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Notes to Accounts of Intrasoft Technologies Ltd.

Mar 31, 2018

27 LEASES

In accordance with Indian Accounting Standard 17 - Leases, the Company does not have any non - cancellable operating lease. Expenditure incurred on account of operating lease rentals during the year are recognized in the Statement of Profit and Loss amount to Rs, 49.70 lacs. (Previous Year Rs, 49.56 lacs)

28 RELATED PARTY DISCLOSURES

Information on related party transactions as required by Ind AS - 24 for the year ended 31 March 2018.

(a) List of related parties

(ii) Key management personnel

i Name of the related party Relationship j

Arvind Kajaria Managing Director

Sharad Kajaria Whole-time Director

Padma Kajaria Relative of Director

Mohit Kumar Jha Chief Financial Officer

Ashok Bhandari Director

Savita Agarwal Director

Anil Agrawal Director

Rupinder Singh Director

Pranvesh Tripathi Company Secretary

29 Segment REPORTING

(a) As per the requirements of IND-AS 108 " Segment Reporting", no disclosures are required to be made since the Company''s activities consist of a single business segment of internet based delivery of services.

(b) Other Information :

The Company does not have any revenue from external customers.

(c) The Company has entered into transaction with a single customer (related party), which amounts to 10% or more of the Company''s total revenue from operations. (Refer note 28) equivalents, other bank balances, bank deposits, loans to employees, trade receivables, trade payables and other financial liabilities approximate their carrying amounts due to the short term maturities of these instruments. For long-term borrowings at fixed/floating rates, management evaluates that their fair value will not be significantly different from the carrying amount.

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 stressed or liquidation sale.

(b) Fair value hierarchy

Financial assets and financial liabilities measured at fair value in the Statement of Profit and Loss are grouped into three Levels of a fair value hierarchy. The three Levels are defined based on the observability of significant inputs to the measurement, as follows:

Level 1: Quoted prices (unadjusted) in active markets for financial instruments.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly

Level 3: Unobservable inputs for the asset or liability

The following table shows the Levels within the hierarchy of financial assets and liabilities measured at fair value on a recurring basis at 31 March 2018, 31 March 2017 and 1 April 2016:

(c) computation of fair values

I nvestments in mutual funds are short-term investments made in debt funds whose fair value is considered as the net asset value (NAV) declared by their respective fund houses on a daily basis. NAV represents the price at which the fund house is willing to issue further units in such fund/the price at which the fund house will redeem such units from the investors. Thus the declared NAV is similar to fair market value for these mutual fund investments since transactions between the investor and fund houses will be carried out at such prices.

The fair value of perpetual bonds is based on quoted prices and market-observable inputs.

31 financial risk management

The Company''s business activities expose it to a variety of financial risks such as credit risks, liquidity risk and market risks. The Company''s focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the related impact in the financial statements.

(a) credit risk

Credit risk is the risk that a counterparty fails to discharge its obligation to the Company. The Company''s exposure to credit risk is influenced mainly by cash and cash equivalents, trade receivables and financial assets measured at amortized cost. The Company continuously monitors defaults of customers and other counterparties and incorporates this information into its credit risk controls. Credit risk related to cash and cash equivalents and bank deposits is managed by only accepting highly rated banks and diversifying bank deposits. Other financial assets measured at amortized cost includes security deposits. Credit risk related to these other financial assets is managed by monitoring the recoverability of such amounts continuously, while at the same time internal control system in place ensure the amounts are within defined limits.

Based on business environment in which the Company operates, a default on a financial asset is considered when the counterparty fails to make payments within the agreed time period as per contract. Loss rates reflecting defaults are based on actual credit loss experience and considering differences between current and historical economic conditions.

Assets are written off when there is no reasonable expectation of recovery, such as a debtor declaring bankruptcy or a litigation decided against the Company. The Company continues to engage with parties whose balances are written off and attempts to enforce repayment. Recoveries made are recognized in statement of profit and loss.

i) Trade receivables

The Company establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade and other receivables. The allowance account in respect of trade and other receivables is used to record impairment losses unless the Company is satisfied that no recovery of the amount owing is possible. At that point, the financial asset is considered irrecoverable and the amount charged to the allowance account is written off against the carrying amount of the impaired financial asset.

As the Company does not hold any collateral, the maximum expense to credit risk for each class of financial instrument is the carrying amount of that class of financial instrument presented on the statement of financial position. Impairment of trade receivables is based on expected credit loss model (simplistic approach) depending upon the historical data, present financial conditions of customers and anticipated regulatory changes. Company does not hold any collateral in respect of such receivables.

ii) Financial instruments and cash deposits

Credit risk related to cash and cash equivalents and bank deposits is managed by only accepting highly rated banks and diversifying bank deposits. Other financial assets measured at amortized cost includes security deposits. Credit risk related to these other financial assets is managed by monitoring the recoverability of such amounts continuously, while at the same time internal control system in place ensure the amounts are within defined limits. credit risk exposure

The Company is exposed to a concentration of credit risk with respect to its trade receivable balances from its subsidiary Company. At the reporting date, trade receivable balances from subsidiary Company represents 100% (31 March 2017

- 100%; 1 April 2016: 100%) of the total trade receivable balances, respectively.

The gross carrying amount of financial assets, net of any impairment losses recognized represents the maximum credit exposure. The maximum exposure to credit risk as at 31 March 2018, 31 March 2017 and 1 April 2016 was as follows:

(b) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in raising funds to meet commitments associated with financial instruments that are settled by delivering cash or another financial asset. Liquidity risk may result from an inability to sell a financial asset quickly at close to its fair value.

The Company has an established liquidity risk management framework for managing its short term, medium term and long-term funding and liquidity management requirements. The Company''s exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. It manages the liquidity risk by maintaining adequate funds in cash and cash equivalents. The Company also has adequate credit facilities agreed with banks to ensure that there is sufficient cash to meet all its normal operating commitments in a timely and cost-effective manner.

Maturities of financial liabilities

The following table shows the remaining contractual maturities of financial liabilities at the reporting date. The amounts reported are on gross and undiscounted basis and includes contractual interest payments. Balances due within 12 months equal their carrying balances as the impact of discounting is insignificant.

(c) Market risk

Market risk is the risk of potential adverse change in the Company''s income and the value of Company net worth arising from movement in foreign exchange rates, interest rates or other market prices. The Company recognizes that the effective management of market risk is essential to the maintenance of stable earnings and preservation of shareholder value. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the overall returns.

(i) Foreign currency risk

Foreign currency risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign exchange rates. Foreign currency risk arises when transactions are denominated in foreign currencies.

The Company operates locally in INR and but is exposed to foreign exchange risk arising from foreign currency transactions (IT enabled services), primarily with respect to the US Dollar. Foreign exchange risk arises from future commercial transactions and recognized assets and liabilities denominated in a currency that is not the Company''s functional currency. The Company does not hedge its foreign exchange receivables.

(ii) price risk

The Company is mainly exposed to the price risk due to its investment in mutual funds. The price risk arises due to uncertainties about the future market values of these investments. The investments in mutual funds have been disclosed in Note 6 (b).

The Company is also exposed to the price risk for its investment in bonds and debentures. These being debt instruments, the exposure to risk of changes in market rates is minimal. The details of such investments in bonds are given in Note 6

(a).

The Company is mainly exposed to change in market rates of its investments in mutual funds recognized at FVTPL. A sensitivity analysis demonstrating the impact of change in market prices of these instruments from the prices existing as at the reporting date is given below:

The Company has laid policies and guidelines which it adheres to in order to minimize pricing risk arising from investments in debt mutual funds.

32 CAPITAL MANAGEMENT

For the purpose of the Company''s capital management, capital includes issued capital and all other equity reserves attributable to the equity shareholders of the Company. The primary objective of the Company when managing capital is to safeguard its ability to continue as a going concern and to maintain an optimal capital structure so as to maximize shareholder value.

The Company manages its capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares.

Proposed Dividend

The Board of Directors at its meeting held on 28 May 2018 proposed a dividend of Rs, 2 per equity share (31 March 2017: Rs, 2), amounting to Rs, 355.20 lacs (31 March 2017: Rs, 354.58 lacs) including dividend distribution tax of Rs, 60.57 lacs (31 March 2017: Rs, 59.95 lacs). The proposed dividend by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

34 FIRST TIME ADOPTION OF IND AS

These are the Company''s first standalone financial statements prepared in accordance with Ind AS.

The accounting policies set out in Note 4 has been applied consistently in preparing the opening Ind AS Balance Sheet as on 1 April 2016 (the Company''s date of transition), the comparative information presented in these standalone financial

statements for the year ended 31 March 2017 and in preparing these standalone financial statements for the year ended 31 March 2018. In preparing its opening Ind As Balance Sheet, the Company has adjusted the amounts reported previously in standalone financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standard Rules), 2006 (as amended) and other relevant provisions of the Act (Indian GAAP). An explanation of how the transition from previous Indian GAAP to Ind AS has impacted the Company''s financial position, financial performance and cash flows is set out in the foot notes to first time adoption.

Ind AS 101 has set out certain mandatory exceptions and optional exemptions to be applied for transition from the existing Indian GAAP to Ind AS. The Company has adopted the following in preparing its opening Ind AS Balance Sheet.

(a) Ind AS optional exemptions

Indian Accounting Standard 101 First time adoption Indian Accounting Standards (Ind AS 101) allows first-time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions:

Deemed cost for property, plant and equipment

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognized in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Indian Accounting Standard 38 Intangible Assets (Ind AS 38). Accordingly, the Company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value.

(b) Ind AS mandatory exceptions Estimates

An entity''s estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

Ind AS estimates as at 1 April 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP.

classification and measurement of financial assets and liabilities

The classification and measurement of financial assets will be made considering whether the conditions as per Ind AS 109 are met based on facts and circumstances existing at the date of transition.

Financial assets can be measured using effective interest method by assessing its contractual cash flow characteristics only on the basis of facts and circumstances existing at the date of transition and if it is impracticable to assess elements of modified time value of money i.e. the use of effective interest method, fair value of financial asset at the date of transition shall be the new carrying amount of that asset. The measurement exemption applies for financial liabilities as well.

Applying a requirement is impracticable when the entity cannot apply it after making every reasonable effort to do so. It is impracticable to apply the changes retrospectively if:

(i) The effects of the retrospective application or retrospective restatement are not determinable;

(ii) The retrospective application or restatement requires assumptions about what management''s intent would have been in that period;

The retrospective application or retrospective restatement requires significant estimates of amounts and it is impossible to distinguish objectively information about those estimates that existed at that time.

De-recognition of financial assets and liabilities

I nd AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the derecognition requirements in Ind AS 109 retrospectively from a date of the entity''s choice, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognized as a result of past transactions was obtained at the time of initially accounting for those transactions.

The Company has elected to apply the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.

(c) Reconciliations between previous GAAP and Ind AS

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for the prior periods. The following tables represent the reconciliation from previous Indian GAAP to Ind AS.

(iii) Effect of Ind AS adoption on the Statement of cash flows for the year ended 31 March 2017

There were no material differences between the Statement of Cash Flows presented under Ind AS and the Previous GAAP.

(*) The Indian GAAP figures have been reclassified to confirm to Ind AS presentation requirements for the purposes of this note.

(iv) Foot notes to first time adoption:

1 Non-current investments

The Company has non-current investments in non-convertible debentures of SREI Infrastructure Bonds, which yields an annual interest of 10.20% on the face value, and shall be repaid as a lump-sum on its maturity during 2019-20. The Company has purchased such bonds at a discounted price, and hence, the same shall be amortized over the life of the debenture yielding interest on the basis of the effective interest rate (EIR). Under previous GAAP, non-current investments were measured at cost.

2 current investments

Mutual funds - Under Previous GAAP, the mutual funds are measured at cost or market value, whichever is lower. Under Ind AS, the Company has designated these investments at fair value through profit or loss (FVTPL). Accordingly, these investments are required to be measured at fair value. At the date of transition to Ind AS, difference between the fair value of the instruments and its Previous GAAP carrying amount has been recognized in retained earnings. Fair value changes are recognized in the Statement of Profit and Loss for the year ended 31 March 2017.

3 proposed dividend

Under Previous GAAP, proposed dividends and the related dividend distribution tax are recognized as a provision in the year to which they relate, irrespective of when they are declared. Under Ind AS, dividends and related dividend distribution tax are recognized as a liability in the year in which it is approved by the shareholders in the Annual General Meeting of the Company.

4 deferred taxes

Under Previous GAAP, deferred taxes were recognized for the tax effect of timing differences between accounting profit and taxable profit for the year using the income statement approach. Under Ind AS, deferred taxes are recognized using the balance sheet approach for future tax consequences of temporary differences between the carrying value of assets and liabilities and their respective tax bases. The above difference, together with the consequential tax impact of the other Ind AS transitional adjustments lead to temporary differences. Deferred tax adjustments are recognized in correlation to the underlying transaction either in retained earnings or through other comprehensive income.

5 defined benefit plans

(a) Actuarial gain/(loss) - Under Previous GAAP, the actuarial gain/(loss) of defined benefit plans has been recognized in Statement of Profit and Loss. Under Ind AS, the remeasurement gain/(loss) on net defined benefit plans is recognized in Other Comprehensive Income net of tax.

(b) Net interest cost on defined benefit plans

- Under Previous GAAP, the interest cost on defined benefit liability and expected return on plan assets is recognized as employee benefit expenses in the Statement of Profit and Loss. Under Ind AS, the Company has adopted the accounting policy to recognize the net interest cost on defined benefit plans as finance cost.

6 discounting of security deposits

Under Previous GAAP, the security deposits for leases are accounted at an undiscounted value. Under Ind AS, the security deposits for leases have been recognized at discounted value and the difference between undiscounted and discounted value has been recognized as ''Deferred lease rent'' which has been amortized over respective lease term

as rent expense under ''other expenses''. The discounted value of the security deposits is increased over the period of lease term by recognizing the notional interest income under ''other income''.

7 Tax impact on adjustments

Retained earnings and statement o

of profit and loss has been adjusted consequent to the Ind AS transition adjustments with corresponding impact to deferred tax, wherever applicable.

8 Other comprehensive income

Under Ind AS, all items of income and expense recognized in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognized in profit or loss but are shown in the statement of profit and loss as ''other comprehensive income'' includes re-measurements of defined benefit plans, effective portion of gain or loss on cash flow hedging instruments, fair value gain or loss on FVOCI equity instruments and their corresponding income tax effects. The concept of other comprehensive income did not exist under previous GAAP.

9 MAT credit

Under Ind AS, MAT Credits are form of unused tax credits that are carried forward by the Company for a specified period of time. Accordingly, MAT Credits are clubbed with deferred tax asset (net) in the Balance Sheet of an entity. Correspondingly, MAT credit entitlement has been clubbed with deferred tax in the Statement of Profit and Loss.

10 Financial guarantee accounted for as deemed investments

The Company has provided a corporate guarantee to Citi Bank on behalf if it''s step-down subsidiary 123Stores Inc. amounting to INR 3,200 lacs, which has resulted in an interest rate reduction for the subsidiary company. The Company has recorded a "deemed investment" in accordance with IND AS 109, as the guarantee enabled its subsidiary to acquire the loan at a lower interest rates.

11 Accrued interest on financial assets

Accrued interest on loan given to body corporates has been clubbed with the loans under Ind AS. Same was appearing under other current assets in previous GAAP


Mar 31, 2017

1. Reconciliation of shares outstanding at the beginning and at the end of the year

There is no movement in the equity share capital during the current and comparative period.

2. Terms and rights attached to equity shares

The Company has only one class of equity shares having a par value ofRs.10 per share. The Company declares and pays dividends in Indian Rupees. In the event of liquidation of the Company, the holders of the equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held by the shareholders.

3. No additional shares were allotted as fully paid up by way of bonus shares or pursuant to contract without payment being received in cash during the last five years. Further, none of the shares were bought back by the Company during the last five years.

4. In the current financial year, the Board has proposed a dividend @ 20% i.e.Rs.2.00 per share amounting toRs.354.61 lacs including dividend tax ofRs.59.98 lacs. The proposed dividend by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

Nature of security and terms of repayment for secured borrowings availed from banks and others

5. The rupee loan obtained has been repaid off during the year.

6. The foreign currency loan is in the nature of a senior secured committed revolving line of credit, obtained from Citi bank N.A., with a limit of USD 5 million The credit facility has been obtained at an interest rate of LIBOR plus 1.75% (LIBOR index being one month, floating daily) and has a maturity of twelve months from the closing date renewable annually. The credit facility is supported by a Stand by Letter of Credit Facility (SBLC), ofRs.3200 lac issued by Citi Bank, N.A., India branch. The credit facility has been availed for general corporate purposes, including meeting short term working capital needs. The short term credit facility in the form of revolving line of credit availed from Citi Bank, N.A., having maturity of

7. months from the closure date, is intended to be refinanced by a long term debt obligation from UPS Capital Corporation. Hence the same has been classified as long term debt.

8. Trade payables

There are no amounts that need to be disclosed in accordance with the Micro Small and Medium Enterprise Development Act, 2006 (the ''MSMED Act'') pertaining to micro or small enterprises. For the year ended 31 March 2017, no supplier has intimated the Company about its status as micro or small enterprises or its registration with the appropriate authority under MSMED Act.

9. Previous year''s amount have been regrouped/rearranged to confirm to the classification of the current year, wherever considered necessary.


Mar 31, 2016

1. Transfer Pricing

In accordance with international transfer pricing regulations of the IT Act, the Company is required to use certain specific methods in computing arm''s length prices of international transactions with associated enterprises and maintain adequate documentation in this respect. These regulations require that such information and documentation be to contemporaneous, including conducting a benchmarking study to determine whether any transactions with associated enterprises undertaken are on an "arm''s length basis". The Company is in the process of updating its transfer pricing study for the financial year ended 31 March 2016. Management is of the opinion that the Company''s international transactions are at arm''s length. Consequently, no adjustments, if any, that may arise from this study are presently recorded in the financial statements.

2. Previous year''s amount have been regrouped/rearranged to confirm to the classification of the current year, wherever considered necessary.


Mar 31, 2015

Note 1:

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

1. 2) In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held by the shareholders.

1. 3) Disclosure regarding shares issued otherwise than in cash in last 5 years are as follows :-

9455724 Equity Shares of Rs. 10/- each fully paid up as Bonus by way of capitalization of General Reserve & Securities Premium Account.

1. 4) The Company declares and pays dividends in Indian Rupees. In the current financial year 2014-15, the board has declared Interim Dividend @ 10% i.e. Rs. 1 per share amounting to Rs. 1,76,77,147 (NIL) including Dividend Tax of Rs. 29,45,469 (NIL) and recommended Final Dividend @ 10% i.e. Rs. 1 per share amounting to Rs. 1,77,30,753 (Rs. 1,72,35,327) including Dividend Tax of Rs. 29,99,075 (Rs. 25,03,649). The Final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

1.5) The Company had raised Rs. 5,365.00 lakhs through an IPO in March, 2010. The amount raised from the said IPO was fully utilised as per the objects of the Issue and amendments there of.

Note 2.

2. 1) Nature of security:

For Car Loan-Hypothecation of Motor Car For Loan Against Property- Charge created by way of mortgage of Land & Building

2.2) Repayment of Term Loan:

From Bank (Car Loan)- Rs. 4,54,784 (Rs. 11,58,517) by way of Equated Monthly Instalments (EMI).

From Others (Car Loan)-Rs. 53,194 (Rs. 3,11,482) by way of Equated Monthly Instalments (EMI).

From Others (Loan Against Property)-Rs. 2,07,29,153 (Rs. 2,25,55,262) by way of Equated Monthly Instalments (EMI).

2.3:

1) Advance Income Tax & TDS is net of Provisions of Rs. 9,17,41,736 (Rs. 8,09,47,888)

2) Minimum Alternative Tax (MAT) credit available to the company as per provision of section 115JAA of the Income Tax Act ,1961 Rs. 7,64,43,982 (Rs. 6,56,50,134) has been recognised as MAT Credit Entitlement and carried forward for set off in future years.

Note 3. Contingent Liabilities and Commitments

Particulars As at As at 31st March, 2015 31st March, 2014 Rs. Rs.

a Contingent Liabilities

1. Claims against the company not acknowledge as debt - -

2. Guarantees 1,25,000 1,25,000

3. Other money for which the company is contingently liable - -

b Commitments

1. Capital commitments 9,83,542 2,48,000

2. Uncalled liability on shares and other investments partly paid - -

3. Other commitment - -

Note 4. Segment Reporting

As per requirements of AS-17 of the Companies (Accounting Standard) Rules, 2006, no disclosure is required as the Company is operating in single business/geographical segment of Internet based delivery of services.

Note 5. Disclosure of Related Party Transactions

a) Names of related parties and nature of relationship where control exists:

i) Key Managerial Personnel and their relatives

Mr. Arvind Kajaria Managing Director

Mr. Sharad Kajaria Whole Time Director

Mrs. Padma Kajaria Mother of the above

Mr. Rakesh Dhanuka Company Secretary

Mr. Mohit Kumar Jha Chief Financial Officer

ii) Subsidiary Company Names Country of Incorporation

Wholly owned Subsidiary 123Greetings.com, Inc USA

Wholly owned Subsidiary IntraSoft Ventures Pte. Singapore Ltd. (Formerly known as 123Greetings (Singapore) Pte Ltd)

Wholly owned Subsidiary One Two Three Greetings India (India) Pvt Ltd

Stepdown Subsidiary 123Stores, Inc USA

iii) Enterprise where KMP have significant IntraSoft Beneficiary Trust

Influence or control

Note 5. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification/disclosure.

Note 6. The Company has transactions with related parties. For the financial year ended March 31, 2014 the Company has obtained the Accountant's Report from a Chartered Accountant as required by the relevant provisions of the Income-tax Act, 1961 and has filed the same with the tax authorities . For the year ended March 31,2015, Management confirms that it maintains documents as prescribed by the Income Tax Act, 1961 to prove that these transactions are at arm's length and the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.


Mar 31, 2014

Notes 1:

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

2) In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held by the shareholders.

4) Disclosure regarding shares issued otherwise than in cash in last 5 years are as follows :-

94,55,724 Equity Shares of Rs. 10/- each fully paid up as Bonus by way of capitalization of General Reserve & Securities Premium Account.

5) The Company declares and pays dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the current Financial Year 2013-14, the Borad has proposed to pay Dividend amounting to Rs. 17,235,327 (Rs. 17,235,327) including Dividend Tax of Rs. 2,503,649 (Rs. 2,503,649) being Rs. 1 per share (10%) as Dividend.

6) The Company had raised Rs. 5365.00 lakhs through an IPO in March, 2010. The amount raised from the said IPO was fully utilised as per the objects of the Issue and amendments there of.

Note 2:

Loan from Barclays Bank Plc has been secured by Investment in Mutual Funds and Non Convertible Debentures shown under note 2.12.

Note 3:

1. Investment in Mutual Funds & Non Convertible Debentures are earmarked for Stand by Letter f Credit facility to be utilized by a subsidiary company and loan of Rs. NIL (Rs. 1,00,00,000) taken by the Company on which lien has been created.

2. The beneficial interest in the Trust amounting to Rs. 1,00,00,000 represents 17,50,000 Equity shares of IntraSoft Technologies Limited shown under ''Non- Current Investment'' in the Balance Sheet.

Notes 4:

1) Advance Income Tax & TDS is net of Provisions of Rs. 8,09,47,888 (Rs. 8,09,47,888)

2) Advance for FBT is net of Provisions of Rs. 8,56,426 (Rs. 8,56,426)

3) Minimum Alternative Tax (MAT) credit available to the company as per provision of section 115JAA of the Income Tax Act ,1961 Rs. 6,56,50,134 (Rs. 6,56,50,134) has been recognised as MAT Credit Entitlement and carried forward for set off in future years.

Note 5:

Management has reviewed the existing activities and based on technical assessment, the carrying amount of certain IT resources of the company amounting to Rs. 181,086,528/- has been written off during the FY as it is no longer usable due to changes in technology.

6. Contingent Liabilities and Commitments

a Contingent Liabilities

1 Claims against the company not acknowledge - - as debt

2 Guarantees 125,000 125,000

3 Other money for which the company is contingently - - liableb Commitments

1 Uncalled liability on shares and other - - investments partly paid

2 Other commitment - -

6. Segment Reporting

As per requirements of AS-17 of the Companies (Accounting Standard) Rules, 2006, no disclosure is required as the Company is operating in single business/geographical segment of Internet based delivery of services.

7. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification/disclosure.

8. The Company has transactions with related parties. For the financial year ended March 31, 2013 the Company has obtained the Accountant''s Report from a Chartered Accountant as required by the relevant provisions of the Income-tax Act, 1961 and has filed the same with the tax authorities. For the year ended March 31, 2014, Management confirms that it maintains documents as prescribed by the Income Tax Act, 1961 to prove that these transactions are at arm''s length and the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.


Mar 31, 2013

Notes to 1.1 :

1) Advance Income Tax & TDS is net of Provisions of Rs. 80,947,888 (Rs. 78,814,157)

2) Advance for FBT is net of Provisions of Rs. 856,426 (Rs. 856,426)

3) Minimum Alternative Tax (MAT) credit available to the company as per provision of section 115JAA of the Income Tax Act ,1961 Rs. 65,650,134 (Rs. 62,647,941) has been recognised as MAT Credit Entitlement and carried forward for set off in future years.

Note to 1.2

1. Salaries and Wages includes Gratuity Rs. 849,007 ( Rs. 557,956).

2. Employee Beneft includes Managerial Remuneration Rs. 4,500,000 (Rs. 4,500,000). Out of which Remuneration paid to Managing Director Rs. 2,400,000 during the year is subject to approval of the share holders.

Note to 1.3

Management has reviewed the existing activities and based on technical assessment, the carrying amount of certain Intangible Assets (Software) amounting to Rs. 149,886,816/- has been written off during the year as it is no longer usable due to changes in technology.

1.4 Contingent Liabilities and Commitments

a Contingent Liabilities

1 Claims against the company not acknowledge as debt - -

2 Guarantees 125,000 125,000

3 Other money for which the company is contingently liable - - b Commitments

1 Uncalled liability on shares and other investments partly paid - -

2 Other commitment - -

2.31 Disclosure as per AS-15" Employees Benefts"

The followings tables set out the funded status and amount recognised in the companies'' fnancial statement as at 31st March,2013 for the defned beneft plans:

1.5 The Company has been approved as STP unit under the scheme of The Government of India.

1.6 Previous year''s fgures have been regrouped / reclassifed wherever necessary to correspond with the current year''s classifcation/disclosure.


Mar 31, 2012

Notes to 1.1:

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

2) In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held by the shareholders.

5) Disclosure regarding shares issued otherwise than in cash in last 5 years are as follows :-

i) i) 319,149 Equity Shares of par value of Rs. 10/- each fully paid up have been allotted to shareholders of One Two Three India.Com Ltd pursuant to Scheme of Amalgamation.

ii) 9,455,724 Equity Shares of Rs. 10/- each fully paid up as Bonus by way of capitalization of General Reserve & Securities Premium Account.

6) The Company declares and pays dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the current Financial Year 2011-2012, the Board has proposed to pay amounting to Rs. 17,121,525 including Dividend Tax of Rs. 2,389,847, being Rs. 1 per share (10%), as Dividend.

7) The position of IPO proceeds and utilization there of vis-a-vis the 'Objects of issue' as amended and approved by shareholders at AGM held on September 29,2011 upto March 31,2012 is as follows:

a) Fund raised through IPO Rs. 5365.00 Lacs b) IPO Expenses Rs. 524.04 Lacs c) Net proceeds through IPO Rs. 4840.96 Lacs d) Utilisation as per Objects of issue and amendments thereof: Rs. 4103.96 Lacs e) Balance fund unutilized Rs. 737.00 Lacs.

The unutilized funds were invested in NCDs and balance in current account with bank.

Note to 1.2:

The Company has not received information from its vendors / service providers regarding their status under Micro, Small & Medium Enterprises Development Act, 2006 and hence disclosures' relating to their outstanding amount and interest has not been made.

* There is no amount due and outstanding to be credited to Investor Education and Protection Fund as at 31st March 2012

1) The company has taken loan from Barclays Investments & Loans (India) Ltd. of Rs. Nil ( Rs. 60,000,000/-) against Hypothecation of Non Convertible Debentures of Rs. Nil ( Rs. 100,000,000/-)

2) Investment with Mutual Fund & Non Convertible Debentures (except SBI Debt Fund ,Series-18 Months-9 Growth 1,000,000 units, ICICI Prudential FMP Series 58- 2 years Plan C 3,000,000 units,ICICI Prudential FMP Series 60-27Month Plan I - Growth 1,000,000 units, ICICI Prudential FMP Series 58- 2 years Plan D 2,000,000 units,Reliance Fixed Horizon Fund - XIX- Series21- Growth Plan 3,000,000 units, ICICI Prudential FMP Series 57-3 year- Plan C 2,000,000 units, Kotak Mahindra MF FMP Series 58 Growth 2,000,000 units and Non Convertiable Debenture Bonds of Amtex Auto Ltd. 30 nos, Magma Fincorp Ltd. 32 nos, Shriram Transport Finance Company Limited 50 nos, Srei Infrastructure Finance Limited 50 nos and Jaiprakash Associates Ltd 50 nos.) are earmarked for Stand By Letter of Credit facility to be utilized by a subsidiary company on which lien has been created.

3) The Company has invested in 1,750,000 Equity Shares of Rs. 10/- each of IntraSoft Technologies Limited held in Trust in terms of the Scheme of Amalgamation.

Notes to 1.3:

1) Advance Income Tax & TDS is net of Provisions of Rs. 78,814,157 (Rs. 47,896,670)

2) Advance for FBT is net of Provisions of Rs. 856,426 (Rs. 856,426)

3) Minimum Alternative Tax (MAT) credit available to the company as per provision of section 115JAA of the Income Tax Act, 1961 Rs. 62,647,941 (Rs. 41,663,872) has been recognised as MAT Credit Entitlement and carried forward for set off in future years.

Note to 1.4

1) Salaries and Wages includes Gratuity Rs. 557,956 ( Rs. 555,487).

2) Employee Benefit includes Managerial Remuneration Rs. 4,500,000 ( Rs. 4,500,000).

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

1.5 Contingent liabilities and Commitments

a Contingent Liabilities

1 Claims against the company not acknowledge as debt

2 Guarantees 125,000 125,000

3 Other money for which the company is contingently liable - -

b Commitments

1 Uncalled Liability on shares & other investments partly paid - -

2 Other commitment - -

1.6 Segment Reporting

As per requirements of AS-17 of the Companies (Accounting Standard) Rules, 2006, no disclosure is required as the Company is operating in single business/geographical segment of Internet based delivery of services.

1.7 The Company has been approved as STP unit under the scheme of The Government of India.

1.8 The revised Schedule VI has become effective from 1st April, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification/disclosure.


Mar 31, 2010

31st March, 31st March, 2010 2009 Rupees Rupees

1. Contingent Liabilities not provided for in respect of outstanding Bank Guarantee 2,625,000 125,000

The company has not recognised deferred tax asset in respect of brought forward unabsorbed losses of the amalgamated company eligible for adjustment under Income Tax Act against the taxable Income of the company in future as there is no virtual certainty with supporting evidences of realization of the same.

2. Related Party Transactions

a) Names of related parties and nature of relationship where control exists:

3. Fixed Deposit with Bank includes Rs.80,000,000/- (Previous Year Rs. 10,000,000/-) earmarked for overdraft facility taken by the company and Rs 10,000,000/-(Previous Year Rs.10,000,000/-) earmarked for overdraft facility to be utilized by a subsidiary company on which lien has been created.

4. Minimum Alternative Tax (MAT) credit available to the company as per provision of section 115JAA of the Income Tax Act ,1961 Rs.30,464,939/- (Previous Year Rs 15,031,411/-) has been recognised as MAT Credit Entitlement and carried forward for set off in future years.

5. The Company has been approved as STP unit under the scheme of The Government of India.

6.The Company has not received information from vendors regarding their status under the Macro, Small & Medium Enterprises Development Act,2006 and hence disclosures relating to their outstanding amount and interest has not been made.

7.Other Income represents interest received from bank on Fixed Deposit( Gross) Rs 16,983,188/- (Previous Year Rs 15,023,908/-) TDS Rs 2,743,076/- (Previous Year Rs 3,156,384/-) and Exchange Gain Rs NIL (Previous Year Rs..46,08,399/-)

8.As per requirements of AS-17 issued by the Institute of Chartered Accountants of India, no disclosure is required as the Company is operating in single business/geographical segment of Internet based delivery of services.

9. During the year, the company has :-

a) Converted 255,805 1.5% Compulsorily Convertible Cumulative Participating Preference Shares by issue of 255,805 Equity Shares of Rs 10/- each at a premium of Rs 757/- per share.

b) Issued 9,455,724 Equity Shares as Bonus shares to the existing shareholders in the ratio 6:1 by capitalization of Share Premium Account.

10.The Company had filed a Prospectus with the Registrar of Companies, Mumbai on March 30, 2010 in respect of Public Offer of 37,00,000 Equity Shares of Rs 10/- each for cash at a price of Rs 145/- per Equity Share aggregating Rs 53,65,00,000/-. The offer opened on March 23, 2010 and closed on March 26, 2010. The allotment for the same has been approved by the Board of Directors at their meeting held on April 07, 2010. After allotment, the paid up capital of the company will increase to 14,731,678 Equity Shares of Rs 10/- each fully paid up.

11.Figures for the previous year are re-grouped / re-arranged wherever considered necessary to confirm to current years presentation.

Signatures on Schedules 1 tol4 are forming part of the Consolidated Accounts As per our Report of even date annexed herewith

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