -

Company has received Revised provisional license fee assessment notice from Department of Telecommunications-AP circle for the years 2005-06, 2006-07,2007-08and 2008-09 w.r.t ISP(IT) License for Rs.43,30,195/- which is disclosed as contingent liability for the year ended 31st March 2012.However the management feels that even this demand is not tenable and hence liability is not provided in the books of accounts.

3 In line with revised Schedule VI, figures for the previous year have been regrouped, recast and rearranged to wherever necessary.

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Mar 31, 2010

1. CONTINGENT LIABILITIES:

As on As on

31.03.2010 31.03.2009

Rs. Rs.

Unexpired Bank Guarantee 12,00,000 12,00,000

(with 100% cash margin)

2. Loans and advances, sundry debtors, creditors and other deposits are subject to confirmation and reconciliations.

3. None of the suppliers had informed the company that they are in the nature of small scale undertaking. Hence, information regarding dues to small scale undertaking, if any, could not be furnished.

4. Related Party Disclosures

Information relating to related party transactions as per Accounting Standard 18 issued by The Institute of Chartered Accountants of India

Subsidiaries -

Nettlinx Inc. USA IADFAC Laboratories Private Limited Nettlinx Realty Private Limited Nettlinx Channel Private Limited Host Department LLC

Associates -

Northeast Broking Services Ltd Northeast Commodities Pvt.Ltd

Key Management Personnel -

Dr. Manohar Lokareddy

5. Since, the Appeal is pending before the Honourable High Court of A.P., in respect of Income Tax for the Assessment years 1996-97 and 1997-98 of Northeast Spinners Limited, a company in existence prior to amalgamation with Nettlinx Limited, the balance lying in TDS Adjustment accoupt Rs.28,62,989/- is shown separately in Current Assets.

6. Figures for the previous year have been regrouped, recast and rearranged to confirm to those of the current year wherever necessary.