Notes to Accounts of Healthfore Technologies Ltd.

Mar 31, 2015

DETAILS OF CONTINGENT LIABILITIES

(i) Religare Technova IT Services Limited (now merged with Religare Technologies Limited) has received an order, passed by Service Tax department, Ludhiana dated December 4, 2009 under Section 73 of the Finance Act, 1994 wherein a demand of Rs. 5,40,824/- has been raised on the Company.

The Company had filed an appeal before the Commissioner of Central Excise (Appeals) - II, Chandigarh against the said order. The commissioner had confirmed the order against which appeal was filed to CESTAT where the order was given in favour for the company and sent back on remand. The proceedings are pending before the assessing officer for regular assessment.

(ii) Appeal has been filed to the Commissioner (Appeal) of Value Added Tax, Kolkata in respect of VAT Demand for Financial Year 2008- 09 amounting to Rs. 10,74,026/-. The proceedings are still pending before Commissioner (Appeal) of Value Added Tax, Kolkata.

(iii) The Income Tax Assessment of Religare Technova IT Services Limited (now merged with Religare Technologies Limited) for the assessment year 2008-09 has been completed by the Deputy Commissioner of Income Tax, Circle-VII, Ludhiana under section 143(3) of the Act vide order dated December 24, 2010. Consequential to certain disallowances made in the assessment order, a demand of Rs. 35,451,530/- has been raised on the Company. The AO has also initiated penalty proceedings under section 271(1) (c) of Act against the Company.

The Company has filed an appeal with Commissioner of Income Tax (Appeals), II, Ludhiana against the said assessmen order. In reply to the notice for initiation of penalty proceedings, the Company has filed a letter with the AO requesting to keep the penalty proceedings in abeyance till the disposal of Appeal filed before CIT(A). (iv) Religare Technova IT Services Limited (now merged with Religare Technologies Limited) ("the Company") has received order dated March 30, 2011 passed by Assessing officer u/s 201(1)/201(1A) of the Act for financial year 2008-09, wherein demand amounting to Rs. 20,05,580/- has been raised on the Company on account of TDS not deducted/TDS deducted but not paid by the Company. The said demand was primarily on account of mismatch in the online database of tax department with the returns/ challans filed by the Company.

The company has filed correction statement and status of liability as on 31 march 2012 is Rs. 136,741/-. The Company has also preferred an appeal against the same to CIT(A)-XXX and the same is pending for disposal.

(v) The Income tax assessment of Religare Technova Business Intellect Limited (now merged with Religare Technologies Limited) for assessment year 2008-09 was completed by the Assistant Commissioner of Income Tax, Circle-15 (1), New Delhi under section 143(3) of the Act vide assessment order dated December 31, 2010. Pursuant to the additions made in the said assessment order, the returned loss of the subject assessment year has been reduced from Rs. 79,47,388/- to Rs. 12,38,895/-. The AO has also initiated penalty proceedings under section 271(1) (c) of the Act against the Company.

The Company has filed an appeal with Commissioner of Income Tax (Appeals), XVIII, New Delhi against the said assessment order. In reply to the notice for initiation of penalty proceedings, the Company has filed a letter with the AO requesting to keep the penalty proceedings in abeyance till the disposal of Appeal filed before CIT(A).

(vi) The company has received a show cause notice dated 03 Feb 2012 from Service tax department on account of disallowance of CENVAT credit in relation to company's premises for which late registration was taken. The amount involve in such show cause notice is Rs. 37,56,456/- including interest.

The company has filled a suitable reply against such notice as the late intimation filed for few company's premises is a procedural gap only and management expects a favourable order on reply against such notice.

(vii) HealthFore Technologies Limited (formerly Religare Technologies Limited) received a notice dated 16th May, 2011 from Presiding Officer, Industrial Tribunal, New Court Complex, Ludhiana regarding a complaint filed by Mr. Rajesh Bansal disputing his termination and claiming an amount of Rs. 3,85,000/-. Further a notice dated 30th September, 2011 was received from the Controlling Authority under Payment of Gratuity Act, 1972 and Assistant Labour Commissioner (Central), KendriyaSadan, Sector 9-A, Chandigarh with respect to an application filed by Mr. Rajesh Bansal regarding non-payment of alleged full gratuity payable to him. The matters are currently pending.

1. SEGMENT REPORTING: Business Segment:

(i) The business segment has been considered as the primary segment.

(ii) The company's primary business segments are reflected based on principal business activities, the nature of service, the differing risks and returns.

(iii) The Company's primary business comprises of three segment viz., 'IT Services' , 'Knowledge Services' and 'Healthcare Services'.

(iv) Segment revenue, results, assets and liabilities include amounts identifiable to each segments allocated on reasonable basis.

(v) The accounting policies adopted for segment reporting are in line with the accounting policies adopted for preparation of financial information as stated in (2) above.

Geographical Segment:

As the company is primarily operating in one Geographic segment "Within India" hence no separate information for Geographic segment wise disclosure is required.

2. OTHER NOTES

(i) In view of accumulated losses, no provision for income tax is considered necessary.

(ii) The Company has unabsorbed depreciation and carry forward losses under the Income Tax Act 1961. Accordingly, keeping in view absence of virtual certainty, deferred tax assets have not been recognised.

(iii) Taking into account management's assessment of growth of business, the accounts of the company have been prepared on a "Going Concern" basis even though, the net worth of the Company has substantially eroded due to accumulated losses.

(iv) During the financial year, the balances which were lying with the creditors and old outstanding cheque having outstanding more than 3 years have been written back.

(v) The cost of Intangible assets and Intangible assets under development includes the cost of Manpower, Interest on borrowing, proportationate amount of common facilities and other miscellaneous cost. During the financial year, Rs. 11,96,70,307/- has been added to Intangible assets under development.

(vi) The Shareholders of the Company had approved the HealthFore Employee Stock Option Scheme – 2013 ("Scheme") on September 13, 2013. However, till date no Stock Options have been granted by the Company under the Scheme

3. PREVIOUS YEAR FIGURES

Figures of the Previous Year have been regrouped, rearranged and reclassified to conform to the current year classification

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Mar 31, 2013

1 OVERVIEW

The Company was incorporated as a limited liability company by the name of Religare Technova Services Limited on 22nd May 2009. It received the certificate of Commencement of Business on 3rd June 2009.

W.e.f. June 12, 2009 name of the Company was changed from "Religare Technova Services Limited” to "Religare Technologies Limited”. W.e.f. April 29, 2013 name of the Company has been changed from Religare Technologies Limited to "HealthFore Technologies Limited"

2 Contingent Liabilities

Particulars As at 31 March 2013 As at 31 March 2012 Amount (Rs.) Amount (Rs.)

Money for which the company is contingently liable

– Disputed Income Tax Demands not provided for 37,457,110 37,457,110

– Disputed Service Tax Demands not provided for 4,297,280 4,297,280

– Disputed VAT/ CST Demands not provided for 2,311,805 34,810,211

– Other contingent liabilities with respect to litigations 385,000 446,000

44,451,195 77,010,601

DETAILS OF CONTINGENT LIABILITIES

(i) Religare Technova IT Services Limited (now merged with Religare Technologies Limited) has received an order, passed by Service Tax department, Ludhiana dated December 4, 2009 under Section 73 of the Finance Act, 1994 wherein a demand of Rs.5,40,824 has been raised on the Company.

The Company had filed an appeal before the Commissioner of Central Excise (Appeals) - II, Chandigarh against the said order. The commissioner had confirmed the order against which appeal was filed to CESTAT where the order was given in favour for the company and sent back for regular assessment. The proceedings are pending before the assessing officer for regular assessment.

(ii) Appeal has been filed to Commissioner (Appeal) of Value Added Tax, Kolkata in respect of VAT Demand for Financial Year 2008-09 amounting to Rs. 10,74,026/-. The proceedings are still pending before Commissioner (Appeal) of Value Added Tax, Kolkata.

(iii) The Income Tax Assessment of Religare Technova IT Services Limited (now merged with Religare Technologies Limited) for the assessment year 2008-09 has been completed by the Deputy Commissioner of Income Tax, Circle-VII, Ludhiana under section 143(3) of the Act vide order dated December 24, 2010. Consequential to certain disallowances made in the assessment order, a demand of Rs. 35,451,530 has been raised on the Company. The AO has also initiated penalty proceedings under section 271(1) (c) of the Act against the Company.

The Company has filed an appeal with Commissioner of Income Tax (Appeals), II, Ludhiana against the said assessment order. In reply to the notice for initiation of penalty proceedings, the Company has filed a letter with the AO requesting to keep the penalty proceedings in abeyance till the disposal of Appeal filed before CIT(A).

(iv) Religare Technova IT Services Limited (now merged with Religare Technologies Limited) ("the Company”) has received order dated Mar-30, 2011 passed by Assessing officer u/s 201(1)/201(1A) of the Act for financial year 2008-09, wherein demand amounting to Rs 2,005,580 has been raised on the Company on account of TDS not deducted/TDS deducted but not paid by the Company. The said demand was primarily on account of mismatch in the online database of tax department with the returns/ challans filed by the Company.

The company has filed correction statement and status of liability as on 31 march 2012 is Rs. 79,995/- . The Company has also preferred an appeal against the same to CIT(A)-XXX and the same is pending for disposal.

(v) The Income tax assessment of Religare Technova Business Intellect Limited (now merged with Religare Technologies Limited) for assessment year 2008-09 was completed by the Assistant Commissioner of Income Tax, Circle-15 (1), New Delhi under section 143(3) of the Act vide assessment order dated December 31, 2010. Pursuant to the additions made in the said assessment order, the returned loss of the subject assessment year has been reduced from Rs 7,947,388 to Rs 1,238,895. The AO has also initiated penalty proceedings under section 271(1) (c) of the Act against the Company.

The Company has filed an appeal with Commissioner of Income Tax (Appeals), XVIII, New Delhi against the said assessment order. In reply to the notice for initiation of penalty proceedings, the Company has filed a letter with the AO requesting to keep the penalty proceedings in abeyance till the disposal of Appeal filed before CIT(A).

(vi) The company has received a show cause notice dated 03 Feb 2012 from Service tax department on account of disallowance of CENVAT credit in relation to company`s premises for which late registration was taken. The amount involve in such show cause notice is Rs. 37,56,456/- including interest.

The company has filled a suitable reply against such notice as the late intimation filed for few company`s premises is a procedural gap only and management expects a favourable order on reply against such notice.

(vii) The company has been assessed by Department of VAT, U.P. dated 24 Jan, 2013 under provisions U.P. VAT ACT, 2008 wherein a demand of Rs. 1237,779/- has been raised on the Company in the assessment order by Dy. Commissioner, VAT for the financial year 2008-09.

The Company is in process of filing an appeal before the Additional Commissioner of VAT (Appeals) Noida agaist the said assessment order as the management is in bonafied belief to get the favourable order in the case.

(viii) Religare Technologies Limited received a notice dated 16th May, 2011 from Presiding Officer, Industrial Tribunal, New Court Complex, Ludhiana regarding a complaint filed by Mr. Rajesh Bansal disputing his termination and claiming an amount of Rs. 3,85,000. Further a notice dated 30th September, 2011 was received from the Controlling Authority under Payment of Gratuity Act, 1972 and Assistant Labour Commissioner (Central), KendriyaSadan, Sector 9-A, Chandigarh with respect to an application filed by Mr. Rajesh Bansal regarding non-payment of alleged full gratuity payable to him. The matters are currently pending.

3 SEGMENT REPORTING: Business Segment:

(i) The business segment has been considered as the primary segment.

(ii) The company`s primary business segments are reflected based on principal business activities, the nature of service, the differing risks and returns.

(iii) The Company`s primary business comprises of three segment viz., ''IT Services` , ''Knowledge Services` and ''Healthcare Services`.

(iv) Segment revenue, results, assets and liabilities include amounts identifiable to each segments allocated on reasonable basis.

(v) The accounting policies adopted for segment reporting are in line with the accounting policies adopted for preparation of financial information as stated in (1) above.

Geographical Segment:

As the company is primarily operating in one Geographic segment "Within India” hence no separate information for Geographic segment wise disclosure is required.

4 OTHER NOTES

(i) Due to change of policy regarding recognition of prepaid expenses in case of expenses more than Rs. 20,000/-, nothing impact in the financial in respect of expenditure during the period. (ii) In view of accumulated losses, no provision for income tax is considered necessary. (iii) The Company has unabsorbed depreciation and carry forward losses under the Income Tax Act 1961. Accordingly, keeping in view absence of virtual certainty, deferred tax assets have not been recognised. (iv) Taking into account management`s assessment of growth of business, the accounts of the company have been prepared on a "Going Concern” basis even though, the net worth of the Company has substantially eroded due to accumulated losses. (v) During the financial year the balances which were lying with the creditors and old outstanding cheque having outstanding more then 3 years has been written back. (vi) During the financial year amounting to Rs. 935.32 Lakhs (Including Rs. 157.98 Lakhs of Interest on borrowing) has been capitalized to CWIP/intangible assets (the project Infinity is under the development phase for which this expenses has been incurred).

5 PREVIOUS YEAR FIGURES

The financial statements for the year ended March 31, 2012 had been prepared as per the then applicable, pre-revised Schedule VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended March 31, 2013 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year`s classification. The adoption of Revised Schedule VI for previous year figures does not impact recognition and measurement principles followed for preparation of financial statements except for accounting for dividend on investments in subsidiaries.

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Mar 31, 2012

1 OVERVIEW

a. The Company was incorporated as a limited liability company by the name of Religare Technova Services Limited on 22nd May 2009. It received the certificate of Commencement of Business on 3rd June 2009.

W.e.f. June 12, 2009 name of the Company was changed from "Religare Technova Services Limited" to "Religare Technologies Limited".

b. The Hon'ble High Court of Delhi approved the Scheme of Arrangement (u/s 391 to 394 of the Companies Act 1956) on July 28th, 2010. The Company received the certified copy of Final Order on August 13th, 2010 and the same was filed with Registrar of Companies on August 16th 2010.

c. There is an excess of Rs. 79,794,629/- of the Liabilities over the Assets received in the amalgamation process. The same has been treated as Goodwill as per the order of Hon'ble High Court of Delhi.

*As consideration in above said amalgamation, the Company has issued 8,079,461 Equity shares (Face Value of Rs. 10 each) to the shareholders of the holding company 'Religare Technova Limited'. The Financials have been prepared as per the approved scheme.

**Information Services Division has been merged with equal amount of assets and liabilities.

There is an excess of Rs. 79,794,629/- of the Liabilities over the Assets received in the amalgamation process. The same has been treated as Goodwill as per the order of Hon'ble High Court of Delhi.

The rights, preferences and restrictions attaching to each class of shares including restrictions on the distribution of dividends and the repayment of capital;

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each shareholder is entitled to one vote per share. The company declares and pays dividend in Indian Rupee. The dividend proposed by the Board of the Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. During the year ended March 31, 2012 the amount per share recognised as distribution to equity holders was Rs. Nil (March 31, 2011 Rs. Nil). The total dividend appropriation for the year ended March 31, 2012 amounts to Rs. Nil (March 31, 2011 Rs. Nil )including Corporate Dividend Tax of Rs. Nil (March 31, 2011 Rs. Nil). In the event of the liquidation of the company, the holder of the equity shares will be entitled to receive any of the remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion of the number of the equity shares held by the equity share holders.

2 Contingent Liabilities

Particulars As at 31 March 2012 As at 31 March 2011 Amount (Rs.) Amount (Rs.)

Money for which the company is contingently liable

- Disputed Income Tax Demands not provided for 35,531,525 35,531,525

- Disputed Service Tax Demands not provided for 4,297,280 540,824

- Disputed VAT/ CST Demands not provided for 34,810,211 20,000

- Other contingent liabilities with respect to litigations 446,000 -

75,085,016 36,092,349

DETAILS OF CONTINGENT LIABILITIES

(i) Religare Technova IT Services Limited (now merged with Religare Technologies Limited) has received an order, passed by Service Tax department, Ludhiana dated December 4, 2009 under Section 73 of the Finance Act, 1994 wherein a demand of Rs. 540,824 has been raised on the Company.

The Company had filed an appeal before the Commissioner of Central Excise (Appeals) - II, Chandigarh against the said order. The commissioner had confirmed the order against which appeal was filed to CESTAT where the order was given in favour for the company and sent back for regular assessment. The proceedings are pending before the assessing officer for regular assessment.

(ii) Appeal has been filed to Commissioner (Appeal) of Value Added Tax, Kolkata in respect of VAT Demand for Financial Year 2008- 09 amounting to Rs. 1,074,026/-. The proceedings are still pending before Commissioner (Appeal) of Value Added Tax, Kolkata.

(iii) The Income Tax Assessment of Religare Technova IT Services Limited (now merged with Religare Technologies Limited) for the assessment year 2008-09 has been completed by the Deputy Commissioner of Income Tax, Circle-VII, Ludhiana under section 143(3) of the Act vide order dated December 24, 2010. Consequential to certain disallowances made in the assessment order, a demand of Rs. 35,451,530 has been raised on the Company. The AO has also initiated penalty proceedings under section 271(1) (c) of the Act against the Company.

The Company has filed an appeal with Commissioner of Income Tax (Appeals), II, Ludhiana against the said assessment order. In reply to the notice for initiation of penalty proceedings, the Company has filed a letter with the AO requesting to keep the penalty proceedings in abeyance till the disposal of Appeal filed before CIT(A).

(iv) Religare Technova IT Services Limited (now merged with Religare Technologies Limited) ("the Company") has received order dated Mar- 30, 2011 passed by Assessing officer u/s 201(1)/201(1A) of the Act for financial year 2008-09, wherein demand amounting to Rs. 2,005,580 has been raised on the Company on account of TDS not deducted/TDS deducted but not paid by the Company. The said demand was primarily on account of mismatch in the online database of tax department with the returns/ challans filed by the Company.

The company has filed correction statement and status of liability as on 31 march 2012 is Rs. 79,995/- . The Company has also preferred an appeal against the same to CIT(A)-XXX and the same is pending for disposal.

(v) The Income tax assessment of Religare Technova Business Intellect Limited (now merged with Religare Technologies Limited) for assessment year 2008-09 was completed by the Assistant Commissioner of Income Tax, Circle-15 (1), New Delhi under section 143(3) of the Act vide assessment order dated December 31, 2010. Pursuant to the additions made in the said assessment order, the returned loss of the subject assessment year has been reduced from Rs. 7,947,388 to Rs. 1,238,895. The AO has also initiated penalty proceedings under section 2 71(1) (c) of the Act against the Company.

The Company has filed an appeal with Commissioner of Income Tax (Appeals), XVIII, New Delhi against the said assessment order. In reply to the notice for initiation of penalty proceedings, the Company has filed a letter with the AO requesting to keep the penalty proceedings in abeyance till the disposal of Appeal filed before CIT(A).

(vi) The company has received a show cause notice dated 03 Feb 2012 from Service tax department on account of disallowance of CENVAT credit in relation to company's premises for which late registration was taken. The amount involve in such show cause notice is Rs. 3,756,456/- including interest.

The company is in process of filing suitable reply against such notice as the late intimation filed for few company's premises is a procedural gap only and management expects a favourable order on reply against such notice.

(vii) Religare Technova IT Services Limited (now merged with Religare Technologies Limited) has received an order, passed by Department of VAT, U.P. dated March 1, 2011 under Section 28(2) / Section 9(2) / Section 9(4) of the U.P. VAT ACT, 2008 wherein a demand of Rs. 33,736,1 85/- has been raised on the Company.

The Company has filed an appeal before the Additional Commissioner of VAT (Appeals) Noida and the commissioner has passed reheard order in the favour of the company and proceedings are pending before assessing officer for regular assessment.

(viii) Religare Technologies Limited received a notice dated 16th May, 2011 from Presiding Officer, Industrial Tribunal, New Court Complex, Ludhiana regarding a complaint filed by Mr. Rajesh Bansal disputing his termination and claiming an amount of Rs. 385,000. Further a notice dated 30th September, 2011 was received from the Controlling Authority under Payment of Gratuity Act, 1972 and Assistant Labour Commissioner (Central), KendriyaSadan, Sector 9-A, Chandigarh with respect to an application filed by Mr. Rajesh Bansal regarding non-payment of alleged full gratuity payable to him. The matters are currently pending.

(ix) Mr.Parvender Moudgil has filed a consumer complaint bearing number 518/11 before District Consumer Disputes Redressal Forum, New Court Complex, Ludhiana against Religare Technova IT Services Ltd. Mr.Moudgil has alleged that he had some dues against his HSBC credit card he alleged that RTITSL being the recovery agent of the HSBC accepted Rs. 2,000 on behalf of the HSBC as full and final payment, however the HSBC is still harassing him for further payment. The complainant has claimed Rs. 50,000 as damages and Rs. 11,000 as litigation cost. The matter is currently pending.

3 SEGMENT REPORTING:

Business Segment:

(i) The business segment has been considered as the primary segment.

(ii) The company's primary business segments are reflected based on principal business activities, the nature of service, the differing risks and returns.

(iii) The Company's primary business comprises of three segment viz., 'IT Services' , 'Knowledge Services' and 'Healthcare Services'.

(iv) Segment revenue, results, assets and liabilities include amounts identifiable to each segments allocated on reasonable basis.

(v) The accounting policies adopted for segment reporting are in line with the accounting policies adopted for preparation of financial information as stated in (1) above.

Geographical Segment:

As the company is primarily operating in one Geographic segment "Within India" hence no separate information for Geographic segment wise disclosure is required.

4 OTHER NOTES

(i) Due to change of policy regarding recognition of prepaid expenses in case of expenses more than Rs. 20,000/- nothing impact in the financial in respect of expenditure during the period

(ii) In view of accumulated losses, no provision for income tax is considered necessary.

(iii) The Company has unabsorbed depreciation and carry forward losses under the Income Tax Act 1961. Accordingly, keeping in view absence of virtual certainty, deferred tax assets have not been recognised.

(iv) Taking into account management's assessment of growth of business, the accounts of the company have been prepared on a "Going Concern" basis even though, the net worth of the Company has substantially eroded due to accumulated losses.

5 PREVIOUS YEAR FIGURES

The financial statements for the year ended March 31, 2011 had been prepared as per the then applicable, pre-revised Schedule VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended March 31, 2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification. The adoption of Revised Schedule VI for previous year figures does not impact recognition and measurement principles followed for preparation of financial statements except for accounting for dividend on investments in subsidiaries.

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Mar 31, 2011

A. The Company was incorporated as a limited liability company by the name of Religare Technova Services Limited on 22nd May 2009. It received the certificate of Commencement of Business on 3rd June 2009.

W.e.f. June 12, 2009 name of the Company was changed from "Religare Technova Services Limited" to "Religare Technologies Limited".

b. The Hon'ble High Court of Delhi approved the Scheme of Arrangement (u/s 391 to 394 of the Companies Act 1956) on July 28th, 2010. The Company received the certified copy of Final Order on August 13th, 2010 and the same was filed with Registrar of Companies on August 16th 2010.

c. Disclosures as per AS-14 is as follows:-

Activities Details

Amalgamating Companies Religare Technova Religare "Information IT Services Limited Technova Services * Business Division" of Intellect Religare Limited* Technova Global Solutions Limited**

Nature of Business IT & IT Enabled Services

Method of Amalgamation Pooling of Interest Method/Purchase Method

Appointed Date of 01-April- 2009 Amalgamation

Effective Date of 16-August- 2010 Amalgamation

*As consideration in above said amalgamation, the Company has issued 8,079,463 Equity shares (Face Value of Rs. 10 each) to the shareholders of the holding company 'Religare Technova Limited'. The Financials have been prepared as per the approved scheme.

**Information Services Division has been merged with equal amount of assets and liabilities.

There is an excess of Rs. 79,794,629/- of the Liabilities over the Assets received in the amalgamation process. The same has been treated as Goodwill as per the order of Hon'ble High Court of Delhi.

d. CONTINGENT LIABILITIES

(i) Religare Technova IT Services Limited (now merged with Religare Technologies Limited) has received an order, passed by Service Tax department, Ludhiana dated December 4, 2009 under Section 73 of the Finance Act, 1994 wherein a demand of Rs. 5.41 lacs has been raised on the Company.

The Company has filed an appeal before the Commissioner of Central Excise (Appeals) - II, Chandigarh against the said order. The proceedings are still pending before the Commissioner of Central Excise (Appeal) for disposal.

(ii) Appeal has been filed to Commissioner of Value Added Tax in respect of VAT Demand for Financial Year FY 2007- 08 amounting to Rs. 0.20 lacs.

(iii) The Income Tax Assessment of Religare Technova IT Services Limited (now merged with Religare Technologies Limited) for the assessment year 2008-09 has been completed by the Deputy Commissioner of Income Tax, Circle-VII, Ludhiana under section 143(3) of the Act vide order dated December 24, 2010. Consequent to certain disallowances made in the assessment order, a demand of Rs. 354.51 lacs has been raised on the Company. The AO has also initiated penalty proceedings under section 271(1) (c) of the Act against the Company.

The Company has filed an appeal with Commissioner of Income Tax (Appeals), II, Ludhiana against the said assessment order. In reply to the notice for initiation of penalty proceedings, the Company has filed a letter with the AO requesting to keep the penalty proceedings in abeyance till the disposal of Appeal filed before CIT(A).

(iv) Religare Technova IT Services Limited (now merged with Religare Technologies Limited) ("the Company") has received order dated Mar-30, 2011 passed by Assessing officer u/s 201(1)/201(1A) of the Act for financial year 2008-09, wherein demand amounting to Rs. 20.06 lacs has been raised on the Company on account of TDS not deducted/TDS deducted but not paid by the Company. The said demand was primarily on account of mismatch in the online database of tax department with the returns/ challans filed by the Company.

The Company has preferred an appeal against the same to CIT(A)-XXX and the same is pending for disposal.

(v) The Income tax assessment of Religare Technova Business Intellect Limited (now merged with Religare Technologies Limited) for assessment year 2008-09 was completed by the Assistant Commissioner of Income Tax, Circle-15 (1), New Delhi under section 143(3) of the Act vide assessment order dated December 31, 2010. Pursuant to the additions made in the said assessment order, the returned loss of the subject assessment year has been reduced from Rs. 79.47 lacs to Rs. 12.39 lacs. The AO has also initiated penalty proceedings under section 271(1) (c) of the Act against the Company.

The Company has filed an appeal with Commissioner of Income Tax (Appeals), XVIII, New Delhi against the said assessment order. In reply to the notice for initiation of penalty proceedings, the Company has filed a letter with the AO requesting to keep the penalty proceedings in abeyance till the disposal of Appeal filed before CIT(A).

e. Fixed Deposits with Scheduled Banks includes Rs. 79.65 (Previous Year Rs. 65.31) lacs pledged against the bank guarantee issued by bank and Rs. 8.19 (Previous Year Rs. 4.03) lacs pledged with VAT Authorities.

f. Advances paid towards the acquisition of fixed assets not put to use before March 31, 2011, are disclosed under capital work-in-progress. Estimated amount of Contract (net of advances) remaining to be executed on capital account and not provided for is ` 2308.00 (Previous Year Rs. 12.10) Lacs.

j. Segment Reporting:

Business Segment:

(i) The business segment has been considered as the primary segment.

(ii) The company's primary business segments are reflected based on principal business activities, the nature of service, the differing risks and returns.

(iii) The Company's primary business comprises of three segment viz., 'IT Services' , 'Knowledge Services' and 'Healthcare Services'.

(iv) Segment revenue, results, assets and liabilities include amounts identifiable to each segments allocated on reasonable basis.

(v) The accounting policies adopted for segment reporting are in line with the accounting policies adopted for preparation of financial information as stated in (1) above.

k. Related party Disclosures as required by Accounting Standard 18 "Related Party Disclosures" issued by Companies (Accounting Standard) Rules, 2006 and the relevant provisions of Companies Act are given below:

Nature of Relationship Name of Party

1. Holding company/Controlling NA Enterprises

2. Fellow Subsidiary & NA Subsidiaries of Fellow- Subsidiaries

3. Associates and joint ventures C2L Biz Solutions Private Limited of the reporting enterprise and the investing party or venturer in respect of which the reporting enterprise is an associates or a joint venture

4. Individual owning directly Mr. Malvinder Mohan Singh or indirectly interest Mr. Shivinder Mohan Singh in voting power that gives Mrs. Nimmi Singh them control, and relatives Mrs. Harjit Grewal of any such individual; Mrs. Japna Malvinder Singh Baby Nimrita Parvinder Singh Baby Nanaki Parvinder Singh Baby Nandini Parvinder Singh Mrs.Aditi Shivinder Singh Master Udayveer Parvinder Singh Master Anhad Parvinder Singh Master Vivan Parvinder Singh Master Kabir Parvinder Singh

5. Enterprises over which Dion Global Solutions Limited* persons covered under (4) RHC Holding Pvt. Ltd.Religare are able to exercise Finvest Limited significant influence Religare Capital Markets Limited with whom transaction Religare Travels India Limited have taken place Aegon Religare Life Insurance Company Limited Religare Wellness Limited Religare Aviation Limited Religare Asset Management Company Limited Religare Arts Initiative Limited Religare Commodities Limited Religare Enterprises Limited Religare Insurance Broking Limited Religare Macquarie Wealth Management Ltd. REL Infrafacilities Limited** Religare Securities Limited Super Religare Laboratories Limited Escorts Heart Institute & Research Centre Limited Escorts Hospital and Research Centre Limited Fortis Clinical Research Limited Fortis Healthcare Limited Hiranandani Healthcare Private Limited Escorts Heart and Super Specialty Hospital Limited Fortis Hospitals Limited Fortis Hospotel Ltd. International Hospital Limited Oscar Investments Limited Religare Health Insurance Company Limited Vistaar Religare Capital Advisors Limited Medsource Health Care Pvt. Ltd Religare Housing Development Finance Corp. Ltd.*** Escorts Heart Centre Limited Fortis Malar Hospitals Limited Sunrise Medicare Private Limited Impact Agencies Private Limited Impact Projects Private Limited Religare Aviation Training Academy Private Limited Religare Aviation Engineering Private Limited Religare Voyages Business Services Pvt. Ltd. Religare Finance Limited Religare Capital Market Plc Religare Bullion Ltd. Religare InfoTech Pvt. Ltd.

*Formerly known as Religare Technova Limited

**Formerly known as Religare Realty Limited

***Formerly Maharishi Housing Development Finance Corp. Ltd.

m. Due to change of policy regarding recognition of prepaid expenses in case of expenses more than Rs. 20,000/- , the expenditure during the period has been increase by Rs. 1.28 Lacs

o. In view of accumulated losses, no provision for income tax is considered necessary.

p. The Company has unabsorbed depreciation and carry forward losses under the Income Tax Act 1961. Accordingly, keeping in view absence of virtual certainty, deferred tax assets have not been recognised.

q. Taking into account management's assessment of growth of business, the accounts of the company have been prepared on a "Going Concern" basis even though, the net worth of the Company has substantially eroded due to accumulated losses.

r. Other Information with regards to other matters specified in clauses 3,4,4A,4C and 4D of Part II of Schedule VI to the Companies Act, 1956 are either nil or not applicable to the Company for the period ended March 31, 2011.

s. There are no transactions during the year with Micro, Small and Medium Enterprises during the year and as such there is no balance outstanding as at March 31, 2011.

Signature to Schedule A to S forming part of the Financial Statements