Notes to Accounts of Cerebra Integrated Technologies Ltd.

Mar 31, 2018

1. Corporate Information

Cerebra Integrated Technologies Limited is a public limited Company , incorporated in India having its Registered Office at S-5, Off 3rd Cross, Peenya Industrial Area, Peenya 1^st Stage Bangalore - 560 058.

The Company is engaged in, assembling and trading of computer systems, and peripherals. The Company is also into the business of providing II Services and e-Waste management.

The financial statements for the year ended March 31, 2018 were approved by the Board of Directors and authorised for issue on May 30, 2018.

2. Basis of Preparation, Critical Accounting Estimates and Judgements, Significant Accounting Policies and Recent Accounting Pronouncements.

A. Basis of preparation:

i. In accordance with the notification issued by the Ministry of Corporate Affairs, the Company has adopted Indian Accounting Standards (referred to as “Ind AS”) notified under the Companies (Indian Accounting Standards) Rules, 2015 with effect from April 1, 2017. Previous periods have been restated to Ind AS. In accordance with Ind AS 101 First time Adoption of Indian Accounting Standards, the Company has presented a reconciliation from the presentation of financial statements under Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (“Previous GAAP”) to Ind AS of Shareholders'' equity as at March 31, 2017 and April 1, 2016 and of the comprehensive net income for the year ended March 31, 2017.

ii. Convention:

These financial statements have been prepared on a historical cost basis, except for certain financial instruments which are measured at fair value at the end of each reporting period. Historical cost is generally based on the fair value of the consideration given in exchange for goods and services. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

B. Critical accounting estimates and judgements:

The preparation of these financial statements in conformity with the recognition and measurement principles of Ind AS requires management to make judgements, estimates and assumptions, that affect the reported balances of assets and liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and the reported amounts of income and expenses for the years presented. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected. In particular, information about significant areas of estimation, uncertainty and critical judgments in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements pertain to:

i. Useful lives of property, plant and equipment and intangible assets: The Company has estimated useful life of each class of assets based on the nature of assets, the estimated usage of the asset, the operating condition of the asset, past history of replacement, anticipated technological changes, etc. The Company reviews the useful life of property, plant and equipment and Intangible assets as at the end of each reporting period. This reassessment may result in change in depreciation expense in future periods.

ii. Impairment testing: Property, plant and equipment and Intangible assets that are subject to amortisation / depreciation are tested for impairment when events occur or changes in circumstances indicate that the recoverable amount of the cash generating unit is less than its carrying value. The recoverable amount of cash generating units is higher of value-in-use and fair value less cost to sell. The calculation involves use of significant estimates and assumptions which includes turnover and earnings multiples, growth rates and net margins used to calculate projected future cash flows, risk-adjusted discount rate, future economic and market conditions.

iii. Impairment of investments: The Company reviews its carrying value of investments carried at cost or amortised cost annually, or more frequently when there is indication for impairment. If the recoverable amount is less than its carrying amount, the impairment loss is accounted for.

iv. Income Taxes: Deferred tax assets are recognized to the extent that it is regarded as probable that deductible temporary differences can be realized. The Company estimates deferred tax assets and liabilities based on current tax laws and rates and in certain cases, business plans, including management''s expectations regarding the manner and timing of recovery of the related assets. Changes in these estimates may affect the amount of deferred tax liabilities or the valuation of deferred tax assets and thereby the tax charge in the Statement of Profit or Loss. Provision for tax liabilities require judgements on the interpretation of tax legislation, developments in case law and the potential outcomes of tax audits and appeals which may be subject to significant uncertainty. Therefore the actual results may vary from expectations resulting in adjustments to provisions, the valuation of deferred tax assets, cash tax settlements and therefore the tax charge in the Statement of Profit or Loss.

v. Litigation: From time to time, the Company is subject to legal proceedings the ultimate outcome of each being always subject to many uncertainties inherent in litigation. A provision for litigation is made when it is considered probable that a payment will be made and the amount of the loss can be reasonably estimated. Significant judgement is made when evaluating, among other factors, the probability of unfavourable outcome and the ability to make a reasonable estimate of the amount of potential loss. Litigation provisions are reviewed at each accounting period and revisions made for the changes in facts and circumstances.

vi. Fair value measurement of financial instruments: The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. This involves significant judgements in selection of a method in making assumptions that are mainly based on market conditions existing at the Balance Sheet date and in identifying the most appropriate estimate of fair value when a wide range of fair value measurements are possible.

* On transition to Ind AS, the carrying values of all property, plant and equipments under the previous GAAP have been considered to be the deemed cost under Ind AS.

# Lease hold land amounting Rs. 506.4 Lakhs (31.03.2017:- Rs. 506.40/- Lakhs, 01.04.2016 Rs. 506.4 Lakhs) includes 48,564 Sq. Mtrs of land at Narsapura Industrial Area, Kolar Taluk, Kolar District, allotted by Karnataka Industrial Area Development Board (KIADB) on lease cum sale basis for setting up an e-waste recycling plant within a specified period. As per the lease cum sale agreement, KIADB has got the right to determine the lease and forfeit up to 25% of the consideration paid / enhance the compensation payable if the company fails to set up the plant with in the specified period.

^A The Factory building having a carring value of Rs. 57.31 Lakhs as on 31st March 2018 has been mortgaged to Syndicate Bank as a security facility sanctioned. against cash credit.

** The vehicles of the the company having a carring value of Rs 15.47 Lakhs are hypothecated to bank as security against term loans obtained by the Company for purchasing the said vehicles from Syndicate Bank.

e Terms / Rights attached to equity shares

The Company has only one class of equity shares having par value of Rs. 10 per share. Each holder of an equity share is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of share holders in the Annual General Meeting. During the year, the Company has not declared any dividend. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company,after distribution of all preferential amounts. The distribution will be in proportion to the number of shares held by the equity share holders.

f Out of the total issued and paid up capital 92,16,153 (92,16,153) shares of Rs 10/ each have been allotted as fully paid up pursuant to a contract without payment received in cash g Shares held by each shareholder holding more than 5 percent shares specifying the number of shares held

‘During the year the company has issued 53 Lakhs of Share warrants to the promoters of the Company at Rs. 40 Per Share. The Company has received Rs.10 per warrant (25% of issue price) against this issue on 22^nd June 2017. The warrants are convertible into equity share at any time within a period of 18 Months from the date of allotment of such warrants at a price of Rs. 40 per Share. Balance 75% (i.e. Rs. 30 per warrant) shall be paid before the date conversion in to Equity Shares.

* Foreign Currency Convertible Bond-unsecured

The company has alloted 5.34% interest bearing Foreign Currency Convertible bond (Dollar Bond), of Dollar 1,00,00,000 on 19th December 2014 having a maturity life of 5 year convertible at any time upto 14th December 2019 into Equity shares of Rs. 10.50 (including premium of Rs. 0.50) at a conversion price of Rs. 63.4135, with a fixed rate of exhange on conversion of Rs. 63.4135 per USD. During the financial year ended 31 March 2017, the Company has converted 20,00,000 Dollar bonds into 1,20,78,760 equity Shares of 10.50 (including premium of Rs. 0.50) per share at a conversion rate of Rs. 63.4135 per USD. Dollar bond outstanding as on 31.03.2018: Nil (31.03.2017: Nil)

Note Number 3

In preparing its opening Ind AS balance sheet as at April 1, 2016, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (“Previous GAAP”).

A Exemptions from retrospective application

The company has applied the following exemptions :

i) Property, plant and equipment and intangible assets - Deemed Cost

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 recognised 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 decommissioning liabilities included in the cost of property, plant and equipment. Accordingly, the company has elected to measure all of its property, plant and equipment and intangible assets at their Previous GAAP carrying values.

ii) Investments in subsidiaries

Ind AS 101 permits a first-time adopter to continue to measure its investments in subsidiaries at previous GAAP carrying amount at the date of transition.The company has elected to measure in its separate financial statements all of its investments in subsidiaries at their previous GAAP carrying amount on the date of transition.

B Reconciliations between Previous GAAP and Ind AS:

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

Notes for first time adoption for Ind As

1 Remeasurement of post-employment benefit obligation

Under Ind AS, remeasurment i.e. acturial gains or losses excluding amounts inculded in the net interest expenses on the net defined benefit liability are recognised in the other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurments were forming a part of the profit or loss for the year. As a result of this change, the profit for the year ended March 31, 2017. There is an increase in profit by Rs. 3.52 Lakhs. There is no impact on total equity

2 Investments

Under the previous GAAP, long term investments were carried at cost less provision for other than temporary decline in the value of such investments. Current investments were carried at lower of cost and fair value. Under Ind AS, these investments are required to be measured at fair value. Fair value changes with respect to investments in equity instruments designated as at fair value through Other Comprehensive Income (FVOCI) have been recognised in Equity through other comprehensive income as at the date of transition and subsequently in the other comprehensive income for the year ended March 31, 2017. Also, profit on sale of investment recognised under previous GAAP is now reversed as the investment was fair valued on transition date.

3 Loss on Sale of Investments of Geetha Monitors Private Limited

The Company has recognized 4,89,387 shares of Geeta Monitors Private Limited an earstwhile subsidiary Company at fair value as on 1st April 2016. Subsequently during the the Financial Year 2016-17 these Shares have been sold and resulting loss is recognised by reversal to other comprahensive income.

Note No. 4

A) Capital Advance of Rs. 838.86 Lakhs (Refer Note No. 8) ( 31.03.2017 Rs 750.66 Lakhs,01.04.2016 Rs. 1282.45 Lakhs) is towards purchase of land and other expenses for setting up of an E-waste plant near Chennai. Out of the same Rs. 750.66 Lakhs is outstanding for more than three years. The Company later decided not to setup the plant there and initiated steps to recover the advance paid.

Note No. 5

Capital Advances includes :

I) Rs. 686.21 Lakhs (Refer Note No. 8) (31.03.2017 Rs. 686.21 Lakhs, 01.04.2016 Rs. 686.21 Lakhs) remittence made to Enviro Hub Ltd Singapore through Cerebra E waste Rrecovery Pte Limited (a subsidiary which is liquidated subsequently). As per the Share Purchase Agreement (SPA) entered between the Company and Enviro-Hub Holdings Limited Singapore (Enviro) the subsidiary Company remitted US$ 12,50,000 equivalent to Rs 6,86.21 Lakhs to Enviro on 2nd February 2013 as initial deposit towards acquisition of 100% shares of Enviro''s wholly owned subsidiary Cimelia Resource Recovery Pte Limited (Cimelia), a Company in the field of e waste recycling business. However during July 2013 based on the advice given by the consultants and advisors the Company decided to abort the acquisition proposal. The Company is in the process of initiating legal steps to recover this advance.

ii) Rs. 402.50 Lakhs (refer Note No. 8) (31.03.2017 Rs. 402.50 Lakhs, 01.04.2016 Rs. 402.50 Lakhs) due from Cimelia Resource Recovery Pte Limited Singapore (Cimelia) since 24th May 2011 towards technology fee. The payment is made by allotting 23,00,000 equity shares of the Company at a premium of Rs 7.50 Per Share

iii) Rs .630 Lakhs (31.03.2017 Rs. 630, 01.04.2016 Rs. 630 Lakhs) due from to Restorer Corp Pte Limited, formerly known as Scenic Overseas (S) Pte Limited (Scenic) due 24th May 2011 towards supply of plant and machinery for e waste recycling plant in India. The payment is made by allotting 36,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

iv) Rs. 577.50 (refer Note No. 8) Lakhs (31.03.2017 Rs. 577.50 Lakhs, 01.04.016 Rs. 577.50 Lakhs) due from to Leytron Technology Pte Limited (Leytron) since 24th May 2011 towards installation and commissioning of the above plant. The payment is made by allotting 33,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

v) Rs. 88.48 Lakhs (refer Note No. 8) ( 31.03.2017 Rs 88.48 Lakhs, 01.04.2016 Rs 88.48 Lakhs) paid for supply of plant to Scenic on 24th May 2011.

vi) After non-cosummation of transaction for Cimelia''s acquisition and due to non performance of Master Service Agreement (MSA) by the above three entities ,Company has obtained a stay order from Additional City Civil Court, Bangalore against all these three entities from in anyway alienating or creating charge over the shares allotted as consideration.The case is in the final stages of arbitration and the company is hopeful of favourable decision .

vii) Based on the legal opinion, Company is confident of recovering these advances either in cash or in kind and hence no provision is made for the same.

Note No. 6 Trade Receivables referred in Note No.10 includes Rs. 2394.28 (31.03.2017 Rs. 1945.44 Lakhs, 01.04.2016 Rs.1943.94 Lakhs) outstanding for substantial period. Based on the discussions with these parties the management is confident of recovering these dues and hence no provision has been made in the books for the same.

Footnote:

*The above excludes investments in subsidiaries of Rs. 14.51 Lakhs

#The Company has advanced interest free loan to its subsidary, but the same has not been recorded at fair value.

b) Fair Value hierarchy

The following table presents the fair value hierarchy of assets and liabilities measured at fair value on a recurring basis, it also includes the financial instruments which are measured at amortised cost for which fair values are disclosed.

Footnotes

The Company has not disclosed the fair value of financial instruments such as trade receivables, trade payables, short term loans, deposits etc. because their carrying amounts are a reasonable approximation of fair value.

c) Fair value hierarchy:

The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable and consists of the following three levels:

a) Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices in an active market. This included listed equity instruments, traded debentures and mutual funds that have quoted price. The fair value of all equity instruments (including debentures) which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the closing NAV.

b) Level 2: Level 2 hierarchy includes financial instruments that are not traded in an active market (for example, traded bonds/ debentures, over the counter derivatives). The fair value in this hierarchy is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2

c) Level 3: If one or more of the significant Inputs is not based on observable market data, the instrument is included in level 3. Fair values are determined in whole or in part using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data. Financial instruments such as unlisted equity shares, loans are included in this hierarchy.

d) Inter level transfers: There are no transfers between levels 1 and 2 as also between levels 2 and 3 during the year.

e) Valuation technique used to determine fair value

i) the use of quoted market prices for the equity instruments and Mutual Funds

ii) the fair value of the unlisted shares are determined based on the income approach or the comparable market approach.

f) Reconciliations of level 3 fair values

The following table shows reconciliation from the opening balances to closing balances for Level 3 fair values:

Note No. 7 Financial Risk Management Risk management framework

The company’s activities expose it to market risk including currency risk, interest rate risk and credit risk.

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk

The company’s risk management is carried out by finance department as per policies approved by the Board of Directors. The board provides principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, and investment of short term / long term surplus funds.

A) Market Risk

i) Foreign Currency Risk

Foreign currency risk arises from commercial transactions assets and liabilities denominated in a currency that is not the Company’s functional currency (INR).

The exposure of the Company to foreign currency risk is not significant. However, this is closely monitored by the management to decide on the requirement of hedging. The position of foreign currency exposure to the Company is given below expressed in INR as under :

ii) Interest Rate Risk

The exposure of the company’s borrowing to interest rate changes at the end of the reporting period depends on the mix of fixed rate and floating rate of the borrowings and the expected movement of market interest rate. The status of borrowings in terms of fixed rate and floating rate are as follows:

As the Variable borrowing is insignificant there is no material impact on the profitability of the Company due to variation is interest rates.

iii) Price Risk

The company’s exposure to securities price risk arises from investments held by the company in units of mutual fund classified in the balance sheet as at fair value through profit and loss. However, company does not have a practice of investing in market equity securities with a view to earn fair value changes gain. Company has invested in units of mutual funds when short term surplus fund exists with prior approval of the Board. Considering the size of the investment the price/market risk is not significant.

B) Credit Risk

Credit risk arises when a counter party defaults on contractual obligations resulting in financial loss to the company. Trade receivables consist of large number of customers, spread across diverse industries and geographical areas. In order to mitigate the risk of financial loss from defaulters, the Company has an ongoing credit evaluation process in respect of customers who are allowed credit period. In respect of walk-in customers the company does not allow any credit period and therefore, is not exposed to any credit risk.

In general, it is presumed that credit risk has significantly increased since initial recognition if the payments are more than 60 days past due.

C) Liquidity Risk

The Company has a liquidity risk management framework for managing its short term, medium term and long term sources of funding vis-a-vis short term and long term utilization requirement. This is monitored through a rolling forecast showing the expected net cash flow, likely availability of cash and cash equivalents, and available undrawn borrowing facilities.

ii) Maturities of financial liabilities

The table below analyses the company’s all financial liabilities into relevant maturity based on their contractual maturities. The amounts disclosed in the table are the contractual undiscounted cash flows.

Note Number 8 : Capital Management Risk management

Capital management objectives of the Company is to Safeguard in ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders.

Note No 9: Segment Reporting

During the current year the company has earned revenue from transactions with single external customers amounting to 10 per cent or more of an entity’s revenues from three customers.

Note No 10: Balances of Sundry Debtors, advances given to parties, creditors and advances received from parties are subject to confirmation

Note No 11: Due to Micro, Small & Medium Enterprises:

The information required to be disclosed under the Micro, Small and Medium Enterprises Develpoment Act, 2006 has been determined to the extent such parties had been identified on the basis of information available with the company in this regard.

Note No 12: Figures in bracket relates to previous year.

As per our attached report of even date

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Mar 31, 2017

1. Terms / Rights attached to equity shares

The Company has only one class of equity shares having par value of Rs. 10 per share. Each holder of an equity share is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of share holders in the Annual General Meeting.

During the year, the Company has not declared any dividend.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of shares held by the equity share holders.

2. Out of the total issued and paid up capital 92,16,153 (92,16,153) shares of Rs 10/ each have been allotted as fully paid up pursuant to a contract without payment received in cash

3. Shares held by each shareholder holding more than 5 percent shares specifying the number of shares held

4. Foreign Currency Convertible Bond-unsecured

The company has allotted 5.34% interest bearing Foreign Currency Convertible bond (Dollar Bond), of Dollar 1,00,00,000 on 19^th December 2014 having a maturity life of 5 year convertible at any time up to 14th December 2019 into Equity shares of Rs. 10.50 (including premium of Rs. 0.50) at a conversion price of Rs. 63.4135, with a fixed rate of exchange on conversion of Rs. 63.4135 per USD

During the financial year ended 31 March 2017, the Company has converted 20,00,000 (20,00,000) Dollar bonds into 1,20,78,760 (1,20,78,760) equity Shares of 10.50 (including premium of Rs. 0.50) per share at a conversion rate of Rs. 63.4135 per USD

5. Lease hold land amounting Rs. 5,06,39,394/- (PY- Rs. 5,06,39,394/-) includes 48,564 Sq. Mtrs of land at Narsapura Industrial Area, KolarTaluk, Kolar District, allotted by Karnataka Industrial Area Development Board (KIADB) on lease cum sale basis for setting up an e-waste recycling plant within a specified period. As per the lease cum sale agreement, KIADB has got the right to determine the lease and forfeit up to 25% of the consideration paid / enhance the compensation payable if the company fails to set up the plant with in the specified period.

6. Advance amounting Rs. 1,34,62,456 (Previous year 1,34,62,456) relates to remittance made to Enviro Hub Ltd Singapore through Cerebra E waste recovery Pte Limited (a wholly owned subsidiary under liquidation). As per the Share Purchase Agreement (SPA) entered between the Company and Enviro-Hub Holdings Limited Singapore (Enviro) the subsidiary Company remitted US$ 12,50,000 equivalent to Rs 6,86,21,230 to Enviro on 2nd February 2013 as initial deposit towards acquisition of 100% shares of Enviro''s wholly owned subsidiary Cimelia Resource Recovery Pte Limited (Cimelia), a Company in the field of e waste recycling business. However during July 2013 based on the advice given by the consultants and advisors the Company decided to abort the acquisition proposal. The Company is negotiating with Enviro for refund of the initial deposit and is confident of amicable settlement of the matter and hence no provision is made.

7. Capital advance includes :

8. Rs 6,99,09,332 (Rs. 12,82,44,644) towards purchase of land and other expenses for setting up of an E-waste plant near Chennai paid during 2009-10. Subsequently the Company has decided to shift the project to Narasapura near Bangalore, and sought refund of advance.

9. Rs. 4,02,50,000 (Previous Year Rs 4,02,50,000) was advanced to Cimelia Resource Recovery Pte Limited Singapore (Cimelia) on 24th May 2011 towards technology fee. The payment is made by allotting 23,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

10. Rs. 6,30,00,000 (Previous Year Rs. 6,30,00,000) was advanced to Restorer Corp Pte Limited, formerly known as Scenic Overseas (S) Pte Limited (Scenic) on 24th May 2011 towards supply of plant and machinery for e waste recycling plant in India. The payment is made by allotting 36,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

11. Rs. 5,77,50,000 (Previous Year Rs. 5,77,50,000) was advanced to Leytron Technology Pte Limited (Leytron) on 24th May 2011 towards installation and commissioning of the above plant. The payment is made by allotting 33,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

12. All the above allotments were made based on the approvals obtained from the FIPB, Government of India, and the Bombay Stock Exchange Ltd, Mumbai. On signing the SPA, Scenic and Leytron have agreed to return the shares allotted to them and authorized the Company to do the needful to set off against the advance amount. The Company is expecting the refund of advance by Ciemelia either by cash or by transfer of shares.

13. Rs. 88,48,000 (Previous Year Rs. 88,48,000) represents balance in advance for supply of plant account from Scenic outstanding since 24th May 2011.

14. Further, the Company has obtained an interim injunction order from Honorable Addl. City Civil Court Bangalore restraining the above mentioned parties from alienating, encumbering or creating any manner of charge or third party rights over the shares allotted to them as detailed above.

15. On signing the SPA, Scenic and Leytron have agreed to return the shares allotted to them and authorized the Company to do the needful to set off against the advance amount. The Company is undergoing arbitration in the current matter.

16. Considering the negotiations with the concerned parties and opinion of the consultants no provision is made in the accounts towards these long outstanding advances.

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Mar 31, 2016

1) Lease hold land amounting Rs. 5,06,39,394/- (PY- Rs. 5,06,39,394/-) includes 48,564 Sq. Mtrs of land at Narsapura Industrial Area, Kolar Taluk, Kolar District, allotted by Karnataka Industrial Area Development Board (KIADB) on lease cum sale basis for setting up an e-waste recycling plant within a specified period. As per the lease cum sale agreement, KIADB has got the right to determine the lease and forfeit up to 25% of the consideration paid / enhance the compensation payable if the company fails to set up the plant with in the specified period.

2) Advance amounting Rs.1,34,62,456 (Previous year 1,34,62,456) relates to remittance made to Enviro Hub Ltd Singapore through Cerebra E-waste recovery Pte Limited (a wholly owned subsidiary under liquidation). As per the Share Purchase Agreement (SPA) entered between the Company and Enviro-Hub Holdings Limited Singapore (Enviro) the subsidiary Company remitted US$ 12,50,000 equivalent to Rs. 6,86,21,230 (Previous Year Rs. 6,86,21,230) to Enviro on 2nd February 2013 as initial deposit towards acquisition of 100% shares of Enviro''s wholly owned subsidiary Cimelia Resource Recovery Pte Limited (Cimelia), a Company in the field of e-waste recycling business. However during July 2013 based on the advice given by the consultants and advisors the Company decided to abort the acquisition proposal. The Company is negotiating with Enviro for refund of the initial deposit and is confident of amicable settlement of the matter and hence no provision is made.

3) Capital advance includes:

(i) Rs. 12,82,44,644 (Previous Year Rs. 13,67,44,644) towards purchase of land and other expenses for setting up of an E-waste plant near Chennai paid during the year 2009-10. Subsequently the Company has decided to shift the project to Narasapura near Bangalore and sought refund of advance. Out of the same Rs 95,00,000 received subsequently.

(ii) Rs. 4,02,50,000 (Previous Year Rs 4,02,50,000) was advanced to Cimelia Resource Recovery Pte Limited Singapore (Cimelia) on 24th May 2011 towards technology fee. The payment is made by allotting 23,00,000 equity shares of the Company at a premium of Rs. 7.50 Per share.

(iii) Rs. 6,30,00,000 (Previous Year Rs. 6,30,00,000) was advanced to Restorer Corp Pte Limited, formerly known as Scenic Overseas (S) Pte Limited (Scenic) on 24^th May 2011 towards supply of plant and machinery for e waste recycling plant in India. The payment is made by allotting 36,00,000 equity shares of the Company at a premium of Rs. 7.50 Per share.

(iv) Rs. 5,77,50,000 (Previous Year Rs. 5,77,50,000) was advanced to Leytron Technology Pte Limited (Leytron) on 24^th May 2011 towards installation and commissioning of the above plant. The payment is made by allotting 33,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

(v) All the above allotments were made based on the approvals obtained from the FIPB, Government of India, and the BSE Limited, Mumbai. On signing the SPA, Scenic and Leytron have agreed to return the shares allotted to them and authorized the Company to do the needful to set off against the advance amount. The Company is expecting the refund of advance by Ciemelia either by cash or by transfer of shares.

(vi) Rs. 88,48,000 (Previous Year Rs. 88,48,000) represents balance in advance for supply of plant account from Scenic outstanding since 24^th May 2011.

(vi) Further, the Company has obtained an interim injunction order from Honorable Addl. City Civil Court Bangalore restraining the above mentioned parties from alienating, encumbering or creating any manner of charge or third party rights over the shares allotted to them as detailed above.

(vii) On signing the SPA, Scenic and Leytron have agreed to return the shares allotted to them and authorized the Company to do the needful to set off against the advance amount. The Company is undergoing arbitration in the current matter.

(viii) Considering the negotiations with the concerned parties and opinion of the consultants no provision is made in the accounts towards these long outstanding advances.

4) Trade Receivables includes Rs. 19,43,93,605/- (P.Y 21,35,10,773/-) outstanding for substantial period. Based on the discussions with these parties the management is confident of recovering these dues and hence no provision has been made in the books.

5) CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

Counter guarantee given to the bankers for guarantees issued on behalf of the Company Rs. 3,22,84,172/- (Rs. 71,03,188/-)

6) Previous year figures are regrouped where ever necessary.

7) Figures in bracket relates to previous year.

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Mar 31, 2015

1. CORPORATE INFORMATION:

Cerebra Integrated Technologies Limited (the Company) was incorporated under the Companies Act, 1956 with registered office at Bangalore, India. The company is listed on Bombay Stock Exchange & National Stock Exchange.

The company is engaged in Manufacturing, Trading of Computer Systems, and Peripherals. The company is also in to the business of providing I T Services and e-Waste management.

2. Terms / Rights attached to equity shares

The Company has only one class of equity shares having par value of Rs. 10 per share. Each holder of an equity share is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of share holders in the Annual General Meeting.

During the year, the Company has not declared any dividend.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of shares held by the equity share holders.

3. Out of the total issued and paid up capital 92,16,153 (92,16,153) shares of Rs 10/ each have been allotted as fully paid up pursuant to a contract without paying received in cash)

4. Shares held by each shareholder holding more than 5 percent shares specifying the number of shares held

The company has allotted 5.34% interest bearing Foreign Currency Convertible Bond (Dollar bonds), of Dollar 1,00,00,000 on 19th December 2014 having a maturity life of 5 year convertable at any time up to 14th December 2019 into equity Shares of Rs. 10.50 (including premium of Rs. 0.50) at a conversion price of Rs 63.4135 , with a fixed rate of exchange on conversion of Rs 63.4135 per USD During the financial year ended 31 march 2015 the company has converted 60,00,000 Dollar bonds into 3,62,36,280 equity Shares of 10.5 (including premium of Rs. 0.5 ) per Share at a conversion rate of Rs 63.3415 per USD.

Unless the bonds have have been previously redeemed, repurchased and cancelled or converted, the company will redeem the bonds on the maturity date at 100% of the principal amount of the Bonds.

5. Balances of Sundry Debtors, Advances given to parties, Sundry Creditors and advances received from parties are subject to confirmation.

6. Due to Micro, small & medium enterprises

As per the records maintained by the company there are no dues to the Micro, small & medium enterprises as on the date of balance sheet.

7. Related Party Disclosure

Cerebra LPO India Limited Subsidiary

Cerebra Middle East FZCO Subsidiary

Geeta Monitors Private Limited Subsidiary

Cerebra E-Waste Recovery Pte Ltd. Subsidiary

Kranion Technologies Private Ltd Associate company

8. Lease hold land amounting Rs. 5,06,39,394/- (PY- Rs. 5,06,39,394/-) includes 48,564 Sq. Mtrs of land at Narsapura Industrial Area, Kolar Taluk, Kolar District, allotted by Karnataka Industrial Area Development Board (KIADB) on lease cum sale basis for setting up an e-waste recycling plant within a specified period. As per the lease cum sale agreement, KIADB has got the right to determine the lease and forfeit up to 25% of the consideration paid / enhance the compensation payable if the company fails to set up the plant with in the specified period.

9. Share application money amounting Rs 1,34,62,456 (Previous year 1,34,62,456) and advance to a Subsidiary amounting Rs 5,39,29,179 (Previous Year Rs 5,39,29,179) relates to remittance made to Cerebra E waste recovery Pte Limited. As per the Share Purchase Agreement (SPA) entered between the Company and Enviro-Hub Holdings Limited Singapore (Enviro) the subsidiary Company remitted US$ 12,50,000 equivalent to Rs 6,79,76,747 (Previous Year Rs 6,79,76,747) to Enviro on 2nd February 2013 as initial deposit towards acquisition of 100% shares of Enviro's wholly owned subsidiary Cimelia Resource Recovery Pte Limited (Cimelia), a Company in the field of e waste recycling business. However during July 2013 based on the advice given by the consultants and advisors the Company decided to abort the acquisition proposal the acquisition. The Company is negotiating with Enviro seeking refund the initial deposit and is confident of amicable settlement of the matter. Considering the opinion of the consultants no provision is made in the accounts towards this advance.

10. Capital advance includes :

(i) Rs. 4,02,50,000 (Previous Year Rs 4,02,50,000) was advanced to Cimelia Resource Recovery Pte Limited Singapore ( Cimelia) on 24th May 2011 towards technology fee. The payment is made by allotting 23,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

(ii) Rs. 6,30,00,000 (Previous Year Rs. 6,30,00,000) was advanced to Restorer Corp Pte Limited, formerly known as Scenic Overseas (S) Pte Limited (Scenic) on 24th May 2011 towards supply of plant and machinery for e waste recycling plant in India. The payment is made by allotting 36,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

(iii) Rs. 5,77,50,000 (Previous Year Rs. 5,77,50,000) was advanced to Leytron Technology Pte Limited (Leytron) on 24th May 2011 towards installation and commissioning of the above plant. The payment is made by allotting 33,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

(iv) All the above allotments were made based on the approvals obtained from the FIPB, Government of India, and the Bombay Stock Exchange Ltd, Mumbai. On signing the SPA, Scenic and Leytron have agreed to return the shares allotted to them and authorized the Company to do the needful to set off against the advance amount. The Company is expecting the refund of advance by Ciemelia either by cash or by transfer of shares.

(v) Rs. 88,48,000 (Previous Year Rs. 88,48,000) represents balance in advance account from Scenic. US $ 2,25,000 was advanced to Scenic on 24th May 2011 towards supply of plant and machinery against which mobile shredder valued US $ 25,000 was supplied by them so far.

(vi) Further, the Company has obtained an interim injunction order from Honorable Addl. City Civil Court Bangalore restraining the above mentioned parties from alienating, encumbering or creating any manner of charge or third party rights over the shares allotted to them as detailed above.

(vii) On signing the SPA, Scenic and Leytron have agreed to return the shares allotted to them and authorized the Company to do the needful to set off against the advance amount. The Company is expecting the refund of advance by Ciemelia either by cash or by transfer of shares.

(viii) Considering the above, no provision is made in the accounts towards these advances.

11. Trade Receivables includes Rs 21,35,10,773 (P.Y 10,46,07,626/-) outstanding for substantial period. Based on the discussions with these parties the management is confident of recovering these dues and hence no provision has been made in the books.

12. Operating Leases:

The Company has taken various premises under cancelable leases. These lease agreements are normally renewed on expiry.

The lease agreements provide an option to the Company to renew the lease period at the end of the non-cancelable period. There are no exceptional / restrictive convents in the lease agreements.

13. CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

Counter guarantee given to the bankers for guarantees issued Rs. 71,03,188/- (Rs. 71,03,188/-)

14. Pursuant to enactment of the Companies Act, 2013, the company has provided depreciation for the year on the basis of the useful life of fixed Asset as prescribed in the Schedule II of the Companies Act, 2013, resulting in higher depreciation of Rs 4620722 for the Year. In respect of fixed asset whose useful life has ended prior to 31st March 2014 an amount of Rs 59265/- has been adjusted to the opening balance of profit and loss account.

15. The figures of the Previous period represent the performance of the Company is for a period of six months i.e., from 1st October 2013 to 31st March 2014 and are not comparable with the current year figures. Figures in bracket relate to previous year. Previous year figures have been regrouped and reclassified wherever necessary to confirm to current year's presentation.

---

Mar 31, 2014

1. CORPORATE INFORMATION:

Cerebra Integrated Technologies Limited (the Company) was incorporated under the Companies Act, 1956 with registered office at Bangalore, India. The company is listed on Bombay Stock Exchange & National Stock Exchange. The company is primarily engaged in Manufacturing, Trading of Computer Systems, and Peripherals. The company is also in to the business of providing I T Services and e-Waste management.

2) Balances of Sundry Debtors, Advances given to parties, Sundry Creditors and advances received from parties are subject to confirmation.

3) Due to Micro, small & medium enterprises

As per the records maintained by the company there are no dues to the Micro, small & medium enterprises as on the date of balance sheet.

4) Related Party Disclosure

Cerebra LPO India Limited Subsidiary

Cerebra Middle East FZCO Subsidiary

Geeta Monitors Private Limited Subsidiary

Cerebra E-Waste Recovery Pte Ltd. Subsidiary

Key Management Personnel

Name Designation

V Ranganathan Managing Director

K Gururaj Upadya Director

P Vishwamurthy Director

Shridhar S Hegde Whole time Director

5) Lease hold land amounting Rs.5,06,39,394/- (PY- Rs.5,06,39,394/-) includes 48,564 Sq. Mtrs of land at Narsapura Industrial Area, Kolar Taluk, Kolar District, allotted by Karnataka Industrial Area Development Board (KIADB) on lease cum sale basis for setting up an e-waste recycling plant within a specified period. As per the lease cum sale agreement, KIADB has got the right to determine the lease and forfeit up to 25% of the consideration paid / enhance the compensation payable if the company fails to set up the plant with in the specified period.

6) Share application money amounting Rs 1,34,62,456 (Previous year 1,34,62,456) and advance to a Subsidiary amounting Rs 5,45,14,291 (Previous Year Rs 5,45,14,291) relates to remittance made to Cerebra E waste recovery Pte Limited. As per the Share Purchase Agreement (SPA) entered between the Company and Enviro–Hub Holdings Limited Singapore (Enviro) the subsidiary Company remitted US$ 12,50,000 equivalent to Rs 6,79,76,747 (Previous Year Rs 6,79,76,747) to Enviro on 2nd February 2013 as initial deposit towards acquisition of 100% shares of Enviro''s wholly owned subsidiary Cimelia Resource Recovery Pte Limited (Cimelia), a Company in the field of e waste recycling business. However during July 2013 based on the advice given by the consultants and advisors the Company decided to abort the acquisition proposal the acquisition. The Company is negotiating with Enviro seeking refund the initial deposit and is confident of amicable settlement of the matter. Considering the opinion of the consultants no provision is made in the accounts towards this advance.

7) Capital advance includes :

(i) Rs. 4,02,50,000 (Previous Year Rs 4,02,50,000) was advanced to Cimelia Resource Recovery Pte Limited Singapore (Cimelia) on 24th May 2011 towards technology fee. The payment is made by allotting 23,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

(ii) Rs. 6,30,00,000 (Previous Year Rs. 6,30,00,000) was advanced to Restorer Corp Pte Limited, formerly known as Scenic Overseas (S) Pte Limited (Scenic) on 24th May 2011 towards supply of plant and machinery for e waste recycling plant in India. The payment is made by allotting 36,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

(iii) Rs. 5,77,50,000 (Previous Year Rs. 5,77,50,000) was advanced to Leytron Technology Pte Limited (Leytron) on 24th May 2011 towards installation and commissioning of the above plant. The payment is made by allotting 33,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

(iv) All the above allotments were made based on the approvals obtained from the FIPB, Government of India, and the Bombay Stock Exchange Ltd, Mumbai.

(v) Rs. 88,48,000 (Previous Year Rs. 88,48,000) represents balance in advance account from Scenic. US $ 2,25,000 was advanced to Scenic on 24th May 2011 towards supply of plant and machinery against which mobile shredder valued US $ 25,000 was supplied by them so far.

(vi) Further, the Company has obtained an interim injunction order from Honorable Addl. City Civil Court Bangalore restraining the above mentioned parties from alienating, encumbering or creating any manner of charge or third party rights over the shares allotted to them as detailed above.

(vii) Considering the above, no provision is made in the accounts towards these advances.

13) Trade Receivables includes Rs 10,46,07,626/- (P.Y 7,54,70,660/-) outstanding for substantial period. No provision has been made in the books.

8) Operating Leases:

The Company has taken various premises under cancelable leases. These lease agreements are normally renewed on expiry.

The lease agreements provide an option to the Company to renew the lease period at the end of the non-cancelable period. There are no exceptional / restrictive convents in the lease agreements.

Contingent rent recognized in the profit & Loss Account NIL

9) The figures of the current period represent the performance of the Company is for a period of six months i.e., from 1st October 2013 to 31st March 2014 and are not comparable with the previous year figures. Figures in bracket relate to previous year. Previous year figures have been regrouped and reclassified wherever necessary to confirm to current year''s presentation.

d Terms / Rights attached to equity shares

The Company has only one class of equity shares having par value of Rs. 10 per share. Each holder of an equity share is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of share holders in the Annual General Meeting.

During the year, the Company has not declared any dividend.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of shares held by the equity share holders.

e Out of the total issued and paid up capital 92,16,153 (92,16,153) shares of Rs 10/ each have been allotted as fully paid up pursuant to a contract without paying received in cash

j. Lease hold land amounting Rs.5,06,39,394/-(PY- Rs.5,06,39,394/-) includes 48,564 Sq. Mtrs of land at Narsapura Industrial Area, Kolar Taluk, Kolar District, allotted by Karnataka Industrial Area Development Board (KIADB) on lease cum sale basis for setting up an e-waste recycling plant within a specified period. As per the lease cum sale agreement, KIADB has got the right to determine the lease and forfeit up to 25% of the consideration paid / enhance the compensation payable if the company fails to set up the plant with in the specified period.

k. Balances of Sundry Debtors, Advances given to parties, Sundry Creditors and advances received from parties are subject to confirmation.

l. As per the Share Purchase Agreement (SPA) entered between the Company and Enviro–Hub Holdings Limited Singapore (Enviro) the subsidiary Company remitted US$ 12,50,000 equivalent to Rs 6,79,76,747 (Previous Year Rs. 6,79,76,747) to Enviro on 2nd February 2013 as initial deposit towards acquisition of 100% shares of Enviro''s wholly owned subsidiary Cimelia Resource Recovery Pte Limited (Cimelia), a Company in the field of e waste recycling business. However during July 2013 based on the advice given by the consultants and advisors the Company decided to abort the acquisition proposal the acquisition. The Company is negotiating with Enviro seeking refund the initial deposit and is confident of amicable settlement of the matter. Considering the opinion of the consultants no provision is made in the accounts towards this advance.

m. Capital advance includes :

i Rs. 4,02,50,000 (Previous Year Rs 4,02,50,000) was advanced to Cimelia Resource Recovery Pte Limited Singapore (Cimelia) on 24th May 2011 towards technology fee. The payment is made by allotting 23,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

ii Rs. 6,30,00,000 (Previous Year Rs. 6,30,00,000) was advanced to Restorer Corp Pte Limited, formerly known as Scenic Overseas (S) Pte Limited (Scenic) on 24th May 2011 towards supply of plant and machinery for e waste recycling plant in India. The payment is made by allotting 36,00,000 equity shares of the Company at a premium of Rs 7.50 Per share..

iii Rs. 5,77,50,000 (Previous Year Rs. 5,77,50,000) was advanced to Leytron Technology Pte Limited ( Leytron) on 24th May 2011 towards installation and commissioning of the above plant. The payment is made by allotting 33,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

All the above allotments were made based on the approvals obtained from the FIPB, Government of India, and the Bombay Stock Exchange Ltd, Mumbai. The Company has obtained an interim injunction order from Honorable Addl. City Civil Court Bangalore restraining the above mentioned parties from alienating, encumbering or creating any manner of charge or third party rights over the shares allotted to them as detailed above. Hence no provision is made in the accounts.

i v Rs 88,48,000 (Previous Year Rs. 88,48,000) represents balance in advance account from Scenic. US $ 2,25,000 was advanced to Scenic on 24th May 2011 towards supply of plant and machinery against which mobile shredder valued US $ 25,000 was supplied by them so far.

n. Trade Receivables and advances include Rs.18,31,99,988/-(Previous Year Rs 14,65,56,431/- outstanding against export of software products and legal process outsourcing services for substantial period. No provision has been made in the books.

o. The figures of the current period represent the performance of the Company is for a period of six months i.e, from 1st October 2013 to 31st March 2014 and are not comparable with the previous year figures. Figures in bracket relate to previous year. Previous year figures have been regrouped and reclassified wherever necessary to confirm to current year''s presentation.

d Terms / Rights attached to equity shares

The Company has only one class of equity shares having par value of Rs. 10 per share. Each holder of an equity share is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of share holders in the Annual General Meeting.

During the year, the Company has not declared any dividend.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of shares held by the equity share holders.

e Out of the total issued and paid up capital 92,16,153 (92,16,153) shares of Rs 10/ each have been allotted as fully paid up pursuant to a contract without paying received in cash

f Shares held by each shareholder holding more than 5 percent shares specifying the number of shares held.

---

Sep 30, 2013

1. CORPORATE INFORMATION:

Cerebra Integrated Technologies Limited (the Company) was incorporated under the Companies Act, 1956 with registered office at Bangalore, India. The Company is a listed on Bombay Stock Exchange & National Stock Exchange. The Company is primarily engaged in Manufacturing, Trading of Computer Systems and Peripherals. The Company is also in to the business of providing IT services and e-Waste management.

a) Due to Micro, small & medium enterprises

As per the records maintained by the company there are no dues to the Micro, small & medium enterprises as on the date of balance sheet.

b) Related Party Disclosure

Cerebra LPO India Limited Subsidiary

Cerebra Middle East FZCO Subsidiary

Cerebra e-Waste Recovery Pte Limited Singapore Subsidiary

Geeta Monitors Private Limited Subsidiary

Kranion technologies Private Limited Associate Company

Key Management Personnel

Name Designation

V Ranganathan Managing Director

K Gururaj Upadya Director

P Vishwamurthy Director

Shridhar S Hegde Whole time Director

P Bharath Chief Operating Officer,

Managing Director of Kranion technologies

c) Lease hold land amounting Rs 5,06,39,394/- (Previous Year Rs 5,06,39,394/-) includes 48,564 sq .mts of land at Narasapura Industrial Area, Kolar Taluk, Kolar District allotted by Karnataka Industrial Area Development Board (KIADB) on lease cum sale basis for setting up an e-waste recycling plant within a specified period. As per the lease cum sale agreement , KIADB has got the right to determine the lease and forfeit up to 25% of the consideration paid/ enhance the compensation payable if the Company fails to set up the plant within the specified period .

d) Share application money amounting Rs 1,34,62,456 (Previous year Nil) and advance to a Subsidiary amounting Rs 5,45,14,291 (Previous Year Rs Nil) relates to remittance made to Cerebra E waste recovery Pte Limited. As per the Share Purchase Agreement (SPA) entered between the Company and Enviro–Hub Holdings Limited Singapore (Enviro ) the subsidiary Company remitted US$ 12,50,000 equivalent to Rs 6,79,76,747 (Previous Year Nil) to Enviro on 25th January 2013 as initial deposit towards acquisition of 100% shares of Enviro''s wholly owned subsidiary Cimelia Resource Recovery Pte Limited (Cimelia), a Company in the field of e waste recycling business. However during July 2013 based on the advice given by the consultants and advisors the Company decided to abort the acquisition proposal the acquisition. The Company is negotiating with Enviro seeking refund the initial deposit and is confident of amicable settlement of the matter. Considering the opinion of the consultants no provision is made in the accounts towards this advance.

e) Capital advance includes :

(i) Rs. 4,02,50,000 (Previous Year Rs 4,02,50,000) was advanced to Cimelia Resource Recovery Pte Limited Singapore (Cimelia) on 24th May 2011 towards technology fee. The payment is made by allotting 23,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

(ii) Rs. 6,30,00,000 (Previous Year Rs. 6,30,00,000) was advanced to Scenic Overseas (S) Pte Limited (Scenic) on 24th May 2011 towards supply of plant and machinery for e waste recycling plant in India. The payment is made by allotting 36,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

(iii) Rs. 5,77,50,000 (Previous Year Rs. 5,77,50,000 ) was advanced to Leytron Technology Pte Limited ( Leytron) on 24th May 2011 towards installation and commissioning of the above plant. The payment is made by allotting 33,00,000 equity shares of the Company at a premium of Rs 7.50 Per share.

All the above allotments were made based on the approvals obtained from the FIPB, Government of India, and the Bombay Stock Exchange Ltd, Mumbai. On signing the SPA, Scenic and Leytron have agreed to return the shares allotted to them and authorized the Company to do the needful to set off against the advance amount. The Company is expecting the refund of advance by Cimelia either by cash or by transfer of shares. Hence no provision is made in the accounts.

(iv) Rs 88,48,000 (Previous Year Rs. 88,48,000) represents balance in advance account from Scenic. US $ 2,25,000 was advanced to Scenic on 24th May 2011 towards supply of plant and machinery against which mobile shredder valued US $ 25,000 was supplied by them so far.

f) Trade Receivables include Rs. 7,54,70,660/- (Previous Year Rs 7,51,44,470/-) outstanding against export of software products for substantial period. The customer has promised to remit the entire dues before 31st March 2014 and hence no provision is made.

Balances of Sundry Debtors, Advances given to parties, Sundry Creditors and advances received from parties are subject to confirmation.

g) OPERATING LEASES:

The Company has taken various residential / commercial premises under cancelable operating leases. These lease agreements are normally renewed on expiry.

The lease agreements provide an option to the Company to renew the lease period at the end of the non-cancelable period. There are no exceptional / restrictive covenants in the lease agreements.

Contingent rent recognized in the Profit & Loss Account NilThe operating lease arrangements are renewable on a periodic basis. Some of these lease agreements have price escalation clauses.

h) Previous year figures have been regrouped and reclassified wherever necessary to confirm to current year''s presentation.

---

Sep 30, 2010

1. Estimated amount of Contracts remaining to be executed on Capital Account and not provided for Rs-Nil (Previous Year Rs. Nil)

2. Contingent Liabilities in respect of

a) Counter Guarantees given to the bankers for guarantees issued Rs 71.03 lacs Previous Year Rs.71.03.lacs)

b) Disputed demand for Sales tax matters Rs 9.24 lacs (Previous year Rs.9.24 lacs)

c) Disputed demand for Income Tax Matters Rs.16.00 Lacs (Previous year Rs.16.00 Lacs)

3. Auditors Remuneration

for Statutory Audit Rs. 50,000/- (Previous Year Rs.50,000/-)

for Tax Audit Rs. 50,000/- (Previous Year Rs.50,000/-)

for Certification Rs. 45,000/- (Previous Year Rs. 46,000/-)

for Reimbursement of expenses 3550/- (Previous year Rs. Nil)

4. Loans & Advances include Rs 130.63 Lacs (Previous Year Rs. 123.14.lacs )due from Kranion Technologies Pvt Ltd, a company under the same management. Maximum amount outstanding at any time during the year Rs 130.63 lacs (Previous Year Rs. 123.14lacs).

5. Impairment of Assets

In the view of Accounting standard required by AS-28" impairment of Assets" ICAI, the company has reviewed its fixed assets and does not expect any loss as on 30.09.2010 on account of impairment.

6. Selling and Distribution expenses include Rs. Nil (previous year Rs. Nil) towards commission to Selling Agents. The company did not have Sole Selling Agents.

7. Balances of Sundry Debtors, Advances given to parites, Sundry Creditors and advances received from parties are subject to confirmation.

8. During the year 881500 Equity shares of Rs.10/- each fully paid up were allotted at par.

9. Cerebra Europe Ltd.

The company has advanced Rs.22.79 Lacs to Cerebra Europe Limited incorporated in United Kingdom including the advance of Rs. 14.29 lacs during the year 2007-08 towards equity participation in the company. Pending allotment of shares in Cerebra Europe Limited the amount is shown under Loans and Advances in Current Assets. The Company tied up with Cerebra Europe Ltd. for carrying on the business for marketing of its IT Services in the United Kingdom, which may eventually be converted into a subsidiary of the company.

10. Cerebra LPO India Limited-Subsidiary Company

The Company has made the following investments / Loans to the subsidiary company a) Advance towards expenses Rs.112.81 Lacs (Previous Year Rs. 8.96 Lacs)

11. During the year, 8655000 warrants were allotted on 20.04.2010 on preferential basis, convertible within 18 months into equity shares of Rs. 10/- each for cash payable Rs. 2.50 per warrant at the time of allotment.

12. Due to Micro , small & medium enterprises

As per the records maintained by the company there are no dues to the Micro , small & medium enterprises as on the date of balance sheet.

13. ADDITIONAL INFORMATIONION PURSUANT TO THE PROVISIONS OF PART II OF SCHEDULE VI TO THE COMPANIES ACT, 1956

I) Particulars in respect of Licensed/Installed Capacities etc.,

The company is Primarily engaged in Manufacturing, Trading of Computer Systems, Peripherals and I T Services. These activities do not require Industrial Licensing and accordingly information for licensed installed and utilised capacity have not been given.

14. Related Party Disclosure

Cerebra Integrated Technologies Limited- Holding Company

CEREBRA LPO India Limited Fellow Subsidiary Company

Kranion Technologies Private Limited Associated Company

Key Management Personnel

Name Designation

V. Ranganathan Managing Director

K. Gururaj Upadhya Director

P. Vishwa Murthy Director

P. Bharath M D, Kranion Technologies

15. Deferred Tax

The company has not recognised net deferred tax asset in view of prudence.

16. Previous Years figures have been regrouped and reclassified wherever necessary to conform to current years presentation

---

Sep 30, 2009

1. Estimated amount of Contracts remaining to be executed on Capital Account and not provided for Rs-Nil (Previous Year Rs. . Nil )

2. Contingent Liabilities in respect of

a) Counter Guarantees given to the bankers for guarantees issued Rs 71.03 lacs Previous Year Rs.71.03.lacs)

b) Disputed demand for Sales tax matters Rs 9.83 lacs (Previous year Rs.9.83 lacs)

c) Disputed demand for Income Tax Matters Rs.16.00 Lacs (Previous year Rs.12.41 Lacs)

3. Auditors Remuneration

for Statutory Audit Rs. 50,000/- (Previous Year Rs.44,000/-)

for Tax Audit Rs. 50,000/- (Previous Year Rs.10,000/-)

for Certification Rs. 46,000/- (Previous Year Rs. Nil)

for Reimbursement of expenses Nil (Previous year Rs. Nil)

4. Loans & Advances include Rs 123.14.Lacs (Previous Year Rs.121.14.lacs )due from Kranion Technologies Pvt Ltd, a company under the same management. Maximum amount outstanding at any time during the year Rs 123.14 lacs (Previous Year Rs. 21.14 lacs).

5. IMPAIRMENT OF ASSETS

In the view of Accounting standard required by AS-28" impairment of Assets" ICAI, the company has reviewed its fixed assets and does not expect any loss as on 30.09.2009 on account of impairment.

6. Selling and Distribution expenses include Rs. Nil (previous year Rs. 0.20 Lacs) towards commission to Selling Agents. The company did not have Sole Selling Agents.

7. Balances of Sundry Debtors, Advances given to parties, Sundry Creditors and advances received from parties are subject to confirmation.

8. Canara Bank Account was closed and the residual small credit balance was transferred to Miscellaneous Income.

9. During the year 20,00,000 warrants were converted into 20,00,000 Equity shares of Rs.10/- each fully paid up.

10. Cerebra Europe Ltd.

The company has advanced Rs.21.99 Lacs to Cerebra Europe Limited incorporated in United Kingdom including the advance of Rs. 14.29 lacs during the year 2007-08 towards equity participation in the company. Pending allotment of shares in Cerebra Europe Limited the amount is shown under Loans and Advances in Current Assets. The Company tied up with Cerebra Europe Ltd. for carrying on the business for marketing of its IT Services in the United Kingdom, which may eventually be converted into a subsidiary of the company.

11 Cerebra LPO India Limited

A subsidiary company Cerebra LPO India Limited was incorporated to cater to the Legal supporting services The Company has made the following investments / Loans to the subsidiary company

a) 35,000/-shares of Rs.10/-each as fully paid up Rs. 3.50 Lacs

b) Advance towards expenses Rs. 8.96 Lacs

12. Due to micro, small & medium enterprises

As per the records maintained by the company there are no dues to the Micro , small & medium enterprises as on the date of balance sheet.

13. ADDITIONAL INFORMATIONION PURSUANT TO THE PROVISIONS OF PART II OF SCHEDULE VI TO THE COMPANIES ACT, 1956

I) Particulars in respect of Licensed/Installed Capacities etc.,

The company is Primarily engaged in Manufacturing, Trading of Computer Systems, Peripherals and I T Services. These activities do not require Industrial Licensing and accordingly information for licensed installed and utilised capacity have not been given.

I) Particulars in respect of Licensed/Installed Capacities etc.,

The company is primarily engaged in Manufacturing, Trading of Computer Systems, Peripherals and IT Services. These activities do not require Industrial Licensing and accordingly information for licensed installed and utilised capacity have not been given.

vii) Value of Imports on CIF Basis

Raw Materials including customs duties and other charges Rs.Nil (Previous year Rs. Nil )

ix) The amount remitted in Non Resident Stake holders on account of Dividend to their NRE account

Number of Non Resident Share Holders

Nil ( Previous year Nil)

Number of Shares held by them

Nil equity shares (previous year Nil equity shares)

Year to which the payment of dividend relates

N A

x) Earnings in Foreign Exchange

Export Sales - Software Rs. 50.93 Lacs (Previous year Nil)

Export Sales - Hardware Nil (Previous year Rs.7.87 Lacs)

xi) Expenditure in Foreign Currency:

Raw Materials Nil (Previous Year Nil)

Foreign Travel Nil (Previous Year Rs. 1.67 Lacs)

Others Nil (Previous Year Nil)

14. Related Party Disclosure

Cerebra Integrated Technologies Limited

Holding Company

CEREBRA LPO India Limited

Fellow Subsidiary Company

Kranion Technologies Private Limited

Associated Company

Key Management Personal

Name Designation

V. Ranganathan Managing Director

K. Gururaja Upadhya Director

P. Vishwa Murthy Director

P. Bharath M D , Kranion Technologies

15. Deferred Tax

The company has not recognised deferred tax asset in view of prudence.

Previous Years figures have been regrouped and reclassified wherever necessary to conform to current years presentation