MPS Infotecnics Ltd. இன் கணக்கு குறிப்புகள்

Mar 31, 2018

Note :

1. The Company has developed or customized various computer software in house.Thecompanyhassourcecodeforallthesesoftwareandhasalltherightsoverthe product. However there is no formal registration of I PR. The company has shown these software under the sub-head “’’Software”” under the head “’’intangible”” in its financial statements and the same is certified by the management. Capital WIP includes various software product underdeveloped / developed which also includes software with third party for development/modification. During the year, the Company has received software product worth Rs. 5.50 Crores as sales return which was sold in the previous year.”

2. During the financial year 2013-14, the Company transferred softwares (under the head Intangible Assets in Fixed Assets) amounting to Rs. 62.23 crores into stock in trade at WDV as on 01/04/2013. The management of the company has decided to sell these various safotware products in the market.

Notes:

1 Other Loans & Advances are subject to balance confirmation.

2 During the financial year 2013-14, due to change in business plan and consequential ammendment in terms, Capital Advances amounting to Rs. 220 Crore has been taken as long term advances and included in Other Loans & Advances.

1 The funds raised by the Company from GDR issue during F.Y. 2007-08 were kept in fixed deposit account with Banco Efisa, Lisbon, Portugal, as the said amount was to be deployed in terms of INFORMATION MEMORANDUM of the GDR issue. During the F.Y. 2008-09, the Bank in Portugal, Banco Efisa wrongly debited an amount of USD 8,883,210.75 out of the balance lying in the Company’s Account with the Bank. The Company has denied and disputed this debit and had initiated legal action under criminal jurisprudence of Portuguese Law. During the criminal investigation, several new facts/ documents have come to our knowledge and based on the evaluation of new facts/documents by Barristers, Senior Advocates and investigation carried out of in India, London and Portugal; your Company has initiated a strong civil action for recovery of USD 8,883,210.75, along with interest, against Banco Efisa and its Holding Company, wherein the Portuguese advocates confirm that the chances of recovery are very high.

2 Bank guarantee issued to Unique Identification Authority of India Rs. 200,000/-

2. In the event of liquidation of the Company, holders of equity shares will be entitled to receive any of the remaining assets of the Company after discharging the liabilities of the Company.

3. The Company had increased the authorized capital during the Financial Year 2010-11 to 2012-13, however due to technical issues necessary forms along with the fees w.r.t. increase in Authorised Capital, could not be filed and paid. Meanwhile the schedule of fees was increased as per the companies act, 2013. However, the authorised capital was increased prior to the applicability of companies act, 2013. The company has filed a Writ Petition bearing No. WP(C) 5199 of 2015 before the Hon’ble High Court of Delhi, challenging the applicability of provisions prescribed under Para 3 of Table B under Registration of Offices and Fees Rules 2014 and the same is pending adjudication.

Note:-Working Capital Loans from Allahabad Bank and Loans from Phoenix ARC Pvt. Ltd. are secured by way of charge on movable and immovable properties of the Company.

(i) Company has entered into an OTS for a sum of Rs. 11,86,50,000.00 with Allahabad Bank as on 14.01.2016 and paid a sum of Rs. 10,27,40,318/till 31.05.2017 and further re entered into an OTS of Rs. 266.00 Lacs and paid Rs. 13.30 Lacs.

(ii) Other Unsecured loans included a sum of Rs. 173,760,793/- from directors.

Note:-Other payable includes Rs.4.88 Crores towards ROC fees in connection with increase in Authorised share capital from Rs. 52.45 Crores to Rs. 377.50 Crores in various EGMs held and Merger through Court orders held during the Period from FY 2010-11 to FY 2012-13. Kindly refer Note No. 1 (3) under the head "Share Capital” Trade Payables are subject to balance confirmation.

Note 1 - Disclosure under Accounting Standard 29 - Contingent Liabilities

A. Dues of Income Tax

a) A.Y. 2006-07 Rs. 1,245,589/- (Rs. 1,245,589/-)

b) A.Y. 2010-11 Nil (27,306,810/-)

c) A.Y. 2011-12 Nil (445,798,390/-)

B. Interest on Cash Credit (NPA as per Bank) of Rs. 10,323,422/- (Rs. 49,476,266/-), which is under settlement with Bank .

C. ROC fees of increase in authorised share capital Rs. 3,52,22,305/- (Rs. 3,13,21,705/-).

D. Bank Gurantee Rs. 2,00,000.00 issued to Unique Identification Authority of India. (Rs. 2,00,000)

E. Service Tax demand Rs. 35,53,123/- against this Rs. 10,00,000/- paid. (Rs. 25,53,123/-)

1. Primary Segmentation has been done according to the nature of product & services. The Company’s Operations predominantly relate to the following segments:

a) IT Solution & Products (including software)

b) IT Enabled Services

c) Telecommunication

2. There is no Inter division or Inter Segment transfer of goods.

3. Since Fixed Assets used in the company’s business cannot be specifically identified with any of the reportable segment, as these are used inter changeably among segments, therefore segment wise disclosure on capital employed has not been furnished.

4. The Company caters mainly to the Domestic market and the Export turnover is not significant in the context of the total turnover. As such there are no geographical segments

Note 2:-

Company had increased its authorised capital during the Financial Year 2010-11 to 2012-13, however, due to technical issues necessary forms along with the fees w.r.t. increase in Authorised Capital could not be filed and paid. Mean while the schedule of fees was increased as per the companies act, 2013. However, the authorised capital was increased prior to the applicability of companies act, 2013. The company has filed a Writ Petition bearing No. WP(C) 5199 of 2015 before the Hon’ble High Court of Delhi challenging the applicability of provisions prescribed under Para 3 of Table B under Registration of Offices and Fees Rules 2014. Due to this reason Annual return form could not be filed.

3 Explanation of transition to Ind AS

These financial statements, for the year ended 31st March, 2018, are the first financial statements, the Company has prepared in accordance with Ind AS. Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for year ended 31st March, 2018, together with the comparative figures for the year ended 31st March, 2017, as described in the summary of significant accounting policies.

In preparing these financial statements, the Company’s opening balance sheet was prepared as at 1st April, 2016, i.e. the date of transition to Ind AS.

This note explains the principal adjustments made by the Company and an explanation on how the transition from the previous GAAP to Ind AS has affected its financial statements, including the Balance Sheet as at 1st April, 2016 and the financial statements for the year ended 31st March, 2017. Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from the previous GAAP to Ind AS:

(a) The Company has elected to continue with carrying value of all Property, plant and equipment under the previous GAAP as deemed cost as at the transition date i.e. 1st April, 2016. Under the previous GAAP, Property, plant and equipment were stated at their original cost (net of accumulated depreciation, amortization and impairment), if any, adjusted by revaluation of certain assets.

(b) The Company has elected to continue with the carrying value of Capital work in progress as recognized under the previous GAAP as deemed cost as at the transition date.

(c) The Company has elected to continue with the carrying value for intangible assets (computer software) as recognized under the previous GAAP as deemed cost as at the transition date. Under the previous GAAP, Computer Software was stated at its original cost, net of accumulated amortization.

(d) Investment is subsidiaries

The company has elected to adopt the carrying value under previous GAAP as on that of transition in it financial statement.

(e) Under Ind AS 109, at initial recognition of a financial asset, an entity may make an irrevocable election to present subsequent changes in the fair value of an investment in an equity instrument in other comprehensive income. Ind AS 101 allows such designation of previously recognized financial assets, as ‘FVTOCI’ on the basis of the facts and circumstances that existed at the date of transition to Ind AS. Accordingly, the Company has designated its investments in certain equity instruments at fair value through other comprehensive income on the basis of the facts and circumstances that existed as at the date of transition to Ind AS. However, since, the fair valuation has been done based on level 3 inputs, difference in fair value and cost as on the date of transition, if any has been deferred and has been considered and shown as “Deferred gain on changes in fair value of financial assets” under Other Non-Current Liabilities.

(f) The estimates as at 1st April, 2016 and as at 31st March 2017 are consistent with those made for the same dates in accordance with Indian GAAP (after adjustments to reflect any differences in accounting policies).

(g) Ind AS 101 requires the de-recognition requirements of Ind AS 109 to be applied prospectively to transactions occurring on or after the date of transition. Therefore, the Company has not recognized financial assets and liabilities under Ind AS which were derecognized under the previous GAAP as a result of a transaction that occurred before the date of transition.

4 Financial risk management objectives and policies

The Company’s principal financial liability includes Borrowings, Trade payable and other financial liabilities. The main purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include Trade receivables, Cash and cash equivalents and other financial assets that derive directly from its operations. The Company is exposed to credit risk, liquidity risk and market risk. The Company’s senior management oversees the management of these risks and the appropriate financial risk governance framework for the Company. The senior management provides assurance that the Company’s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives.

The Board of Directors reviewed policies for managing each of these risks, which are summarized below:

a) 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 three types of risk: interest rate risk, currency risk and other risks, such as regulatory risk and commodity price risk.

(i) 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 borrowings obligations with floating interest rates.

(ii) Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the Company’s foreign currency denominated payables on account of import and receivables of export value.

(iii) Commodity price risk

There is no commodity price risk, since the stock in hand of software is not subjected to any fluctuation. . And the Company anticipate to receive of favourable price for the same when delivered / sold.

(iv) 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 impairment for financial assets are based on assumptions about risk of default and expected loss rates. The Company uses judgment in making these assumptions and selecting the inputs to the impairment calculation, based on the Company’s past history, existing market conditions as well as forward looking estimates at the end of each balance sheet date. Financial assets are written off when there is no reasonable expectation of recovery, however, the Company continues to attempt to recover the receivables. Where recoveries are made, these are recognized in the Statement of Profit and Loss.

(v) Trade receivables

Trade receivables are non-interest bearing and are generally on credit terms of 60 to 90 days. An impairment analysis is performed at each balance sheet date on an individual basis for major clients.

(vi) Liquidity Risk

Liquidity risk refers to the probability of loss arising from a situation where there will not be enough cash and/or cash equivalents to meet the needs of depositors and borrowers, sale of illiquid assets will yield less than their fair value and illiquid assets will not be sold at the desired time due to lack of buyers. The primary objective of liquidity management is to provide for sufficient cash and cash equivalents at all times and any place in the world to enable us to meet our payment obligations.

5 Employee Benefit

The company has contributed to PF and ESI Rs. 5,02,397/- ( Previous years 5,40,774/-).

Brief description of the Plans: The Company has various schemes for long term benefits such as Provident Fund, Gratuity, and Leave Encashment. The Company’s defined contribution plans are Provident Funds, Employee’s State Insurance Fund & Employee’s Pension Scheme (under the provision of Provident Funds & Miscellaneous Provisions Act, 1952). The Company has no further obligation beyond making the contributions. The Company’s defined benefit plans include Gratuity & Leave Encashment Plan. In accordance with the applicable Indian Laws, the company provides for gratuity for all employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on respective employees last drawn salary & for the years of employment with the Company. During the year company has computed his liability through Actuarial Valuar M/s Charan Gupta Consultants Pvt Ltd. The present value of obligation for Gratuity is determined based on actuarial valuation using the Projected Unit Credit Method. The additional disclosure in terms of Accounting Standards-15 “Employees Benefits” is as under:. The amounts charges to Profit & Loss Account based on estimated basis are as under:-

6 In the absence of necessary information with the company, relating to the registration status of suppliers under the micro, small and medium enterprises development ACT, 2006, the information required under the said act could not be complied and disclosed.

7 The Company is already a holding company of the following:

Axis Convergence Inc Greenwire Network Limited

Opentec Thai Network Specialists Company Limited

8 Capital Management

The Company’s objective for capital management is to maximize shareholders value, safeguard business continuity and support the growth of the Company. The Company determines the capital requirement based on annual operating plans and long-term and other strategic investment plans. The funding requirements are primarily being met through operating cash flows generated.

No changes were made in the objectives, policies or processes for managing capital during the years ended 31 March 2018 and 31 March 2017:

9 Fair value

i) Set out below, is a comparison by class of the carrying amounts and fair value of the Company’s financial instruments, other than those with carrying amounts that are reasonable approximations of fair values:

a) The management assessed that cash and cash equivalents, other bank balances, trade receivables and trade payables approximate their carrying amounts largely due to the short-term maturities of these instruments.

b) The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

c) Long-term fixed-rate and variable-rate receivables/Borrowings are evaluated by the company based on parameters such as interest Rates, specific country risk factors, individual creditworthiness of the customer and the risk characteristics of the financed project, based on this evaluation, allowances are taken into account for the expected credit losses of these receivables.

d) Non-current financial liabilities is estimated by discounting future cash flows using rates currently available for debt on similar terms, credit risk and remaining maturities. In addition to being sensitive to a reasonably possible change in the forecast cash flows or the discount rate, the fair value of the equity instruments is also sensitive to a reasonably possible change in the growth rates. The valuation requires management to use unobservable inputs in the model, of which the significant unobservable inputs are disclosed in the tables below. Management regularly assesses a range of reasonably possible alternatives for those significant unobservable inputs and determines their impact on the total fair value.

e) The fair values of the unquoted equity shares have been estimated using a net asset value method.

ii) Fair value hierarchy

The following table provides the fair value measurement hierarchy of the Company’s assets and liabilities.

# Since the financial statement of the company in which unquoted equity shares were held was not available, in the absence of same the faire value of unquoted equity shares has been taken as Re 1/-.

10. Previous year’s figures have been regrouped I reclassified wherever necessary to correspond with current year’s classification/disclosure.

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Mar 31, 2016

1. The Company has only one class of equity shares having a par value of Re.1/- each per share. Each holder of equity share is entitled to one vote per share.

2. In the event of liquidation of the Company, holders of equity shares will be entitled to receive any of the remaining assets of the Company after discharging the liabilities of the Company.

3. The Company had increased the authorized capital during the Financial Year 2010-11 to 2012-13, however due to technical issues necessary forms along with the fees w.r.t. increase in Authorized Capital, could not be filed and paid. Meanwhile the schedule of fees was increased as per the companies act, 2013. However, the authorized capital was increased prior to the applicability of companies act, 2013. The company has filed a Writ Petition bearing No. WP(C) 5199 of 2015 before the Hon’ble High Court of Delhi, challenging the applicability of provisions prescribed under Para 3 of Table B under Registration of Offices and Fees Rules 2014. Due to this reason Annual Report could not be filed. Hence, “Directors of your company are not disqualified for reappointment in this company and are eligible for appointment in any other company as a Director in terms of Section 164(2) of the Act”.

1 Working Capital Loans from Allahabad Bank and Loans from Phoenix ARC Pvt. Ltd. are secured by way of charge on movable and immovable properties of the Company.

(i) Company has settled all the issues with DBS Bank and the entire outstanding paid off in full.

(ii) Barclays bank has assigned its total debt of Rs. 1,45,56,000.00 to Phoenix ARC Pvt. Ltd, including interest of Rs. 5,56,000/-

(iii) Your company has entered into an OTS for a sum of Rs. 11,86,50,000.00 with Allahabad Bank and started paying the amount in terms of the same.

(iv) Other Unsecured loans include a sum of Rs. 15,55,91,429.00 from directors.

Notes: -

Other payable includes Rs.3.90 Crores towards ROC fees in connection with increase in Authorized share capital from Rs. 52.45 Crores to Rs. 377.50 Crores in various EGMs held and Merger through Court orders held during the Period from FY 2010-11 to FY 2012-13.

Note:-

Income tax Liability against Provision for Income Tax in respect of Assessment Year 2013-14, including provision of interest thereon, had already been made in the books of account. As such this liability has no further impact on the profits / retained earnings of the reported period of the company.

Notes :

1 Other Loans & Advances are subject to balance confirmation.

2 During the financial year 2013-14, due to change in business plan and consequential amendment in terms, Capital Advances amounting to Rs. 220 Crore has been taken as long term advances as included in Other Loans & Advances.

Note:

1. The funds raised by the Company from GDR issue during F.Y. 2007-08 were kept in fixed deposit account with Banco Efisa, Lisbon, Portugal, as the said amount was to be deployed in terms of INFORMATION MEMORANDUM of the GDR issue. During the F.Y. 2008-09, the Bank in Portugal, Banco Efisa wrongly debited an amount of USD 8,883,210.75 out of the balance lying in the Company’s Account with the Bank. The Company has denied and disputed this debit and had initiated legal action under criminal jurisprudence of Portuguese Law. During the criminal investigation, several new facts/documents have come to our knowledge and based on the evaluation of new facts/documents by Barristers, Senior Advocates and investigation carried out of in India, London and Portugal; your Company has initiated a strong civil action for recovery of USD 8,883,210.75, along with interest, against Banco Efisa and its Holding Company, wherein the Portuguese advocates confirm that the chances of recovery are very high. A criminal complaint against the conniving accused for siphoning off the above said amount had been filed and the matter is presently under investigation.

2. Bank guarantee issued to Unique Identification Authority of India Rs. 200,000.

Notes :

1 Other Loans & Advances, Advance to suppliers are subject to balance confirmation.

Notes:

Preliminary Expenditure included in Miscellaneous Expenditure, have been written off on the basis as provided under section 35D of the Income Tax Act, 1961 as amended from time to time.

Note:

The Miscellaneous income includes i) reversal of interest debited in earlier years of DBS Bank & Barclays Bank amounting to Rs. 17,45,090/- & Rs. 19,83,972/- respectively, because both banks loan are settled at less amount of interest ii) Includes waiver of principal amount of Rs. 58,60,537/- by Barclays Bank at the time of settlement of Loan on a total sum of Rs. 2.00 Crores instead of principle outstanding of Rs. 2,58,60537/- iii) Profit on Sales of Fixed Assets, Rs. 5,51,15,723.83, and iv) interest on FDRs Rs. 4,64,915/-

A. Dues of Income Tax

a) Rs. 5,104,827/- related to A.Y. 2005-06 against this Rs. 4,000,000/- deposited with Income-tax Authorities (Rs. 1,104,827/-),

b) Rs. 1,245,589/- related to A.Y. 2006-07 (Rs. 1,245,589/-),

c) Rs. 43,851,395/- related to F.Y 2008-09 against this Rs. 1,500,000/- deposited with Income-tax Authorities (Rs. 42,351,395/-),

d) Rs. 27,487,250/- related to F.Y. 2009-10 (Nil),

e) In respect of A.Y. 2010-11 is 27,306,810/- (Nil)

f) In respect of A.Y. 2011-12 Income-tax demand of Rs. 445,798,390/- (445,798,390/-),

g) A.Y. 2012-13 Income Tax Demand of Rs. 88,30,590 (Nil)

B. Interest on Cash Credit (NPA as per Bank) of Rs. 2,13,78,631/- (Rs. 2,43,59,929/-), which is under settlement with Bank .

C. ROC fees of increase in authorized share capital Rs. 2,74,21,105.29/- (Rs. 23,509,819/-).

D. Bank guarantee Rs. 200,000. (Nil)

E. Service tax demand of Rs. 35,53,123/- against which paid Rs. 10,00,000.00 (Nil)

1. Primary Segmentation has been done according to the nature of product & services. The Company’s Operations predominantly relate to the following segments:

a) IT Solution & Products (including software)

b) IT Enabled Services

c) Telecommunication

2. There is no Inter division or Inter Segment transfer of goods.

3. Since Fixed Assets used in the company’s business cannot be specifically identified with any of the reportable segment, as these are used inter changeably among segments, therefore segment wise disclosure on capital employed has not been furnished.

4. The Company caters mainly to the Domestic market and the Export turnover is not significant in the context of the total

Note: Related Parties transactions during the year, have been identified by the management

Company had increased its authorized capital during the Financial Year 2010-11 to 2012-13, however, due to technical issues

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Mar 31, 2015

Note 1 - Disclosure under Accounting Standard 29 - Contingent Liabilities

A. Dues of Income Tax a) Rs. 5,104,827/- related to A.Y. 2005-06 against this Rs. 4,000,000/- deposited with Income-tax Authorities (Rs. 1,104,827/-), b) Rs. 1,245,589/- related to A.Y. 2006-07 (Rs. 1,245,589/-), c) Rs. 43,851,395/- related to A.Y. 2008-09 against this Rs. 1,500,000/- deposited with Income-tax Authorities (Rs. 42,351,395/-), d) In respect of A.Y. 2010-11 is Nill (Rs. 27,306,810/-), f) In respect of A.Y. 2011-12 Income tax demand of Rs. 445,798,390/- (Rs. 44,579,390), g) A.Y. 2012-13 Income Tax Demand of Rs. 88,30,590 (Nil)

B. Letter of Credit Rs. Nil (Rs. 13,398,961/-)

C. Allahabad Bank, Scindia House, New Delhi Rs. 1,498,612/- (NIL) Allahabad Bank, South Extn., New Delhi Rs. 22,861,317/- (Rs. 8,959,613/-) DBS Bank, New Delhi Rs. 5,530,761/- (NIL) Barclays Bank, New Delhi Rs. 3,879,075/- (NIL)

D. ROC fees of increase in authorised share capital Rs. 23,509,819/- (Rs., 1,96,09,219/-).

Notes 2

Company had increased its authorised capital during the Financial Year 2010-11 to 2012-13, however, due to technical issues necessary forms along with the fees w.r.t. increase in Authorised Capital could not be filed and paid. Mean while the schedule of fees was increased as per the companies act, 2013. However, the authorised capital was increased prior to the applicability of companies act, 2013. The company has filed a Writ Petition bearing No. WP(C) 5199 of 2015 before the Hon'ble High Court of Delhi challenging the applicability of provisions prescribed under Para 3 of Table B under Registration of Offices and Fees Rules 2014. Due to this reason Annual return form could not be filed. Hence, "Directors of this company are not disqualified for re-appointment in this company and is eligible for appointment in any other company as a Director in terms of Section 164(2) of the Act".

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Mar 31, 2014

Note 1 - Disclosure under Accounting Standard 29 - Contingent Liability

A. Dues of Income Tax a) Rs. 5,104,827/- related to A.Y. 2005-06 against this Rs. 4,000,000/- deposited with Income-tax Authorities (Rs. 1,104,827/-), b) Rs.1,245,589/- related to A.Y. 2006-07 (Rs. 1,245,589/-), c) Rs. 43,851,395/- related to A.Y. 2008-09 against this Rs. 15,00,000/- deposited with Income-tax Authorities (Rs. 42,351,395/-), d) In respect of A.Y. 2009-2010 Income Ta x demand is Rs. 27,487,250/- (Rs. 27,487,250/-), e) Income-tax demand for the A.Y. 2010-11 is Nil (Rs. 27,306,810/-), f) in respect of Assessment year 2011-12 income tax demand of Rs. 44,57,98,390/- (Nil).

B. Letter of credit Rs. 13,398,961/- (Rs. 18,460,514/-)

C. Interest of Cash Credit (NPA as per Bank) Rs. 8,959,613/- (Nil)

D. ROC fees of increase in authorised sharecapital Rs. 30,415,052/- (Nil)

Notes:

1. Primary Segmentation has been done according to the nature of product & services.The Company''s Operations predominantly relate to the following segments:

a) IT Solution & Products (including software)

b) IT Enabled Services

c) Telecommunication

2. There is no Inter division or Inter Segment transfer of goods.

3. Since Fixed Assets used in the company''s business cannot be specifically identified with any of the reportable segment, as these are used inter changeably among segments, therefore segment wise disclosure on capital employed has not been furnished.

4. The Company caters mainly to the Domestic market and the Export turnover is not significant in the context of the total turnover. As such there are no geographical segments.

5. The sales turnover under the segment, during the FY 2013-14 amounted to Rs. 35.91 Crores is being reduced to Rs. 1.90 Crores, as a result of rejection and return of software goods amounting to Rs. 34.01 Crores sold on approval basis during the FY 2012-13.

Note 6

The Company had not been able to comply with the provisions of Clause 41 of the Listing Agreement since the Officials of Directorate General of Central Excise Intelligence (DGCEI) had during search, in the month of March 2014, in the premises of the company had taken away the hard discs containing the accounting and financial data for the FY 2013-14 hence the accounts for the FY 2013-14 could not be finalized and audited. The company had informed the stock exchanges well in advance of the situation however, the Stock exchanges still imposed fine. Against the imposition of the fine, the company had preferred an appeal before the Hon''ble Securities Appellate Tribunal, which vide its order dated 10/11/2014 quashed and set asite the penalty imposed by the Stock exchanges and restored the matter back to them. The Hon''ble SAT also permitted the company to file additional affidavit which has been filed and the same is under consideration by the Stock Exchanges.

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Mar 31, 2012

Notes:

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

2. In the event of liquidation of the Company, holders of equity shares will be entitled to receive any of the remaining assets of the Company after discharging the liabilities of the Company.

3. M/s Axis Convergence Private Limited has been merged with the Company as per the scheme of amalgamation sanctioned by the Hon'ble High Court, New Delhi vide its order dated 20.07.2012. Pursuant to this scheme of amalgamation, the Company has agreed to allot 59389515 equity shares fully paid up of Rs.10/- each to the shareholders of Transferor Company.

4. As per the scheme of amalgamation, the business carried on by the transferor company from the appointed date till the effective date is carried on, for and on behalf of the transferee company and all profits accruing to the transferor company are profits of the transferee company. Therefore, the profits of the transferor company from 1st April'2011 to 31st March'2012 are reflected in the profit & loss a/c of the transferee company. Various items of profit & loss a/c of the company include corresponding figures of erstwhile transferor company. The corresponding figures of assets and liabilities of the transferor company as on 31st March' 2012 have merged with the assets and liabilities of the transferee company.

5. Pursuant to the scheme of amalgamation as approved, the transferee company has taken over the entire business of erstwhile transferor company including all assets, liabilities obligations etc. and the same has been given effect to in the accounts subject to and read with point (4) above, on a purchase method basis as prescribed by Accounting Standard (AS- 14) issued by the institute of chartered accountants of India. In view of this, the figures for the current year represent the operations of the company including the operations of erstwhile transferor company whereas the figures of the previous year represent figures relating to the operations of the transferee company only. To this extent the figures for the current year are not comparable with the figures of the previous year.

6. The amount of excess difference between the consideration and the value of net identifiable assets acquired from transferor company has been transferred to Capital Reserve.

7. In terms of the resolution passed under section 81(1A) of the Companies Act,1956 at the Extra Ordinary General Meeting of the Company held on 30.09.2010 and 'In-principle' approval received from NSE and BSE, The Board has allotted 220000000 convertible share warrants into equal number of equity shares of Rs 10/- each at a price of Rs 10/- per warrant, in the board meeting held on 30.10.2010 on preferential basis to promotors and non-promotors category. Pursuant to allotment of convertible share warrants, the company during the financial year 2010-2011 and 2011-2012, has received monies aggregating to Rs 158.85 crores out of Rs. 220.00 crores.

Notes:

1. Working Capital loans are secured by the first ranking pari passu charges over entire Current Assets of the Company including stocks of finished goods, stock in trade, goods in transit, book debts etc. (present and future).

2. Loan from other banks are secured by the movable assets and immovable properties of the company, personal guarantee of the directors viz. Mr. Peeyush Aggarwal, Mr. Karun Jain, and body corporates guarantee namely Infotecnics India Ltd, Omkam Developers Pvt Ltd and guarantee of M/s. Peeyush Aggarwal (HUF).

3. * During the year, there were irregularaties in the Loan account, which has now been regularised as per confirmation given by bank.

The funds raised by the Company from GDR issue during F.Y. 2007-08 were kept in fixed deposit account with Banco Efisa, Lisbon, Portugal, as the said amount was to be deployed in terms of INFORMATION MEMORANDUM of the GDR issue. During the F.Y. 2008-09, the Bank in Portugal, Banco Efisa wrongly debited an amount of USD 8,883,210.75 out of the balance lying in the Company's Account with the Bank. The Company has denied and disputed this debit and had initiated legal action under criminal jurisprudence of Portuguese Law. During the criminal investigation, several new facts/documents have come to our knowledge and based on the evaluation of new facts/documents by Barristers, Senior Advocates and investigation carried out of in India, London and Portugal; your Company has initiated a strong civil action for recovery of USD 8,883,210.75, alongwith interest, against Banco Efisa and its Holding Company, wherein the Portuguese advocates confirm that the chances of recovery are very high. A criminal complaint against the conniving accused for siphoning off the above said amount had been filed and the matter is presently under investigation.

The Company makes Provident Fund and Superannuation Fund (Gratuity) contributions to contribution plans for qualifying employees. Under the Schemes, the company is required to contribute a specified percentage of payroll costs to fund the benefits. The Company recognised the contributions in the statement of profit and Loss. The Contributions payable to these plans by the company are at rates specified in the rules of the schemes.

Note:

1. Primary Segmentation has been done according to the nature of product & services.The Company's Operations predominantly relate to the following segments:

a) IT Solution & Products

b) IT Enabled Services

c) Telecommunication

2. There is no Inter division or Inter Segment transfer of goods.

3. Since Fixed Assets used in the company's business cannot be specifically identified with any of the reportable segment, as these are used inter changeably among segments, therefore segment wise disclosure on capital employed has not been furnished.

4. The Company caters mainly to the Domestic market and the Export turnover is not significant in the context of the total turnover. As such, there are no geographical segments.

5. The Segment of IT Solutions & products also includes revenue generated from trading in communicating devices.

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Mar 31, 2010

1) Contingent Liabilities not provided for:-

Bank Guarantees outstanding Rs. 275,000/- (Rs. 292,587/-).

ii. Letter of Credits issued by Bank Rs. 7,594,932/- (Rs. 58,864,946/-).

iii. The Company has received notices u/s 156 of Income Tax Act, for the Assessment Year 2005-06 for a demand of Rs. 5,104,827/- against which the Company has already paid a sum of Rs. 4,000,000/- and for the Assessment Year 2006-07 for a demand of Rs. 1,245,589/-. Further the Company has filed appeals before Commissioner of Income Tax (Appeals), Bangalore against these demands. Management is of the opinion that these demands are not sustainable. Accordingly no provision has been made for the same.

2) There was a dispute between Mr. P.R. Sheshadri, sole proprietor of Visesh Technologies and Pro Data Distribution Pte Ltd., Singapore in which M/s Pro Data Distribution Pte Ltd. Singapore made Visesh Infosystems Limited a party to the dispute and filed a case against the company and Mr. P.R. Sheshadri, Proprietor of Visesh Technologies. Honble High Court of Karnataka has passed an adverse order against the Company on 17.10.2001. On the request of the Company, the Honble High Court of Karnataka has recalled the order. The Company has deposited a sum of Rs. 1,858,671/- with Honble High Court of Karnataka against the same. The High Court dismissed the petition in view of non presence of petitioners on the date of hearing on 13.12.2007. The Company now has been advised to proceed in the matter for refund of the said amount deposited with the Court.

3) Earning in Foreign Exchange include sale of software and services Rs. 28,478,755/- ( Rs. NIL)

4) Managerial Remuneration under section 198 of the Companies Act, 1956. Salaries, Benefits & Allowances Rs. 851,065/- (Rs. 1,532,194/-)

5) Balances of Sundry Debtors, Sundry Creditors, Current Liabilities, Loans and Advances are subject to confirmation.

6) Prior year adjustments amounting to Rs. 1,49,331/- (Rs. 71,86,916/-) includes Rs. 300,499/- (Rs. 667,746/-) towards Service Tax input credit of earlier years, Services given in the earlier year of Rs. 1,66,377/- (Rs. NIL) not realiesed and Rs. 15,208/- (Rs. NIL ) towards Interest on FDRs provided excess in the earlier years, impact of above has been provided in the current year.

7) i) a) Out of the Issued, Subscribed & Paid up Capital, the following shares were allotted for consideration other than cash : 871,700 Equity Shares were allotted as fully paid up bonus shares in the ratio of 1:1 shares held on 28.06.1998 by capitalization of reserves;

b) 2,283,300 Equity Shares were allotted as fully paid up bonus shares in the ratio of 1:2 shares held on 11.08.1999 by capitalization of reserves;

c) 2,700,000 Equity Shares were allotted as fully paid up equity shares pursuant to a swapping contract on 26.09.2001;

d)2,225,000 Equity Shares were allotted as fully paid up equity shares pursuant to a business acquisition contract on 25.07.2002;

e)11,047,650 Equity Shares were allotted as fully paid up to the shareholders of erstwhile MPS Technosoft Ltd. pursuant to scheme of amalgamation as sanctioned by Honble High Court of Delhi vide its order dated 10.05.2005;

ii) 9,309,524 Equity Shares were allotted against 4,654,762 Global Depository Receipts at US$ 2.148 each representing two equity shares of Rs. 10/- each against each GDR.

iii) During the year, the Company had alloted 6,800,000 convertible warrants with an option to convert such warrants into equal number of equity shares of Rs. 10/- each at a price of Rs. 10/- per warrant, on preferential basis. Out of the total warrants so issued 6,300,000 warrants were converted into equal number of equity shares.

8 a) Working Capital Loan from Allahabad Bank, DBS Bank and Barclays bank are secured against mortgage of certain immovable property of the company, Hypothecation of Stock & Book Debts and other movable assets of the Company, Personal Guarantee of certain Directors namely Mr. Peeyush Aggarwal, Mr. Karun Jain and body corporates and others namely Infotecnics India Ltd., Omkam Developers Pvt. Ltd and Peeyush Aggarwal (HUF).

b) Loans from other banks includes Loans from (i) DBS Bank Ltd. Rs. 77,090,782 (Rs. 99,638,834/-) ii) Barclays Bank Rs. 49,375,000/- (Rs. 75,000,000/-) iii) Kotak Mahindra Prime Ltd. Rs. 75,382/- (` 234,834/-)

c) Loan from other institution includes loan from LIC Rs. 14,87,000/- (Rs. 1,487,000/-)

9) The funds received by the Company from GDR issue during the F. Y. 2007-08 were kept in fixed deposit account with Banco Efisa, Lisbon, Portugal as the said amount was to be deployed in terms of INFORMATION MEMORANDUM of the GDR issue. During the F.Y. 2008-09 Banco Efisa wronglly adjusted an amount of USD 8,883,210.75 out of the balance lying in the Companys Account with the Bank. The Company has denied and disputed this debit. The Legal experts have advised that the company has strong case and very good chance of recovery. On the advice of the legal experts, the company had filed complaint under Portuguse Laws and investigations are pending before DIAP. The Company is also planning to initiate cases under civil as well as criminal laws before various forums/authorities. No interest has been credited in the Company account after 5th December 2008 and the company has also not provided for interest subsequent to this date. No impact of Bank adjustments has been provided in the books of accounts in view of legal opinion. Due to the dispute the company has not provided exchange fluctuation gain/(loss) on the balance with Banco Efisa as on 31st March 2010.

10) In the opinion of the Board, the realisable value of Current Assets, Loans and Advances, in the ordinary course of business, would not be less than the amount at which these are stated in the Balance Sheet and provision for all known liabilities have been made.

11). The Company has entered into contracts with companies for upgradation of ERP & Development / upgradation of other products. The amount spent on the same is pending capitalization under the head "Capital Work In Progress".

12) As required by the provisions of the Micro, Small and Medium Enterprises Development Act, 2006 and as per the information available with the company, no amount is due to Micro, Small and Medium Enterprises as at 31st March, 2010.

Note: Primary segmentation has been done according to the nature of products and services. The Companys operations predominantly relate to the following segments:

a) I T Solutions & Product Support

b) Enterprise Software

c) I T Enabled Services

There is no Inter-divisional or inter-segmental transfer of Goods.

Since fixed assets used in the companys business cannot be specifically identified with any of the report- able segments as these are used inter changeably among segments, therefore segment wise disclosure on capital employed has not been furnished.

The company caters mainly to the domestic market and the Export turnover is not significant in the context of the total turnover. As such, there are no Geographical Segments.

13) Related Party Disclosures :

Related Party Disclosures as per Accounting Standard 18 "Related Party Disclosures"

A. List of related parties with whom the Company has transacted:

a Key Managerial Personnel

1. Mr. Peeyush Aggarwal

2. Mr. Karun Jain

b Parties in which the Key Managerial Personnel or the relatives of the Key Managerial Personnel are Interested

1. Omkam Communication Pvt. Ltd., 2. Omkam Global Capital Pvt. Ltd., 3. Positive Comsol Pvt. Ltd., 4. Omkam Securities Pvt. Ltd..

* Related party relationship is as identified by the Company and relied upon by the Auditors

14) Figures have been rounded off to the nearest rupee.

15) Figures in brackets represent the previous year.

16) Previous year figures have been regrouped / rearranged wherever considered necessary to correspond with current year figures.