Notes to Accounts of Bartronics India Ltd.

Mar 31, 2023

2.27 Contingent Liabilities: A. Claims against the Company not acknowledged as debts:
	Disputed Taxes	As At 31.03.2023	As At 31.03.2022
	Income Tax	16048.05	15727.51
	Sales Tax	-	-
Future cash outflows in respect of the above are determinable only on receipt of judgement / decisions pending with various forums / authorities.
B.	Letters of Credit and Guarantees issued:		Rs In Lakhs
	Particulars	As At 31.03.2023	As At 31.03.2022
	Letters of Credit	-	-
	Counter Guarantees Given To Banks Towards:
	- Bank Guarantees Issued	Rs.513.90	Rs.620.66
	- Corporate Guarantees	-	-

2.28 Estimated amount of contracts remaining to be executed on capital account and not provided for [Net of advance Rs. Nil (31.03.2022 Rs.9,061.49 lakhs))] Rs. Nil (31.03.2022: Rs. 1,216.34 lakhs)

2.29 Unsecured Loans:

Foreign Currency Convertible Borrowings (FCCB):

Bartronics India Ltd. had issued Foreign Currency Convertible Bonds (FCCB) for an aggregate sum of USD 50mn in January 2008. These bonds got matured in February 2013. However, On December 2, 2019 your company got admitted under Corporate Insolvency and Resolution Process (CIRP) and as per the laid process, Resolution Plan submitted by the Successful Resolution Applicant was approved by the Committee of Creditors was approved by the Hon’ble NCLT vide their order dated March 10, 2022. Upon successful implementation of the said Resolution Plan, the Successful Resolution Applicant got the control over the company when the handover took place on March 28, 2023. The Company has also received the order on successful completion of CIRP from Hon’ble NCLT vide their order dated May 02, 2023. Hence, the maturity of FCCBs is now addressed pursuant to successful completion of CIRP.

1. The above figures exclude provision for gratuity and compensated absences actuarially valued as separate figures are not available.

2. As per the term of appointment, no commission is payable to Managing Director or Whole time Directors, accordingly computation of Net Profit in accordance with Section 309(5) of the Companies Act, 1956 is not

2.35 Segment Reporting

1. The activities of the Company relate to only one business segment i.e. the business of providing Automatic Identification & Data Capture (AIDC) solutions.

During the year, the company implemented the Resolution Plan approved by Hon’ble NCLT and accordingly reduced the face value of its equity shares from 10/- each to Re. 1/- each, extinguished erstwhile promoters stake in the company and issued 27,41,19,066 equity shares to new promoters. Hence, EPS for the year ending March 31, 2023 may not be comparable with EPS for the year ending March 31, 2022.

i. Discount Rate

The discount rate is based on the prevailing market yield on Indian Government Securities as at the balance sheet date for the estimated term of the obligations.

2.42 The Company’s significant leasing arrangements are in respect of operating leases for premises (office, stores, godowns, etc.). The leasing arrangements, which are not non-cancellable, range between eleven months and five years generally, and are usually renewable by mutual consent on agreed terms. The aggregate lease rentals payable are charged as rent in to the profit and loss account.

2.43. The dues to Micro and Small enterprises as defined in The Micro, Small & Medium Enterprises Development Act, 2006 (the Act) are identified by the Company based on enquiries with the parties and information available with the Company. There are no dues to be paid by the company to The Micro, Small & Medium enterprises as per the management.

2.44. The Company was awarded the “Aapke Dwar” Project in 2009 by the Municipal Corproation of Delhi (MCD). The project envisaged offering various Governments to Citizen (G2C) services. The Company was required to install and operate 2,000 kiosks at various locations in the city of New Delhi to facilitate the above. The Company also had the right to display advertisements on the external walls of the kiosks. As at the balance sheet date 300 kiosks have been constructed and for the balance 1,700 kiosks, allotment of clear sites by MCD is awaited. Capital Work-in-progress includes the amounts expended on such construction which aggregates to Rs. Nil (2021-22 : Rs. 1,216.34 lakhs). Further amounts aggregating to Rs. Nil (2021-22:Rs.9061.49 lakhs ) has been advanced for work to be carried out. However, the said project was cancelled by the MCD and this cancellation of the contract was disputed by the company. The matter was referred to Arbitration Courts but since the company was not able to pay Arbitration Fee on time, the matter was time lapsed.

Further, On December 2, 2019 your company got admitted under Corporate Insolvency and Resolution Process (CIRP) and as per the laid process, Resolution Plan submitted by the Successful Resolution Applicant was approved by the Committee of Creditors was approved by the Hon’ble NCLT vide their order dated March 10, 2022. Upon successful implementation of the said Resolution Plan, the Successful Resolution Applicant got the control over the company when the handover took place on March 28, 2023. The Company has also received the order on successful completion of CIRP from Hon’ble NCLT vide their order dated May 02, 2023. Subsequent to the handover of the Company, the new management has written off all the investments & advances pertaining to this project as the same is not likely to be restarted.

2.45 The Company was admitted into Corporate Insolvency resolution Process under the Insolvency and Bankruptcy Code, 2016 (“the Code”) by Hon’ble National Company Law Tribunal, Hyderabad (“Hon’ble NCLT”) vide order dated 02nd December 2019 (“Admission Order”). Mr. Chinnam Poorna Chandra Rao was appointed as Resolution Professional.

Vide Order dated 10th March 2022 (“Approval Order"), the Hon’ble NCLT has approved the Resolution Plan submitted by Antanium India Private Limited (referred as “Resolution Applicant/ Currently Promoter of the Company"), as voted by the majority of the Committee of Creditors. The Plan is binding on the Company, its creditors, guarantors, members, workmen, employees, government and statutory authorities both at central and state level and other stakeholders (including the Existing Promoter Group) in accordance with Section 31 of the Code.

Further to successful implementation of Resolution Plan, the Present Promoters of the company got control over the company when the handover from the Monitoring Agent (erstwhile Resolution Professional) to the new promoters on March 28, 2023.

The Financial Statements have been prepared on a going concern basis. The financial statement captures the transactions contemplated in the approved resolution plan in accordance with applicable accounting standards and legal framework. Following are the certain significant transactions contemplated in the resolution plan which have been considered in preparation of this financial statement:

1. The resolution plan envisages extinguisment of the stake held by erstwhile Promoters and reduction of share capital by reducing the face value from Rs. 10/- to Re 1/-. The necessary disclosures have been made in accordance with approved resolution plan. Further, the resolution plan envisaged allotment of 27,41,19,066 equity shares of face value Re 1/- to Antanium India Private Limited.

2. Difference in the admitted liability of Operational and employees dues and the proposed settlement has been credited to the statement of profit and loss.

3. The admitted liability of the Financial Creditors have been proposed to be settled with Rs. 2,500 Lakhs as principal and Interest of Rs. 54.53 Lakhs for the delayed period which was paid as full and final settlement of the admitted claim of Rs. 1,04,194.79 Lakhs. The Resolution Applicant has effected remittance of payments to Financial Creditors in accordance with approved Resolution Plan. This payment passed through the statement of profit and loss.

Pursuant to implementation of the Resolution Plan, the Company has written off/derecognised or provided for impairment of its assets, based on management’s estimate, to the extent not receivable/recoverable and written back/derecognised its liabilities, based on management’s estimate, to the extent not payable/extinguished/waived/ cancelled to the Statement of Profit and Loss amounting to Rs. 15,752.20 Lakhs.

2.46. The figures for the previous year have been reclassified / regrouped / amended, wherever necessary.

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Mar 31, 2016

1. Loans repayable on demand includes an amount of Rs. 17245.49 lakhs (31.03.2015 : Rs. 16885.27 lakhs) represents working capital loans from banks are inter alia secured by way of pari passu first charge on current assets and pari passu second charge on fixed assets both present and future. Further these loans are secured by personal guarantee and properties of Mr.A.B.S.Reddy.

2. Unsecured Loan is the short term advance received from the subsidiary Bartronics Asia Pte Ltd.

3. Interest on Working Capital Loans are provided on the last known rates as the Banks have not provided the Statement of Account of each Working Capital loan. The figures are as per the books of accounts and not reconciled as statement of accounts for certain banks have not been provided.

4. Term Loans from banks viz. Bank of Baroda, Bank of India, Andhra Bank, Indian Bank, Life Insurance Corporation of India are secured by first pari passu charge on all the immovable and movable fixed assets of the Company both present and future and second pari passu charge on the current assets both present and future of the Company. Further, these loans are secured by personal guarantees and properties of the A.B.S.Reddy.

5. Terms of repayment are given below:

6. Loan taken from Bank of Baroda carries an interest rate of 14.75% p.a and is repayable in 24 quarterly installments of Rs. 137.50 lakhs each from Feb’2010 to Nov^2015.

7. Loan taken from Bank of india carries an interest rate of 14.75% p.a and is repayable in 18 quarterly installments of Rs.330.00 lakhs each from Apr’2009 to Jul 2013.

8. Loan taken from Andhra bank carries an interest rate of 14.50% p.a and is repayable in 36 monthly installments of Rs.152.78 lakhs each from Aug’2010 to Jul 2013.

9. Loan taken from Indian bank carries an interest rate of 16.25% p.a and is repayable in 24 quarterly installments of Rs.91.67 lakhs each from Nov’2008 to Aug 2014.

10. Loan taken from Life Insurance Corporation of India carries an interest rate of 13% p.a and is repayable in 21 quarterly installments of Rs.142.80 lakhs each from Jan’2011 to Jan’ 2016.

11. The Company has not provided for interest on Unsecured Loans.

12. Estimated amount of contracts remaining to be executed on capital account and not provided for [Net of advance Rs.9,061.49 lakhs (31.03.2015 Rs.9,062.09 lakhs))] Rs1,355.54 lakhs (31.03.2015: Rs. 1,355.54 lakhs )

13. Unsecured Loans:

Foreign Currency Convertible Borrowings (FCCB):

Bartronics India Ltd. had issued Foreign Currency Convertible Bonds (FCCB) for an aggregate sum of USD 50mn in January 2008. These bonds got matured in February 2013. In this regard the Company had filed a request for an extension of the maturity of the bonds to May 4, 2014 with Reserve Bank of India which was granted by them vide their letter dated February 21, 2014.

The Company has appointed M/s Avista Advisory Group to assess all the options available with the Company and finalize best suited approach in order to address the maturity. The options available with the Company include restructuring the bonds i.e. rolling over the bonds for next five years or replacing the bonds with fresh bonds, or redeeming all the bonds at a mutually agreeable price. With these available options; the Company, along with M/s Avista Advisory Group has got in touch with the bondholders and has initiated discussions which are at advanced stages now. The Company has applied for further extension of the maturity with Reserve Bank of India and is waiting to hear from RBI to move forward. The Company is confident of addressing the maturity of Bonds shortly.

14. Related Party Disclosures:

The following are related parties as defined in “Accounting Standard (AS) 18- Related Party Disclosures” notified under The Companies (Accounting Standards) Rules, 2006.

15. The above figures exclude provision for gratuity and compensated absences actuarially valued as separate figures are not available.

16. As per the term of appointment, no commission is payable to Managing Director or Whole time Directors, accordingly computation of Net Profit in accordance with Section 309(5) of the Companies Act, 1956 is not given.

17. Segment Reporting

18.. The activities of the Company relate to only one business segment i.e. the business of providing Automatic Identification & Data Capture (AIDC) solutions.

19. Disclosures as required under Accounting Standard AS-15

The Company liability on account of Employee benefits comprising Gratuity- a defined benefit scheme and compensated absences has been determined in accordance with the requirements of Accounting Standard (AS)-15 notified by the Companies (Accounting Standards) Rules, 2006. Disclosures required in terms of the requirement of AS-15.

20. Discount Rate

The discount rate is based on the prevailing market yield on Indian Government Securities as at the balance sheet date for the estimated term of the obligations.

21. The Company’s significant leasing arrangements are in respect of operating leases for premises (office, stores, godowns, etc.). The leasing arrangements, which are not non-cancellable, range between eleven months and five years generally, and are usually renewable by mutual consent on agreed terms. The aggregate lease rentals payable are charged as rent in to the profit and loss account.

22. The dues to Micro and Small enterprises as defined in The Micro, Small & Medium Enterprises Development Act, 2006 (the Act) are identified by the Company based on enquiries with the parties and information available with the Company. There are no dues to be paid by the Company to The Micro, Small & Medium enterprises as per the management.

23. The Company was awarded the “Aapke Dwar” Project in 2009 by the Municipal Corporation of Delhi (MCD). The project envisages availment of various Governments to Citizen (G2C) services. The Company is required to install and operate 2,000 kiosks at various locations in the city to facilitate the above. The Company has also the right to display advertisements on the external walls of the kiosks.

As at the balance sheet date 300 kiosks have been constructed and for the balance 1,700 kiosks, allotment of clear sites by MCD is awaited. Capital Work-in-progress includes the amounts expended on such construction which aggregates to Rs.1,355.54 Lakhs (2013-15 : Rs. 1,355.54 lakhs). Further amounts aggregating to Rs. 9061.49 Lakhs (2013-15:Rs.9062.09 lakhs )has been advanced for work to be carried out.

In view of the unseemly delays in the allocation of sites by the MCD, the Company has filed a petition in the High Court of Delhi which has initiated the process of arbitration. The Company is confident of arriving at an amicable solution shortly.

24. The figures for the previous year have been reclassified / regrouped / amended, wherever necessary.

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Mar 31, 2015

1. CORPORATE INFORMATION

The Company was incorporated as a private limited Company by the name of Super Bar Tronics Private Limited on September 10, 1990. Further, the Company changed its name from Super Bartronics Private Limited to Super Bartronics Limited and subsequently converted into a Public Limited Company w.e.f. July 27, 1995. The name of the Company was changed to Bartronics India Limited on January 1, 1996.

Bartronics is currently engaged in providing solutions based on Bar Coding, one of the oldest AIDC technologies. Since then, in the past two decades, it has been pioneer in introducing newer technologies and solutions in India based on Biometrics, RFID, POS, EAS, and Smart Cards etc.

2. Term Loans from banks viz. Bank of Baroda, Bank of India, Andhra Bank, Indian Bank, Hongkong and Shanghai Banking Corporation Limited, Life Insurance Corporation of India are secured by first pari passu charge on all the immovable and movable fixed assets of the company both present and future and second pari passu charge on the current assets, both present and future, of the company. Further, these loans are secured by personal guarantees and properties of the A.B.S.Reddy

3. Terms of repayment are given below:

a. Loan taken from Bank of Baroda carries an interest rate of 14.75% p.a and is repayable in 24 quarterly installments of Rs.137.50 lakhs each from Feb''2010 to Nov''2015.

b. Loan taken from Bank of india carries an interest rate of 14.75% p.a and is repayable in 18 quarterly installments of Rs.330.00 lakhs each from Apr''2009 to Jul 2013.

c. Loan taken from Andhra bank carries an interest rate of 14.50% p.a and is repayable in 36 monthly installments of Rs.152.78 lakhs each from Aug''2010 to Jul 2013.

d. Loan taken from Indian bank carries an interest rate of 16.25% p.a and is repayable in 24 quarterly installments of Rs.91.67 lakhs each from Nov''2008 to Aug 2014

e. Loan taken from Hongkong and shanghai banking corporation Limited carries an interest rate of 18.75% p.a and is repayable in 3 monthly installments of Rs.30.00 lakhs each.

f. Loan taken from Life Insurance Corporation of India carries an interest rate of 13% p.a and is repayable in 21 quarterly installments of Rs.142.80 lakhs each from Jan''2011 to Jan''2016

4. Contingent Liabilities:

Letters of Credit and Guarantees issued: Rs. & USD. In Lakhs

Particulars As At As At 30. 09. 31.03.2015 2013 (Restated)

Letters of Credit - -

Counter Guarantees Given To Banks Towards:

* Bank Guarantees Issued Rs.591.30 Rs.590.14

* Corporate Guarantees - $ 150

5. Estimated amount of contracts remaining to be executed on capital account and not provided for [Net of advance Rs. 9,062.09 lakhs (30.09.2013 Rs. 9,374.39 lakhs)] Rs. 1,355.54 lakhs (30.09.2013: Rs. 1,340.56 lakhs).

6. Reserves & Surplus:

Securities Premium:

a. In this Period the company has arrived at an "One time settlement (OTS) of dues with its some of the lenders, as a result the lenders have agreed to waive the principal amount of Rs.97,421,014/-, Interest amount of Rs.41,139,319/- and leased rental charges of Rs.72,184,847/-. The waiver of the principal amount is credited to Capital reserve A/c and interest & Leased rental charges amount is credited to Other Income account.

7. Unsecured Loans:

Foreign Currency Convertible Borrowings (FCCB):

Bartronics India Ltd. had issued Foreign Currency Convertible Bonds (FCCB) for an aggregate sum of USD 50mn in January 2008. These bonds got matured in February 2013. In this regard the company had filed a request for an extension of the maturity of the bonds to May 4, 2014 with Reserve Bank of India which was granted by them vide their letter dated February 21, 2014.

The company has appointed M/s Avista Advisory Group to assess all the options available with the company and finalize best suited approach in order to address the maturity. The options available with the company include restructuring the bonds i.e. rolling over the bonds for next five years or replacing the bonds with fresh bonds, or redeeming all the bonds at a mutually agreeable price. With these available options; the Company, along with M/s Avista Advisory Group has got in touch with the bondholders and has initiated discussions which are at advanced stages now. The company has applied for further extension of the maturity date with Reserve Bank of India and the company is waiting to hear from RBI to move forward. The company is confident of addressing the maturity of Bonds shortly.

8. The Company''s significant leasing arrangements are in respect of operating leases for premises (office, stores, godowns, etc.). The leasing arrangements, which are not non-cancellable, range between eleven months and five years generally, and are usually renewable by mutual consent on agreed terms. The aggregate lease rentals payable are charged as rent in to the profit and loss account.

9. The dues to Micro and Small enterprises as defined in The Micro, Small & Medium Enterprises Development Act, 2006 (the Act) are identified by the Company based on enquiries with the parties and information available with the Company. There are no dues to be paid by the company to The Micro, Small & Medium enterprises as per the management.

10. The Company was awarded the "Aapke Dwar" Project in 2009 by the Municipal Corproation of Delhi (MCD). The project envisages availment of various Governments to Citizen (G2C) services. The Company is required to install and operate 2,000 kiosks at various locations in the city to facilitate the above. The Company has also the right to display advertisements on the external walls of the kiosks.

As at the balance sheet date 300 kiosks have been constructed and for the balance 1,700 kiosks, allotment of clear sites by MCD is awaited. Capital Work-in-progress includes the amounts expended on such construction which aggregates to Rs.1,340.56 Lakhs (2012-13 : Rs. 1,426.34 lakhs). Further amounts aggregating to Rs. 9374.39 Lakhs (2012-13:Rs.13,688.82 lakhs )has been advanced for work to be carried out.

In view of the unseemly delays in the allocation of sites by the MCD, the Company has filed a petition in the High Court of Delhi which has initiated the process of arbitration. The Company is confident of arriving at an amicable solution shortly.

11. Previous period''s figures have been restated as suggested by the NSE.

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Sep 30, 2013

1. CORPORATE INFORMATION

The Company was incorporated as a private limited Company by the name of Super Bartronics Private Limited on September 10, 1990. Further, the Company changed its name from Super Bartronics Private Limited to Super Bartronics Limited and subsequently converted into a Public Limited Company w.ef. from July 27, 1995. The name of the Company was changed to Bartronics India Limited on January 1, 1996.

Bartronics is currently engaged in providing solutions based on Bar Coding, one of the oldest AIDC technologies. Since then, in the past two decades, it has been pioneer in introducing newer technologies and solutions in India based on Biometrics, RFID, POS, EAS, and Smart Cards etc

2. Contingent Liabilities:

Letters of Credit and Guarantees issued: Rs. & USD. In Lakhs

As At As At particulars 30. 09. 2013 30. 09. 2012

Letters of Credit - -

Counter Guarantees Given to Banks Towards:

- Bank Guarantees Issued Rs.590.14 Rs.573.83

- Corporate Guarantees $ 150 $150

3. Estimated amount of contracts remaining to be executed on capital account and not provided for [Net of advance Rs.9,374.39 lakhs (30.09.2012 Rs. 8,312.07 lakhs)] Rs1,340.56 lakhs (30.09.2012: Rs. 1,555.54 lakhs )

4. Reserves & Surplus:

Securities Premium:

a. The Company charges the premium payable on redemption of Foreign Currency Convertible Bonds to the securities premium account over the life of the bond. Had the Company provided the full liability of premium payable on redemption of bonds in terms of the provisions of Accounting Standard-29 ''Provisions, Contingent Liabilities & Contingent Assets'' in Securities Premium Account in the year of issue, the additional liability would have been Rs.1194.91 Lakhs (30.09.2012 Rs. 789.79 Lakhs).

5. Related Party Disclosures:

The following are related parties as defined in "Accounting Standard (AS) 18- Related Party Disclosures" notified under The Companies (Accounting Standards) Rules, 2006.

1. The above figures exclude provision for gratuity and compensated absences actuarially valued as separate figures are not available.

2. As per the term of appointment, no commission is payable to Managing Director or Whole time Directors, accordingly computation of Net Profit in accordance with Section 309(5) of the Companies Act, 1956 is not given.

6. Segment Reporting

1. The activities of the Company relate to only one business segment i.e. the business of providing Automatic Identification & Data Capture (AIDC) solutions.

2. Information relating to Secondary Segment based on geographical location:

Note: Based on expert opinion the deferred tax expense in the previous year has been recognized using previous year applicable effective tax rate being Minimum Alternate Tax (MAT) rate.

Note: Figures in italics relate to previous year

Note: Only Provisions has been Made in the books but no payments were made.

i. Discount Rate

The discount rate is based on the prevailing market yield on Indian Government Securities as at the balance sheet date for the estimated term of the obligations.

7. The Company''s significant leasing arrangements are in respect of operating leases for premises (office, stores, godowns, etc.). The leasing arrangements, which are not non-cancellable, range between eleven months and five years generally, and are usually renewable by mutual consent on agreed terms. The aggregate lease rentals payable are charged as rent in to the profit and loss account.

8. The dues to Micro and Small enterprises as defined in The Micro, Small & Medium Enterprises Development Act, 2006 (the Act) are identified by the Company based on enquiries with the parties and information available with the Company. There are no dues to be paid by the company to The Micro, Small & Medium enterprises as per the management.

9. The Company was awarded the "Aapke Dwar" Project in 2009 by the Municipal Corproation of Delhi (MCD). The project envisages availment of various Governments to Citizen (G2C) services. The Company is required to install and operate 2,000 kiosks at various locations in the city to facilitate the above. The Company has also the right to display advertisements on the external walls of the kiosks.

As at the balance sheet date 300 kiosks have been constructed and for the balance 1,700 kiosks, allotment of clear sites by MCD is awaited. Capital Work-in-progress includes the amounts expended on such construction which aggregates to Rs.1,426.34 Lakhs(2011-12 : Rs. 1,426.34 lakhs). Further amounts aggregating to Rs. 13,688.82 Lakhs(2011-12:Rs. 13,474.47.10 lakhs )has been advanced for work to be carried out.

In view of the unseemly delays in the allocation of sites by the MCD, the Company has filed a petition in the High Court of Delhi which has initiated the process of arbitration. The Company is confident of arriving at an amicable solution shortly.

10. Due to no profits in the Company the remuneration of Directors as fixed by the members for the financial year 2012-13 is exceeding the permissible remuneration under the Companies Act, 1956 by 82.18 Lakhs. The Company is taking necessary steps.

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

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Mar 31, 2011

1. Contingent Liabilities:

Rs. In Lakhs

As At As At

Particulars 31. 03. 2011 31. 03. 2010

Counter Guarantees Given To Banks Towards:

-Bank Guarantees Issued 497.97 71.38

2. Estimated amount of contracts remaining to be executed on capital account and not provided for [Net of advance Rs.15,265.87 lakhs (31.03.2010 Rs. 18,322.43 lakhs)] Rs.29,643.67 lakhs (31.03.2010: Rs. 26,734.64 lakhs )

3. Share Warrants:

The Company has issued 6,300,000 Convertible Share Warrants of Rs 10 each at a premium of Rs 222 per warrant belonging to the promoter and promoter group and 2,000,000 Compulsory Convertible Warrants of Rs.10 each at a premium of Rs.152.25 per warrant to non-promoter group during February, 2010.These are convertible into equity shares at a later date but before expiry of 18 months from the date of issue in one or more tranches. As per the terms of issue, the Company has received 25% value as advance against the said Compulsory Convertible Warrants aggregating to Rs. 4,465.25 Lakhs.

premium payable on redemption of Foreign Currency Convertible Bonds to the securities premium account over the life of the bond. Had the Company provided the full liability of premium payable on redemption of bonds in terms of the provisions of Accounting Standard-29 'Provisions, Contingent Liabilities & Contingent Assets' in Securities Premium Account in the year of issue, the additional liability would have been Rs.3,581.92 Lakhs. (31.03.2010 Rs. 5,305.05 Lakhs)

4. Secured Loans:

i. Term Loans:

a. Term loans availed from banks and fnancial institutions are secured by:

v Equitable mortgage of the Company's immovable property at Raj Bollaram Village.

v First pari passu charge on all fixed assets, present and future and pari passu second charge on

all the current assets both present and future.

v The personal guarantees of certain promoters.

b. Amounts repayable within twelve months in respect of Term Loans: Rs.6,024.01 Lakhs (31.03.2010: Rs. 4,114.25 Lakhs)

ii. Working Capital Loans:

Working Capital loans availed from banks are secured by:

v First pari-passu charge on all the movable properties both present and future including without its limitation its stock in trade, receivables, investments, deposits and other movables.

v First pari passu charge on all the current assets and pari passu second charge on all the moveable fixed assets of the Company.

v The personal guarantees of certain promoters.

iii. Hire Purchase Loans:

a. Equipment and Vehicle loans from others are secured by hypothecation of equipments/vehicles acquired out of the said loans.

b. Amounts repayable within twelve months in respect of equipment/vehicle loans: Rs. 468.95 Lakhs (31.03.2010: Rs 7.52 Lakhs).

5. Unsecured Loans:

Foreign Currenzcy Convertible Borrowings (FCCB):

The Company raised US$ 25 Million ('FCCB-I') on 09.06.2007 and US$ 50 Million ('FCCB-II') on 04.01.2008 through the issue of zero coupon Foreign Currency Convertible Bonds. Bond holders have an option to convert each bond of US$ 100000 into shares of Rs. 10/- each at the conversion price of Rs.140/- in respect of the FCCB-I and at the conversion price of Rs.290/- in respect of FCCB-II. The bonds are redeemable with a yield to maturity of 7.25% in case of FCCB-I and 6.65% in case of FCCB-II. During the year Nil (31.03.2010: 23,78,340) shares were allotted out of the FCCB-I consequent to conversion of balance Nil Bonds (31.03.2010: 60 bonds) aggregating to US$ Nil (31.03.2010 US$ 60 Lakhs). The balance bonds unless converted will be redeemed on 4th February, 2013 in respect of FCCB-II [The entire issue of 250 bonds relating to FCCB-I aggregating to US$ 250 Lakhs stand converted into equity shares as at 31.03.2010]

FCCB-II Price Reset: Pursuant to the terms and conditions of FCCB-II Bond issue the conversion price has been reset from Rs.290 to Rs.232 on 6 July, 2009 and further to Rs.191.25 on 4 January, 2010.

6. Sales :

Self Developed Software:

Development cost for self developed software's has been charged to the Profit & loss accounts in the earlier years.

7. Sundry Debtors:

Sundry Debtors (Schedule 8) Considered Good, includes amount aggregating to Rs. 36,577.76 Lakhs which have been outstanding for more than six months. On account of the economic slowdown and consequent recessionary conditions in the global market there have been delays in recovery of such amounts and in respect of which necessary applications have been fled with the authorised dealers.Given the fact that the amounts are recoverable from customers with whom the Company, has a long standing relationship, management is confdent of realising the amounts due and no provisions are required on these accounts at this stage.

8. Cash & Bank Balances:

a. Cash on Hand includes Rs. 0.26 lakhs (31.03.2010: Rs.0.40 lakhs) held in foreign currency.

9. Inventories:

Finished goods inventory includes bought out software aggegating to Rs.314.13 Lakhs which has remained in stock for over a year. Management is confdent of realising a sale value not lower than its current carrying cost and consequently, no provision has been made on this account.

10. Related Party Disclosures:

The following are related parties as defned in "Accounting Standard (AS) 18 - Related Party Disclosures" notifed under The Companies (Accounting Standards) Rules, 2006.

11. Segment Reporting

1. The activities of the Company relate to only one business segment i.e. the business of providing

Automatic Identifcation & Data Capture (AIDC) solutions.

i) Discount Rate

The discount rate is based on the prevailing market yield on Indian Government Securities as at the balance sheet date for the estimated term of the obligations.

ii) Salary Escalation Rate

The estimates of future salary increase considered takes into account the infation, seniority and other relevant factors

12. Current Income Tax:

Current tax represents income tax payable on the book Profits computed under Section 115JB of the Income Tax Act, 1961.

13. The Company's significant leasing arrangements are in respect of operating leases for premises (Offices, equipment's etc.). The leasing arrangements, which are not non-cancellable, range between eleven months and five years generally, and are usually renewable by mutual consent on agreed terms. The aggregate lease rentals payable are charged as rent expense to the Profit and loss account.

14. The dues to Micro and Small enterprises as defned in The Micro, Small & Medium Enterprises Development Act, 2006 (the Act) are identifed by the Company based on enquiries with the parties and information available with the Company. This has been relied upon by the auditors.

15. The Company was awarded the "Aapke Dwar" Project in 2009 by the Municipal Corproation of Delhi (MCD). The project envisages availment of various Government to Citizen (G2C) services. The Company is required to install and operate 2,000 kiosks at various location in the city to facilitate the above. The Company has also the right to display advertisements on the external walls of the kiosks.

As at the balance sheet date 300 kiosks have been constructed and for the balance 1,700 kiosks, allotment of clear sites by MCD is awaited. Capital Work-in-progress includes the amounts expended on such construction which aggregates to Rs. 4,112.58 lakhs. Further amounts aggregating to Rs. 14,893.10 lakhs has been advaced for work to be carried out.

In view of the unseemly delays in the allocation of sites by the MCD, the Company has fled a petition in the High Court of Delhi which has initiated the process of arbitration. The Company is confdent of arriving at an amicable solution shortly.

16. Previous year's figures have been regrouped/ rearranged/reclassified wherever necessary to confirm to current year's presentation.

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Mar 31, 2010

1. Contingent liabilities:

Letters of Credit and Guarantees issued: Rs. in lakhs

Particulars As at As at 31.03.2010 31.03.2009

Letters of Credit -- 4,277.10

Counter Guarantees Given To Banks Towards :

— Bank Guarantees Issued 71.38 298.85

2. Claims Against The Company Not Acknowledged As Debts:

Disputed Income Tax liability Rs.225.16 Lakhs (31.03.2009: Rs.8.51 Lakhs). The Company has contested before appellate authorities.

3. Estimated Amount Of Contracts Remaining To Be Executed On Capital Account And Not Provided For [Net Of Advance Rs.l 8,322.43 Lakhs (31.03.2009 Rs.1 ,427.69 Lakhs)] Rs.26,734.64 Lakhs (31.03.2009: Rs.80,000 Lakhs)

4. Share Capital:

During the year:

a) USS 60 Lakhs worth of Foreign Currency- Convertible Bonds (FCCB) have been converted into 2,378,340 equity shares of Rs.10 each aggregating to Rs.237.83 Lakhs at a premium of Rs.102 per share aggregating to Rs.2,425.91 Lakhs.

b) The Company has issued shares under Preferential Allotment of 2,200,000 equity shares of Rs.10 each at a premium of Rs.222 per share fully paid-up belonging to the promoter and promoter group and 493,065 equity shares of Rs. 10 each at a premium of Rs. 152.25 per share fully paid-up to non-promoters group, aggregating to Rs.269.31 Lakhs of equity shares and Rs.5,634.69 Lakhs of securities premium.

c) The Company has issued 6,300,000 Compulsory Convertible Warrants of Rs.10 each at a premium of Rs.222 per warrant belonging to the promoter and promoter group and 2,000,000 Compulsory Convertible Warrants of Rs.lt) each at a premium of Rs.152.25 per warrant to non-promoter groups, which are convertible into equity shares at a later date but before expiry of 18 months from the date of issue in one or more tranches. As per the terms of issue, the Company has received 25% value of the Compulsory Convertible Warrants aggregating to Rs.4,465.25 Lakhs.

b. As stated in Significant Accounting Policies No. 15 of Schedule 20, the Company charges the premium payable on redemption of Foreign Currency Convertible Bonds to the securities premium account over the life of the bond. Had the Company provided the full liability of premium payable on redemption of bonds in terms of the provisions of Accounting Standard 29 Provisions, Contingent Liabilities & Contingent Assets in Securities Premium Account in the year of issue, the additional liability would have been Rs.5,305.05 Lakhs.

5. Secured Loans:

I. Term Loans:

a) Term loans availed from banks are secured by:

- Equitable mortgage of the Companys immovable property at Raj Bollaram Village.

- First pari passu charge on all fixed assets, present and future and pari passu second charge on all the current assets both present and future.

- The personal guarantees of certain promoters.

b) Amounts repayable within twelve months in respect of Term Loans: Rs.4,114.25 Lakhs (31.03.2009: Rs.2,610.38 Lakhs)

II. Working Capital Loans:

Working Capital loans availed from banks are secured by:

- First pari-passu charge on all the movable properties both present and future including without its limitation its stock in trade, receivables, investments, deposits and other movables.

- First pari passu charge on all the current assets and pari passu second charge on all the movable fixed assets of the Company.

- The personal guarantees of certain promoters.

III. Vehicle Loans:

a) Vehicle loans from banks and others are secured by hypothecation of vehicles acquired out of the said loans.

b) Amounts repayable within twelve months in respect of vehicle loans: Rs. 7.52 Lakhs (31st March, 2009: Rs 5.92 Lakhs).

6. Unsecured Loans:

Foreign Currency Convertible Borrowings (FCCB):

The Company raised US$ 25 Million (FCCB-I) on 09.06.2007 and US$ 50 Million (FCCB-II) on 04.01.2008 through the issue of zero coupon Foreign Currency Convertible Bonds. Bond holders have an option to convert each bond of US$ 100000 into shares of Rs. 10/- each at the conversion price of Rs.140/- in respect of the FCCB-I and at the conversion price of Rs.290/- in respect of FCCB-H. The bonds are redeemable with a yield to maturity of 7.25% in case of FCCB-I and 6.65% in case of FCCB-II. During the year 23,78,340 (31.03.2009: 2,282,332) shares were allotted out of the FCCB-I consequent to conversion of balance 60 bonds (31.03.2009: 75 bonds) aggregating to US$ 60 Lakhs (31.03.2009 US$ 75 Lakhs). The balance bonds unless converted will be redeemed on 4th February, 2013 in respect of FCCB-II. On conversion of 60 bonds of FCCB-I, the entire issue of 250 bonds aggregating to US$ 250 Lakhs now stand converted into equity shares.

FCCB-II Price Reset: Pursuant to the terms and conditions of FCCB-II Bond issue the conversion price has been reset from Rs.290 to Rs.232 on 6 July, 2009 and further to Rs.191.25 on 4January, 2010.

7. Sales:

Self Developed Software:

The Company has incurred development cost for the self developed softwares and charged to the profit and loss accounts in the earlier years. No further development costs are incurred on the sale self developed softwares during the year.

Trading Sales and Purchases:

The trading sales and purchases include software sales of Rs.8,837.59 Lakhs and Rs.8,461.87 Lakhs recognized upon transmission of software to customer or by vendors through electronic form and significant risks and rewards relating to ownership of products are transferred to the customers or by the vendor. These sales and purchases are integral part of the project fulfilment process and are in the normal course business practice. The Customers and Vendors have confirmed the receipt / dispatch of goods/services and the balance outstanding as on 31 March 2010.

8. Sundry Debtors:

Sundry Debtors outstanding for more than six months considered good for recovery by the Management is Rs.27,004.88 Lakhs. Due to slowdown and recessionary conditions witnessed in the global market during 2009-10, the Company has to give extension in the payment terms to some of these export customers. These export customers are dealing with the Company for number of years and their dealings with the Company are satisfactory. Subsequent to the balance sheet date the Company has recovered Rs. 22,243.39 Lakhs and the balance debtors are recoverable and considered good, hence no provision for bad and doubtful debt is considered necessary.

9. Inventories:

Closing Stock of Raw-Material- Export software stocks of Rs.986.34 Lakhs is non-moving for more than nine months. These software stocks relate to common application softwares, the Company has been implementing over the years. The Company is confident of selling this application software in the near future and no provision for slow and non-moving stocks is considered necessary.

10. Derivatives:

1. Exchange difference in respect of forward exchange contracts to be recognized in the profit and loss account in subsequent reporting period amounts to Rs.Nil (31.03.2009 Rs.0.29 Lakhs)

2. Key Management Personnel

1. Mr. Sudhir Rao - Managing Director

2. Mr. T Venkateswara Rao - Whole Time Director (Finance)*

3. Mr. S. T. Prasad - Whole Time Director (Technical)*

*Mr. T Venkateswara Rao and Mr. S.T Prasad are non executive directors we.f 30.01.2010

11. Segment Reporting

1. The activities of the Company relate to only one business segment i.e. the business of providing Automatic Identification & Data Capture (AIDC) solutions.

12. "The Company is engaged in development, trading and maintenance of computet hardwares and softwares. Being technical in nature, the production and sale of such hardwares and softwares cannot be expressed in generic units. Accordingly the quantitative information relating to production, purchases, consumption and sales, as required under paragraph 3, 4C and 4D of Part II of Schedule VI of the Companies Act, 1956, has not been provided."

13. Current Income Tax:

Current tax represents income tax payable on the book profits computed under section .115JB of the Income Tax Act, 1961.

14. Disclosure in respect of Operating Leases: c

The Companys leasing arrangements are in respect of operating leases for premises (office, stores, godowns, etc). General descriptions of the leasing arrangements are:

- All lease agreements are cancellable in nature and range between 11 months to 5 5ears.

- As per the agreements, refundable interest free deposits have been given.

- Some of the agreements provide for increase in rent

- Some of the agreements provide for early termination by either party with a notice period which varies from 15 days to 3 months.

- Some of the agreements contain a provision for its renewal by mutual consent on mutually agreeable terms.

- Operating Lease payments recognised in the statement of profit and loss for the year: Rs. 112.34 Lakhs (2008 09: Rs.90.03 Lakhs)

15. The dues to Micro and Small enterprises as defined in The Micro, Small & Medium Enterprises Development Act, 2006 (the Act) are identified by the Company based on enquiries with the parties and information available with the Company. This has been relied upon by the auditors.

16. Previous years figures have been regrouped/ rearranged/ reclassified wherever necessary to conform to current years presentation.

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Mar 31, 2003

(Forming part of Balance Sheet and Profit & Loss Account)

1. SECURED LOANS

1.1 Cash credit facilities from UTI Bank are secured by hypothecation of stocks, Trade receivables, collateral by way of extension of charge on the fixed assets and personal guarantee of Directors.

1.2 Loan from Citi Bank Maruthi Finance is secured by the hypothecation of Maruthi car purchased out of the said loan.

1.3 Venture Capital Loan availed from Industrial Development Bank of India is towards expansion project of the company. The said loan is secured by all movable & immovable assets, present and future, of the company except stock and book debts.

2. UNSECURED LOANS

2.1 The company has availed loan from M/s. Futuretech Industries Limited. The loan availed is interest free.

3. FIXED ASSETS

3.1 The company incurred certain expenses for setting R & D center for improving the product quality. Since the R & D center is commissioned, the relevant assets together with incidental expenses up to date of commissioning are capitalized.

4. CURRENT ASSETS, LOANS AND ADVANCES

4.1 Inventory quantities and values as at the period end are as certified by the management.

4.2 Sundry debtor’s balances are subject to confirmation and reconciliation.

5. CURRENT LIABILITIES & PROVISIONS

5.1 Sundry creditors balances are subject to confirmation and reconciliation.

5.2 There are no dues outstanding more than Rs.1 lakh and more than 30 days to Small Scale Industrial Undertakings. The total outstanding due to Small Scale Industrial undertaking is Nil. Total outstanding due to creditors other than Small Scale Industrial undertaking is Rs.97,86,958/-.

6. DEFERRED EXPENDITURE

6.1 Deferred Software Expenditure pertaining to charges incurred in connection with the development of new software. The company has amortized the same over 5 years.

6.2 Market Seeding expenditure is of the nature of marketing expenses such as salaries, rent, general expenses of newly established branches for development of a particular market area segment. The directors are of the view that these expenses will bear fruit over the long term and hence deferred the same over 5 years.

6.3 Deferred Project Expenditure pertains to expenditure incurred on infrastructure for setting up of R & D center for improved products and the same has been charged off during the year as the project is completed.

7. OTHERS :

7.1 Information on licensed and installed capacity is not furnished since the company is not involved in any manufacturing activity during the year.

7.2 The impact of deferred tax in accordance with AS-22 has been considered while forming the accounts and necessary provision has been created.

7.8 Previous year’s figures have been regrouped and reclassified where ever necessary.